83 FR 37046 - Medicare Program: Proposed Changes to Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; Requests for Information on Promoting Interoperability and Electronic Health Care Information, Price Transparency, and Leveraging Authority for the Competitive Acquisition Program for Part B Drugs and Biologicals for a Potential CMS Innovation Center Model
DEPARTMENT OF HEALTH AND HUMAN SERVICES Centers for Medicare & Medicaid Services
Federal Register Volume 83, Issue 147 (July 31, 2018)
Page Range
37046-37240
FR Document
2018-15958
This proposed rule would revise the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for CY 2019 to implement changes arising from our continuing experience with these systems. In this proposed rule, we describe the proposed changes to the amounts and factors used to determine the payment rates for Medicare services paid under the OPPS and those paid under the ASC payment system. In addition, this proposed rule would update and refine the requirements for the Hospital Outpatient Quality Reporting (OQR) Program and the ASC Quality Reporting (ASCQR) Program. The proposed rule also includes requests for information on promoting interoperability and electronic health care information exchange, improving beneficiary access to provider and supplier charge information, and leveraging the authority for the Competitive Acquisition Program (CAP) for Part B drugs and biologicals for a potential CMS Innnovation Center model. In addition, we are proposing to modify the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) Survey measure under the Hospital Inpatient Quality Reporting (IQR) Program by removing the Communication about Pain questions.
Federal Register, Volume 83 Issue 147 (Tuesday, July 31, 2018)
[Federal Register Volume 83, Number 147 (Tuesday, July 31, 2018)]
[Proposed Rules]
[Pages 37046-37240]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2018-15958]
[[Page 37045]]
Vol. 83
Tuesday,
No. 147
July 31, 2018
Part II
Book 2 of 2 Books
Pages 37045-37420
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Parts 416 and 419
Medicare Program: Proposed Changes to Hospital Outpatient Prospective
Payment and Ambulatory Surgical Center Payment Systems and Quality
Reporting Programs; Requests for Information on Promoting
Interoperability and Electronic Health Care Information, Price
Transparency, and Leveraging Authority for the Competitive Acquisition
Program for Part B Drugs and Biologicals for a Potential CMS Innovation
Center Model; Proposed Rule
Federal Register / Vol. 83 , No. 147 / Tuesday, July 31, 2018 /
Proposed Rules
[[Page 37046]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 416 and 419
[CMS-1695-P]
RIN 0938-AT30
Medicare Program: Proposed Changes to Hospital Outpatient
Prospective Payment and Ambulatory Surgical Center Payment Systems and
Quality Reporting Programs; Requests for Information on Promoting
Interoperability and Electronic Health Care Information, Price
Transparency, and Leveraging Authority for the Competitive Acquisition
Program for Part B Drugs and Biologicals for a Potential CMS Innovation
Center Model
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would revise the Medicare hospital
outpatient prospective payment system (OPPS) and the Medicare
ambulatory surgical center (ASC) payment system for CY 2019 to
implement changes arising from our continuing experience with these
systems. In this proposed rule, we describe the proposed changes to the
amounts and factors used to determine the payment rates for Medicare
services paid under the OPPS and those paid under the ASC payment
system. In addition, this proposed rule would update and refine the
requirements for the Hospital Outpatient Quality Reporting (OQR)
Program and the ASC Quality Reporting (ASCQR) Program. The proposed
rule also includes requests for information on promoting
interoperability and electronic health care information exchange,
improving beneficiary access to provider and supplier charge
information, and leveraging the authority for the Competitive
Acquisition Program (CAP) for Part B drugs and biologicals for a
potential CMS Innnovation Center model. In addition, we are proposing
to modify the Hospital Consumer Assessment of Healthcare Providers and
Systems (HCAHPS) Survey measure under the Hospital Inpatient Quality
Reporting (IQR) Program by removing the Communication about Pain
questions.
DATES: To be assured consideration, comments on this proposed rule must
be received at one of the addresses provided in the ADDRESSES section
no later than 5 p.m. EST on September 24, 2018.
ADDRESSES: In commenting, please refer to file code CMS-1695-P when
commenting on the issues in this proposed rule. Because of staff and
resource limitations, we cannot accept comments by facsimile (FAX)
transmission.
Comments, including mass comment submissions, must be submitted in
one of the following three ways (please choose only one of the ways
listed):
1. Electronically. You may (and we encourage you to) submit
electronic comments on this regulation to http://www.regulations.gov.
Follow the instructions under the ``submit a comment'' tab.
2. By regular mail. You may mail written comments to the following
address ONLY: Centers for Medicare & Medicaid Services, Department of
Health and Human Services, Attention: CMS-1695-P, P.O. Box 8013,
Baltimore, MD 21244-1850.
Please allow sufficient time for mailed comments to be received
before the close of the comment period.
3. By express or overnight mail. You may send written comments via
express or overnight mail to the following address ONLY: Centers for
Medicare & Medicaid Services, Department of Health and Human Services,
Attention: CMS-1695-P, Mail Stop C4-26-05, 7500 Security Boulevard,
Baltimore, MD 21244-1850.
b. For delivery in Baltimore, MD--Centers for Medicare & Medicaid
Services, Department of Health and Human Services, 7500 Security
Boulevard, Baltimore, MD 21244-1850.
If you intend to deliver your comments to the Baltimore address,
please call the telephone number (410) 786-7195 in advance to schedule
your arrival with one of our staff members.
Comments mailed to the addresses indicated as appropriate for hand
or courier delivery may be delayed and received after the comment
period.
For information on viewing public comments, we refer readers to the
beginning of the SUPPLEMENTARY INFORMATION section.
FOR FURTHER INFORMATION CONTACT: (We note that public comments must be
submitted through one of the four channels outlined in the ADDRESSES
section above. Comments may not be submitted via email.)
340B Drug Payment Policy to Nonexcepted Off-Campus Departments of a
Hospital, contact Juan Cortes via email [email protected] or at
410-786-4325.
Advisory Panel on Hospital Outpatient Payment (HOP Panel), contact
the HOP Panel mailbox at [email protected].
Ambulatory Surgical Center (ASC) Payment System, contact Scott
Talaga via email [email protected] or at 410-786-4142.
Ambulatory Surgical Center Quality Reporting (ASCQR) Program
Administration, Validation, and Reconsideration Issues, contact Anita
Bhatia via email [email protected] or at 410-786-7236.
Ambulatory Surgical Center Quality Reporting (ASCQR) Program
Measures, contact Vinitha Meyyur via email [email protected]
or at 410-786-8819.
Blood and Blood Products, contact Joshua McFeeters via email
[email protected] or at 410-786-9732.
Cancer Hospital Payments, contact Scott Talaga via email
[email protected] or at 410-786-4142.
CMS Web Posting of the OPPS and ASC Payment Files, contact Chuck
Braver via email [email protected] or at 410-786-6719.
CPT Codes, contact Marjorie Baldo via email
[email protected] or at 410-786-4617.
Collecting Data on Services Furnished in Off-Campus Provider-Based
Emergency Departments, contact Twi Jackson via email
[email protected] or at 410-786-1159.
Comment Solicitation to Control for Unnecessary Increases in Volume
of Outpatient Services, contact Elise Barringer via email
[email protected] or at 410-786-9222.
Composite APCs (Low Dose Brachytherapy and Multiple Imaging),
contact Elise Barringer via email [email protected] or at
410-786-9222.
Comprehensive APCs (C-APCs), contact Lela Strong-Holloway via email
[email protected] or at 410-786-3213.
Expansion of Clinical Families of Services at Excepted Off-Campus
Departments of a Provider, contact Juan Cortes via email
[email protected] or at 410-786-4325.
Hospital Outpatient Quality Reporting (OQR) Program Administration,
Validation, and Reconsideration Issues, contact Anita Bhatia via email
[email protected] or at 410-786-7236.
Hospital Outpatient Quality Reporting (OQR) Program Measures,
contact Vinitha Meyyur via email [email protected] or at 410-
786-8819.
Hospital Outpatient Visits (Emergency Department Visits and
Critical Care Visits), contact Twi Jackson via email
[[Page 37047]]
[email protected] or at 410-786-1159.
Inpatient Only (IPO) Procedures List, contact Lela Strong-Holloway
via email [email protected] or at 410-786-3213.
New Technology Intraocular Lenses (NTIOLs), contact Scott Talaga
via email [email protected] or at 410-786-4142.
No Cost/Full Credit and Partial Credit Devices, contact Twi Jackson
via email [email protected] or at 410-786-1159.
OPPS Brachytherapy, contact Scott Talaga via email
[email protected] or at 410-786-4142.
OPPS Data (APC Weights, Conversion Factor, Copayments, Cost-to-
Charge Ratios (CCRs), Data Claims, Geometric Mean Calculation, Outlier
Payments, and Wage Index), contact Erick Chuang via email
[email protected] or at 410-786-1816 or Scott Talaga via email
[email protected] or at 410-786-4142.
OPPS Drugs, Radiopharmaceuticals, Biologicals, and Biosimilar
Products, contact Josh McFeeters via email [email protected]
or at 410-786-9732.
OPPS New Technology Procedures/Services, contact the New Technology
APC email at [email protected].
OPPS Exceptions to the 2 Times Rule, contact Marjorie Baldo via
email [email protected] or at 410-786-4617.
OPPS Packaged Items/Services, contact Lela Strong-Holloway via
email [email protected] or at 410-786-3213.
OPPS Pass-Through Devices, contact the Device Pass-Through email at
[email protected].
OPPS Status Indicators (SI) and Comment Indicators (CI), contact
Marina Kushnirova via email [email protected] or at 410-
786-2682.
Partial Hospitalization Program (PHP) and Community Mental Health
Center (CMHC) Issues, contact the PHP Payment Policy Mailbox at
[email protected].
Request for Information on Leveraging the Authority for the
Competitive Acquisition Program (CAP) for Part B Drugs and Biologicals
for a Potential CMS Innovation Center Model, contact the CMS Innovation
Center Team Mailbox via email at [email protected].
Request for Information on Promoting Interoperability and
Electronic Healthcare Information Exchange, contact Scott Cooper via
email at [email protected] or at 410-786-9465.
Request for Information on Requirements for Hospitals To Make
Public a List of Their Standard Charges via the internet, contact Elise
Barringer via email [email protected] or at 410-786-9222.
Rural Hospital Payments, contact Joshua McFeeters via email
[email protected] or at 410-786-9732.
Skin Substitutes, contact Josh McFeeters via email
[email protected] or at 410-786-9732.
All Other Issues Related to Hospital Outpatient and Ambulatory
Surgical Center Payments Not Previously Identified, contact Marjorie
Baldo via email [email protected] or at 410-786-4617.
SUPPLEMENTARY INFORMATION:
Inspection of Public Comments: All comments received before the
close of the comment period are available for viewing by the public,
including any personally identifiable or confidential business
information that is included in a comment. We post all comments
received before the close of the comment period on the following
website as soon as possible after they have been received: http://www.regulations.gov/. Follow the search instructions on that website to
view public comments.
Comments received timely will also be available for public
inspection, generally beginning approximately 3 weeks after publication
of the rule, at the headquarters of the Centers for Medicare & Medicaid
Services, 7500 Security Boulevard, Baltimore, MD 21244, on Monday
through Friday of each week from 8:30 a.m. to 4:00 p.m. EST. To
schedule an appointment to view public comments, phone 1-800-743-3951.
Electronic Access
This Federal Register document is also available from the Federal
Register online database through Federal Digital System (FDsys), a
service of the U.S. Government Publishing Office. This database can be
accessed via the internet at https://www.thefederalregister.org/fdsys/.
Addenda Available Only Through the Internet on the CMS Website
In the past, a majority of the Addenda referred to in our OPPS/ASC
proposed and final rules were published in the Federal Register as part
of the annual rulemakings. However, beginning with the CY 2012 OPPS/ASC
proposed rule, all of the Addenda no longer appear in the Federal
Register as part of the annual OPPS/ASC proposed and final rules to
decrease administrative burden and reduce costs associated with
publishing lengthy tables. Instead, these Addenda are published and
available only on the CMS website. The Addenda relating to the OPPS are
available at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html. The Addenda relating to the
ASC payment system are available at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html.
Table of Contents
I. Summary and Background
A. Executive Summary of This Document
B. Legislative and Regulatory Authority for the Hospital OPPS
C. Excluded OPPS Services and Hospitals
D. Prior Rulemaking
E. Advisory Panel on Hospital Outpatient Payment (the HOP Panel
or the Panel)
F. Public Comments Received in Response to CY 2018 OPPS/ASC
Final Rule With Comment Period
II. Proposed Updates Affecting OPPS Payments
A. Recalibration of APC Relative Payment Weights
B. Proposed Conversion Factor Update
C. Proposed Wage Index Changes
D. Proposed Statewide Average Default Cost-to-Charge Ratios
(CCRs)
E. Proposed Adjustment for Rural Sole Community Hospitals (SCHs)
and Essential Access Community Hospitals (EACHs) under Section
1833(t)(13)(B) of the Act
F. Proposed Payment Adjustment for Certain Cancer Hospitals for
CY 2019
G. Proposed Hospital Outpatient Outlier Payments
H. Proposed Calculation of an Adjusted Medicare Payment From the
National Unadjusted Medicare Payment
I. Proposed Beneficiary Copayments
III. Proposed OPPS Ambulatory Payment Classification (APC) Group
Policies
A. Proposed OPPS Treatment of New CPT and Level II HCPCS Codes
B. Proposed OPPS Changes--Variations within APCs
C. Proposed New Technology APCs
D. Proposed OPPS APC-Specific Policies
IV. Proposed OPPS Payment for Devices
A. Pass-Through Payments for Devices
B. Proposed Device-Intensive Procedures
V. Proposed OPPS Payment Changes for Drugs, Biologicals, and
Radiopharmaceuticals
A. Proposed OPPS Transitional Pass-Through Payment for
Additional Costs of Drugs, Biologicals, and Radiopharmaceuticals
B. Proposed OPPS Payment for Drugs, Biologicals, and
Radiopharmaceuticals Without Pass-Through Payment Status
VI. Proposed Estimate of OPPS Transitional Pass-Through Spending for
Drugs, Biologicals, Radiopharmaceuticals, and Devices
A. Background
[[Page 37048]]
B. Estimate of Pass-Through Spending
VII. Proposed OPPS Payment for Hospital Outpatient Visits and
Critical Care Services
VIII. Proposed Payment for Partial Hospitalization Services
A. Background
B. Proposed PHP APC Update for CY 2019
C. Proposed Outlier Policy for CMHCs
IX. Proposed Procedures That Would Be Paid Only as Inpatient
Procedures
A. Background
B. Proposed Changes to the Inpatient Only (IPO) List
X. Proposed Nonrecurring Policy Changes
A. Collecting Data on Services Furnished in Off-Campus Provider-
Based Emergency Departments
B. Proposal and Comment Solicitation on Method to Control
Unnecessary Increases in the Volume of Outpatient Services
C. Proposal to Apply the 340B Drug Payment Policy to Nonexcepted
Off-Campus Departments of a Hospital
D. Expansion of Clinical Families of Services at Excepted Off-
Campus Departments of a Provider
XI. Proposed CY 2019 OPPS Payment Status and Comment Indicators
A. Proposed CY 2019 OPPS Payment Status Indicator Definitions
B. Proposed CY 2019 Comment Indicator Definitions
XII. Proposed Updates to the Ambulatory Surgical Center (ASC)
Payment System
A. Background
B. Proposed Treatment of New and Revised Codes
C. Proposed Update to the List of ASC Covered Surgical
Procedures and Covered Ancillary Services
D. Proposed ASC Payment for Covered Surgical Procedures and
Covered Ancillary Services
E. New Technology Intraocular Lenses (NTIOLs)
F. Proposed ASC Payment and Comment Indicators
G. Proposed Calculation of the Proposed ASC Payment Rates and
the Proposed ASC Conversion Factor
XIII. Requirements for the Hospital Outpatient Quality Reporting
(OQR) Program
A. Background
B. Hospital OQR Program Quality Measures
C. Administrative Requirements
D. Form, Manner, and Timing of Data Submitted for the Hospital
OQR Program
E. Proposed Payment Reduction for Hospitals That Fail to Meet
the Hospital OQR Program Requirements for the CY 2019 Payment
Determination
XIV. Requirements for the Ambulatory Surgical Center Quality
Reporting (ASCQR) Program
A. Background
B. ASCQR Program Quality Measures
C. Administrative Requirements
D. Form, Manner, and Timing of Data Submitted for the ASCQR
Program
E. Payment Reduction for ASCs That Fail to Meet the ASCQR
Program Requirements
XV. Requests for Information (RFIs)
A. Request for Information on Promoting Interoperability and
Electronic Health Care Information Exchange Through Possible
Revisions to the CMS Patient Health and Safety Requirements for
Hospitals and Other Medicare-Participating and Medicaid-
Participating Providers and Suppliers
B. Request for Information on Price Transparency: Improving
Beneficiary Access to Provider and Supplier Charge Information
C. Request for Information on Leveraging the Authority for the
Competitive Acquisition Program (CAP) for Part B Drugs and
Biologicals for a Potential CMS Innovation Center Model
XVI. Proposed Additional Hospital Inpatient Quality Reporting (IQR)
Program Policies
XVII. Files Available to the Public Via the Internet
XVIII. Collection of Information Requirements
A. Statutory Requirement for Solicitation of Comments
B. ICRs for the Hospital OQR Program
C. ICRs for the ASCQR Program
D. ICRs for the Proposed Update to the HCAHPS Survey Measure in
the Hospital IQR Program
E. Total Reduction in Burden Hours and in Costs
XIX. Response to Comments
XX. Economic Analyses
A. Statement of Need
B. Overall Impact for the Provisions of This Proposed Rule
C. Detailed Economic Analyses
D. Effects of the Proposed Update to the HCAHPS Survey Measure
in the Hospital IQR Program
E. Regulatory Review Costs
F. Regulatory Flexibility Act (RFA) Analysis
G. Unfunded Mandates Reform Act Analysis
H. Reducing Regulation and Controlling Regulatory Costs
I. Conclusion
XXI. Federalism Analysis
Regulation Text
I. Summary and Background
A. Executive Summary of This Document
1. Purpose
In this proposed rule, we are proposing to update the payment
policies and payment rates for services furnished to Medicare
beneficiaries in hospital outpatient departments (HOPDs) and ambulatory
surgical centers (ASCs) beginning January 1, 2019. Section 1833(t) of
the Social Security Act (the Act) requires us to annually review and
update the payment rates for services payable under the Hospital
Outpatient Prospective Payment System (OPPS). Specifically, section
1833(t)(9)(A) of the Act requires the Secretary to review certain
components of the OPPS not less often than annually, and to revise the
groups, relative payment weights, and other adjustments that take into
account changes in medical practices, changes in technologies, and the
addition of new services, new cost data, and other relevant information
and factors. In addition, under section 1833(i) of the Act, we annually
review and update the ASC payment rates. We describe these and various
other statutory authorities in the relevant sections of this proposed
rule. In addition, this proposed rule would update and refine the
requirements for the Hospital Outpatient Quality Reporting (OQR)
Program and the ASC Quality Reporting (ASCQR) Program.
In this proposed rule, we also are including three Requests for
Information (RFIs) on: (1) Promoting interoperability and electronic
health care information exchange through possible revisions to the CMS
patient health and safety requirements for hospitals and other
Medicare-participating and Medicaid-participating providers and
suppliers; (2) improving beneficiary access to provider and supplier
charge information; and (3) leveraging the authority for the
Competitive Acqisition Program (CAP) for Part B drugs and biologicals
for a potential CMS Innovation Center model. In addition, we are
proposing to modify the HCAHPS Survey measure by removing the
Communication about Pain questions from the HCAHPS Survey for the
Hospital IQR Program, which are used to assess patients' experiences of
care, effective with January 2022 discharges for the FY 2024 payment
determination.
2. Improving Patient Outcomes and Reducing Burden Through Meaningful
Measures
Regulatory reform and reducing regulatory burden are high
priorities for CMS. To reduce the regulatory burden on the healthcare
industry, lower health care costs, and enhance patient care, in October
2017, we launched the Meaningful Measures Initiative.\1\ This
initiative is one component of our agency-wide Patients Over Paperwork
Initiative,\2\ which is aimed at evaluating and streamlining
regulations with a goal to reduce unnecessary cost and burden, increase
efficiencies, and improve
[[Page 37049]]
beneficiary experience. The Meaningful Measures Initiative is aimed at
identifying the highest priority areas for quality measurement and
quality improvement in order to assess the core quality of care issues
that are most vital to advancing our work to improve patient outcomes.
The Meaningful Measures Initiative represents a new approach to quality
measures that fosters operational efficiencies, and will reduce costs
including, collection and reporting burden while producing quality
measurement that is more focused on meaningful outcomes.
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\1\ Meaningful Measures web page: https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/QualityInitiativesGenInfo/MMF/General-info-Sub-Page.html.
\2\ Remarks by Administrator Seema Verma at the Health Care
Payment Learning and Action Network (LAN) Fall Summit, as prepared
for delivery on October 30, 2017. Available at: https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2017-Fact-Sheet-items/2017-10-30.html.
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The Meaningful Measures framework has the following objectives:
Address high-impact measure areas that safeguard public
health;
Patient-centered and meaningful to patients;
Outcome-based where possible;
Fulfill each program's statutory requirements;
Minimize the level of burden for health care providers;
Significant opportunity for improvement;
Address measure needs for population based payment through
alternative payment models; and
Align across programs and/or with other payers.
In order to achieve these objectives, we have identified 19
Meaningful Measures areas and mapped them to six overarching quality
priorities as shown in the table below.
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Quality priority Meaningful measure area
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Making Care Safer by Reducing Harm Healthcare-Associated
Caused in the Delivery of Care. Infections
Preventable Healthcare Harm
Strengthen Person and Family Engagement Care is Personalized and
as Partners in Their Care. Aligned with Patient's Goals
End of Life Care According to
Preferences
Patient's Experience of Care
Patient Reported Functional
Outcomes
Promote Effective Communication and Medication Management
Coordination of Care. Admissions and Readmissions to
Hospitals
Transfer of Health Information
and Interoperability
Promote Effective Prevention and Preventive Care
Treatment of Chronic Disease. Management of Chronic
Conditions
Prevention, Treatment, and
Management of Mental Health
Prevention and Treatment of
Opioid and Substance Use
Disorders
Risk Adjusted Mortality
Work with Communities to Promote Best Equity of Care
Practices of Healthy Living. Community Engagement
Make Care Affordable................... Appropriate Use of Healthcare
Patient-focused Episode of Care
Risk Adjusted Total Cost of
Care
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By including Meaningful Measures in our programs, we believe that
we can also address the following cross-cutting measure criteria:
Eliminating disparities;
Tracking measurable outcomes and impact;
Safeguarding public health;
Achieving cost savings;
Improving access for rural communities; and
Reducing burden.
We believe that the Meaningful Measures Initiative will improve
outcomes for patients, their families, and health care providers while
reducing burden and costs for clinicians and providers as well as
promoting operational efficiencies.
3. Summary of the Major Provisions
OPPS Update: For CY 2019, we are proposing to increase the
payment rates under the OPPS by an outpatient department (OPD) fee
schedule increase factor of 1.25 percent. This increase factor is based
on the proposed hospital inpatient market basket percentage increase of
2.8 percent for inpatient services paid under the hospital inpatient
prospective payment system (IPPS), minus the proposed multifactor
productivity (MFP) adjustment of 0.8 percentage point, and minus a 0.75
percentage point adjustment required by the Affordable Care Act. Based
on this proposed update, we estimate that total payments to OPPS
providers (including beneficiary cost-sharing and estimated changes in
enrollment, utilization, and case-mix) for CY 2019 would be
approximately $74.6 billion, an increase of approximately $4.9 billion
compared to estimated CY 2018 OPPS payments.
We are proposing to continue to implement the statutory 2.0
percentage point reduction in payments for hospitals failing to meet
the hospital outpatient quality reporting requirements, by applying a
reporting factor of 0.980 to the OPPS payments and copayments for all
applicable services.
Comprehensive APCs: For CY 2019, we are proposing to
create three new comprehensive APCs (C-APCs). These proposed new C-APCs
include ears, nose, and throat (ENT) and vascular procedures. This
proposal would increase the total number of C-APCs to 65.
Proposed Changes to the Inpatient Only List: For CY 2019,
we are proposing to remove two procedures from the inpatient only list
and add one procedure to the list.
Proposal and Comment Solicitation on Method to Control
Unnecessary Increases in Volume of Outpatient Services: To the extent
that similar services can be safely provided in more than one setting,
it is not prudent for the Medicare program to pay more for these
services in one setting than another. We believe that capping the OPPS
payment at the Physician Fee Schedule (PFS)-equivalent rate would be an
effective method to control the volume of these unnecessary services
because the payment differential that is driving the site-of-service
decision will be removed. In particular, we believe this method of
capping payment will control unnecessary volume increases as manifested
both in terms of numbers of covered outpatient department services
furnished and costs of those services. Therefore, we are proposing to
use our authority under section 1833(t)(2)(F) of the Act to apply an
amount equal to the site-specific PFS payment rate for nonexcepted
items and services furnished by a nonexcepted off-campus PBD (the PFS
payment rate) for the clinic visit service, as described by HCPCS code
G0463, when provided at an off-campus PBD excepted from section
1833(t)(21) of the Act. In addition, we are soliciting public
[[Page 37050]]
comments on how to expand the Secretary's statutory authority under
section 1833(t)(2)(F) of the Act to additional items and services paid
under the OPPS that may represent unnecessary increases in hospital
outpatient department utilization.
Expansion of Services at Off-Campus Provider-
Based Departments (PBDs) Paid under the OPPS (Section 603): For CY
2019, we are proposing that if an excepted off-campus PBD furnishes a
service from a clinical family of services for which it did not
previously furnish a service (and subsequently bill for that service)
during a baseline period, services from this new clinical family of
services would not be covered OPD services. Instead, services in the
new clinical family of services would be paid under the PFS.
Proposal to Apply 340B Drug Payment Policy to
Off-Campus Departments of a Hospital Paid under the Medicare Physician
Fee Schedule: For CY 2019, we are proposing to pay average sales price
(ASP) minus 22.5 percent for 340B-acquired drugs furnished by
nonexcepted, off-campus provider-based departments (PBDs). This is
consistent with the payment methodology adopted in CY 2018 for 340B-
acquired drugs furnished in hospital departments paid under the OPPS.
Payment Policy for Biosimilar Biological
Products without Pass-Through Status That Are Acquired under the 340B
Program: For CY 2019, we are proposing to pay nonpass-through
biosimilars acquired under the 340B program at ASP minus 22.5 percent
of the biosimilar's own ASP rather than ASP minus 22.5 percent of the
reference product's ASP.
Payment of Drugs, Biologicals, and
Radiopharmaceuticals If Average Sales Price (ASP) Data Are Not
Available: For CY 2019, we are proposing to pay separately payable
drugs and biological products that do not have pass-through payment
status and are not acquired under the 340B Program at wholesale
acquisition cost (WAC)+3 percent instead of WAC+6 percent. If WAC data
are not available for a drug or biological product, we are proposing to
continue our policy to pay separately payable drugs and biological
products at 95 percent of the average wholesale price (AWP). Drugs and
biologicals that are acquired under the 340B Program would continue to
be paid at ASP minus 22.5 percent, WAC minus 22.5 percent, or 69.46
percent of AWP, as applicable.
Device-Intensive Procedure Criteria: For CY 2019, we are
proposing to modify the device-intensive criteria to allow procedures
that involve single-use devices, regardless of whether or not they
remain in the body after the conclusion of the procedure, to qualify as
device-intensive procedures. We also are proposing to allow procedures
with a device offset percentage of greater than 30 percent to qualify
as device-intensive procedures. In addition, we are soliciting comments
on whether any high-cost devices (other than capital equipment) should
be left out of the definition of single-use devices or, alternatively,
whether our proposed definition excludes devices that commenters
believe should be subject to our device-intensive policy.
Device Pass-Through Payment Applications: For CY 2019, we
are evaluating seven applications for device pass-through payments and
are seeking public comments in this CY 2019 proposed rule on whether
these applications meet the criteria for device pass-through payment
status.
New Technology APC Payment for Extremely Low-Volume
Procedures: For CY 2019, we are proposing to apply a ``smoothing
methodology'' based on multiple years of claims data to establish a
more stable rate for services assigned to New Technology APCs with
fewer than 100 claims per year under the OPPS. Under the smoothing
methodology, we would calculate the geometric mean costs, the median
costs, and the arithmetic mean costs for these procedures to promote
payment stability. This methodology allows the option to use of one of
these methodologies to assign the most representative payment for the
service. In addition, we are proposing to exclude low-volume services
from bundling into C-APC procedures.
Cancer Hospital Payment Adjustment: For CY 2019, we are
proposing to continue to provide additional payments to cancer
hospitals so that the cancer hospital's payment-to-cost ratio (PCR)
after the additional payments is equal to the weighted average PCR for
the other OPPS hospitals using the most recently submitted or settled
cost report data. However, section 16002(b) of the 21st Century Cures
Act requires that this weighted average PCR be reduced by 1.0
percentage point. Based on the data and the required 1.0 percentage
point reduction, we are proposing that a target PCR of 0.88 would be
used to determine the CY 2019 cancer hospital payment adjustment to be
paid at cost report settlement. That is, the payment adjustments would
be the additional payments needed to result in a PCR equal to 0.88 for
each cancer hospital.
Rural Adjustment: For 2019 and subsequent years, we are
proposing to continue the 7.1 percent adjustment to OPPS payments for
certain rural SCHs, including essential access community hospitals
(EACHs). We intend to continue the 7.1 percent adjustment for future
years in the absence of data to suggest a different percentage
adjustment should apply.
Ambulatory Surgical Center (ASC) Payment Update: For CYs
2019 through 2023, we are proposing to update the ASC payment system
using the hospital market basket update instead of the CPI-U. However,
we are requesting public comments on ASCs' cost structure to assess
whether the hospital market basket is an appropriate proxy for ASC
costs. During this 5-year period, we intend to examine whether such
adjustment leads to a migration of services from other settings to the
ASC setting. Using the hospital market basket methodology, for CY 2019,
we are proposing to increase payment rates under the ASC payment system
by 2.0 percent for ASCs that meet the quality reporting requirements
under the ASCQR Program. This proposed increase is based on a proposed
hospital market basket percentage increase of 2.8 percent minus a
proposed MFP adjustment required by the Affordable Care Act of 0.8
percentage point.
Based on this proposed update, we estimate that total payments to
ASCs (including beneficiary cost-sharing and estimated changes in
enrollment, utilization, and case-mix) for CY 2019 would be
approximately $4.89 billion, an increase of approximately $300 million
compared to estimated CY 2018 Medicare payments to ASCs. We note that
the CY 2019 ASC payment update, under our prior policy, would have been
1.3 percent, based on a projected CPI-U update of 2.1 percent minus a
MFP adjustment required by the Affordable Care Act of 0.8 percentage
point. In addition, we will assess the feasibility of collaborating
with stakeholders to collect ASC cost data in a minimally burdensome
manner and could propose a plan to collect such information.
Proposed Changes to the List of ASC Covered Surgical
Procedures: For CY 2019, we are proposing to revise our definition of
``surgery'' in the ASC payment system to account for certain ``surgery-
like'' procedures that are assigned codes outside the Current
Procedural Terminology (CPT) surgical range. In addition, we are
proposing to add 12 cardiac catheterization procedures to the ASC
covered procedures list. We also are soliciting public comments on our
proposal to reassess, and soliciting further public comments on,
procedures recently
[[Page 37051]]
added to the ASC covered procedures list.
Payment for Non-Opioid Pain Management Therapy: For CY
2019, in response to the recommendation from the President's Commission
on Combating Drug Addiction and the Opioid Crisis, we are proposing to
change the packaging policy for certain drugs when administered in the
ASC setting and provide separate payment for non-opioid pain management
drugs that function as a supply when used in a surgical procedure when
the procedure is performed in an ASC. In addition, we are soliciting
public comments and peer-reviewed evidence to help determine whether we
should pay separately for other non-opioid treatments for pain under
the OPPS and the ASC payment system.
Hospital Outpatient Quality Reporting (OQR) Program: For
the Hospital OQR Program, we are proposing changes for the CY 2019, CY
2020, and CY 2021 payment determinations and subsequent years.
Effective upon the final rule, we are proposing to: (1) Update measure
removal Factor 7; (2) add a new removal Factor 8; and (3) codify our
measure removal policies and factors. We also are providing
clarification of our ``topped-out'' criteria. These proposals would
align the Hospital OQR Program measure removal factors with those used
in the ASCQR Program. In addition, beginning with CY 2019, we are
proposing to update the frequency with which we would release a
Hospital OQR Program Specifications Manual such that it would occur
every 6 to 12 months. We also are proposing for the CY 2020 payment
determination and subsequent years: (1) To update the participation
status requirements by removing the Notice of Participation (NOP) form;
and (2) to extend the reporting period for the OP-32: Facility Seven-
Day Risk-Standardized Hospital Visit Rate after Outpatient Colonoscopy
measure to 3 years.
Beginning with the CY 2020 payment determination and subsequent
years, we also are proposing to remove the OP-27: Influenza Vaccination
Coverage Among Healthcare Personnel measure.
Beginning with the CY 2021 payment determination and subsequent
years, we are proposing to remove the following nine measures: (1) OP-
5: Median Time to ECG; (2) OP-9: Mammography Follow-up Rates; (3) OP-
11: Thorax CT Use of Contrast Material; (4) OP-12: The Ability for
Providers with HIT to Receive Laboratory Data Electronically Directly
into Their Qualified/Certified EHR System as Discrete Searchable Data;
(5) OP-14: Simultaneous Use of Brain Computed Tomography (CT) and Sinus
CT; (6) OP-17: Tracking Clinical Results between Visits; (7) OP-29:
Endoscopy/Polyp Surveillance: Appropriate Follow-Up Interval for Normal
Colonoscopy in Average Risk Patients; (8) OP-30: Endoscopy/Polyp
Surveillance: Colonoscopy Interval for Patients with a History of
Adenomatous Polyps--Avoidance of Inappropriate Use; and (9) OP-31:
Cataracts--Improvement in Patient's Visual Function within 90 Days
Following Cataract Surgery.
Ambulatory Surgical Center Quality Reporting (ASCQR)
Program: For the ASCQR Program, we are proposing changes in policies
for the CY 2020 payment determination and CY 2021 payment determination
and subsequent years. Effective upon the final rule, we are proposing
to: (1) Remove one factor; (2) add two new measure removal factors; and
(3) update the regulations to better reflect our measure removal
policies. We also are making one clarification to measure removal
Factor 1. These proposals would align the ASCQR Program measure removal
factors with those used in the Hospital OQR Program.
Beginning with the CY 2020 payment determination and subsequent
years, we are proposing to extend the reporting period for the ASC-12:
Facility Seven-Day Risk-Standardized Hospital Visit Rate after
Outpatient Colonoscopy measure to 3 years. For the CY 2020 payment
determination and subsequent years, we also are proposing to remove one
measure from the ASCQR Program measure set, ASC-8: Influenza
Vaccination Coverage Among Healthcare Personnel.
Beginning with the CY 2021 payment determination and subsequent
years, we are proposing to remove seven measures: (1) ASC-1: Patient
Burn; (2) ASC-2: Patient Fall; (3) ASC-3: Wrong Site, Wrong Side, Wrong
Patient, Wrong Procedure, Wrong Implant; (4) ASC-4: All-Cause Hospital
Transfer/Admission; (5) ASC-9: Endoscopy/Polyp Surveillance Follow-up
Interval for Normal Colonoscopy in Average Risk Patients; (6) ASC-10:
Endoscopy/Polyp Surveillance: Colonoscopy Interval for Patients with a
History of Adenomatous Polyps--Avoidance of Inappropriate Use; and (7)
ASC-11: Cataracts--Improvement in Patient's Visual Function within 90
Days Following Cataract Surgery.
Hospital Inpatient Quality Reporting (IQR) Program Update:
In this proposed rule, we are proposing to modify the HCAHPS Survey
measure by removing the Communication about Pain questions from the
HCAHPS Survey for the Hospital IQR Program, effective with January 2022
discharges for the FY 2024 payment determination and subsequent years.
4. Summary of Costs and Benefits
In sections XX. and XXI. of this proposed rule, we set forth a
detailed analysis of the regulatory and Federalism impacts that the
proposed changes would have on affected entities and beneficiaries. Key
estimated impacts are described below.
a. Impacts of the Proposed OPPS Update
(1) Impacts of All Proposed OPPS Changes
Table 42 in section XX. of this proposed rule displays the
distributional impact of all the proposed OPPS changes on various
groups of hospitals and CMHCs for CY 2019 compared to all estimated
OPPS payments in CY 2018. We estimate that policies in this proposed
rule would result in a 0.1 percent overall decrease in OPPS payments to
providers. We estimate that total OPPS payments for CY 2019, including
beneficiary cost-sharing, to the approximate 3,800 facilities paid
under the OPPS (including general acute care hospitals, children's
hospitals, cancer hospitals, and CMHCs) would decrease by approximately
$80 million compared to CY 2018 payments, excluding our estimated
changes in enrollment, utilization, and case-mix.
We estimated the isolated impact of our proposed OPPS policies on
CMHCs because CMHCs are only paid for partial hospitalization services
under the OPPS. Continuing the provider-specific structure we adopted
beginning in CY 2011 and basing payment fully on the type of provider
furnishing the service, we estimate a 17.9 percent decrease in CY 2019
payments to CMHCs relative to their CY 2018 payments.
(2) Impacts of the Proposed Updated Wage Indexes
We estimate that our proposed update of the wage indexes based on
the FY 2019 IPPS proposed rule wage indexes would result in no
estimated payment change for urban and rural hospitals under the OPPS.
These proposed wage indexes include the continued implementation of the
OMB labor market area delineations based on 2010 Decennial Census data,
with updates as discussed in section II.C. of this proposed rule.
[[Page 37052]]
(3) Impacts of the Proposed Rural Adjustment and the Cancer Hospital
Payment Adjustment
There are no significant impacts of our proposed CY 2019 payment
policies for hospitals that are eligible for the rural adjustment or
for the cancer hospital payment adjustment. We are not proposing to
make any change in policies for determining the rural hospital payment
adjustments. While we are implementing the required reduction to the
cancer hospital payment adjustment in section 16002 of the 21st Century
Cures Act for CY 2019, the proposed target payment-to-cost ratio (PCR)
for CY 2019 remains the same as in CY 2018 and therefore does not
impact the budget neutrality adjustments.
(4) Impacts of the Proposed OPD Fee Schedule Increase Factor
For the CY 2019 OPPS, we are proposing an OPD fee schedule increase
factor of 1.25 percent to the conversion factor for CY 2019. As a
result of the proposed OPD fee schedule increase factor and other
budget neutrality adjustments, we estimate that rural and urban
hospitals would experience increases of approximately 1.3 percent for
urban hospitals and 1.5 percent for rural hospitals. Classifying
hospitals by teaching status, we estimate nonteaching hospitals would
experience increases of 1.4 percent, minor teaching hospitals would
experience increases of 1.3 percent, and major teaching hospitals would
experience a decrease of 1.1 percent. We also classified hospitals by
type of ownership. We estimate that hospitals with voluntary ownership
would experience increases of 1.3 percent, hospitals with proprietary
ownership would experience increases of 1.4 percent, and hospitals with
government ownership would experience decrease of 1.3 percent in
payments.
(5) Impacts of the Proposal to Control for Unnecessary Increases in the
Volume of Outpatient Services
In section X.B. of this proposed rule, we discuss our CY 2019
proposal to control for unnecessary increases in the volume of
outpatient service by paying for clinic visits furnished at an off-
campus provider-based department at a PFS-equivalent rate under the
OPPS rather than at the standard OPPS rate. As a result of this
proposal, we estimated decreases of 1.2 percent to urban hospitals, and
estimated decreases of 1.3 percent to rural hospitals, with the
estimated effect for individual groups of hospitals depending on the
volume of clinic visits provided at off-campus provider-based
departments.
b. Impacts of the Proposed ASC Payment Update
For impact purposes, the surgical procedures on the ASC list of
covered procedures are aggregated into surgical specialty groups using
CPT and HCPCS code range definitions. The percentage change in
estimated total payments by specialty groups under the proposed CY 2019
payment rates, compared to estimated CY 2018 payment rates, generally
ranges between an increase of 1 to 4 percent, depending on the service,
with some exceptions. We estimate the impact of applying the hospital
market basket update to proposed ASC payment rates would increase
payments by $32 million under the ASC payment system in CY 2019
compared to if we applied an update based on CPI-U.
c. Impact of the Proposed Changes to the Hospital OQR Program
Across 3,300 hospitals participating in the Hospital OQR Program,
we estimate that our proposed requirements would result in the
following changes to costs and burdens related to information
collection for the Hospital OQR Program compared to previously adopted
requirements: (1) No change in the total collection of information
burden or costs for the CY 2020 payment determination; (2) a total
collection of information burden reduction of 1,468,614 hours and a
total collection of information cost reduction of approximately $57.3
million for the CY 2021 payment determination due to the proposed
removal of six specific measures: OP-5, OP-12, OP-17, OP-29, OP-30, and
OP-31.
Further, we anticipate that the proposed removal of a total of 10
measures would result in a reduction in costs unrelated to information
collection. For example, it may be costly for health care providers to
track the confidential feedback, preview reports, and publicly reported
information on a measure where we use the measure in more than one
program. Also, when measures are in multiple programs, maintaining the
specifications for those measures, as well as the tools we need to
collect, validate, analyze, and publicly report the measure data may
result in costs to CMS. In addition, beneficiaries may find it
confusing to see public reporting on the same measure in different
programs.
d. Impact of the Proposed Changes to the ASCQR Program
Across 3,937 ASCs participating in the ASCQR Program, we estimate
that our proposed requirements would result in the following changes to
costs and burdens related to information collection for the ASCQR
Program compared to previously adopted requirements: (1) No change in
the total collection of information burden or costs for the CY 2020
payment determination; (2) a total collection of information burden
reduction of 140,585 hours and a total collection of information cost
reduction of approximately $5.1 million for the CY 2021 payment
determination due to the proposed removal of three specific measures:
ASC-9, ASC-10, and ASC-11.
Further, we anticipate that the proposed removal of a total of
eight measures would result in a reduction in costs unrelated to
information collection. For example, it may be costly for health care
providers to track the confidential feedback, preview reports, and
publicly reported information on a measure where we use the measure in
more than one program. Also, when measures are in multiple programs,
maintaining the specifications for those measures as well as the tools
we need to collect, analyze, and publicly report the measure data may
result in costs to CMS. In addition, beneficiaries may find it
confusing to see public reporting on the same measure in different
programs.
B. Legislative and Regulatory Authority for the Hospital OPPS
When Title XVIII of the Social Security Act was enacted, Medicare
payment for hospital outpatient services was based on hospital-specific
costs. In an effort to ensure that Medicare and its beneficiaries pay
appropriately for services and to encourage more efficient delivery of
care, the Congress mandated replacement of the reasonable cost-based
payment methodology with a prospective payment system (PPS). The
Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33) added section
1833(t) to the Act, authorizing implementation of a PPS for hospital
outpatient services. The OPPS was first implemented for services
furnished on or after August 1, 2000. Implementing regulations for the
OPPS are located at 42 CFR parts 410 and 419.
The Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of
1999 (BBRA) (Pub. L. 106-113) made major changes in the hospital OPPS.
The following Acts made additional changes to the OPPS: the Medicare,
[[Page 37053]]
Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000
(BIPA) (Pub. L. 106-554); the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003 (MMA) (Pub. L. 108-173); the Deficit
Reduction Act of 2005 (DRA) (Pub. L. 109-171), enacted on February 8,
2006; the Medicare Improvements and Extension Act under Division B of
Title I of the Tax Relief and Health Care Act of 2006 (MIEA-TRHCA)
(Pub. L. 109-432), enacted on December 20, 2006; the Medicare,
Medicaid, and SCHIP Extension Act of 2007 (MMSEA) (Pub. L. 110-173),
enacted on December 29, 2007; the Medicare Improvements for Patients
and Providers Act of 2008 (MIPPA) (Pub. L. 110-275), enacted on July
15, 2008; the Patient Protection and Affordable Care Act (Pub. L. 111-
148), enacted on March 23, 2010, as amended by the Health Care and
Education Reconciliation Act of 2010 (Pub. L. 111-152), enacted on
March 30, 2010 (these two public laws are collectively known as the
Affordable Care Act); the Medicare and Medicaid Extenders Act of 2010
(MMEA, Pub. L. 111-309); the Temporary Payroll Tax Cut Continuation Act
of 2011 (TPTCCA, Pub. L. 112-78), enacted on December 23, 2011; the
Middle Class Tax Relief and Job Creation Act of 2012 (MCTRJCA, Pub. L.
112-96), enacted on February 22, 2012; the American Taxpayer Relief Act
of 2012 (Pub. L. 112-240), enacted January 2, 2013; the Pathway for SGR
Reform Act of 2013 (Pub. L. 113-67) enacted on December 26, 2013; the
Protecting Access to Medicare Act of 2014 (PAMA, Pub. L. 113-93),
enacted on March 27, 2014; the Medicare Access and CHIP Reauthorization
Act (MACRA) of 2015 (Pub. L. 114-10), enacted April 16, 2015; the
Bipartisan Budget Act of 2015 (Pub. L. 114-74), enacted November 2,
2015; the Consolidated Appropriations Act, 2016 (Pub. L. 114-113),
enacted on December 18, 2015, and the 21st Century Cures Act (Pub. L.
114-255), enacted on December 13, 2016.
Under the OPPS, we generally pay for hospital Part B services on a
rate-per-service basis that varies according to the APC group to which
the service is assigned. We use the Healthcare Common Procedure Coding
System (HCPCS) (which includes certain Current Procedural Terminology
(CPT) codes) to identify and group the services within each APC. The
OPPS includes payment for most hospital outpatient services, except
those identified in section I.C. of this final rule with comment
period. Section 1833(t)(1)(B) of the Act provides for payment under the
OPPS for hospital outpatient services designated by the Secretary
(which includes partial hospitalization services furnished by CMHCs),
and certain inpatient hospital services that are paid under Medicare
Part B.
The OPPS rate is an unadjusted national payment amount that
includes the Medicare payment and the beneficiary copayment. This rate
is divided into a labor-related amount and a nonlabor-related amount.
The labor-related amount is adjusted for area wage differences using
the hospital inpatient wage index value for the locality in which the
hospital or CMHC is located.
All services and items within an APC group are comparable
clinically and with respect to resource use (section 1833(t)(2)(B) of
the Act). In accordance with section 1833(t)(2) of the Act, subject to
certain exceptions, items and services within an APC group cannot be
considered comparable with respect to the use of resources if the
highest median cost (or mean cost, if elected by the Secretary) for an
item or service in the APC group is more than 2 times greater than the
lowest median cost (or mean cost, if elected by the Secretary) for an
item or service within the same APC group (referred to as the ``2 times
rule''). In implementing this provision, we generally use the cost of
the item or service assigned to an APC group.
For new technology items and services, special payments under the
OPPS may be made in one of two ways. Section 1833(t)(6) of the Act
generally provides for temporary additional payments, which we refer to
as ``transitional pass-through payments,'' for at least 2 but not more
than 3 years for certain drugs, biological agents, brachytherapy
devices used for the treatment of cancer, and categories of other
medical devices and in some cases, provides for a longer period under
which transitional pass-through payments are made. For new technology
services that are not eligible for transitional pass-through payments,
and for which we lack sufficient clinical information and cost data to
appropriately assign them to a clinical APC group, we have established
special APC groups based on costs, which we refer to as New Technology
APCs. These New Technology APCs are designated by cost bands which
allow us to provide appropriate and consistent payment for designated
new procedures that are not yet reflected in our claims data. Similar
to pass-through payments, an assignment to a New Technology APC is
temporary; that is, we retain a service within a New Technology APC
until we acquire sufficient data to assign it to a clinically
appropriate APC group.
C. Excluded OPPS Services and Hospitals
Section 1833(t)(1)(B)(i) of the Act authorizes the Secretary to
designate the hospital outpatient services that are paid under the
OPPS. While most hospital outpatient services are payable under the
OPPS, section 1833(t)(1)(B)(iv) of the Act excludes payment for
ambulance, physical and occupational therapy, and speech-language
pathology services, for which payment is made under a fee schedule. It
also excludes screening mammography, diagnostic mammography, and
effective January 1, 2011, an annual wellness visit providing
personalized prevention plan services. The Secretary exercises the
authority granted under the statute to also exclude from the OPPS
certain services that are paid under fee schedules or other payment
systems. Such excluded services include, for example, the professional
services of physicians and nonphysician practitioners paid under the
Physician Fee Schedule (PFS); certain laboratory services paid under
the Clinical Laboratory Fee Schedule (CLFS); services for beneficiaries
with end-stage renal disease (ESRD) that are paid under the ESRD
prospective payment system; and services and procedures that require an
inpatient stay that are paid under the hospital IPPS. In addition,
section 1833(t)(1)(B)(v) of the Act does not include applicable items
and services (as defined in subparagraph (A) of paragraph (21)) that
are furnished on or after January 1, 2017 by an off-campus outpatient
department of a provider (as defined in subparagraph (B) of paragraph
(21). We set forth the services that are excluded from payment under
the OPPS in regulations at 42 CFR 419.22.
Under Sec. 419.20(b) of the regulations, we specify the types of
hospitals that are excluded from payment under the OPPS. These excluded
hospitals include:
Critical access hospitals (CAHs);
Hospitals located in Maryland and paid under the Maryland
All-Payer Model;
Hospitals located outside of the 50 States, the District
of Columbia, and Puerto Rico; and
Indian Health Service (IHS) hospitals.
D. Prior Rulemaking
On April 7, 2000, we published in the Federal Register a final rule
with comment period (65 FR 18434) to implement a prospective payment
system for hospital outpatient services. The hospital OPPS was first
[[Page 37054]]
implemented for services furnished on or after August 1, 2000. Section
1833(t)(9)(A) of the Act requires the Secretary to review certain
components of the OPPS, not less often than annually, and to revise the
groups, relative payment weights, and other adjustments that take into
account changes in medical practices, changes in technologies, and the
addition of new services, new cost data, and other relevant information
and factors.
Since initially implementing the OPPS, we have published final
rules in the Federal Register annually to implement statutory
requirements and changes arising from our continuing experience with
this system. These rules can be viewed on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.html.
E. Advisory Panel on Hospital Outpatient Payment (the HOP Panel or the
Panel)
1. Authority of the Panel
Section 1833(t)(9)(A) of the Act, as amended by section 201(h) of
Public Law 106-113, and redesignated by section 202(a)(2) of Public Law
106-113, requires that we consult with an external advisory panel of
experts to annually review the clinical integrity of the payment groups
and their weights under the OPPS. In CY 2000, based on section
1833(t)(9)(A) of the Act, the Secretary established the Advisory Panel
on Ambulatory Payment Classification Groups (APC Panel) to fulfill this
requirement. In CY 2011, based on section 222 of the Public Health
Service Act which gives discretionary authority to the Secretary to
convene advisory councils and committees, the Secretary expanded the
panel's scope to include the supervision of hospital outpatient
therapeutic services in addition to the APC groups and weights. To
reflect this new role of the panel, the Secretary changed the panel's
name to the Advisory Panel on Hospital Outpatient Payment (the HOP
Panel or the Panel). The HOP Panel is not restricted to using data
compiled by CMS, and in conducting its review, it may use data
collected or developed by organizations outside the Department.
2. Establishment of the Panel
On November 21, 2000, the Secretary signed the initial charter
establishing the Panel, and at that time named the APC Panel. This
expert panel is composed of appropriate representatives of providers
(currently employed full-time, not as consultants, in their respective
areas of expertise) who review clinical data, and advise CMS about the
clinical integrity of the APC groups and their payment weights. Since
CY 2012, the Panel also is charged with advising the Secretary on the
appropriate level of supervision for individual hospital outpatient
therapeutic services. The Panel is technical in nature, and it is
governed by the provisions of the Federal Advisory Committee Act
(FACA). The current charter specifies, among other requirements, that
the Panel--
May advise on the clinical integrity of Ambulatory Payment
Classification (APC) groups and their associated weights;
May advise on the appropriate supervision level for
hospital outpatient services;
Continues to be technical in nature;
Is governed by the provisions of the FACA;
Has a Designated Federal Official (DFO); and
Is chaired by a Federal Official designated by the
Secretary.
The Panel's charter was amended on November 15, 2011, renaming the
Panel and expanding the Panel's authority to include supervision of
hospital outpatient therapeutic services and to add critical access
hospital (CAH) representation to its membership. The Panel's charter
was also amended on November 6, 2014 (80 FR 23009), and the number of
members was revised from up to 19 to up to 15 members. The Panel's
current charter was approved on November 21, 2016, for a 2-year period
(81 FR 94378).
The current Panel membership and other information pertaining to
the Panel, including its charter, Federal Register notices, membership,
meeting dates, agenda topics, and meeting reports, can be viewed on the
CMS website at: https://www.cms.gov/Regulations-and-Guidance/Guidance/FACA/AdvisoryPanelonAmbulatoryPaymentClassificationGroups.html.
3. Panel Meetings and Organizational Structure
The Panel has held many meetings, with the last meeting taking
place on August 21, 2017. Prior to each meeting, we publish a notice in
the Federal Register to announce the meeting and, when necessary, to
solicit nominations for Panel membership, to announce new members and
to announce any other changes of which the public should be aware.
Beginning in CY 2017, we have transitioned to one meeting per year (81
FR 31941). Further information on the 2018 summer meeting can be found
in the meeting notice titled ``Medicare Program: Announcement of the
Advisory Panel on Hospital Outpatient Payment (the Panel) Meeting on
August 20-21, 2018'' (83 FR 19785).
In addition, the Panel has established an operational structure
that, in part, currently includes the use of three subcommittees to
facilitate its required review process. The three current subcommittees
include the following:
APC Groups and Status Indicator Assignments Subcommittee,
which advises the Panel on the appropriate status indicators to be
assigned to HCPCS codes, including but not limited to whether a HCPCS
code or a category of codes should be packaged or separately paid, as
well as the appropriate APC assignment of HCPCS codes regarding
services for which separate payment is made;
Data Subcommittee, which is responsible for studying the
data issues confronting the Panel and for recommending options for
resolving them; and
Visits and Observation Subcommittee, which reviews and
makes recommendations to the Panel on all technical issues pertaining
to observation services and hospital outpatient visits paid under the
OPPS.
Each of these subcommittees was established by a majority vote from
the full Panel during a scheduled Panel meeting, and the Panel
recommended at the August 21, 2017 meeting that the subcommittees
continue. We accepted this recommendation.
Discussions of the other recommendations made by the Panel at the
August 21, 2017 Panel meeting, namely endovascular procedure APCs,
blood derived hematopoietic stem cell transplantation, OPPS payment for
drugs acquired under the 340B program, and packaging of drug
administration services, were discussed in the CY 2018 OPPS/ASC final
rule with comment period (82 FR 59216) and the CY 2018 OPPS/ASC
correction notice (82 FR 61184), or are included in the sections of
this proposed rule that are specific to each recommendation. For
discussions of earlier Panel meetings and recommendations, we refer
readers to previously published OPPS/ASC proposed and final rules, the
CMS website mentioned earlier in this section, and the FACA database at
http://facadatabase.gov.
F. Public Comments Received on the CY 2018 OPPS/ASC Final Rule With
Comment Period
We received approximately 127 timely pieces of correspondence on
the
[[Page 37055]]
CY 2018 OPPS/ASC final rule with comment period that appeared in the
Federal Register on December 14, 2017 (82 FR 59216), some of which
contained comments on the interim APC assignments and/or status
indicators of new or replacement Level II HCPCS codes (identified with
comment indicator ``NI'' in OPPS Addendum B, ASC Addendum AA, and ASC
Addendum BB to that final rule). Summaries of the public comments on
new or replacement Level II HCPCS codes will be set forth in the CY
2019 final rule with comment period under the appropriate subject
matter headings.
II. Proposed Updates Affecting OPPS Payments
A. Proposed Recalibration of APC Relative Payment Weights
1. Database Construction
a. Database Source and Methodology
Section 1833(t)(9)(A) of the Act requires that the Secretary review
not less often than annually and revise the relative payment weights
for APCs. In the April 7, 2000 OPPS final rule with comment period (65
FR 18482), we explained in detail how we calculated the relative
payment weights that were implemented on August 1, 2000 for each APC
group.
In this CY 2019 OPPS/ASC proposed rule, for CY 2019, we are
proposing to recalibrate the APC relative payment weights for services
furnished on or after January 1, 2019, and before January 1, 2020 (CY
2019), using the same basic methodology that we described in the CY
2018 OPPS/ASC final rule with comment period (82 FR 52367 through
52370), using updated CY 2017 claims data. That is, we are proposing to
recalibrate the relative payment weights for each APC based on claims
and cost report data for hospital outpatient department (HOPD)
services, using the most recent available data to construct a database
for calculating APC group weights.
For the purpose of recalibrating the APC proposed relative payment
weights for CY 2019, we began with approximately 163 million final
action claims (claims for which all disputes and adjustments have been
resolved and payment has been made) for HOPD services furnished on or
after January 1, 2017, and before January 1, 2018, before applying our
exclusionary criteria and other methodological adjustments. After the
application of those data processing changes, we used approximately 86
million final action claims to develop the proposed CY 2019 OPPS
payment weights. For exact numbers of claims used and additional
details on the claims accounting process, we refer readers to the
claims accounting narrative under supporting documentation for this CY
2019 OPPS/ASC proposed rule on the CMS website at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html.
Addendum N to this proposed rule (which is available via the
internet on the CMS website) includes the proposed list of bypass codes
for CY 2019. The proposed list of bypass codes contains codes that were
reported on claims for services in CY 2017 and, therefore, includes
codes that were in effect in CY 2017 and used for billing, but were
deleted for CY 2018. We retained these deleted bypass codes on the
proposed CY 2019 bypass list because these codes existed in CY 2017 and
were covered OPD services in that period, and CY 2017 claims data are
used to calculate CY 2019 payment rates. Keeping these deleted bypass
codes on the bypass list potentially allows us to create more
``pseudo'' single procedure claims for ratesetting purposes. ``Overlap
bypass codes'' that are members of the proposed multiple imaging
composite APCs are identified by asterisks (*) in the third column of
Addendum N to this proposed rule. HCPCS codes that we are proposing to
add for CY 2019 are identified by asterisks (*) in the fourth column of
Addendum N.
We are not proposing to remove any codes from the CY 2019 bypass
list.
b. Proposed Calculation and Use of Cost-to-Charge Ratios (CCRs)
For CY 2019, in this CY 2019 OPPS/ASC proposed rule, we are
proposing to continue to use the hospital-specific overall ancillary
and departmental cost-to-charge ratios (CCRs) to convert charges to
estimated costs through application of a revenue code-to-cost center
crosswalk. To calculate the APC costs on which the proposed CY 2019 APC
payment rates are based, we calculated hospital-specific overall
ancillary CCRs and hospital-specific departmental CCRs for each
hospital for which we had CY 2017 claims data by comparing these claims
data to the most recently available hospital cost reports, which, in
most cases, are from CY 2016. For the proposed CY 2019 OPPS payment
rates, we used the set of claims processed during CY 2017. We applied
the hospital-specific CCR to the hospital's charges at the most
detailed level possible, based on a revenue code-to-cost center
crosswalk that contains a hierarchy of CCRs used to estimate costs from
charges for each revenue code. That crosswalk is available for review
and continuous comment on the CMS website at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html.
To ensure the completeness of the revenue code-to-cost center
crosswalk, we reviewed changes to the list of revenue codes for CY 2017
(the year of claims data we used to calculate the proposed CY 2019 OPPS
payment rates) and found that the National Uniform Billing Committee
(NUBC) did not add any new revenue codes to the NUBC 2017 Data
Specifications Manual.
In accordance with our longstanding policy, we calculate CCRs for
the standard and nonstandard cost centers accepted by the electronic
cost report database. In general, the most detailed level at which we
calculate CCRs is the hospital-specific departmental level. For a
discussion of the hospital-specific overall ancillary CCR calculation,
we refer readers to the CY 2007 OPPS/ASC final rule with comment period
(71 FR 67983 through 67985). The calculation of blood costs is a
longstanding exception (since the CY 2005 OPPS) to this general
methodology for calculation of CCRs used for converting charges to
costs on each claim. This exception is discussed in detail in the CY
2007 OPPS/ASC final rule with comment period and discussed further in
section II.A.2.a.(1) of this proposed rule.
In the CY 2014 OPPS/ASC final rule with comment period (78 FR 74840
through 74847), we finalized our policy of creating new cost centers
and distinct CCRs for implantable devices, magnetic resonance imagings
(MRIs), computed tomography (CT) scans, and cardiac catheterization.
However, in response to the CY 2014 OPPS/ASC proposed rule, commenters
reported that some hospitals currently use an imprecise ``square feet''
allocation methodology for the costs of large moveable equipment like
CT scan and MRI machines. They indicated that while CMS recommended
using two alternative allocation methods, ``direct assignment'' or
``dollar value,'' as a more accurate methodology for directly assigning
equipment costs, industry analysis suggested that approximately only
half of the reported cost centers for CT scans and MRIs rely on these
preferred methodologies. In response to concerns from commenters, we
finalized a policy for the CY 2014 OPPS to remove claims from providers
that use a cost allocation method of ``square feet'' to calculate CCRs
used to estimate costs associated with the APCs for CT and MRI (78 FR
74847). Further, we finalized a transitional policy to estimate the
imaging APC relative
[[Page 37056]]
payment weights using only CT and MRI cost data from providers that do
not use ``square feet'' as the cost allocation statistic. We provided
that this finalized policy would sunset in 4 years to provide a
sufficient time for hospitals to transition to a more accurate cost
allocation method and for the related data to be available for
ratesetting purposes (78 FR 74847). Therefore, beginning CY 2018, with
the sunset of the transition policy, we would estimate the imaging APC
relative payment weights using cost data from all providers, regardless
of the cost allocation statistic employed. However, in the CY 2018
OPPS/ASC final rule with comment period (82 FR 59228 and 59229), we
finalized a policy to extend the transition policy for 1 additional
year and continued to remove claims from providers that use a cost
allocation method of ``square feet'' to calculate CT and MRI CCRs for
the CY 2018 OPPS.
As we discussed in the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59228), some stakeholders have raised concerns regarding
using claims from all providers to calculate CT and MRI CCRs,
regardless of the cost allocations statistic employed (78 FR 74840
through 74847). Stakeholders noted that providers continue to use the
``square feet'' cost allocation method and that including claims from
such providers would cause significant reductions in the imaging APC
payment rates.
Table 1 below demonstrates the relative effect on imaging APC
payments after removing cost data for providers that report CT and MRI
standard cost centers using ``square feet'' as the cost allocation
method by extracting HCRIS data on Worksheet B-1. Table 2 below
provides statistical values based on the CT and MRI standard cost
center CCRs using the different cost allocation methods.
Table 1--Percentage Change in Estimate Cost for CT and MRI APCs When Excluding Claims From Provider Using
``Square Feet'' as the Cost Allocation Method
----------------------------------------------------------------------------------------------------------------
Percentage
APC APC descriptor change
----------------------------------------------------------------------------------------------------------------
5521........................................ Level 1 Imaging without Contrast.................. -3.6
5522........................................ Level 2 Imaging without Contrast.................. 5.5
5523........................................ Level 3 Imaging without Contrast.................. 4.3
5524........................................ Level 4 Imaging without Contrast.................. 4.7
5571........................................ Level 1 Imaging with Contrast..................... 7.7
5572........................................ Level 2 Imaging with Contrast..................... 8.4
5573........................................ Level 3 Imaging with Contrast..................... 2.8
8005........................................ CT and CTA without Contrast Composite............. 13.9
8006........................................ CT and CTA with Contrast Composite................ 11.4
8007........................................ MRI and MRA without Contrast Composite............ 6.6
8008........................................ MRI and MRA with Contrast Composite............... 7.4
----------------------------------------------------------------------------------------------------------------
Table 2--CCR Statistical Values Based on use of Different Cost Allocation Methods
----------------------------------------------------------------------------------------------------------------
CT MRI
Cost allocation method ---------------------------------------------------------------
Median CCR Mean CCR Median CCR Mean CCR
----------------------------------------------------------------------------------------------------------------
All Providers................................... 0.0377 0.0527 0.0780 0.1046
Square Feet Only................................ 0.0309 0.0475 0.0701 0.0954
Direct Assign................................... 0.0553 0.0645 0.1058 0.1227
Dollar Value.................................... 0.0446 0.0592 0.0866 0.1166
Direct Assign and Dollar Value.................. 0.0447 0.0592 0.0867 0.1163
----------------------------------------------------------------------------------------------------------------
Our analysis shows that since the CY 2014 OPPS in which we
established the transition policy, the number of valid MRI CCRs has
increased by 17.4 percent to 2,174 providers and the number of valid CT
CCRs has increased by 14.8 percent to 2,244 providers. However, as
shown in Table 1 above, nearly all imaging APCs would see an increase
in payment rates for CY 2019 if claims from providers that report using
the ``square feet'' cost allocation method were removed. This can be
attributed to the generally lower CCR values from providers that use a
cost allocation method of ``square feet'' as shown in Table 2 above.
In response to provider concerns and to provide added flexibility
for hospitals to improve their cost allocation methods, for the CY 2019
OPPS, we are proposing to extend our transition policy and remove
claims from providers that use a cost allocation method of ``square
feet'' to calculate CCRs used to estimate costs with the APCs for CT
and MRI identified in Table 2 above. This proposed extension would mean
that CMS would now be providing 6 years for providers to transition
from a ``square feet'' cost allocation method to another cost
allocation method. We do not believe another extension in CY 2020 will
be warranted and expect to determine the imaging APC relative payment
weights for CY 2020 using cost data from all providers, regardless of
the cost allocation method employed.
2. Proposed Data Development Process and Calculation of Costs Used for
Ratesetting
In this section of this proposed rule, we discuss the use of claims
to calculate the proposed OPPS payment rates for CY 2019. The Hospital
OPPS page on the CMS website on which this proposed rule is posted
(http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html) provides an accounting of claims used
in the development of the proposed payment rates. That accounting
provides additional detail regarding the number of claims derived at
each stage of the process. In addition, below in this section we
discuss the file of claims that comprises the data set that is
available upon payment of an administrative fee
[[Page 37057]]
under a CMS data use agreement. The CMS website, http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html, includes information about obtaining the ``OPPS Limited
Data Set,'' which now includes the additional variables previously
available only in the OPPS Identifiable Data Set, including ICD-10-CM
diagnosis codes and revenue code payment amounts. This file is derived
from the CY 2017 claims that were used to calculate the proposed
payment rates for the CY 2019 OPPS.
In the history of the OPPS, we have traditionally established the
scaled relative weights on which payments are based using APC median
costs, which is a process described in the CY 2012 OPPS/ASC final rule
with comment period (76 FR 74188). However, as discussed in more detail
in section II.A.2.f. of the CY 2013 OPPS/ASC final rule with comment
period (77 FR 68259 through 68271), we finalized the use of geometric
mean costs to calculate the relative weights on which the CY 2013 OPPS
payment rates were based. While this policy changed the cost metric on
which the relative payments are based, the data process in general
remained the same, under the methodologies that we used to obtain
appropriate claims data and accurate cost information in determining
estimated service cost. For CY 2019, in this CY 2019 OPPS/ASC proposed
rule, we are proposing to continue to use geometric mean costs to
calculate the proposed relative weights on which the CY 2019 OPPS
payment rates are based.
We used the methodology described in sections II.A.2.a. through
II.A.2.c. of this proposed rule to calculate the costs we used to
establish the proposed relative payment weights used in calculating the
proposed OPPS payment rates for CY 2019 shown in Addenda A and B to
this proposed rule (which are available via the internet on the CMS
website). We refer readers to section II.A.4. of this proposed rule for
a discussion of the conversion of APC costs to scaled payment weights.
We note that this will be the first year in which claims data
containing lines with the modifier ``PN'' will be available, which
indicate nonexcepted items and services furnished and billed by off-
campus provider-based departments (PBDs) of hospitals. Because
nonexcepted services are not paid under the OPPS, we are proposing to
remove those claim lines reported with modifier ``PN'' from the claims
data used in ratesetting for the CY 2019 OPPS and subsequent years.
For details of the claims process used in this proposed rule, we
refer readers to the claims accounting narrative under supporting
documentation for this CY 2019 OPPS/ASC proposed rule on the CMS
website at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html.
a. Proposed Calculation of Single Procedure APC Criteria-Based Costs
(1) Blood and Blood Products
(a) Methodology
Since the implementation of the OPPS in August 2000, we have made
separate payments for blood and blood products through APCs rather than
packaging payment for them into payments for the procedures with which
they are administered. Hospital payments for the costs of blood and
blood products, as well as for the costs of collecting, processing, and
storing blood and blood products, are made through the OPPS payments
for specific blood product APCs.
In this CY 2019 OPPS/ASC proposed rule, we are proposing to
continue to establish payment rates for blood and blood products using
our blood-specific CCR methodology, which utilizes actual or simulated
CCRs from the most recently available hospital cost reports to convert
hospital charges for blood and blood products to costs. This
methodology has been our standard ratesetting methodology for blood and
blood products since CY 2005. It was developed in response to data
analysis indicating that there was a significant difference in CCRs for
those hospitals with and without blood-specific cost centers, and past
public comments indicating that the former OPPS policy of defaulting to
the overall hospital CCR for hospitals not reporting a blood-specific
cost center often resulted in an underestimation of the true hospital
costs for blood and blood products. Specifically, in order to address
the differences in CCRs and to better reflect hospitals' costs, we are
proposing to continue to simulate blood CCRs for each hospital that
does not report a blood cost center by calculating the ratio of the
blood-specific CCRs to hospitals' overall CCRs for those hospitals that
do report costs and charges for blood cost centers. We also are
proposing to apply this mean ratio to the overall CCRs of hospitals not
reporting costs and charges for blood cost centers on their cost
reports in order to simulate blood-specific CCRs for those hospitals.
We are proposing to calculate the costs upon which the proposed CY 2019
payment rates for blood and blood products are based using the actual
blood-specific CCR for hospitals that reported costs and charges for a
blood cost center and a hospital-specific, simulated blood-specific CCR
for hospitals that did not report costs and charges for a blood cost
center.
We continue to believe that the hospital-specific, simulated blood-
specific, CCR methodology better responds to the absence of a blood-
specific CCR for a hospital than alternative methodologies, such as
defaulting to the overall hospital CCR or applying an average blood-
specific CCR across hospitals. Because this methodology takes into
account the unique charging and cost accounting structure of each
hospital, we believe that it yields more accurate estimated costs for
these products. We continue to believe that this methodology in CY 2019
would result in costs for blood and blood products that appropriately
reflect the relative estimated costs of these products for hospitals
without blood cost centers and, therefore, for these blood products in
general.
We note that, as discussed in section II.A.2.b. of the CY 2018
OPPS/ASC final rule with comment period (82 FR 59234 through 59239), we
defined a comprehensive APC (C-APC) as a classification for the
provision of a primary service and all adjunctive services provided to
support the delivery of the primary service. Under this policy, we
include the costs of blood and blood products when calculating the
overall costs of these C-APCs. In this CY 2019 OPPS/ASC proposed rule,
we are proposing to continue to apply the blood-specific CCR
methodology described in this section when calculating the costs of the
blood and blood products that appear on claims with services assigned
to the C-APCs. Because the costs of blood and blood products would be
reflected in the overall costs of the C-APCs (and, as a result, in the
proposed payment rates of the C-APCs), we are proposing to not make
separate payments for blood and blood products when they appear on the
same claims as services assigned to the C-APCs (we refer readers to the
CY 2015 OPPS/ASC final rule with comment period (79 FR 66796)).
We also refer readers to Addendum B to this proposed rule (which is
available via the internet on the CMS website) for the proposed CY 2019
payment rates for blood and blood products (which are identified with
status indicator ``R''). For a more detailed discussion of the blood-
specific CCR methodology, we refer readers to the CY 2005 OPPS proposed
rule (69 FR 50524 through 50525). For a full history of OPPS
[[Page 37058]]
payment for blood and blood products, we refer readers to the CY 2008
OPPS/ASC final rule with comment period (72 FR 66807 through 66810).
(b) Pathogen-Reduced Platelets Payment Rate
In the CY 2016 OPPS/ASC final rule with comment period (80 FR 70322
through 70323), we reiterated that we calculate payment rates for blood
and blood products using our blood-specific CCR methodology, which
utilizes actual or simulated CCRs from the most recently available
hospital cost reports to convert hospital charges for blood and blood
products to costs. Because HCPCS code P9072 (Platelets, pheresis,
pathogen reduced or rapid bacterial tested, each unit), the predecessor
code to HCPCS code P9073 (Platelets, pheresis, pathogen-reduced, each
unit), was new for CY 2016, there were no claims data available on the
charges and costs for this blood product upon which to apply our blood-
specific CCR methodology. Therefore, we established an interim payment
rate for HCPCS code P9072 based on a crosswalk to existing blood
product HCPCS code P9037 (Platelets, pheresis, leukocytes reduced,
irradiated, each unit), which we believed provided the best proxy for
the costs of the new blood product. In addition, we stated that once we
had claims data for HCPCS code P9072, we would calculate its payment
rate using the claims data that should be available for the code
beginning in CY 2018, which is our practice for other blood product
HCPCS codes for which claims data have been available for 2 years.
We stated in the CY 2018 OPPS/ASC final rule with comment period
(82 FR 59232) that, although our standard practice for new codes
involves using claims data to set payment rates once claims data become
available, we were concerned that there may have been confusion among
the provider community about the services that HCPCS code P9072
described. That is, as early as 2016, there were discussions about
changing the descriptor for HCPCS code P9072 to include the phrase ``or
rapid bacterial tested'', which is a less costly technology than
pathogen reduction. In addition, effective January 2017, the code
descriptor for HCPCS code P9072 was changed to describe rapid bacterial
testing of platelets and, effective July 1, 2017, the descriptor for
the temporary successor code for HCPCS code P9072 (HCPCS code Q9988)
was changed again back to the original descriptor for HCPCS code P9072
that was in place for 2016.
Based on the ongoing discussions involving changes to the original
HCPCS code P9072 established in CY 2016, we believed that claims from
CY 2016 for pathogen reduced platelets may have potentially reflected
certain claims for rapid bacterial testing of platelets. Therefore, we
decided to continue to crosswalk the payment amount for services
described by HCPCS code P9073 to the payment amount for services
described by HCPCS P9037 for CY 2018 (82 FR 59232), as had been done
previously, to determine the payment rate for services described by
HCPCS code P9072. In this proposed rule, for CY 2019, we have reviewed
the CY 2017 claims data for the two predecessor codes to HCPCS code
P9073 (HCPCS codes P9072 and Q9988), along with the claims data for the
CY 2017 temporary code for pathogen test for platelets (HCPCS code
Q9987), which describes rapid bacterial testing of platelets.
We found that there were over 2,200 claims billed with either HCPCS
code P9072 or Q9988. Accordingly, we believe that there are a
sufficient number of claims to use to calculate a payment rate for
HCPCS code P9073 for CY 2019. We also performed checks to estimate the
share of claims that may have been billed for rapid bacterial testing
of platelets as compared to the share of claims that may have been
billed for pathogen-reduced, pheresis platelets (based on when HCPCS
code P9072 was an active procedure code from January 1, 2017 to June
30, 2017). First, we found that the geometric mean cost for pathogen-
reduced, pheresis platelets, as reported by HCPCS code Q9988 when
billed separately for rapid bacterial testing of platelets, was
$453.87, and that over 1,200 claims were billed for services described
by HCPCS code Q9988. Next, we found that the geometric mean cost for
rapid bacterial testing of platelets, as reported by HCPCS code Q9987
on claims, was $33.44, and there were only 59 claims reported for
services described by HCPCS code Q9987, of which 3 were separately
paid.
These findings imply that almost all of the claims billed for
services reported with HCPCS code P9072 were for pathogen-reduced,
pheresis platelets. In addition, the geometric mean cost for services
described by HCPCS code P9072, which may contain rapid bacterial
testing of platelets claims, was $468.11, which is lower than the
geometric mean cost for services described by HCPCS code Q9988 of
$453.87, which would not have contained claims for rapid bacterial
testing of platelets. Because the geometric mean for services described
by HCPCS code Q9987 is only $33.44, it would be expected that if a
significant share of claims billed for services described by HCPCS code
P9072 were for the rapid bacterial testing of platelets, the geometric
mean cost for services described by HCPCS code P9072 would be lower
than the geometric mean cost for services described by HCPCS code
Q9988. Instead, we found that the geometric mean cost for services
described by HCPCS code Q9988 is higher than the geometric mean cost
for services described by HCPCS code P9072.
Based on our analysis of claims data, we believe there are
sufficient claims available to establish a payment rate for pathogen-
reduced pheresis platelets without using a crosswalk. Therefore, we are
proposing to calculate the payment rate for services described by HCPCS
code P9073 in CY 2019 and in subsequent years using claims payment
history, which is the standard methodology used by the OPPS for HCPCS
and CPT codes with at least 2 years of claims history. We refer readers
to Addendum B of this proposed rule for the proposed payment rate for
services described by HCPCS code P9073 reportable under the OPPS.
Addendum B is available via the internet on the CMS website.
(2) Brachytherapy Sources
Section 1833(t)(2)(H) of the Act mandates the creation of
additional groups of covered OPD services that classify devices of
brachytherapy consisting of a seed or seeds (or radioactive source)
(``brachytherapy sources'') separately from other services or groups of
services. The statute provides certain criteria for the additional
groups. For the history of OPPS payment for brachytherapy sources, we
refer readers to prior OPPS final rules, such as the CY 2012 OPPS/ASC
final rule with comment period (77 FR 68240 through 68241). As we have
stated in prior OPPS updates, we believe that adopting the general OPPS
prospective payment methodology for brachytherapy sources is
appropriate for a number of reasons (77 FR 68240). The general OPPS
methodology uses costs based on claims data to set the relative payment
weights for hospital outpatient services. This payment methodology
results in more consistent, predictable, and equitable payment amounts
per source across hospitals by averaging the extremely high and low
values, in contrast to payment based on hospitals' charges adjusted to
costs. We believe that the OPPS methodology, as opposed to payment
based on hospitals' charges
[[Page 37059]]
adjusted to cost, also would provide hospitals with incentives for
efficiency in the provision of brachytherapy services to Medicare
beneficiaries. Moreover, this approach is consistent with our payment
methodology for the vast majority of items and services paid under the
OPPS. We refer readers to the CY 2016 OPPS/ASC final rule with comment
period (80 FR 70323 through 70325) for further discussion of the
history of OPPS payment for brachytherapy sources.
In this CY 2019 OPPS/ASC proposed rule, for CY 2019, we are
proposing to use the costs derived from CY 2017 claims data to set the
proposed CY 2019 payment rates for brachytherapy sources because CY
2017 is the same year of data we are proposing to use to set the
proposed payment rates for most other items and services that would be
paid under the CY 2019 OPPS. We are proposing to base the payment rates
for brachytherapy sources on the geometric mean unit costs for each
source, consistent with the methodology that we are proposing for other
items and services paid under the OPPS, as discussed in section II.A.2.
of this proposed rule. We also are proposing to continue the other
payment policies for brachytherapy sources that we finalized and first
implemented in the CY 2010 OPPS/ASC final rule with comment period (74
FR 60537). We are proposing to pay for the stranded and nonstranded not
otherwise specified (NOS) codes, HCPCS codes C2698 (Brachytherapy
source, stranded, not otherwise specified, per source) and C2699
(Brachytherapy source, non-stranded, not otherwise specified, per
source), at a rate equal to the lowest stranded or nonstranded
prospective payment rate for such sources, respectively, on a per
source basis (as opposed to, for example, a per mCi), which is based on
the policy we established in the CY 2008 OPPS/ASC final rule with
comment period (72 FR 66785). We also are proposing to continue the
policy we first implemented in the CY 2010 OPPS/ASC final rule with
comment period (74 FR 60537) regarding payment for new brachytherapy
sources for which we have no claims data, based on the same reasons we
discussed in the CY 2008 OPPS/ASC final rule with comment period (72 FR
66786; which was delayed until January 1, 2010 by section 142 of Pub.
L. 110-275). Specifically, this policy is intended to enable us to
assign new HCPCS codes for new brachytherapy sources to their own APCs,
with prospective payment rates set based on our consideration of
external data and other relevant information regarding the expected
costs of the sources to hospitals. The proposed CY 2019 payment rates
for brachytherapy sources are included in Addendum B to this proposed
rule (which is available via the internet on the CMS website) and are
identified with status indicator ``U''. For CY 2019, we are proposing
to continue to assign status indicator ``U'' (Brachytherapy Sources,
Paid under OPPS; separate APC payment) to HCPCS code C2645
(Brachytherapy planar source, palladium-103, per square millimeter) and
to use external data (invoice prices) and other relevant information to
establish the proposed APC payment rate for HCPCS code C2645.
Specifically, we are proposing to set the payment rate at $4.69 per
mm\2\, the same rate that was in effect for CYs 2017 and 2018.
We note that, for CY 2019, we are proposing to assign status
indicator ``E2'' (Items and Services for Which Pricing Information and
Claims Data Are Not Available) to HCPCS code C2644 (Brachytherapy
cesium-131 chloride) because this code was not reported on CY 2017
claims. Therefore, we are unable to calculate a proposed payment rate
based on the general OPPS ratesetting methodology described earlier.
Although HCPCS code C2644 became effective July 1, 2014, there are no
CY 2017 claims reporting this code. Therefore, we are proposing to
assign new proposed status indicator ``E2'' to HCPCS code C2644 in the
CY 2019 OPPS.
We continue to invite hospitals and other parties to submit
recommendations to us for new codes to describe new brachytherapy
sources. Such recommendations should be directed to the Division of
Outpatient Care, Mail Stop C4-01-26, Centers for Medicare and Medicaid
Services, 7500 Security Boulevard, Baltimore, MD 21244. We will
continue to add new brachytherapy source codes and descriptors to our
systems for payment on a quarterly basis.
b. Proposed Comprehensive APCs (C-APCs) for CY 2019
(1) Background
In the CY 2014 OPPS/ASC final rule with comment period (78 FR 74861
through 74910), we finalized a comprehensive payment policy that
packages payment for adjunctive and secondary items, services, and
procedures into the most costly primary procedure under the OPPS at the
claim level. The policy was finalized in CY 2014, but the effective
date was delayed until January 1, 2015, to allow additional time for
further analysis, opportunity for public comment, and systems
preparation. The comprehensive APC (C-APC) policy was implemented
effective January 1, 2015, with modifications and clarifications in
response to public comments received regarding specific provisions of
the C-APC policy (79 FR 66798 through 66810).
A C-APC is defined as a classification for the provision of a
primary service and all adjunctive services provided to support the
delivery of the primary service. We established C-APCs as a category
broadly for OPPS payment and implemented 25 C-APCs beginning in CY 2015
(79 FR 66809 through 66810). In the CY 2016 OPPS/ASC final rule with
comment period (80 FR 70332), we finalized 10 additional C-APCs to be
paid under the existing C-APC payment policy and added one additional
level to both the Orthopedic Surgery and Vascular Procedures clinical
families, which increased the total number of C-APCs to 37 for CY 2016.
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79584
through 79585), we finalized another 25 C-APCs for a total of 62 C-
APCs. In the CY 2018 OPPS/ASC final rule, we did not change the total
number of C-APCs from 62.
Under this policy, we designate a service described by a HCPCS code
assigned to a C-APC as the primary service when the service is
identified by OPPS status indicator ``J1''. When such a primary service
is reported on a hospital outpatient claim, taking into consideration
the few exceptions that are discussed below, we make payment for all
other items and services reported on the hospital outpatient claim as
being integral, ancillary, supportive, dependent, and adjunctive to the
primary service (hereinafter collectively referred to as ``adjunctive
services'') and representing components of a complete comprehensive
service (78 FR 74865 and 79 FR 66799). Payments for adjunctive services
are packaged into the payments for the primary services. This results
in a single prospective payment for each of the primary, comprehensive
services based on the costs of all reported services at the claim
level.
Services excluded from the C-APC policy under the OPPS include
services that are not covered OPD services, services that cannot by
statute be paid for under the OPPS, and services that are required by
statute to be separately paid. This includes certain mammography and
ambulance services that are not covered OPD services in accordance with
section 1833(t)(1)(B)(iv) of the Act;
[[Page 37060]]
brachytherapy seeds, which also are required by statute to receive
separate payment under section 1833(t)(2)(H) of the Act; pass-through
payment drugs and devices, which also require separate payment under
section 1833(t)(6) of the Act; self-administered drugs (SADs) that are
not otherwise packaged as supplies because they are not covered under
Medicare Part B under section 1861(s)(2)(B) of the Act; and certain
preventive services (78 FR 74865 and 79 FR 66800 through 66801). A list
of services excluded from the C-APC policy is included in Addendum J to
this proposed rule (which is available via the internet on the CMS
website).
The C-APC policy payment methodology set forth in the CY 2014 OPPS/
ASC final rule with comment period for the C-APCs and modified and
implemented beginning in CY 2015 is summarized as follows (78 FR 74887
and 79 FR 66800):
Basic Methodology. As stated in the CY 2015 OPPS/ASC final rule
with comment period, we define the C-APC payment policy as including
all covered OPD services on a hospital outpatient claim reporting a
primary service that is assigned to status indicator ``J1'', excluding
services that are not covered OPD services or that cannot by statute be
paid for under the OPPS. Services and procedures described by HCPCS
codes assigned to status indicator ``J1'' are assigned to C-APCs based
on our usual APC assignment methodology by evaluating the geometric
mean costs of the primary service claims to establish resource
similarity and the clinical characteristics of each procedure to
establish clinical similarity within each APC.
In the CY 2016 OPPS/ASC final rule with comment period, we expanded
the C-APC payment methodology to qualifying extended assessment and
management encounters through the ``Comprehensive Observation
Services'' C-APC (C-APC 8011). Services within this APC are assigned
status indicator ``J2''. Specifically, we make a payment through C-APC
8011 for a claim that:
Does not contain a procedure described by a HCPCS code to
which we have assigned status indicator ``T'' that is reported with a
date of service on the same day or 1 day earlier than the date of
service associated with services described by HCPCS code G0378;
Contains 8 or more units of services described by HCPCS
code G0378 (Observation services, per hour);
Contains services provided on the same date of service or
1 day before the date of service for HCPCS code G0378 that are
described by one of the following codes: HCPCS code G0379 (Direct
referral of patient for hospital observation care) on the same date of
service as HCPCS code G0378; CPT code 99281 (Emergency department visit
for the evaluation and management of a patient (Level 1)); CPT code
99282 (Emergency department visit for the evaluation and management of
a patient (Level 2)); CPT code 99283 (Emergency department visit for
the evaluation and management of a patient (Level 3)); CPT code 99284
(Emergency department visit for the evaluation and management of a
patient (Level 4)); CPT code 99285 (Emergency department visit for the
evaluation and management of a patient (Level 5)) or HCPCS code G0380
(Type B emergency department visit (Level 1)); HCPCS code G0381 (Type B
emergency department visit (Level 2)); HCPCS code G0382 (Type B
emergency department visit (Level 3)); HCPCS code G0383 (Type B
emergency department visit (Level 4)); HCPCS code G0384 (Type B
emergency department visit (Level 5)); CPT code 99291 (Critical care,
evaluation and management of the critically ill or critically injured
patient; first 30-74 minutes); or HCPCS code G0463 (Hospital outpatient
clinic visit for assessment and management of a patient); and
Does not contain services described by a HCPCS code to
which we have assigned status indicator ``J1''.
The assignment of status indicator ``J2'' to a specific combination
of services performed in combination with each other allows for all
other OPPS payable services and items reported on the claim (excluding
services that are not covered OPD services or that cannot by statute be
paid for under the OPPS) to be deemed adjunctive services representing
components of a comprehensive service and resulting in a single
prospective payment for the comprehensive service based on the costs of
all reported services on the claim (80 FR 70333 through 70336).
Services included under the C-APC payment packaging policy, that
is, services that are typically adjunctive to the primary service and
provided during the delivery of the comprehensive service, include
diagnostic procedures, laboratory tests, and other diagnostic tests and
treatments that assist in the delivery of the primary procedure; visits
and evaluations performed in association with the procedure; uncoded
services and supplies used during the service; durable medical
equipment as well as prosthetic and orthotic items and supplies when
provided as part of the outpatient service; and any other components
reported by HCPCS codes that represent services that are provided
during the complete comprehensive service (78 FR 74865 and 79 FR
66800).
In addition, payment for hospital outpatient department services
that are similar to therapy services and delivered either by therapists
or nontherapists is included as part of the payment for the packaged
complete comprehensive service. These services that are provided during
the perioperative period are adjunctive services and are deemed not to
be therapy services as described in section 1834(k) of the Act,
regardless of whether the services are delivered by therapists or other
nontherapist health care workers. We have previously noted that therapy
services are those provided by therapists under a plan of care in
accordance with section 1835(a)(2)(C) and section 1835(a)(2)(D) of the
Act and are paid for under section 1834(k) of the Act, subject to
annual therapy caps as applicable (78 FR 74867 and 79 FR 66800).
However, certain other services similar to therapy services are
considered and paid for as hospital outpatient department services.
Payment for these nontherapy outpatient department services that are
reported with therapy codes and provided with a comprehensive service
is included in the payment for the packaged complete comprehensive
service. We note that these services, even though they are reported
with therapy codes, are hospital outpatient department services and not
therapy services. Therefore, the requirement for functional reporting
under the regulations at 42 CFR 410.59(a)(4) and 42 CFR 410.60(a)(4)
does not apply. We refer readers to the July 2016 OPPS Change Request
9658 (Transmittal 3523) for further instructions on reporting these
services in the context of a C-APC service.
Items included in the packaged payment provided in conjunction with
the primary service also include all drugs, biologicals, and
radiopharmaceuticals, regardless of cost, except those drugs with pass-
through payment status and SADs, unless they function as packaged
supplies (78 FR 74868 through 74869 and 74909 and 79 FR 66800). We
refer readers to Section 50.2M, Chapter 15, of the Medicare Benefit
Policy Manual for a description of our policy on SADs treated as
hospital outpatient supplies, including lists of SADs that function as
supplies and those that do not function as supplies.
We define each hospital outpatient claim reporting a single unit of
a single primary service assigned to status indicator ``J1'' as a
single ``J1'' unit procedure claim (78 FR 74871 and 79
[[Page 37061]]
FR 66801). Line item charges for services included on the C-APC claim
are converted to line item costs, which are then summed to develop the
estimated APC costs. These claims are then assigned one unit of the
service with status indicator ``J1'' and later used to develop the
geometric mean costs for the C-APC relative payment weights. (We note
that we use the term ``comprehensive'' to describe the geometric mean
cost of a claim reporting ``J1'' service(s) or the geometric mean cost
of a C-APC, inclusive of all of the items and services included in the
C-APC service payment bundle.) Charges for services that would
otherwise be separately payable are added to the charges for the
primary service. This process differs from our traditional cost
accounting methodology only in that all such services on the claim are
packaged (except certain services as described above). We apply our
standard data trims, which exclude claims with extremely high primary
units or extreme costs.
The comprehensive geometric mean costs are used to establish
resource similarity and, along with clinical similarity, dictate the
assignment of the primary services to the C-APCs. We establish a
ranking of each primary service (single unit only) to be assigned to
status indicator ``J1'' according to its comprehensive geometric mean
costs. For the minority of claims reporting more than one primary
service assigned to status indicator ``J1'' or units thereof, we
identify one ``J1'' service as the primary service for the claim based
on our cost-based ranking of primary services. We then assign these
multiple ``J1'' procedure claims to the C-APC to which the service
designated as the primary service is assigned. If the reported ``J1''
services on a claim map to different C-APCs, we designate the ``J1''
service assigned to the C-APC with the highest comprehensive geometric
mean cost as the primary service for that claim. If the reported
multiple ``J1'' services on a claim map to the same C-APC, we designate
the most costly service (at the HCPCS code level) as the primary
service for that claim. This process results in initial assignments of
claims for the primary services assigned to status indicator ``J1'' to
the most appropriate C-APCs based on both single and multiple procedure
claims reporting these services and clinical and resource homogeneity.
Complexity Adjustments. We use complexity adjustments to provide
increased payment for certain comprehensive services. We apply a
complexity adjustment by promoting qualifying paired ``J1'' service
code combinations or paired code combinations of ``J1'' services and
certain add-on codes (as described further below) from the originating
C-APC (the C-APC to which the designated primary service is first
assigned) to the next higher paying C-APC in the same clinical family
of C-APCs. We apply this type of complexity adjustment when the paired
code combination represents a complex, costly form or version of the
primary service according to the following criteria:
Frequency of 25 or more claims reporting the code
combination (frequency threshold); and
Violation of the 2 times rule in the originating C-APC
(cost threshold).
These criteria identify paired code combinations that occur
commonly and exhibit materially greater resource requirements than the
primary service. The CY 2017 OPPS/ASC final rule with comment period
(81 FR 79582) included a revision to the complexity adjustment
eligibility criteria. Specifically, we finalized a policy to
discontinue the requirement that a code combination (that qualifies for
a complexity adjustment by satisfying the frequency and cost criteria
thresholds described above) also not create a 2 times rule violation in
the higher level or receiving APC.
After designating a single primary service for a claim, we evaluate
that service in combination with each of the other procedure codes
reported on the claim assigned to status indicator ``J1'' (or certain
add-on codes) to determine if there are paired code combinations that
meet the complexity adjustment criteria. For a new HCPCS code, we
determine initial C-APC assignment and qualification for a complexity
adjustment using the best available information, crosswalking the new
HCPCS code to a predecessor code(s) when appropriate.
Once we have determined that a particular code combination of
``J1'' services (or combinations of ``J1'' services reported in
conjunction with certain add-on codes) represents a complex version of
the primary service because it is sufficiently costly, frequent, and a
subset of the primary comprehensive service overall according to the
criteria described above, we promote the claim including the complex
version of the primary service as described by the code combination to
the next higher cost C-APC within the clinical family, unless the
primary service is already assigned to the highest cost APC within the
C-APC clinical family or assigned to the only C-APC in a clinical
family. We do not create new APCs with a comprehensive geometric mean
cost that is higher than the highest geometric mean cost (or only) C-
APC in a clinical family just to accommodate potential complexity
adjustments. Therefore, the highest payment for any claim including a
code combination for services assigned to a C-APC would be the highest
paying C-APC in the clinical family (79 FR 66802).
We package payment for all add-on codes into the payment for the C-
APC. However, certain primary service add-on combinations may qualify
for a complexity adjustment. As noted in the CY 2016 OPPS/ASC final
rule with comment period (80 FR 70331), all add-on codes that can be
appropriately reported in combination with a base code that describes a
primary ``J1'' service are evaluated for a complexity adjustment.
To determine which combinations of primary service codes reported
in conjunction with an add-on code may qualify for a complexity
adjustment for CY 2019, in this CY 2019 OPPS/ASC proposed rule, we are
proposing to apply the frequency and cost criteria thresholds discussed
above, testing claims reporting one unit of a single primary service
assigned to status indicator ``J1'' and any number of units of a single
add-on code for the primary ``J1'' service. If the frequency and cost
criteria thresholds for a complexity adjustment are met and
reassignment to the next higher cost APC in the clinical family is
appropriate (based on meeting the criteria outlined above), we make a
complexity adjustment for the code combination; that is, we reassign
the primary service code reported in conjunction with the add-on code
to the next higher cost C-APC within the same clinical family of C-
APCs. As previously stated, we package payment for add-on codes into
the C-APC payment rate. If any add-on code reported in conjunction with
the ``J1'' primary service code does not qualify for a complexity
adjustment, payment for the add-on service continues to be packaged
into the payment for the primary service and is not reassigned to the
next higher cost C-APC. We list the complexity adjustments proposed for
``J1'' and add-on code combinations for CY 2019, along with all of the
other proposed complexity adjustments, in Addendum J to this proposed
rule (which is available via the internet on the CMS website).
Addendum J to this proposed rule includes the cost statistics for
each code combination that would qualify for a complexity adjustment
(including primary code and add-on code
[[Page 37062]]
combinations). Addendum J to this proposed rule also contains summary
cost statistics for each of the paired code combinations that describe
a complex code combination that would qualify for a complexity
adjustment and are proposed to be reassigned to the next higher cost C-
APC within the clinical family. The combined statistics for all
proposed reassigned complex code combinations are represented by an
alphanumeric code with the first 4 digits of the designated primary
service followed by a letter. For example, the proposed geometric mean
cost listed in Addendum J for the code combination described by
complexity adjustment assignment 3320R, which is assigned to C-APC 5224
(Level 4 Pacemaker and Similar Procedures), includes all paired code
combinations that are proposed to be reassigned to C-APC 5224 when CPT
code 33208 is the primary code. Providing the information contained in
Addendum J to this proposed rule allows stakeholders the opportunity to
better assess the impact associated with the proposed reassignment of
claims with each of the paired code combinations eligible for a
complexity adjustment.
(2) Proposed Additional C-APCs for CY 2019
For CY 2019 and subsequent years, in this CY 2019 OPPS/ASC proposed
rule, we are proposing to continue to apply the C-APC payment policy
methodology made effective in CY 2015 and updated with the
implementation of status indicator ``J2'' in CY 2016. We refer readers
to the CY 2017 OPPS/ASC final rule with comment period (81 FR 79583)
for a discussion of the C-APC payment policy methodology and revisions.
Each year, in accordance with section 1833(t)(9)(A) of the Act, we
review and revise the services within each APC group and the APC
assignments under the OPPS. As a result of our annual review of the
services and the APC assignments under the OPPS, we are proposing to
add three C-APCs under the existing C-APC payment policy beginning in
CY 2019: proposed C-APC 5163 (Level 3 ENT Procedures); proposed C-APC
5183 (Level 3 Vascular Procedures); and proposed C-APC 5184 (Level 4
Vascular Procedures). These APCs were selected to be included in this
proposal because, similar to other C-APCs, these APCs include primary,
comprehensive services, such as major surgical procedures, that are
typically reported with other ancillary and adjunctive services. Also,
similar to other APCs that have been converted to C-APCs, there are
higher APC levels within the clinical family or related clinical family
of these APCs that have previously been assigned to a C-APC. Table 3 of
this proposed rule lists the proposed C-APCs for CY 2019. All C-APCs
are displayed in Addendum J to this proposed rule (which is available
via the internet on the CMS website). Addendum J to this proposed rule
also contains all of the data related to the C-APC payment policy
methodology, including the list of proposed complexity adjustments and
other information.
Table 3--Proposed CY 2019 C-APCs
----------------------------------------------------------------------------------------------------------------
Proposed new
C-APC CY 2019 APC group title Clinical family C[dash]APC
----------------------------------------------------------------------------------------------------------------
5072........................... Level 2 Excision/Biopsy/ EBIDX ...............
Incision and Drainage.
5073........................... Level 3 Excision/Biopsy/ EBIDX ...............
Incision and Drainage.
5091........................... Level 1 Breast/Lymphatic BREAS ...............
Surgery and Related Procedures.
5092........................... Level 2 Breast/Lymphatic BREAS ...............
Surgery and Related Procedures.
5093........................... Level 3 Breast/Lymphatic BREAS ...............
Surgery & Related Procedures.
5094........................... Level 4 Breast/Lymphatic BREAS ...............
Surgery & Related Procedures.
5112........................... Level 2 Musculoskeletal ORTHO ...............
Procedures.
5113........................... Level 3 Musculoskeletal ORTHO ...............
Procedures.
5114........................... Level 4 Musculoskeletal ORTHO ...............
Procedures.
5115........................... Level 5 Musculoskeletal ORTHO ...............
Procedures.
5116........................... Level 6 Musculoskeletal ORTHO ...............
Procedures.
5153........................... Level 3 Airway Endoscopy....... AENDO ...............
5154........................... Level 4 Airway Endoscopy....... AENDO ...............
5155........................... Level 5 Airway Endoscopy....... AENDO ...............
5163........................... Level 3 ENT Procedures......... ENTXX *
5164........................... Level 4 ENT Procedures......... ENTXX ...............
5165........................... Level 5 ENT Procedures......... ENTXX ...............
5166........................... Cochlear Implant Procedure..... COCHL ...............
5183........................... Level 3 Vascular Procedures.... VASCX *
5184........................... Level 4 Vascular Procedures.... VASCX *
5191........................... Level 1 Endovascular Procedures EVASC ...............
5192........................... Level 2 Endovascular Procedures EVASC ...............
5193........................... Level 3 Endovascular Procedures EVASC ...............
5194........................... Level 4 Endovascular Procedures EVASC ...............
5200........................... Implantation Wireless PA WPMXX ...............
Pressure Monitor.
5211........................... Level 1 Electrophysiologic EPHYS ...............
Procedures.
5212........................... Level 2 Electrophysiologic EPHYS ...............
Procedures.
5213........................... Level 3 Electrophysiologic EPHYS ...............
Procedures.
5222........................... Level 2 Pacemaker and Similar AICDP ...............
Procedures.
5223........................... Level 3 Pacemaker and Similar AICDP ...............
Procedures.
5224........................... Level 4 Pacemaker and Similar AICDP ...............
Procedures.
5231........................... Level 1 ICD and Similar AICDP ...............
Procedures.
5232........................... Level 2 ICD and Similar AICDP ...............
Procedures.
5244........................... Level 4 Blood Product Exchange SCTXX ...............
and Related Services.
5302........................... Level 2 Upper GI Procedures.... GIXXX ...............
5303........................... Level 3 Upper GI Procedures.... GIXXX ...............
5313........................... Level 3 Lower GI Procedures.... GIXXX ...............
5331........................... Complex GI Procedures.......... GIXXX ...............
5341........................... Abdominal/Peritoneal/Biliary GIXXX ...............
and Related Procedures.
5361........................... Level 1 Laparoscopy & Related LAPXX ...............
Services.
[[Page 37063]]
5362........................... Level 2 Laparoscopy & Related LAPXX ...............
Services.
5373........................... Level 3 Urology & Related UROXX ...............
Services.
5374........................... Level 4 Urology & Related UROXX ...............
Services.
5375........................... Level 5 Urology & Related UROXX ...............
Services.
5376........................... Level 6 Urology & Related UROXX ...............
Services.
5377........................... Level 7 Urology & Related UROXX ...............
Services.
5414........................... Level 4 Gynecologic Procedures. GYNXX ...............
5415........................... Level 5 Gynecologic Procedures. GYNXX ...............
5416........................... Level 6 Gynecologic Procedures. GYNXX ...............
5431........................... Level 1 Nerve Procedures....... NERVE ...............
5432........................... Level 2 Nerve Procedures....... NERVE ...............
5462........................... Level 2 Neurostimulator & NSTIM ...............
Related Procedures.
5463........................... Level 3 Neurostimulator & NSTIM ...............
Related Procedures.
5464........................... Level 4 Neurostimulator & NSTIM ...............
Related Procedures.
5471........................... Implantation of Drug Infusion PUMPS ...............
Device.
5491........................... Level 1 Intraocular Procedures. INEYE ...............
5492........................... Level 2 Intraocular Procedures. INEYE ...............
5493........................... Level 3 Intraocular Procedures. INEYE ...............
5494........................... Level 4 Intraocular Procedures. INEYE ...............
5495........................... Level 5 Intraocular Procedures. INEYE ...............
5503........................... Level 3 Extraocular, Repair, EXEYE ...............
and Plastic Eye Procedures.
5504........................... Level 4 Extraocular, Repair, EXEYE ...............
and Plastic Eye Procedures.
5627........................... Level 7 Radiation Therapy...... RADTX ...............
5881........................... Ancillary Outpatient Services N/A ...............
When Patient Dies.
8011........................... Comprehensive Observation N/A ...............
Services.
----------------------------------------------------------------------------------------------------------------
C-APC Clinical Family Descriptor Key: AENDO = Airway Endoscopy; AICDP = Automatic Implantable Cardiac
Defibrillators, Pacemakers, and Related Devices.; BREAS = Breast Surgery; COCHL = Cochlear Implant; EBIDX =
Excision/Biopsy/Incision and Drainage; ENTXX = ENT Procedures; EPHYS = Cardiac Electrophysiology; EVASC =
Endovascular Procedures; EXEYE = Extraocular Ophthalmic Surgery; GIXXX = Gastrointestinal Procedures; GYNXX =
Gynecologic Procedures; INEYE = Intraocular Surgery; LAPXX = Laparoscopic Procedures; NERVE = Nerve
Procedures; NSTIM = Neurostimulators; ORTHO = Orthopedic Surgery; PUMPS = Implantable Drug Delivery Systems;
RADTX = Radiation Oncology; SCTXX = Stem Cell Transplant; UROXX = Urologic Procedures; VASCX = Vascular
Procedures; WPMXX = Wireless PA Pressure Monitor.
(3) Exclusion of Procedures Assigned to New Technology APCs From the
Comprehensive APC (C-APC) Policy
Services that are assigned to New Technology APCs are typically new
procedures that do not have sufficient claims history to establish an
accurate payment for the procedures. Beginning in CY 2002, we retain
services within New Technology APC groups until we gather sufficient
claims data to enable us to assign the service to an appropriate
clinical APC. This policy allows us to move a service from a New
Technology APC in less than 2 years if sufficient data are available.
It also allows us to retain a service in a New Technology APC for more
than 2 years if sufficient data upon which to base a decision for
reassignment have not been collected (82 FR 59277).
The C-APC payment policy packages payment for adjunctive and
secondary items, services, and procedures into the most costly primary
procedure under the OPPS at the claim level. When a procedure assigned
to a New Technology APC is included on the claim with a primary
procedure, identified by OPPS status indicator ``J1'', payment for the
new technology service is typically packaged into the payment for the
primary procedure. Because the new technology service is not separately
paid in this scenario, the overall number of single claims available to
determine an appropriate clinical APC for the new service is reduced.
This is contrary to the objective of the New Technology APC payment
policy, which is to gather sufficient claims data to enable us to
assign the service to an appropriate clinical APC.
For example, for CY 2017, there were seven claims generated for
HCPCS code 0100T (Placement of a subconjunctival retinal prosthesis
receiver and pulse generator, and implantation of intraocular retinal
electrode array, with vitrectomy), which involves the use of the
Argus[supreg] II Retinal Prosthesis System. However, several of these
claims were not available for ratesetting because HCPCS code 0100T was
reported with a ``J1'' procedure and, therefore, payment was packaged
into the associated C-APC payment. If these services had been
separately paid under the OPPS, there would be at least two additional
single claims available for ratesetting. As mentioned previously, the
purpose of the new technology APC policy is to ensure that there are
sufficient claims data for new services, which is particularly
important for services with a low volume such as procedures described
by HCPCS code 0100T. Another concern is the costs reported for the
claims when payment is not packaged for a new technology procedure may
not be representative of all of the services included on a claim that
is generated, which may also affect our ability to assign the new
service to the most appropriate clinical APC.
To address this issue and help ensure that there is sufficient
claims data for services assigned to New Technology APCs, we are
proposing to exclude payment for any procedure that is assigned to a
New Technology APC (APCs 1491 through 1599 and APCs 1901 through 1908)
from being packaged when included on a claim with a ``J1'' service
assigned to a C-APC. This issue is also addressed in section III.C.3.b.
of this proposed rule.
c. Proposed Calculation of Composite APC Criteria-Based Costs
As discussed in the CY 2008 OPPS/ASC final rule with comment period
(72 FR 66613), we believe it is important that the OPPS enhance
incentives for hospitals to provide necessary, high quality care as
efficiently as possible. For CY 2008, we developed composite APCs to
provide a single payment for
[[Page 37064]]
groups of services that are typically performed together during a
single clinical encounter and that result in the provision of a
complete service. Combining payment for multiple, independent services
into a single OPPS payment in this way enables hospitals to manage
their resources with maximum flexibility by monitoring and adjusting
the volume and efficiency of services themselves. An additional
advantage to the composite APC model is that we can use data from
correctly coded multiple procedure claims to calculate payment rates
for the specified combinations of services, rather than relying upon
single procedure claims which may be low in volume and/or incorrectly
coded. Under the OPPS, we currently have composite policies for mental
health services and multiple imaging services. (We note that, in the CY
2018 OPPS/ASC final rule with comment period, we finalized a policy to
delete the composite APC 8001 (LDR Prostate Brachytherapy Composite)
for CY 2018 and subsequent years.) We refer readers to the CY 2008
OPPS/ASC final rule with comment period (72 FR 66611 through 66614 and
66650 through 66652) for a full discussion of the development of the
composite APC methodology, and the CY 2012 OPPS/ASC final rule with
comment period (76 FR 74163) and the CY 2018 OPPS/ASC final rule with
comment period (82 FR 59241 through 59242 and 59246 through 52950) for
more recent background.
In this CY 2019 OPPS/ASC proposed rule, for CY 2019 and subsequent
years, we are proposing to continue our composite APC payment policies
for mental health services and multiple imaging services, as discussed
below. In addition, as discussed in section II.A.2.b.(3) and II.A.2.c.
of the CY 2018 OPPS/ASC proposed rule and final rule with comment
period (82 FR 33577 through 33578 and 59241 through 59242 and 59246,
respectively), we are proposing to continue to assign CPT code 55875
(Transperineal placement of needs or catheters into prostate for
interstitial radioelement application, with or without cystoscopy) to
status indicator ``J1'' and to continue to assign the services
described by CPT code 55875 to C-APC 5375 (Level 5 Urology and Related
Services) for CY 2019.
(1) Mental Health Services Composite APC
In this CY 2019 OPPS/ASC proposed rule, we are proposing to
continue our longstanding policy of limiting the aggregate payment for
specified less resource-intensive mental health services furnished on
the same date to the payment for a day of partial hospitalization
services provided by a hospital, which we consider to be the most
resource intensive of all outpatient mental health services. We refer
readers to the April 7, 2000 OPPS final rule with comment period (65 FR
18452 through 18455) for the initial discussion of this longstanding
policy and the CY 2012 OPPS/ASC final rule with comment period (76 FR
74168) for more recent background.
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79588
through 79589), we finalized a policy to combine the existing Level 1
and Level 2 hospital-based PHP APCs into a single hospital-based PHP
APC, and thereby discontinue APCs 5861 (Level 1 Partial Hospitalization
(3 services) for Hospital-Based PHPs) and 5862 (Level 2 Partial
Hospitalization (4 or more services) for Hospital-Based PHPs) and
replace them with APC 5863 (Partial Hospitalization (3 or more services
per day)).
In the CY 2018 OPPS/ASC proposed rule and final rule with comment
period (82 FR 33580 through 33581 and 59246 through 59247,
respectively), we proposed and finalized the policy for CY 2018 and
subsequent years that, when the aggregate payment for specified mental
health services provided by one hospital to a single beneficiary on a
single date of service, based on the payment rates associated with the
APCs for the individual services, exceeds the maximum per diem payment
rate for partial hospitalization services provided by a hospital, those
specified mental health services will be paid through composite APC
8010 (Mental Health Services Composite). In addition, we set the
payment rate for composite APC 8010 for CY 2018 at the same payment
rate that will be paid for APC 5863, which is the maximum partial
hospitalization per diem payment rate for a hospital, and finalized a
policy that the hospital will continue to be paid the payment rate for
composite APC 8010. Under this policy, the I/OCE will continue to
determine whether to pay for these specified mental health services
individually, or to make a single payment at the same payment rate
established for APC 5863 for all of the specified mental health
services furnished by the hospital on that single date of service. We
continue to believe that the costs associated with administering a
partial hospitalization program at a hospital represent the most
resource intensive of all outpatient mental health services. Therefore,
we do not believe that we should pay more for mental health services
under the OPPS than the highest partial hospitalization per diem
payment rate for hospitals.
For CY 2019, we are proposing that when the aggregate payment for
specified mental health services provided by one hospital to a single
beneficiary on a single date of service, based on the payment rates
associated with the APCs for the individual services, exceeds the
maximum per diem payment rate for partial hospitalization services
provided by a hospital, those specified mental health services would be
paid through composite APC 8010 for CY 2019. In addition, we are
proposing to set the proposed payment rate for composite APC 8010 at
the same payment rate that we are proposing for APC 5863, which is the
maximum partial hospitalization per diem payment rate for a hospital,
and that the hospital continue to be paid the proposed payment rate for
composite APC 8010.
(2) Multiple Imaging Composite APCs (APCs 8004, 8005, 8006, 8007,
and 8008)
Effective January 1, 2009, we provide a single payment each time a
hospital submits a claim for more than one imaging procedure within an
imaging family on the same date of service, in order to reflect and
promote the efficiencies hospitals can achieve when performing multiple
imaging procedures during a single session (73 FR 41448 through 41450).
We utilize three imaging families based on imaging modality for
purposes of this methodology: (1) Ultrasound; (2) computed tomography
(CT) and computed tomographic angiography (CTA); and (3) magnetic
resonance imaging (MRI) and magnetic resonance angiography (MRA). The
HCPCS codes subject to the multiple imaging composite policy and their
respective families are listed in Table 12 of the CY 2014 OPPS/ASC
final rule with comment period (78 FR 74920 through 74924).
While there are three imaging families, there are five multiple
imaging composite APCs due to the statutory requirement under section
1833(t)(2)(G) of the Act that we differentiate payment for OPPS imaging
services provided with and without contrast. While the ultrasound
procedures included under the policy do not involve contrast, both CT/
CTA and MRI/MRA scans can be provided either with or without contrast.
The five multiple imaging composite APCs established in CY 2009 are:
APC 8004 (Ultrasound Composite);
APC 8005 (CT and CTA without Contrast Composite);
APC 8006 (CT and CTA with Contrast Composite);
[[Page 37065]]
APC 8007 (MRI and MRA without Contrast Composite); and
APC 8008 (MRI and MRA with Contrast Composite).
We define the single imaging session for the ``with contrast''
composite APCs as having at least one or more imaging procedures from
the same family performed with contrast on the same date of service.
For example, if the hospital performs an MRI without contrast during
the same session as at least one other MRI with contrast, the hospital
will receive payment based on the payment rate for APC 8008, the ``with
contrast'' composite APC.
We make a single payment for those imaging procedures that qualify
for payment based on the composite APC payment rate, which includes any
packaged services furnished on the same date of service. The standard
(noncomposite) APC assignments continue to apply for single imaging
procedures and multiple imaging procedures performed across families.
For a full discussion of the development of the multiple imaging
composite APC methodology, we refer readers to the CY 2009 OPPS/ASC
final rule with comment period (73 FR 68559 through 68569).
In this CY 2019 OPPS/ASC proposed rule, we are proposing, for CY
2019 and subsequent years, to continue to pay for all multiple imaging
procedures within an imaging family performed on the same date of
service using the multiple imaging composite APC payment methodology.
We continue to believe that this policy would reflect and promote the
efficiencies hospitals can achieve when performing multiple imaging
procedures during a single session.
The proposed CY 2019 payment rates for the five multiple imaging
composite APCs (APCs 8004, 8005, 8006, 8007, and 8008) are based on
proposed geometric mean costs calculated from a partial year of CY 2017
claims available for this CY 2019 OPPS/ASC proposed rule that qualified
for composite payment under the current policy (that is, those claims
reporting more than one procedure within the same family on a single
date of service). To calculate the proposed geometric mean costs, we
used the same methodology that we have used to calculate the geometric
mean costs for these composite APCs since CY 2014, as described in the
CY 2014 OPPS/ASC final rule with comment period (78 FR 74918). The
imaging HCPCS codes referred to as ``overlap bypass codes'' that we
removed from the bypass list for purposes of calculating the proposed
multiple imaging composite APC geometric mean costs, in accordance with
our established methodology as stated in the CY 2014 OPPS/ASC final
rule with comment period (78 FR 74918), are identified by asterisks in
Addendum N to this CY 2019 OPPS/ASC proposed rule (which is available
via the internet on the CMS website) and are discussed in more detail
in section II.A.1.b. of this CY 2019 OPPS/ASC proposed rule.
For this CY 2019 OPPS/ASC proposed rule, we were able to identify
approximately 638,902 ``single session'' claims out of an estimated 1.7
million potential claims for payment through composite APCs from our
ratesetting claims data, which represents approximately37 percent of
all eligible claims, to calculate the proposed CY 2019 geometric mean
costs for the multiple imaging composite APCs. Table 4 of this CY 2019
OPPS/ASC proposed rule lists the proposed HCPCS codes that would be
subject to the multiple imaging composite APC policy and their
respective families and approximate composite APC proposed geometric
mean costs for CY 2019.
Table 4--Proposed OPPS Imaging Families and Multiple Imaging Procedure
Composite APCs
------------------------------------------------------------------------
------------------------------------------------------------------------
Proposed CY 2019 APC 8004 (ultrasound Proposed CY 2019 approximate
composite) APC geometric mean cost = $300
------------------------------------------------------------------------
Family 1--Ultrasound
------------------------------------------------------------------------
76700.................................. Us exam, abdom, complete.
76705.................................. Echo exam of abdomen.
76770.................................. Us exam abdo back wall, comp.
76776.................................. Us exam k transpl w/Doppler.
76831.................................. Echo exam, uterus.
76856.................................. Us exam, pelvic, complete.
76857.................................. Us exam, pelvic, limited.
------------------------------------------------------------------------
Proposed CY 2019 APC 8005 (CT and CTA Proposed CY 2019 approximate
without contrast composite) * APC geometric mean cost = $275
------------------------------------------------------------------------
Family 2--CT and CTA with and without Contrast
------------------------------------------------------------------------
70450.................................. Ct head/brain w/o dye.
70480.................................. Ct orbit/ear/fossa w/o dye.
70486.................................. Ct maxillofacial w/o dye.
70490.................................. Ct soft tissue neck w/o dye.
71250.................................. Ct thorax w/o dye.
72125.................................. Ct neck spine w/o dye.
72128.................................. Ct chest spine w/o dye.
72131.................................. Ct lumbar spine w/o dye.
72192.................................. Ct pelvis w/o dye.
73200.................................. Ct upper extremity w/o dye.
73700.................................. Ct lower extremity w/o dye.
74150.................................. Ct abdomen w/o dye.
74261.................................. Ct colonography, w/o dye.
74176.................................. Ct angio abd & pelvis.
------------------------------------------------------------------------
Proposed CY 2019 APC 8006 (CT and CTA Proposed CY 2019 approximate
with contrast composite) APC geometric mean cost = $501
------------------------------------------------------------------------
70487.................................. Ct maxillofacial w/dye.
70460.................................. Ct head/brain w/dye.
[[Page 37066]]
70470.................................. Ct head/brain w/o & w/dye.
70481.................................. Ct orbit/ear/fossa w/dye.
70482.................................. Ct orbit/ear/fossa w/o & w/dye.
70488.................................. Ct maxillofacial w/o & w/dye.
70491.................................. Ct soft tissue neck w/dye.
70492.................................. Ct sft tsue nck w/o & w/dye.
70496.................................. Ct angiography, head.
70498.................................. Ct angiography, neck.
71260.................................. Ct thorax w/dye.
71270.................................. Ct thorax w/o & w/dye.
71275.................................. Ct angiography, chest.
72126.................................. Ct neck spine w/dye.
72127.................................. Ct neck spine w/o & w/dye.
72129.................................. Ct chest spine w/dye.
72130.................................. Ct chest spine w/o & w/dye.
72132.................................. Ct lumbar spine w/dye.
72133.................................. Ct lumbar spine w/o & w/dye.
72191.................................. Ct angiograph pelv w/o & w/dye.
72193.................................. Ct pelvis w/dye.
72194.................................. Ct pelvis w/o & w/dye.
73201.................................. Ct upper extremity w/dye.
73202.................................. Ct uppr extremity w/o & w/dye.
73206.................................. Ct angio upr extrm w/o & w/dye.
73701.................................. Ct lower extremity w/dye.
73702.................................. Ct lwr extremity w/o & w/dye.
73706.................................. Ct angio lwr extr w/o & w/dye.
74160.................................. Ct abdomen w/dye.
74170.................................. Ct abdomen w/o & w/dye.
74175.................................. Ct angio abdom w/o & w/dye.
74262.................................. Ct colonography, w/dye.
75635.................................. Ct angio abdominal arteries.
74177.................................. Ct angio abd & pelv w/contrast.
74178.................................. Ct angio abd & pelv 1+ regns.
------------------------------------------------------------------------
* If a ``without contrast'' CT or CTA procedure is performed during the
same session as a ``with contrast'' CT or CTA procedure, the I/OCE
assigns the procedure to APC 8006 rather than APC 8005.
------------------------------------------------------------------------
------------------------------------------------------------------------
Proposed CY 2019 APC 8007 (MRI and MRA Proposed CY 2019 approximate
without contrast composite) * APC geometric mean cost = $556
------------------------------------------------------------------------
Family 3--MRI and MRA with and without Contrast
------------------------------------------------------------------------
70336.................................. Magnetic image, jaw joint.
70540.................................. Mri orbit/face/neck w/o dye.
70544.................................. Mr angiography head w/o dye.
70547.................................. Mr angiography neck w/o dye.
70551.................................. Mri brain w/o dye.
70554.................................. Fmri brain by tech.
71550.................................. Mri chest w/o dye.
72141.................................. Mri neck spine w/o dye.
72146.................................. Mri chest spine w/o dye.
72148.................................. Mri lumbar spine w/o dye.
72195.................................. Mri pelvis w/o dye.
73218.................................. Mri upper extremity w/o dye.
73221.................................. Mri joint upr extrem w/o dye.
73718.................................. Mri lower extremity w/o dye.
73721.................................. Mri jnt of lwr extre w/o dye.
74181.................................. Mri abdomen w/o dye.
75557.................................. Cardiac mri for morph.
75559.................................. Cardiac mri w/stress img.
C8901.................................. MRA w/o cont, abd.
C8910.................................. MRA w/o cont, chest.
C8913.................................. MRA w/o cont, lwr ext.
C8919.................................. MRA w/o cont, pelvis.
C8932.................................. MRA, w/o dye, spinal canal.
C8935.................................. MRA, w/o dye, upper extr.
------------------------------------------------------------------------
Proposed CY 2019 APC 8008 (MRI and MRA Proposed CY 2019 approximate
with contrast composite) APC geometric mean cost = $871
------------------------------------------------------------------------
70549.................................. Mr angiograph neck w/o & w/dye.
70542.................................. Mri orbit/face/neck w/dye.
70543.................................. Mri orbt/fac/nck w/o & w/dye.
70545.................................. Mr angiography head w/dye.
70546.................................. Mr angiograph head w/o & w/dye.
70547.................................. Mr angiography neck w/o dye.
[[Page 37067]]
70548.................................. Mr angiography neck w/dye.
70552.................................. Mri brain w/dye.
70553.................................. Mri brain w/o & w/dye.
71551.................................. Mri chest w/dye.
71552.................................. Mri chest w/o & w/dye.
72142.................................. Mri neck spine w/dye.
72147.................................. Mri chest spine w/dye.
72149.................................. Mri lumbar spine w/dye.
72156.................................. Mri neck spine w/o & w/dye.
72157.................................. Mri chest spine w/o & w/dye.
72158.................................. Mri lumbar spine w/o & w/dye.
72196.................................. Mri pelvis w/dye.
72197.................................. Mri pelvis w/o & w/dye.
73219.................................. Mri upper extremity w/dye.
73220.................................. Mri uppr extremity w/o & w/dye.
73222.................................. Mri joint upr extrem w/dye.
73223.................................. Mri joint upr extr w/o & w/dye.
73719.................................. Mri lower extremity w/dye.
73720.................................. Mri lwr extremity w/o & w/dye.
73722.................................. Mri joint of lwr extr w/dye.
73723.................................. Mri joint lwr extr w/o & w/dye.
74182.................................. Mri abdomen w/dye.
74183.................................. Mri abdomen w/o & w/dye.
75561.................................. Cardiac mri for morph w/dye.
75563.................................. Card mri w/stress img & dye.
C8900.................................. MRA w/cont, abd.
C8902.................................. MRA w/o fol w/cont, abd.
C8903.................................. MRI w/cont, breast, uni.
C8905.................................. MRI w/o fol w/cont, brst, un.
C8906.................................. MRI w/cont, breast, bi.
C8908.................................. MRI w/o fol w/cont, breast,
C8909.................................. MRA w/cont, chest.
C8911.................................. MRA w/o fol w/cont, chest.
C8912.................................. MRA w/cont, lwr ext.
C8914.................................. MRA w/o fol w/cont, lwr ext.
C8918.................................. MRA w/cont, pelvis.
C8920.................................. MRA w/o fol w/cont, pelvis.
C8931.................................. MRA, w/dye, spinal canal.
C8933.................................. MRA, w/o&w/dye, spinal canal.
C8934.................................. MRA, w/dye, upper extremity.
C8936.................................. MRA, w/o&w/dye, upper extr.
------------------------------------------------------------------------
* If a ``without contrast'' MRI or MRA procedure is performed during the
same session as a ``with contrast'' MRI or MRA procedure, the I/OCE
assigns the procedure to APC 8008 rather than APC 8007.
3. Proposed Changes to Packaged Items and Services
a. Background and Rationale for Packaging in the OPPS
Like other prospective payment systems, the OPPS relies on the
concept of averaging to establish a payment rate for services. The
payment may be more or less than the estimated cost of providing a
specific service or a bundle of specific services for a particular
patient. The OPPS packages payments for multiple interrelated items and
services into a single payment to create incentives for hospitals to
furnish services most efficiently and to manage their resources with
maximum flexibility. Our packaging policies support our strategic goal
of using larger payment bundles in the OPPS to maximize hospitals'
incentives to provide care in the most efficient manner. For example,
where there are a variety of devices, drugs, items, and supplies that
could be used to furnish a service, some of which are more costly than
others, packaging encourages hospitals to use the most cost-efficient
item that meets the patient's needs, rather than to routinely use a
more expensive item, which often occurs if separate payment is provided
for the item.
Packaging also encourages hospitals to effectively negotiate with
manufacturers and suppliers to reduce the purchase price of items and
services or to explore alternative group purchasing arrangements,
thereby encouraging the most economical health care delivery.
Similarly, packaging encourages hospitals to establish protocols that
ensure that necessary services are furnished, while scrutinizing the
services ordered by practitioners to maximize the efficient use of
hospital resources. Packaging payments into larger payment bundles
promotes the predictability and accuracy of payment for services over
time. Finally, packaging may reduce the importance of refining service-
specific payment because packaged payments include costs associated
with higher cost cases requiring many ancillary items and services and
lower cost cases requiring fewer ancillary items and services. Because
packaging encourages efficiency and is an essential component of a
prospective payment system, packaging payments for items and services
that are typically integral, ancillary, supportive, dependent, or
adjunctive to a primary service has been a fundamental part of the OPPS
since its implementation in August 2000. For an extensive discussion of
the history and background of the OPPS packaging policy, we refer
readers to the CY 2000 OPPS final rule (65 FR 18434), the CY 2008 OPPS/
ASC final rule with comment period (72 FR 66580), the CY 2014 OPPS/ASC
final rule with comment period (78 FR 74925), the CY 2015 OPPS/ASC
final rule with comment period (79 FR 66817), the CY 2016 OPPS/ASC
final rule with comment period (80 FR 70343), the CY 2017 OPPS/ASC
final rule with comment period (81 FR 79592), and the
[[Page 37068]]
CY 2018 OPPS/ASC final rule with comment period (82 FR 59250). As we
continue to develop larger payment groups that more broadly reflect
services provided in an encounter or episode of care, we have expanded
the OPPS packaging policies. Most, but not necessarily all, items and
services currently packaged in the OPPS are listed in 42 CFR 419.2(b).
Our overarching goal is to make payments for all services under the
OPPS more consistent with those of a prospective payment system and
less like those of a per-service fee schedule, which pays separately
for each coded item. As a part of this effort, we have continued to
examine the payment for items and services provided under the OPPS to
determine which OPPS services can be packaged to further achieve the
objective of advancing the OPPS toward a more prospective payment
system.
For CY 2019, we examined the items and services currently provided
under the OPPS, reviewing categories of integral, ancillary,
supportive, dependent, or adjunctive items and services for which we
believe payment would be appropriately packaged into payment of the
primary service that they support. Specifically, we examined the HCPCS
code definitions (including CPT code descriptors) and outpatient
hospital billing patterns to determine whether there were categories of
codes for which packaging would be appropriate according to existing
OPPS packaging policies or a logical expansion of those existing OPPS
packaging policies. In this CY 2019 OPPS/ASC proposed rule, for CY
2019, we are proposing to conditionally package the costs of selected
newly identified ancillary services into payment with a primary service
where we believe that the packaged item or service is integral,
ancillary, supportive, dependent, or adjunctive to the provision of
care that was reported by the primary service HCPCS code. Below we
discuss proposed changes to packaging policies beginning in CY 2019.
b. Proposed CY 2019 Packaging Policy for Non-Opioid Pain Management
Treatments
In the CY 2018 OPPS/ASC proposed rule (82 FR 33588), within the
framework of existing packaging categories, such as drugs that function
as supplies in a surgical procedure or diagnostic test or procedure, we
requested stakeholder feedback on common clinical scenarios involving
currently packaged items and services described by HCPCS codes that
stakeholders believe should not be packaged under the OPPS. We also
expressed interest in stakeholder feedback on common clinical scenarios
involving separately payable HCPCS codes for which payment would be
most appropriately packaged under the OPPS. Commenters expressed a
variety of views on packaging under the OPPS. In the CY 2018 OPPS/ASC
final rule with comment period, we summarized the comments received in
response to our request (82 FR 59255). The comments ranged from
requests to unpackage most items and services that are either
conditionally or unconditionally packaged under the OPPS, including
drugs and devices, to specific requests for separate payment for a
specific drug or device. We stated in the CY 2018 OPPS/ASC final rule
with comment period that CMS would continue to explore and evaluate
packaging policies under the OPPS and consider these policies in future
rulemaking.
In addition to stakeholder feedback regarding OPPS packaging
policies, the President's Commission on Combating Drug Addiction and
the Opioid Crisis (the Commission) recently recommended that CMS
examine payment policies for certain drugs that function as a supply,
specifically non-opioid pain management treatments. The Commission was
established in 2017 to study ways to combat and treat drug abuse,
addiction, and the opioid crisis. The Commission's report \3\ included
a recommendation for CMS to ``. . . review and modify ratesetting
policies that discourage the use of non-opioid treatments for pain,
such as certain bundled payments that make alternative treatment
options cost prohibitive for hospitals and doctors, particularly those
options for treating immediate postsurgical pain. . . . '' \4\ With
respect to the packaging policy, the Commission's report states that
``. . . the current CMS payment policy for `supplies' related to
surgical procedures creates unintended incentives to prescribe opioid
medications to patients for postsurgical pain instead of administering
non-opioid pain medications. Under current policies, CMS provides one
all-inclusive bundled payment to hospitals for all `surgical supplies,'
which includes hospital-administered drug products intended to manage
patients' postsurgical pain. This policy results in the hospitals
receiving the same fixed fee from Medicare whether the surgeon
administers a non-opioid medication or not.'' \5\ HHS also presented an
Opioid Strategy in April 2017 \6\ that aims in part to support cutting-
edge research and advance the practice of pain management. On October
26, 2017, the opioid crisis was declared a national public health
emergency under Federal law \7\ and this determination was renewed on
April 20, 2018.\8\
---------------------------------------------------------------------------
\3\ President's Commission on Combating Drug Addiction and the
Opioid Crisis, Report (2017). Available at: https://www.whitehouse.gov/sites/whitehouse.gov/files/images/Final_Report_Draft_11-1-2017.pdf.
\4\ Ibid, at page 57, Recommendation 19.
\5\ Ibid.
\6\ Available at: https://www.hhs.gov/about/leadership/secretary/speeches/2017-speeches/secretary-price-announces-hhs-strategy-for-fighting-opioid-crisis/index.html.
\7\ Available at: https://www.hhs.gov/about/news/2017/10/26/hhs-acting-secretary-declares-public-health-emergency-address-national-opioid-crisis.html.
\8\ Available at: https://www.phe.gov/emergency/news/healthactions/phe/Pages/default.aspx.
---------------------------------------------------------------------------
In response to stakeholder comments on the CY 2018 OPPS/ASC
proposed rule and in light of the recommendations regarding payment
policies for certain drugs, we recently evaluated the impact of our
packaging policy for drugs that function as a supply when used in a
surgical procedure on the utilization of these drugs in both the
hospital outpatient department and the ASC setting. Currently, as noted
above, drugs that function as a supply are packaged under the OPPS and
the ASC payment system, regardless of the costs of the drugs. The costs
associated with packaged drugs that function as a supply are included
in the ratesetting methodology for the surgical procedures with which
they are billed and the payment rate for the associated procedure
reflects the costs of the packaged drugs and other packaged items and
services to the extent they are billed with the procedure. In our
evaluation, we used currently available data to analyze the utilization
patterns associated with specific drugs that function as a supply over
a 5-year time period (CYs 2013 through 2017) to determine whether this
packaging policy has reduced the use of these drugs. If the packaging
policy discouraged the use of drugs that function as a supply or
impeded access to these products, we would expect to see a significant
decline in utilization of these drugs over time, although we note that
a decline in utilization could also reflect other factors, such as the
availability of alternative products. We did not observe significant
declines in the total number of units used in the hospital outpatient
department for a majority of the drugs included in our analysis.
In fact, under the OPPS, we observed the opposite effect for
several drugs that function as a supply, including Exparel
[[Page 37069]]
(HCPCS code C9290). Exparel is a liposome injection of bupivacaine, an
amide local anesthetic, indicated for single-dose infiltration into the
surgical site to produce postsurgical analgesia. In 2011, Exparel was
approved by the FDA for administration into the postsurgical site to
provide postsurgical analgesia.\9\ Exparel had pass-through payment
status from CYs 2012 through 2014 and was separately paid under both
the OPPS and the ASC payment system during this 3-year period.
Beginning in CY 2015, Exparel was packaged as a surgical supply under
both the OPPS and the ASC payment system. Exparel is currently the only
non-opioid pain management drug that is packaged as a drug that
functions as a supply when used in a surgical procedure under the OPPS
and the ASC payment system.
---------------------------------------------------------------------------
\9\ Available at: https://www.accessdata.fda.gov/drugsatfda_docs/label/2011/022496s000lbl.pdf.
---------------------------------------------------------------------------
From CYs 2013 through 2017, there was an overall increase in the
OPPS Medicare utilization of Exparel of approximately 229 percent (from
2.3 million units to 7.7 million units) during this 5-year time period.
The total number of claims reporting Exparel increased by 222 percent
(from 10,609 claims to 34,183 claims) over this time period. This
increase in utilization continued, even after the 3-year drug pass-
through payment period ended for this product in 2014, with 18 percent
overall growth in the total number of units used from CYs 2015 through
2017 (from 6.5 million units to 7.7 million units). The number of
claims reporting Exparel increased by 21 percent during this time
period (from 28,166 claims to 34,183 claims).
Thus, we have not found evidence to support the notion that the
OPPS packaging policy has had an unintended consequence of discouraging
the use of non-opioid treatment for postsurgical pain management in the
hospital outpatient department. Therefore, based on this data analysis,
we do not believe that changes are necessary under the OPPS for the
packaged drug policy for drugs that function as a surgical supply when
used in a surgical procedure in this setting at this time.
In terms of Exparel in particular, we have received several
requests to pay separately for the drug rather than packaging payment
for it as a surgical supply. In the CY 2015 OPPS/ASC final rule with
comment period (79 FR 66874 and 66875), in response to comments from
stakeholders requesting separate payment for Exparel, we stated that we
considered Exparel to be a drug that functions as a surgical supply
because it is indicated for the alleviation of postoperative pain. We
also stated that we consider all items related to the surgical outcome
and provided during the hospital stay in which the surgery is
performed, including postsurgical pain management drugs, to be part of
the surgery for purposes of our drug and biological surgical supply
packaging policy. In the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59345), we reiterated our position with regard to payment
for Exparel, stating that we believed that payment for this drug is
appropriately packaged with the primary surgical procedure. In
addition, we have reviewed recently available literature with respect
to Exparel, including a briefing document \10\ submitted for the FDA
Advisory Committee Meeting held February 14-15, 2018, by the
manufacturer of Exparel that notes that ``. . . Bupivacaine, the active
pharmaceutical ingredient in Exparel, is a local anesthetic that has
been used for infiltration/field block and peripheral nerve block for
decades'' and that ``since its approval, Exparel has been used
extensively, with an estimated 3.5 million patient exposures in the
U.S.'' \11\ On April 6, 2018, the FDA approved Exparel's new indication
for use as an interscalene brachial plexus nerve block to produce
postsurgical regional analgesia.\12\ Based on our review of currently
available OPPS Medicare claims data and public information from the
manufacturer of the drug, we do not believe that the OPPS packaging
policy has discouraged the use of Exparel for either of the drug's
indications. Accordingly, we continue to believe it is appropriate to
package payment for Exparel as we do with other postsurgical pain
management drugs when it is furnished in a hospital outpatient
department. However, we are seeking public comments on whether separate
payment would nonetheless further incentivize appropriate use of
Exparel in the hospital outpatient setting and peer-reviewed evidence
that such increased utilization would lead to a decrease in opioid use
and addiction among Medicare beneficiaries.
---------------------------------------------------------------------------
\10\ Food and Drug Administration, Meeting of the Anesthetic and
Analgesic Drug Products Advisory Committee Briefing Document (2018).
Available at: https://www.fda.gov/downloads/AdvisoryCommittees/CommitteesMeetingMaterials/Drugs/AnestheticAndAnalgesicDrugProductsAdvisoryCommittee/UCM596314.pdf.
\11\ Ibid, page 9.
\12\ Available at: https://www.accessdata.fda.gov/drugsatfda_docs/label/2018/022496s009lbledt.pdf.
---------------------------------------------------------------------------
Although we found increases in utilization for Exparel when it is
paid under the OPPS, we did notice different effects on Exparel
utilization when examining the effects of our packaging policy under
the ASC payment system. In particular, during the same 5-year period of
CYs 2013 through 2017, the total number of units of Exparel used in the
ASC setting decreased by 25 percent (from 98,160 total units to 73,595
total units) and the total number of claims reporting Exparel decreased
by 16 percent (from 527 claims to 441 claims). In the ASC setting,
after the pass-through payment period ended for Exparel at the end of
CY 2014, the total number of units of Exparel used decreased by 70
percent (from 244,757 units to 73,595 units) between CYs 2015 and 2017.
The total number of claims reporting Exparel also decreased during this
time period by 62 percent (from 1,190 claims to 441 claims). However,
there was an increase of 238 percent (from 98,160 total units to
331,348 total units) in the total number of units of Exparel used in
the ASC setting during the time period of CYs 2013 and 2014 when the
drug received pass-through payments, indicating that the payment rate
of ASP +6 percent for Exparel may have an impact on its usage in the
ASC setting. The total number of claims reporting Exparel also
increased during this time period from 527 total claims to 1,540 total
claims, an increase of 192 percent.
While several variables may contribute to this difference between
utilization and claims reporting in the hospital outpatient department
and the ASC setting, one potential explanation is that, in comparison
to hospital outpatient departments, ASCs tend to provide specialized
care and a more limited range of services. Also, ASCs are paid, in
aggregate, approximately 55 percent of the OPPS rate. Therefore,
fluctuations in payment rates for specific services may impact these
providers more acutely than hospital outpatient departments, and
therefore, ASCs may be less likely to choose to furnish non-opioid
postsurgical pain management treatments, which are typically more
expensive than opioids, as a result. Another possible contributing
factor is that ASCs do not typically report packaged items and services
and, accordingly, our analysis may be undercounting the number of
Exparel units utilized in the ASC setting.
In light of the results of our evaluation of packaging policies
under the OPPS and the ASC payment system, which showed decreased
utilization for certain drugs that function as a supply in the ASC
setting in comparison to the hospital outpatient department setting, as
well as the Commission's recommendation to examine payment
[[Page 37070]]
policies for non-opioid pain management drugs that function as a
supply, we believe a change in how we pay for non-opioid pain
management drugs that function as surgical supplies may be warranted.
In particular, we believe it may be appropriate to pay separately for
evidence-based non-opioid pain management drugs that function as a
supply in a surgical procedure in the ASC setting to address the
decreased utilization of these drugs and to encourage use of these
types of drugs rather than prescription opioids. Therefore, we are
proposing in section XII.D.3. of this proposed rule to unpackage and
pay separately for the cost of non-opioid pain management drugs that
function as surgical supplies when they are furnished in the ASC
setting for CY 2019.
We have stated previously (82 FR 59250) that our packaging policies
are designed to support our strategic goal of using larger payment
bundles in the OPPS to maximize hospitals' incentives to provide care
in the most efficient manner. The packaging policies established under
the OPPS also typically apply when services are provided in the ASC
setting, and the policies have the same strategic goals in both
settings. While this proposal is a departure from our current ASC
packaging policy for drugs (specifically, non-opioid pain management
drugs) that function as a supply when used in a surgical procedure, we
believe that this proposed change will incentivize the use of non-
opioid pain management drugs and is responsive to the Commission's
recommendation to examine payment policies for non-opioid pain
management drugs that function as a supply, with the overall goal of
combating the current opioid addiction crisis. As previously noted, the
proposal for payment of non-opioid pain management drugs in the ASC
setting is presented in further detail in section XII.D.3. of this
proposed rule. However, we also are interested in peer-reviewed
evidence that demonstrates that non-opioid alternatives, such as
Exparel, in the outpatient setting actually do lead to a decrease in
prescription opioid use and addiction and are seeking public comments
containing evidence that demonstrate whether and how such non-opioid
alternatives affect prescription opioid use during or after an
outpatient visit or procedure.
In addition, as noted in section XII.D.3. of this proposed rule, we
are seeking comment on whether the proposed policy would decrease the
dose, duration, and/or number of opioid prescriptions beneficiaries
receive during and following an outpatient visit or procedure
(especially for beneficiaries at high-risk for opioid addiction) as
well as whether there are other non-opioid pain management alternatives
that would have similar effects and may warrant separate payment. For
example, we are interested in identifying whether single post-surgical
analgesic injections, such as Exparel, or other non-opioid drugs or
devices that are used during an outpatient visit or procedure are
associated with decreased opioid prescriptions and reduced cases of
associated opioid addiction following such an outpatient visit or
procedure. We also are requesting comments that provide evidence (such
as published peer-reviewed literature) we could use to determine
whether these products help to deter or avoid prescription opioid use
and addiction as well as evidence that the current packaged payment for
such non-opioid alternatives presents a barrier to access to care and
therefore warrants separate payment under either or both the OPPS and
the ASC payment system. The reduction or avoidance of prescription
opioids would be the criteria we would seek to determine whether
separate payment is warranted for CY 2019. Should evidence change over
time, we would consider whether a reexamination of any policy adopted
in the final rule would be necessary.
In addition, we are inviting the public to submit ideas on
regulatory, subregulatory, policy, practice, and procedural changes to
help prevent opioid use disorders and improve access to treatment under
the Medicare program. We are interested in identifying barriers that
may inhibit access to non-opioid alternatives for pain treatment and
management or access to opioid use disorder treatment, including those
barriers related to payment methodologies or coverage. In addition,
consistent with our ``Patients Over Paperwork'' Initiative, we are
interested in suggestions to improve existing requirements in order to
more effectively address the opioid epidemic.
As noted above, we are interested in comments regarding other non-
opioid treatments besides Exparel that might be affected by OPPS and
ASC packaging policies, including alternative, non-opioid pain
treatments, such as devices or therapy services that are not currently
separable payable. We are specifically interested in comments regarding
whether CMS should consider separate payment for such items and
services for which payment is currently packaged under the OPPS and the
ASC payment system that are effective non-opioid alternatives as well
as evidence that demonstrates such items and services lead to a
decrease in prescription opioid use during or after an outpatient visit
or procedure in order to determine whether separate payment may be
warranted. We intend to examine the evidence submitted to determine
whether to adopt a final policy that incentivizes use of non-opioid
alternative items and services that have evidence to demonstrate an
associated decrease in prescription opioid use and addiction following
an outpatient visit or procedure. Some examples of evidence that may be
relevant could include an indication on the product's FDA label or
studies published in peer-reviewed literature that such product aids in
the management of acute or chronic pain and is an evidence-based non-
opioid alternative for acute and/or chronic pain management. We would
also be interested in evidence relating to products that have shown
clinical improvement over other alternatives, such as a device that has
been shown to provide a substantial clinical benefit over the standard
of care for pain management. This could include, for example, spinal
cord stimulators used to treat chronic pain such as the devices
described by HCPCS codes C1822 (Generator, neurostimulator
(implantable), high frequency, with rechargeable battery and charging
system), C1820 (Generator, neurostimulator (implantable), with
rechargeable battery and charging system), and C1767 (Generator,
neurostimulator (implantable), nonrechargeable) which are primarily
assigned to APCs 5463 and 5464 (Levels 3 and 4 Neurostimulator and
Related Procedures) with proposed CY 2019 payment rates of $18,718 and
$27,662, respectively, that have received pass-through payment status
as well as other similar devices.
Currently, all devices are packaged under the OPPS and the ASC
payment system unless they have pass-through payment status. However,
in light of the Commission's recommendation to review and modify
ratesetting policies that discourage the use of non-opioid treatments
for pain, we are interested in comments from stakeholders regarding
whether, similar to the goals of the proposed payment policy for non-
opioid pain management drugs that function as a supply when used in a
surgical procedure, a policy of providing separate payment (rather than
packaged payment) for these products, indefinitely or for a specified
period of time, would also incentivize the use of alternative non-
opioid pain
[[Page 37071]]
management treatments and improve access to care for non-opioid
alternatives, particularly for innovative and low-volume items and
services.
We also are interested in comments regarding whether we should
provide separate payment for non-opioid pain management treatments or
products using a mechanism such as an equitable payment adjustment
under our authority at section 1833(t)(2)(E) of the Act, which states
that the Secretary shall establish, in a budget neutral manner, other
adjustments as determined to be necessary to ensure equitable payments.
For example, we are considering whether an equitable payment adjustment
in the form of an add-on payment for APCs that use a non-opioid pain
management drug, device, or service would be appropriate. To the extent
that commenters provide evidence to support this approach, we would
consider adopting a final policy, which could include regulatory
changes that would allow for an exception to the packaging of certain
nonpass-through devices that represent non-opioid alternatives for
acute or chronic pain that have evidence to demonstrate that their use
leads to a decrease in opioid prescriptions or addictions, in the final
rule for CY 2019 to effectuate such change.
Alternatively, we are interested in comments on whether a
reorganization of the APC structure for procedures involving these
products or establishing more granular APC groupings for specific
procedure and device combinations to ensure that the payment rate for
such services is aligned with the resources associated with procedures
involving specific devices would better achieve our goal of
incentivizing increased use of non-opioid alternatives, with the aim of
reducing opioid use and subsequent addiction. For example, we would
consider finalizing a policy to establish new APCs for procedures
involving non-opioid pain management packaged items or services if such
APCs would better recognize the resources involved in furnishing such
items and services and decrease or eliminate the need for prescription
opioids. In addition, given the general desire to encourage provider
efficiency through creating larger bundles of care and packaging items
and services that are integral, ancillary, supportive, dependent, or
adjunctive to a primary service, we also are seeking comment on how
such alternative payment structures would continue to balance the goals
of incentivizing provider efficiencies with encouraging the use of non-
opioid alternatives to pain management. Furthermore, because patients
may receive opioid prescriptions following receipt of a non-opioid drug
or implantation of a device, we are interested in identifying any cost
implications for the patient and the Medicare program caused by this
potential change in policy. The implications of incentivizing non-
opioid pain management drugs available for postsurgical acute pain
relief during or after an outpatient visit or procedure are also of
interest, including for non-opioid drugs. The goal is to encourage
appropriate use of such non-opioid alternatives. We note that this
comment solicitation is also discussed in section XII.D.3. of this
proposed rule.
4. Proposed Calculation of OPPS Scaled Payment Weights
We established a policy in the CY 2013 OPPS/ASC final rule with
comment period (77 FR 68283) of using geometric mean-based APC costs to
calculate relative payment weights under the OPPS. In the CY 2018 OPPS/
ASC final rule with comment period (82 FR 59255 through 59256), we
applied this policy and calculated the relative payment weights for
each APC for CY 2018 that were shown in Addenda A and B to that final
rule with comment period (which were made available via the internet on
the CMS website) using the APC costs discussed in sections II.A.1. and
II.A.2. of that final rule with comment period. For CY 2019, as we did
for CY 2018, we are proposing to continue to apply the policy
established in CY 2013 and calculate relative payment weights for each
APC for CY 2019 using geometric mean-based APC costs.
For CY 2012 and CY 2013, outpatient clinic visits were assigned to
one of five levels of clinic visit APCs, with APC 0606 representing a
mid-level clinic visit. In the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75036 through 75043), we finalized a policy that created
alphanumeric HCPCS code G0463 (Hospital outpatient clinic visit for
assessment and management of a patient), representing any and all
clinic visits under the OPPS. HCPCS code G0463 was assigned to APC 0634
(Hospital Clinic Visits). We also finalized a policy to use CY 2012
claims data to develop the CY 2014 OPPS payment rates for HCPCS code
G0463 based on the total geometric mean cost of the levels one through
five CPT E/M codes for clinic visits previously recognized under the
OPPS (CPT codes 99201 through 99205 and 99211 through 99215). In
addition, we finalized a policy to no longer recognize a distinction
between new and established patient clinic visits.
For CY 2016, we deleted APC 0634 and reassigned the outpatient
clinic visit HCPCS code G0463 to APC 5012 (Level 2 Examinations and
Related Services) (80 FR 70372). For CY 2019, as we did for CY 2018, we
are proposing to continue to standardize all of the relative payment
weights to APC 5012. We believe that standardizing relative payment
weights to the geometric mean of the APC to which HCPCS code G0463 is
assigned maintains consistency in calculating unscaled weights that
represent the cost of some of the most frequently provided OPPS
services. For CY 2019, as we did for CY 2018, we are proposing to
assign APC 5012 a relative payment weight of 1.00 and to divide the
geometric mean cost of each APC by the geometric mean cost for APC 5012
to derive the unscaled relative payment weight for each APC. The choice
of the APC on which to standardize the relative payment weights does
not affect payments made under the OPPS because we scale the weights
for budget neutrality.
We note that, in section X.B. of this proposed rule, we discuss our
CY 2019 proposal to control for unnecessary increases in the volume of
outpatient service by paying for clinic visits furnished at an off-
campus provider-based department at a PFS-equivalent rate under the
OPPS rather than at the standard OPPS rate. While the volume associated
with these visits is included in the impact model, and thus used in
calculating the weight scalar, the proposal has only a negligible
effect on the scalar. Specifically, under the proposed policy, there
would be no change to the relativity of the OPPS payment weights
because the adjustment is made at the payment level rather than in the
cost modeling. Further, under our proposal, the savings that would
result from the change in payments for these clinic visits would not be
budget neutral. Therefore, the impact of the proposed policy would
generally not be reflected in the budget neutrality adjustments,
whether the adjustment is to the OPPS relative weights or to the OPPS
conversion factor.
Section 1833(t)(9)(B) of the Act requires that APC reclassification
and recalibration changes, wage index changes, and other adjustments be
made in a budget neutral manner. Budget neutrality ensures that the
estimated aggregate weight under the OPPS for CY 2019 is neither
greater than nor less than the estimated aggregate weight that would
have been made without the changes. To comply with this requirement
concerning the APC changes, we are proposing to compare
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the estimated aggregate weight using the CY 2018 scaled relative
payment weights to the estimated aggregate weight using the proposed CY
2019 unscaled relative payment weights.
For CY 2018, we multiplied the CY 2018 scaled APC relative payment
weight applicable to a service paid under the OPPS by the volume of
that service from CY 2017 claims to calculate the total relative
payment weight for each service. We then added together the total
relative payment weight for each of these services in order to
calculate an estimated aggregate weight for the year. For CY 2019, we
are proposing to apply the same process using the estimated CY 2019
unscaled relative payment weights rather than scaled relative payment
weights. We are proposing to calculate the weight scalar by dividing
the CY 2018 estimated aggregate weight by the unscaled CY 2019
estimated aggregate weight.
For a detailed discussion of the weight scalar calculation, we
refer readers to the OPPS claims accounting document available on the
CMS website at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html. Click on the CY 2019 OPPS
proposed rule link and open the claims accounting document link at the
bottom of the page.
We are proposing to compare the estimated unscaled relative payment
weights in CY 2019 to the estimated total relative payment weights in
CY 2018 using CY 2017 claims data, holding all other components of the
payment system constant to isolate changes in total weight. Based on
this comparison, we are proposing to adjust the calculated CY 2019
unscaled relative payment weights for purposes of budget neutrality. We
are proposing to adjust the estimated CY 2019 unscaled relative payment
weights by multiplying them by a proposed weight scalar of 1.4553 to
ensure that the proposed CY 2019 relative payment weights are scaled to
be budget neutral. The proposed CY 2019 relative payment weights listed
in Addenda A and B to this proposed rule (which are available via the
internet on the CMS website) were scaled and incorporated the
recalibration adjustments discussed in sections II.A.1. and II.A.2. of
this proposed rule.
Section 1833(t)(14) of the Act provides the payment rates for
certain SCODs. Section 1833(t)(14)(H) of the Act provides that
additional expenditures resulting from this paragraph shall not be
taken into account in establishing the conversion factor, weighting,
and other adjustment factors for 2004 and 2005 under paragraph (9), but
shall be taken into account for subsequent years. Therefore, the cost
of those SCODs (as discussed in section V.B.2. of this proposed rule)
is included in the budget neutrality calculations for the CY 2019 OPPS.
B. Proposed Conversion Factor Update
Section 1833(t)(3)(C)(ii) of the Act requires the Secretary to
update the conversion factor used to determine the payment rates under
the OPPS on an annual basis by applying the OPD fee schedule increase
factor. For purposes of section 1833(t)(3)(C)(iv) of the Act, subject
to sections 1833(t)(17) and 1833(t)(3)(F) of the Act, the OPD fee
schedule increase factor is equal to the hospital inpatient market
basket percentage increase applicable to hospital discharges under
section 1886(b)(3)(B)(iii) of the Act. In the FY 2019 IPPS/LTCH PPS
proposed rule (83 FR 20381), consistent with current law, based on IHS
Global, Inc.'s fourth quarter 2017 forecast of the FY 2019 market
basket increase, the proposed FY 2019 IPPS market basket update is 2.8
percent. However, sections 1833(t)(3)(F) and 1833(t)(3)(G)(v) of the
Act, as added by section 3401(i) of the Patient Protection and
Affordable Care Act of 2010 (Pub. L. 111-148) and as amended by section
10319(g) of that law and further amended by section 1105(e) of the
Health Care and Education Reconciliation Act of 2010 (Pub. L. 111-152),
provide adjustments to the OPD fee schedule increase factor for CY
2019.
Specifically, section 1833(t)(3)(F)(i) of the Act requires that,
for 2012 and subsequent years, the OPD fee schedule increase factor
under subparagraph (C)(iv) be reduced by the productivity adjustment
described in section 1886(b)(3)(B)(xi)(II) of the Act. Section
1886(b)(3)(B)(xi)(II) of the Act defines the productivity adjustment as
equal to the 10-year moving average of changes in annual economy-wide,
private nonfarm business multifactor productivity (MFP) (as projected
by the Secretary for the 10-year period ending with the applicable
fiscal year, year, cost reporting period, or other annual period) (the
``MFP adjustment''). In the FY 2012 IPPS/LTCH PPS final rule (76 FR
51689 through 51692), we finalized our methodology for calculating and
applying the MFP adjustment, and then revised this methodology as
discussed in the FY 2016 IPPS/LTCH PPS final rule (80 FR 49509). In
this proposed rule, the proposed MFP adjustment for FY 2019 is 0.8
percentage point.
We are proposing that if more recent data become subsequently
available after the publication of this proposed rule (for example, a
more recent estimate of the market basket increase and the MFP
adjustment), we would use such updated data, if appropriate, to
determine the CY 2019 market basket update and the MFP adjustment,
which are components in calculating the OPD fee schedule increase
factor under sections 1833(t)(3)(C)(iv) and 1833(t)(3)(F) of the Act,
in the CY 2019 OPPS/ASC final rule with comment period.
In addition, section 1833(t)(3)(F)(ii) of the Act requires that,
for each of years 2010 through 2019, the OPD fee schedule increase
factor under section 1833(t)(3)(C)(iv) of the Act be reduced by the
adjustment described in section 1833(t)(3)(G) of the Act. For CY 2019,
section 1833(t)(3)(G)(v) of the Act provides a 0.75 percentage point
reduction to the OPD fee schedule increase factor under section
1833(t)(3)(C)(iv) of the Act. Therefore, in accordance with sections
1833(t)(3)(F)(ii) and 1833(t)(3)(G)(v) of the Act, we are proposing to
apply a 0.75 percentage point reduction to the OPD fee schedule
increase factor for CY 2019.
We note that section 1833(t)(3)(F) of the Act provides that
application of this subparagraph may result in the OPD fee schedule
increase factor under section 1833(t)(3)(C)(iv) of the Act being less
than 0.0 percent for a year, and may result in OPPS payment rates being
less than rates for the preceding year. As described in further detail
below, we are proposing to apply an OPD fee schedule increase factor of
1.25 percent for the CY 2019 OPPS (which is 2.8 percent, the proposed
estimate of the hospital inpatient market basket percentage increase,
less the proposed 0.8 percentage point MFP adjustment, and less the
0.75 percentage point additional adjustment).
Hospitals that fail to meet the Hospital OQR Program reporting
requirements are subject to an additional reduction of 2.0 percentage
points from the OPD fee schedule increase factor adjustment to the
conversion factor that would be used to calculate the OPPS payment
rates for their services, as required by section 1833(t)(17) of the
Act. For further discussion of the Hospital OQR Program, we refer
readers to section XIII. of this proposed rule.
In this CY 2019 OPPS/ASC proposed rule, we are proposing to amend
42 CFR 419.32(b)(1)(iv)(B) by adding a new paragraph (10) to reflect
the requirement in section 1833(t)(3)(F)(i) of the Act that, for CY
2019, we reduce the OPD fee schedule increase factor by the MFP
adjustment as determined by CMS, and
[[Page 37073]]
to reflect the requirement in section 1833(t)(3)(G)(v) of the Act, as
required by section 1833(t)(3)(F)(ii) of the Act, that we reduce the
OPD fee schedule increase factor by an additional 0.75 percentage point
for CY 2019.
To set the OPPS conversion factor for this CY 2019 OPPS/ASC
proposed rule, we are proposing to increase the CY 2018 conversion
factor of $78.636 by 1.25 percent. In accordance with section
1833(t)(9)(B) of the Act, we are proposing further to adjust the
conversion factor for CY 2019 to ensure that any revisions made to the
wage index and rural adjustment are made on a budget neutral basis. We
are proposing to calculate an overall proposed budget neutrality factor
of 1.0004 for wage index changes by comparing proposed total estimated
payments from our simulation model using the proposed FY 2019 IPPS wage
indexes to those payments using the FY 2018 IPPS wage indexes, as
adopted on a calendar year basis for the OPPS.
For this CY 2019 OPPS/ASC proposed rule, we are proposing to
maintain the current rural adjustment policy, as discussed in section
II.E. of this proposed rule. Therefore, the proposed budget neutrality
factor for the rural adjustment would be 1.0000.
For this CY 2019 OPPS/ASC proposed rule, we are proposing to
continue previously established policies for implementing the cancer
hospital payment adjustment described in section 1833(t)(18) of the
Act, as discussed in section II.F. of this proposed rule. We are
proposing to calculate a CY 2019 budget neutrality adjustment factor
for the cancer hospital payment adjustment by comparing estimated
proposed total CY 2019 payments under section 1833(t) of the Act,
including the proposed CY 2019 cancer hospital payment adjustment, to
estimated CY 2019 total payments using the CY 2018 final cancer
hospital payment adjustment as required under section 1833(t)(18)(B) of
the Act. The CY 2019 proposed estimated payments applying the proposed
CY 2019 cancer hospital payment adjustment are the same as estimated
payments applying the CY 2018 final cancer hospital payment adjustment.
Therefore, we are proposing to apply a budget neutrality adjustment
factor of 1.0000 to the conversion factor for the cancer hospital
payment adjustment. In accordance with section 16002(b) of the 21st
Century Cures Act, we are applying a budget neutrality factor
calculated as if the proposed cancer hospital adjustment target
payment-to-cost ratio was 0.89, not the 0.88 target payment-to-cost
ratio we are proposing to apply as stated in section II.F. of this
proposed rule.
For this CY 2019 OPPS/ASC proposed rule, we estimate that proposed
pass-through spending for drugs, biologicals, and devices for CY 2019
would equal approximately $126.7 million, which represents 0.17 percent
of total projected CY 2019 OPPS spending. Therefore, the proposed
conversion factor would be adjusted by the difference between the 0.04
percent estimate of pass-through spending for CY 2018 and the 0.17
percent estimate of proposed pass-through spending for CY 2019,
resulting in a proposed decrease for CY 2019 of 0.13 percent. Proposed
estimated payments for outliers would remain at 1.0 percent of total
OPPS payments for CY 2019. We estimate for this proposed rule that
outlier payments would be 1.02 percent of total OPPS payments in CY
2018; the 1.00 percent for proposed outlier payments in CY 2019 would
constitute a 0.02 percent increase in payment in CY 2019 relative to CY
2018.
For this CY 2019 OPPS/ASC proposed rule, we also are proposing that
hospitals that fail to meet the reporting requirements of the Hospital
OQR Program would continue to be subject to a further reduction of 2.0
percentage points to the OPD fee schedule increase factor. For
hospitals that fail to meet the requirements of the Hospital OQR
Program, we are proposing to make all other adjustments discussed
above, but use a reduced OPD fee schedule update factor of -0.75
percent (that is, the proposed OPD fee schedule increase factor of 1.25
percent further reduced by 2.0 percentage points). This would result in
a proposed reduced conversion factor for CY 2019 of $77.955 for
hospitals that fail to meet the Hospital OQR Program requirements (a
difference of -1.591 in the conversion factor relative to hospitals
that met the requirements).
In summary, for CY 2019, we are proposing to amend Sec.
419.32(b)(1)(iv)(B) by adding a new paragraph (10) to reflect the
reductions to the OPD fee schedule increase factor that are required
for CY 2019 to satisfy the statutory requirements of sections
1833(t)(3)(F) and (t)(3)(G)(v) of the Act. We are proposing to use a
reduced conversion factor of $77.955 in the calculation of payments for
hospitals that fail to meet the Hospital OQR Program requirements (a
difference of -1.591 in the conversion factor relative to hospitals
that met the requirements).
For CY 2019, we are proposing to use a conversion factor of $79.546
in the calculation of the national unadjusted payment rates for those
items and services for which payment rates are calculated using
geometric mean costs; that is, the proposed OPD fee schedule increase
factor of 1.25 percent for CY 2019, the required proposed wage index
budget neutrality adjustment of approximately1.0004, the proposed
cancer hospital payment adjustment of 1.0000, and the proposed
adjustment of 0.02 percentage point of projected OPPS spending for the
difference in the pass-through spending and outlier payments that
result in a proposed conversion factor for CY 2019 of $79.546.
C. Proposed Wage Index Changes
Section 1833(t)(2)(D) of the Act requires the Secretary to
determine a wage adjustment factor to adjust the portion of payment and
coinsurance attributable to labor-related costs for relative
differences in labor and labor-related costs across geographic regions
in a budget neutral manner (codified at 42 CFR 419.43(a)). This portion
of the OPPS payment rate is called the OPPS labor-related share. Budget
neutrality is discussed in section II.B. of this proposed rule.
The OPPS labor-related share is 60 percent of the national OPPS
payment. This labor-related share is based on a regression analysis
that determined that, for all hospitals, approximately 60 percent of
the costs of services paid under the OPPS were attributable to wage
costs. We confirmed that this labor-related share for outpatient
services is appropriate during our regression analysis for the payment
adjustment for rural hospitals in the CY 2006 OPPS final rule with
comment period (70 FR 68553). We are proposing to continue this policy
for the CY 2019 OPPS. We refer readers to section II.H. of this
proposed rule for a description and an example of how the wage index
for a particular hospital is used to determine payment for the
hospital.
As discussed in the claims accounting narrative included with the
supporting documentation for this proposed rule (which is available via
the internet on the CMS website), for estimating APC costs, we
standardize 60 percent of estimated claims costs for geographic area
wage variation using the same proposed FY 2019 pre-reclassified wage
index that the IPPS uses to standardize costs. This standardization
process removes the effects of differences in area wage levels from the
determination of a national unadjusted OPPS payment rate and copayment
amount.
Under 42 CFR 419.41(c)(1) and 419.43(c) (published in the OPPS
April 7, 2000 final rule with comment period (65 FR 18495 and 18545)),
the OPPS adopted the final fiscal year IPPS post-
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reclassified wage index as the calendar year wage index for adjusting
the OPPS standard payment amounts for labor market differences.
Therefore, the wage index that applies to a particular acute care,
short-stay hospital under the IPPS also applies to that hospital under
the OPPS. As initially explained in the September 8, 1998 OPPS proposed
rule (63 FR 47576), we believe that using the IPPS wage index as the
source of an adjustment factor for the OPPS is reasonable and logical,
given the inseparable, subordinate status of the HOPD within the
hospital overall. In accordance with section 1886(d)(3)(E) of the Act,
the IPPS wage index is updated annually.
The Affordable Care Act contained several provisions affecting the
wage index. These provisions were discussed in the CY 2012 OPPS/ASC
final rule with comment period (76 FR 74191). Section 10324 of the
Affordable Care Act added section 1886(d)(3)(E)(iii)(II) to the Act,
which defines a frontier State and amended section 1833(t) of the Act
to add paragraph (19), which requires a frontier State wage index floor
of 1.00 in certain cases, and states that the frontier State floor
shall not be applied in a budget neutral manner. We codified these
requirements at Sec. 419.43(c)(2) and (c)(3) of our regulations. For
the CY 2019 OPPS, we are proposing to implement this provision in the
same manner as we have since CY 2011. Under this policy, the frontier
State hospitals would receive a wage index of 1.00 if the otherwise
applicable wage index (including reclassification, the rural floor, and
rural floor budget neutrality) is less than 1.00 (as discussed below,
we are proposing not to extend the imputed floor under the OPPS for CY
2019 and subsequent years, consistent with our proposal in the FY 2019
IPPS/LTCH PPS proposed rule (83 FR 20362 and 20363) not to extend the
imputed floor under the IPPS for FY 2019 and subsequent fiscal years).
Because the HOPD receives a wage index based on the geographic location
of the specific inpatient hospital with which it is associated, the
frontier State wage index adjustment applicable for the inpatient
hospital also would apply for any associated HOPD. We refer readers to
the FY 2011 through FY 2018 IPPS/LTCH PPS final rules for discussions
regarding this provision, including our methodology for identifying
which areas meet the definition of ``frontier States'' as provided for
in section 1886(d)(3)(E)(iii)(II) of the Act: For FY 2011, 75 FR 50160
through 50161; for FY 2012, 76 FR 51793, 51795, and 51825; for FY 2013,
77 FR 53369 through 53370; for FY 2014, 78 FR 50590 through 50591; for
FY 2015, 79 FR 49971; for FY 2016, 80 FR 49498; for FY 2017, 81 FR
56922; and for FY 2018, 82 FR 38142.
In addition to the changes required by the Affordable Care Act, we
note that the proposed FY 2019 IPPS wage indexes continue to reflect a
number of adjustments implemented over the past few years, including,
but not limited to, reclassification of hospitals to different
geographic areas, the rural floor provisions, an adjustment for
occupational mix, and an adjustment to the wage index based on
commuting patterns of employees (the out-migration adjustment). We
refer readers to the FY 2019 IPPS/LTCH PPS proposed rule (83 FR 20353
through 20377) for a detailed discussion of all proposed changes to the
FY 2019 IPPS wage indexes. We note that, in the FY 2019 IPPS/LTCH PPS
proposed rule (83 FR 20362 through 20363), we proposed not to apply the
imputed floor to the IPPS wage index computations for FY 2019 and
subsequent fiscal years. Consistent with this, we are proposing not to
extend the imputed floor policy under the OPPS beyond December 31, 2018
(the date the imputed floor policy is set to expire under the OPPS). We
refer readers to the FY 2018 IPPS/LTCH PPS final rule (82 FR 38138
through 38142) for a detailed discussion of the application of the
imputed floor under the IPPS for FY 2018.
As discussed in the FY 2015 IPPS/LTCH PPS final rule (79 FR 49951
through 49963) and in each subsequent IPPS/LTCH PPS final rule,
including the FY 2018 IPPS/LTCH PPS final rule (82 FR 38129 through
38130), the Office of Management and Budget (OMB) issued revisions to
the labor market area delineations on February 28, 2013 (based on 2010
Decennial Census data), that included a number of significant changes
such as new Core Based Statistical Areas (CBSAs), urban counties that
became rural, rural counties that became urban, and existing CBSAs that
were split apart (OMB Bulletin 13-01). This bulletin can be found at:
https://obamawhitehouse.archives.gov/sites/default/files/omb/bulletins/2013/b13-01.pdf. In the FY 2015 IPPS/LTCH PPS final rule (79 FR 49950
through 49985), for purposes of the IPPS, we adopted the use of the OMB
statistical area delineations contained in OMB Bulletin No. 13-01,
effective October 1, 2014. For purposes of the OPPS, in the CY 2015
OPPS/ASC final rule with comment period (79 FR 66826 through 66828), we
adopted the use of the OMB statistical area delineations contained in
OMB Bulletin No. 13-01, effective January 1, 2015, beginning with the
CY 2015 OPPS wage indexes. In the FY 2017 IPPS/LTCH PPS final rule (81
FR 56913), we adopted revisions to statistical areas contained in OMB
Bulletin No. 15-01, issued on July 15, 2015, which provided updates to
and superseded OMB Bulletin No. 13-01 that was issued on February 28,
2013. For purposes of the OPPS, in the CY 2017 OPPS/ASC final rule with
comment period (81 FR 79598), we adopted the revisions to the OMB
statistical area delineations contained in OMB Bulletin No. 15-01,
effective January 1, 2017, beginning with the CY 2017 OPPS wage
indexes. We believe that it is important for the OPPS to use the latest
labor market area delineations available as soon as is reasonably
possible in order to maintain a more accurate and up-to-date payment
system that reflects the reality of population shifts and labor market
conditions.
On August 15, 2017, OMB issued OMB Bulletin No. 17-01, which
provided updates to and superseded OMB Bulletin No. 15-01 that was
issued on July 15, 2015. The attachments to OMB Bulletin No. 17-01
provide detailed information on the update to the statistical areas
since July 15, 2015, and are based on the application of the 2010
Standards for Delineating Metropolitan and Micropolitan Statistical
Areas to Census Bureau population estimates for July 1, 2014 and July
1, 2015. In OMB Bulletin No. 17-01, OMB announced that one Micropolitan
Statistical Area now qualifies as a Metropolitan Statistical Area. The
new urban CBSA is as follows:
Twin Falls, Idaho (CBSA 46300). This CBSA is comprised of
the principal city of Twin Falls, Idaho in Jerome County, Idaho and
Twin Falls County, Idaho.
The OMB Bulletin No. 17-01 is available on the OMB website at
https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/bulletins/2017/b-17-01.pdf. In the FY 2019 IPPS/LTCH PPS proposed rule (83 FR
20354), we noted that we did not have sufficient time to include this
change in the computation of the proposed FY 2019 IPPS wage index,
ratesetting, and Tables 2 and 3 associated with the FY 2019 IPPS/LTCH
PPS proposed rule. We stated that this new CBSA may affect the IPPS
budget neutrality factors and wage indexes, depending on whether the
area is eligible for the rural floor and the impact of the overall
payments of the hospital located in this new CBSA. As we did in the FY
2019 IPPS/LTCH
[[Page 37075]]
PPS proposed rule (83 FR 20354), we are providing below an estimate of
this new area's wage index based on the average hourly wages for new
CBSA 46300 and the national average hourly wages from the wage data for
the proposed FY 2019 IPPS wage index (described in section III.B. of
the preamble of the FY 2019 IPPS/LTCH PPS proposed rule). Currently,
provider 130002 is the only hospital located in Twin Falls County,
Idaho, and there are no hospitals located in Jerome County, Idaho.
Thus, the proposed wage index for CBSA 46300 is calculated using the
average hourly wage data for one provider (provider 130002).
Below we provide the proposed FY 2019 IPPS unadjusted and
occupational mix adjusted national average hourly wages and the
estimated CBSA average hourly wages. Taking the estimated average
hourly wage of new CBSA 46300 and dividing by the proposed national
average hourly wage results in the estimated wage indexes shown in the
table below.
------------------------------------------------------------------------
Estimated
Estimated occupational
unadjusted wage mix adjusted
index for new wage index for
CBSA 46300 new CBSA 46300
------------------------------------------------------------------------
Proposed National Average Hourly Wage. 42.990625267 42.948428861
Estimated CBSA Average Hourly Wage.... 35.833564813 38.127590025
Estimated Wage Index.................. 0.8335 0.8878
------------------------------------------------------------------------
As we stated in the FY 2019 IPPS/LTCH PPS proposed rule (83 FR
20354), for the proposed FY 2019 IPPS wage indexes, we would use the
OMB delineations that were adopted beginning with FY 2015 to calculate
the area wage indexes, with updates as reflected in OMB Bulletin Nos.
13-01, 15-01, and 17-01. We also stated that we would incorporate the
revision from OMB Bulletin No. 17-01 in the final FY 2019 IPPS wage
index, ratesetting, and tables. Similarly, for the proposed CY 2019
OPPS wage indexes, we are proposing to use the OMB delineations that
were adopted beginning with CY 2015 to calculate the area wage indexes,
with updates as reflected in OMB Bulletin Nos. 13-01, 15-01, and 17-01.
We would incorporate the revision from OMB Bulletin No. 17-01 in the
final CY 2019 OPPS wage index, ratesetting, and tables.
CBSAs are made up of one or more constituent counties. Each CBSA
and constituent county has its own unique identifying codes. The FY
2018 IPPS/LTCH PPS final rule (82 FR 38130) discussed the two different
lists of codes to identify counties: Social Security Administration
(SSA) codes and Federal Information Processing Standard (FIPS) codes.
Historically, CMS listed and used SSA and FIPS county codes to identify
and crosswalk counties to CBSA codes for purposes of the IPPS and OPPS
wage indexes. However, the SSA county codes are no longer being
maintained and updated, although the FIPS codes continue to be
maintained by the U.S. Census Bureau. The Census Bureau's most current
statistical area information is derived from ongoing census data
received since 2010; the most recent data are from 2015. In the FY 2018
IPPS/LTCH PPS final rule (82 FR 38130), for purposes of crosswalking
counties to CBSAs for the IPPS wage index, we finalized our proposal to
discontinue the use of the SSA county codes and begin using only the
FIPS county codes. Similarly, for the purposes of crosswalking counties
to CBSAs for the OPPS wage index, in the CY 2018 OPPS/ASC final rule
with comment period (82 FR 59260), we finalized our proposal to
discontinue the use of SSA county codes and begin using only the FIPS
county codes for the purposes of crosswalking counties to CBSAs for the
OPPS wage index.
The Census Bureau maintains a complete list of changes to counties
or county equivalent entities on the website at: https://www.census.gov/geo/reference/county-changes.html. In our transition to
using only FIPS codes for counties for the IPPS wage index, in the FY
2018 IPPS/LTCH PPS final rule (82 FR 38130), we updated the FIPS codes
used for crosswalking counties to CBSAs for the IPPS wage index
effective October 1, 2017, to incorporate changes to the counties or
county equivalent entities included in the Census Bureau's most recent
list. We included these updates to calculate the area IPPS wage indexes
in a manner that is generally consistent with the CBSA-based
methodologies finalized in the FY 2005 IPPS final rule and the FY 2015
IPPS/LTCH PPS final rule. In the CY 2018 OPPS/ASC final rule with
comment period (82 FR 59261), we finalized our proposal to implement
these FIPS code updates for the OPPS wage index effective January 1,
2018, beginning with the CY 2018 OPPS wage indexes.
For this CY 2019 OPPS/ASC proposed rule, we are proposing to use
the FY 2019 hospital IPPS post-reclassified wage index for urban and
rural areas as the wage index for the OPPS to determine the wage
adjustments for both the OPPS payment rate and the copayment
standardized amount for CY 2019. Therefore, any adjustments for the FY
2019 IPPS post-reclassified wage index would be reflected in the final
CY 2019 OPPS wage index. (We refer readers to the FY 2019 IPPS/LTCH PPS
proposed rule (83 FR 20353 through 20377) and the proposed FY 2019
hospital wage index files posted on the CMS website.) As explained
above, we believe that using the IPPS wage index as the source of an
adjustment factor for the OPPS is reasonable and logical, given the
inseparable, subordinate status of the HOPD within the hospital
overall.
Hospitals that are paid under the OPPS, but not under the IPPS, do
not have an assigned hospital wage index under the IPPS. Therefore, for
non-IPPS hospitals paid under the OPPS, it is our longstanding policy
to assign the wage index that would be applicable if the hospital were
paid under the IPPS, based on its geographic location and any
applicable wage index adjustments. We are proposing to continue this
policy for CY 2019. The following is a brief summary of the major
proposed FY 2019 IPPS wage index policies and adjustments that we are
proposing to apply to these hospitals under the OPPS for CY 2019. We
are inviting public comments on these proposals. We refer readers to
the FY 2019 IPPS/LTCH PPS proposed rule (83 FR 20353 through 20377) for
a detailed discussion of the proposed changes to the FY 2019 IPPS wage
indexes.
It has been our longstanding policy to allow non-IPPS hospitals
paid under the OPPS to qualify for the out-migration adjustment if they
are located in a section 505 out-migration county (section 505 of the
Medicare Prescription Drug, Improvement, and
[[Page 37076]]
Modernization Act of 2003 (MMA)). Applying this adjustment is
consistent with our policy of adopting IPPS wage index policies for
hospitals paid under the OPPS. We note that, because non-IPPS hospitals
cannot reclassify, they are eligible for the out-migration wage
adjustment if they are located in a section 505 out-migration county.
This is the same out-migration adjustment policy that applies if the
hospital were paid under the IPPS. For CY 2019, we are proposing to
continue our policy of allowing non-IPPS hospitals paid under the OPPS
to qualify for the out-migration adjustment if they are located in a
section 505 out-migration county (section 505 of the MMA).
As stated earlier, in the FY 2015 IPPS/LTCH PPS final rule, we
adopted the OMB labor market area delineations issued by OMB in OMB
Bulletin No. 13-01 on February 28, 2013, based on standards published
on June 28, 2010 (75 FR 37246 through 37252) and the 2010 Census data
to delineate labor market areas for purposes of the IPPS wage index.
For IPPS wage index purposes, for hospitals that were located in urban
CBSAs in FY 2014 but were designated as rural under these revised OMB
labor market area delineations, we generally assigned them the urban
wage index value of the CBSA in which they were physically located for
FY 2014 for a period of 3 fiscal years (79 FR 49957 through 49960). To
be consistent, we applied the same policy to hospitals paid under the
OPPS but not under the IPPS so that such hospitals maintained the wage
index of the CBSA in which they were physically located for FY 2014 for
3 calendar years (until December 31, 2017). Because this 3-year
transition ended at the end of CY 2017, it was not applied beginning in
CY 2018.
In addition, under the IPPS, the imputed floor policy is set to
expire effective October 1, 2018. In the FY 2019 IPPS/LTCH PPS proposed
rule (83 FR 20362 through 20363), we proposed not to extend the imputed
floor policy under the IPPS for FY 2019 and subsequent fiscal years.
For purposes of the CY 2019 OPPS, the imputed floor policy is set to
expire effective December 31, 2018. Consistent with the FY 2019 IPPS/
LTCH PPS proposed rule, as discussed earlier, we are proposing not to
extend the imputed floor policy under the OPPS beyond December 31,
2018.
For CMHCs, for CY 2019, we are proposing to continue to calculate
the wage index by using the post-reclassification IPPS wage index based
on the CBSA where the CMHC is located. As with OPPS hospitals and for
the same reasons, for CMHCs previously located in urban CBSAs that were
designated as rural under the revised OMB labor market area
delineations in OMB Bulletin No. 13-01, we finalized a policy to
maintain the urban wage index value of the CBSA in which they were
physically located for CY 2014 for 3 calendar years (until December 31,
2017). Because this 3-year transition ended at the end of CY 2017, it
was not applied beginning in CY 2018. The wage index that would apply
to CMHCs for CY 2019 would include the rural floor adjustment, but
would not include the imputed floor adjustment because, as discussed
above, we are proposing to not extend the imputed floor policy beyond
December 31, 2018. Also, the wage index that would apply to CMHCs would
not include the out-migration adjustment because that adjustment only
applies to hospitals.
Table 2 associated with the FY 2019 IPPS/LTCH PPS proposed rule
(available via the internet on the CMS website at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/index.html)
identifies counties eligible for the out-migration adjustment and IPPS
hospitals that would receive the adjustment for FY 2019. We are
including the out-migration adjustment information from Table 2
associated with the FY 2019 IPPS/LTCH PPS proposed rule as Addendum L
to this proposed rule with the addition of non-IPPS hospitals that
would receive the section 505 out-migration adjustment under the CY
2019 OPPS. Addendum L is available via the internet on the CMS website.
We refer readers to the CMS website for the OPPS at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html. At this link, readers will find a
link to the proposed FY 2019 IPPS wage index tables and Addendum L.
D. Proposed Statewide Average Default Cost-to-Charge Ratios (CCRs)
In addition to using CCRs to estimate costs from charges on claims
for ratesetting, CMS uses overall hospital-specific CCRs calculated
from the hospital's most recent cost report to determine outlier
payments, payments for pass-through devices, and monthly interim
transitional corridor payments under the OPPS during the PPS year. MACs
cannot calculate a CCR for some hospitals because there is no cost
report available. For these hospitals, CMS uses the statewide average
default CCRs to determine the payments mentioned earlier until a
hospital's MAC is able to calculate the hospital's actual CCR from its
most recently submitted Medicare cost report. These hospitals include,
but are not limited to, hospitals that are new, hospitals that have not
accepted assignment of an existing hospital's provider agreement, and
hospitals that have not yet submitted a cost report. CMS also uses the
statewide average default CCRs to determine payments for hospitals that
appear to have a biased CCR (that is, the CCR falls outside the
predetermined ceiling threshold for a valid CCR) or for hospitals in
which the most recent cost report reflects an all-inclusive rate status
(Medicare Claims Processing Manual (Pub. L. 100-04), Chapter 4, Section
10.11).
In this CY 2019 OPPS/ASC proposed rule, we are proposing to update
the default ratios for CY 2019 using the most recent cost report data.
We discussed our policy for using default CCRs, including setting the
ceiling threshold for a valid CCR, in the CY 2009 OPPS/ASC final rule
with comment period (73 FR 68594 through 68599) in the context of our
adoption of an outlier reconciliation policy for cost reports beginning
on or after January 1, 2009. For detail on our process for calculating
the statewide average CCRs, we refer readers to the CY 2019 OPPS
proposed rule Claims Accounting Narrative that is posted on the CMS
website. Table 5 below lists the proposed statewide average default
CCRs for OPPS services furnished on or after January 1, 2019, based on
proposed rule data.
Table 5--Proposed CY 2019 Statewide Average CCRs
----------------------------------------------------------------------------------------------------------------
Previous
Proposed CY default CCR
State Urban/Rural 2019 default (CY 2018 OPPS
CCR Final Rule)
----------------------------------------------------------------------------------------------------------------
ALASKA........................................ RURAL........................... 0.655 0.659
[[Page 37077]]
ALASKA........................................ URBAN........................... 0.224 0.218
ALABAMA....................................... RURAL........................... 0.190 0.190
ALABAMA....................................... URBAN........................... 0.154 0.155
ARKANSAS...................................... RURAL........................... 0.193 0.186
ARKANSAS...................................... URBAN........................... 0.195 0.200
ARIZONA....................................... RURAL........................... 0.241 0.232
ARIZONA....................................... URBAN........................... 0.157 0.160
CALIFORNIA.................................... RURAL........................... 0.181 0.181
CALIFORNIA.................................... URBAN........................... 0.188 0.193
COLORADO...................................... RURAL........................... 0.337 0.346
COLORADO...................................... URBAN........................... 0.201 0.204
CONNECTICUT................................... RURAL........................... 0.322 0.324
CONNECTICUT................................... URBAN........................... 0.251 0.249
DISTRICT OF COLUMBIA.......................... URBAN........................... 0.273 0.279
DELAWARE...................................... URBAN........................... 0.268 0.295
FLORIDA....................................... RURAL........................... 0.171 0.158
FLORIDA....................................... URBAN........................... 0.136 0.138
GEORGIA....................................... RURAL........................... 0.223 0.222
GEORGIA....................................... URBAN........................... 0.199 0.198
HAWAII........................................ RURAL........................... 0.355 0.332
HAWAII........................................ URBAN........................... 0.321 0.322
IOWA.......................................... RURAL........................... 0.288 0.296
IOWA.......................................... URBAN........................... 0.242 0.254
IDAHO......................................... RURAL........................... 0.339 0.339
IDAHO......................................... URBAN........................... 0.376 0.369
ILLINOIS...................................... RURAL........................... 0.209 0.214
ILLINOIS...................................... URBAN........................... 0.205 0.208
INDIANA....................................... RURAL........................... 0.256 0.299
INDIANA....................................... URBAN........................... 0.213 0.213
KANSAS........................................ RURAL........................... 0.266 0.264
KANSAS........................................ URBAN........................... 0.195 0.199
KENTUCKY...................................... RURAL........................... 0.179 0.184
KENTUCKY...................................... URBAN........................... 0.190 0.187
LOUISIANA..................................... RURAL........................... 0.211 0.212
LOUISIANA..................................... URBAN........................... 0.193 0.195
MASSACHUSETTS................................. RURAL........................... 0.314 0.322
MASSACHUSETTS................................. URBAN........................... 0.343 0.348
MAINE......................................... RURAL........................... 0.423 0.419
MAINE......................................... URBAN........................... 0.419 0.422
MARYLAND...................................... RURAL........................... 0.256 0.258
MARYLAND...................................... URBAN........................... 0.226 0.227
MICHIGAN...................................... RURAL........................... 0.296 0.302
MICHIGAN...................................... URBAN........................... 0.314 0.318
MINNESOTA..................................... RURAL........................... 0.376 0.379
MINNESOTA..................................... URBAN........................... 0.309 0.302
MISSOURI...................................... RURAL........................... 0.216 0.220
MISSOURI...................................... URBAN........................... 0.247 0.240
MISSISSIPPI................................... RURAL........................... 0.219 0.213
MISSISSIPPI................................... URBAN........................... 0.157 0.160
MONTANA....................................... RURAL........................... 0.478 0.486
MONTANA....................................... URBAN........................... 0.339 0.350
NORTH CAROLINA................................ RURAL........................... 0.204 0.206
NORTH CAROLINA................................ URBAN........................... 0.217 0.212
NORTH DAKOTA.................................. RURAL........................... 0.325 0.366
NORTH DAKOTA.................................. URBAN........................... 0.375 0.369
NEBRASKA...................................... RURAL........................... 0.304 0.313
NEBRASKA...................................... URBAN........................... 0.227 0.233
NEW HAMPSHIRE................................. RURAL........................... 0.304 0.307
NEW HAMPSHIRE................................. URBAN........................... 0.247 0.255
NEW JERSEY.................................... URBAN........................... 0.198 0.200
NEW MEXICO.................................... RURAL........................... 0.231 0.224
NEW MEXICO.................................... URBAN........................... 0.280 0.284
NEVADA........................................ RURAL........................... 0.163 0.175
NEVADA........................................ URBAN........................... 0.121 0.114
NEW YORK...................................... RURAL........................... 0.297 0.299
NEW YORK...................................... URBAN........................... 0.310 0.303
OHIO.......................................... RURAL........................... 0.277 0.280
OHIO.......................................... URBAN........................... 0.204 0.203
[[Page 37078]]
OKLAHOMA...................................... RURAL........................... 0.215 0.215
OKLAHOMA...................................... URBAN........................... 0.166 0.169
OREGON........................................ RURAL........................... 0.277 0.290
OREGON........................................ URBAN........................... 0.327 0.336
PENNSYLVANIA.................................. RURAL........................... 0.264 0.267
PENNSYLVANIA.................................. URBAN........................... 0.177 0.173
PUERTO RICO................................... URBAN........................... 0.547 0.577
RHODE ISLAND.................................. URBAN........................... 0.276 0.276
SOUTH CAROLINA................................ RURAL........................... 0.166 0.170
SOUTH CAROLINA................................ URBAN........................... 0.187 0.191
SOUTH DAKOTA.................................. RURAL........................... 0.338 0.391
SOUTH DAKOTA.................................. URBAN........................... 0.240 0.242
TENNESSEE..................................... RURAL........................... 0.173 0.173
TENNESSEE..................................... URBAN........................... 0.166 0.174
TEXAS......................................... RURAL........................... 0.218 0.205
TEXAS......................................... URBAN........................... 0.169 0.168
UTAH.......................................... RURAL........................... 0.288 0.391
UTAH.......................................... URBAN........................... 0.304 0.304
VIRGINIA...................................... RURAL........................... 0.177 0.177
VIRGINIA...................................... URBAN........................... 0.215 0.215
VERMONT....................................... RURAL........................... 0.392 0.393
VERMONT....................................... URBAN........................... 0.383 0.378
WASHINGTON.................................... RURAL........................... 0.260 0.256
WASHINGTON.................................... URBAN........................... 0.325 0.323
WISCONSIN..................................... RURAL........................... 0.342 0.348
WISCONSIN..................................... URBAN........................... 0.304 0.308
WEST VIRGINIA................................. RURAL........................... 0.261 0.253
WEST VIRGINIA................................. URBAN........................... 0.299 0.297
WYOMING....................................... RURAL........................... 0.397 0.407
WYOMING....................................... URBAN........................... 0.343 0.327
----------------------------------------------------------------------------------------------------------------
E. Proposed Adjustment for Rural Sole Community Hospitals (SCHs) and
Essential Access Community Hospitals (EACHs) Under Section
1833(t)(13)(B) of the Act for CY 2019
In the CY 2006 OPPS final rule with comment period (70 FR 68556),
we finalized a payment increase for rural sole community hospitals
(SCHs) of 7.1 percent for all services and procedures paid under the
OPPS, excluding drugs, biologicals, brachytherapy sources, and devices
paid under the pass-through payment policy in accordance with section
1833(t)(13)(B) of the Act, as added by section 411 of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003 (MMA)
(Pub. L. 108-173). Section 1833(t)(13) of the Act provided the
Secretary the authority to make an adjustment to OPPS payments for
rural hospitals, effective January 1, 2006, if justified by a study of
the difference in costs by APC between hospitals in rural areas and
hospitals in urban areas. Our analysis showed a difference in costs for
rural SCHs. Therefore, for the CY 2006 OPPS, we finalized a payment
adjustment for rural SCHs of 7.1 percent for all services and
procedures paid under the OPPS, excluding separately payable drugs and
biologicals, brachytherapy sources, and devices paid under the pass-
through payment policy, in accordance with section 1833(t)(13)(B) of
the Act.
In the CY 2007 OPPS/ASC final rule with comment period (71 FR 68010
and 68227), for purposes of receiving this rural adjustment, we revised
Sec. 419.43(g) of the regulations to clarify that essential access
community hospitals (EACHs) also are eligible to receive the rural SCH
adjustment, assuming these entities otherwise meet the rural adjustment
criteria. Currently, two hospitals are classified as EACHs, and as of
CY 1998, under section 4201(c) of Public Law 105-33, a hospital can no
longer become newly classified as an EACH.
This adjustment for rural SCHs is budget neutral and applied before
calculating outlier payments and copayments. We stated in the CY 2006
OPPS final rule with comment period (70 FR 68560) that we would not
reestablish the adjustment amount on an annual basis, but we may review
the adjustment in the future and, if appropriate, would revise the
adjustment. We provided the same 7.1 percent adjustment to rural SCHs,
including EACHs, again in CYs 2008 through 2018. Further, in the CY
2009 OPPS/ASC final rule with comment period (73 FR 68590), we updated
the regulations at Sec. 419.43(g)(4) to specify, in general terms,
that items paid at charges adjusted to costs by application of a
hospital-specific CCR are excluded from the 7.1 percent payment
adjustment.
For the CY 2019 OPPS, we are proposing to continue the current
policy of a 7.1 percent payment adjustment that is done in a budget
neutral manner for rural SCHs, including EACHs, for all services and
procedures paid under the OPPS, excluding separately payable drugs and
biologicals, devices paid under the pass-through payment policy, and
items paid at charges reduced to costs. In addition, we are proposing
to maintain this 7.1 percent payment adjustment for the years after CY
2019 until we identify data in the future that would support a change
to this payment adjustment.
[[Page 37079]]
F. Proposed Payment Adjustment for Certain Cancer Hospitals for CY 2019
1. Background
Since the inception of the OPPS, which was authorized by the
Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33), Medicare has paid
the 11 hospitals that meet the criteria for cancer hospitals identified
in section 1886(d)(1)(B)(v) of the Act under the OPPS for covered
outpatient hospital services. These cancer hospitals are exempted from
payment under the IPPS. With the Medicare, Medicaid and SCHIP Balanced
Budget Refinement Act of 1999 (Pub. L. 106-113), Congress established
section 1833(t)(7) of the Act, ``Transitional Adjustment to Limit
Decline in Payment,'' to determine OPPS payments to cancer and
children's hospitals based on their pre-BBA payment amount (often
referred to as ``held harmless'').
As required under section 1833(t)(7)(D)(ii) of the Act, a cancer
hospital receives the full amount of the difference between payments
for covered outpatient services under the OPPS and a ``pre-BBA
amount.'' That is, cancer hospitals are permanently held harmless to
their ``pre-BBA amount,'' and they receive transitional outpatient
payments (TOPs) or hold harmless payments to ensure that they do not
receive a payment that is lower in amount under the OPPS than the
payment amount they would have received before implementation of the
OPPS, as set forth in section 1833(t)(7)(F) of the Act. The ``pre-BBA
amount'' is the product of the hospital's reasonable costs for covered
outpatient services occurring in the current year and the base payment-
to-cost ratio (PCR) for the hospital defined in section
1833(t)(7)(F)(ii) of the Act. The ``pre-BBA amount'' and the
determination of the base PCR are defined at 42 CFR 419.70(f). TOPs are
calculated on Worksheet E, Part B, of the Hospital Cost Report or the
Hospital Health Care Complex Cost Report (Form CMS-2552-96 or Form CMS-
2552-10, respectively) as applicable each year. Section 1833(t)(7)(I)
of the Act exempts TOPs from budget neutrality calculations.
Section 3138 of the Affordable Care Act amended section 1833(t) of
the Act by adding a new paragraph (18), which instructs the Secretary
to conduct a study to determine if, under the OPPS, outpatient costs
incurred by cancer hospitals described in section 1886(d)(1)(B)(v) of
the Act with respect to APC groups exceed outpatient costs incurred by
other hospitals furnishing services under section 1833(t) of the Act,
as determined appropriate by the Secretary. Section 1833(t)(18)(A) of
the Act requires the Secretary to take into consideration the cost of
drugs and biologicals incurred by cancer hospitals and other hospitals.
Section 1833(t)(18)(B) of the Act provides that, if the Secretary
determines that cancer hospitals' costs are higher than those of other
hospitals, the Secretary shall provide an appropriate adjustment under
section 1833(t)(2)(E) of the Act to reflect these higher costs. In
2011, after conducting the study required by section 1833(t)(18)(A) of
the Act, we determined that outpatient costs incurred by the 11
specified cancer hospitals were greater than the costs incurred by
other OPPS hospitals. For a complete discussion regarding the cancer
hospital cost study, we refer readers to the CY 2012 OPPS/ASC final
rule with comment period (76 FR 74200 through 74201).
Based on these findings, we finalized a policy to provide a payment
adjustment to the 11 specified cancer hospitals that reflects their
higher outpatient costs as discussed in the CY 2012 OPPS/ASC final rule
with comment period (76 FR 74202 through 74206). Specifically, we
adopted a policy to provide additional payments to the cancer hospitals
so that each cancer hospital's final PCR for services provided in a
given calendar year is equal to the weighted average PCR (which we
refer to as the ``target PCR'') for other hospitals paid under the
OPPS. The target PCR is set in advance of the calendar year and is
calculated using the most recently submitted or settled cost report
data that are available at the time of final rulemaking for the
calendar year. The amount of the payment adjustment is made on an
aggregate basis at cost report settlement. We note that the changes
made by section 1833(t)(18) of the Act do not affect the existing
statutory provisions that provide for TOPs for cancer hospitals. The
TOPs are assessed as usual after all payments, including the cancer
hospital payment adjustment, have been made for a cost reporting
period. For CYs 2012 and 2013, the target PCR for purposes of the
cancer hospital payment adjustment was 0.91. For CY 2014, the target
PCR for purposes of the cancer hospital payment adjustment was 0.89.
For CY 2015, the target PCR was 0.90. For CY 2016, the target PCR was
0.92, as discussed in the CY 2016 OPPS/ASC final rule with comment
period (80 FR 70362 through 70363). For CY 2017, the target PCR was
0.91, as discussed in the CY 2017 OPPS/ASC final rule with comment
period (81 FR 79603 through 79604). For CY 2018, the target PCR was
0.88, as discussed in the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59265 through 59266).
2. Proposed Policy for CY 2019
Section 16002(b) of the 21st Century Cures Act (Pub. L. 114-255)
amended section 1833(t)(18) of the Act by adding subparagraph (C),
which requires that in applying 42 CFR 419.43(i), that is, the payment
adjustment for certain cancer hospitals, for services furnished on or
after January 1, 2018, the target PCR adjustment be reduced by 1.0
percentage point less than what would otherwise apply. Section 16002(b)
also provides that, in addition to the percentage reduction, the
Secretary may consider making an additional percentage point reduction
to the target PCR that takes into account payment rates for applicable
items and services described under section 1833(t)(21)(C) of the Act
for hospitals that are not cancer hospitals described under section
1886(d)(1)(B)(v) of the Act. Further, in making any budget neutrality
adjustment under section 1833(t) of the Act, the Secretary shall not
take into account the reduced expenditures that result from application
of section 1833(t)(18)(C) of the Act. For CY 2019, we are proposing to
provide additional payments to the 11 specified cancer hospitals so
that each cancer hospital's final PCR is equal to the weighted average
PCR (or ``target PCR'') for the other OPPS hospitals using the most
recent submitted or settled cost report data that are available at the
time of the development of this proposed rule, reduced by 1.0
percentage point to comply with section 16002(b) of the 21st Century
Cures Act. We are not proposing an additional reduction beyond the 1.0
percentage point reduction required by section 16002(b) for CY 2019. To
calculate the proposed CY 2019 target PCR, we use the same extract of
cost report data from HCRIS, as discussed in section II.A. of this
proposed rule, used to estimate costs for the CY 2019 OPPS. Using these
cost report data, we included data from Worksheet E, Part B, for each
hospital, using data from each hospital's most recent cost report,
whether as submitted or settled.
We then limited the dataset to the hospitals with CY 2017 claims
data that we used to model the impact of the proposed CY 2019 APC
relative payment weights (3,676 hospitals) because it is appropriate to
use the same set of hospitals that we are using to calibrate the
modeled CY 2019 OPPS. The cost report data for the hospitals in this
dataset were from cost report
[[Page 37080]]
periods with fiscal year ends ranging from 2014 to 2017.
We then removed the cost report data of the 43 hospitals located in
Puerto Rico from our dataset because we do not believe that their cost
structure reflects the costs of most hospitals paid under the OPPS and,
therefore, their inclusion may bias the calculation of hospital-
weighted statistics. We also removed the cost report data of 18
hospitals because these hospitals had cost report data that were not
complete (missing aggregate OPPS payments, missing aggregate cost data,
or missing both), so that all cost reports in the study would have both
the payment and cost data necessary to calculate a PCR for each
hospital, leading to a proposed analytic file of 3,615 hospitals with
cost report data.
Using this smaller dataset of cost report data, we estimated that,
on average, the OPPS payments to other hospitals furnishing services
under the OPPS were approximately 89 percent of reasonable cost
(weighted average PCR of 0.89). Therefore, after applying the 1.0
percentage point reduction as required by section 16002(b) of the 21st
Century Cures Act, we are proposing that the payment amount associated
with the cancer hospital payment adjustment to be determined at cost
report settlement would be the additional payment needed to result in a
proposed target PCR equal to 0.88 for each cancer hospital.
Table 6 below indicates the proposed estimated percentage increase
in OPPS payments to each cancer hospital for CY 2019 due to the
proposed cancer hospital payment adjustment policy. The actual amount
of the CY 2019 cancer hospital payment adjustment for each cancer
hospital will be determined at cost report settlement and will depend
on each hospital's CY 2019 payments and costs. We note that the
requirements contained in section 1833(t)(18) of the Act do not affect
the existing statutory provisions that provide for TOPs for cancer
hospitals. The TOPs will be assessed as usual after all payments,
including the cancer hospital payment adjustment, have been made for a
cost reporting period.
Table 6--Proposed Estimated CY 2019 Hospital-Specific Payment Adjustment
for Cancer Hospitals to be Provided at Cost Report Settlement
------------------------------------------------------------------------
Estimated
percentage
increase in
Provider No. Hospital name OPPS payments
for CY 2019
due to payment
adjustment
------------------------------------------------------------------------
050146..................... City of Hope Comprehensive 37.1
Cancer Center.
050660..................... USC Norris Cancer Hospital. 13.4
100079..................... Sylvester Comprehensive 21.0
Cancer Center.
100271..................... H. Lee Moffitt Cancer 22.3
Center & Research
Institute.
220162..................... Dana-Farber Cancer 43.7
Institute.
330154..................... Memorial Sloan-Kettering 46.9
Cancer Center.
330354..................... Roswell Park Cancer 16.2
Institute.
360242..................... James Cancer Hospital & 22.6
Solove Research Institute.
390196..................... Fox Chase Cancer Center.... 8.4
450076..................... M.D. Anderson Cancer Center 53.6
500138..................... Seattle Cancer Care 54.3
Alliance.
------------------------------------------------------------------------
G. Proposed Hospital Outpatient Outlier Payments
1. Background
The OPPS provides outlier payments to hospitals to help mitigate
the financial risk associated with high-cost and complex procedures,
where a very costly service could present a hospital with significant
financial loss. As explained in the CY 2015 OPPS/ASC final rule with
comment period (79 FR 66832 through 66834), we set our projected target
for aggregate outlier payments at 1.0 percent of the estimated
aggregate total payments under the OPPS for the prospective year.
Outlier payments are provided on a service-by-service basis when the
cost of a service exceeds the APC payment amount multiplier threshold
(the APC payment amount multiplied by a certain amount) as well as the
APC payment amount plus a fixed-dollar amount threshold (the APC
payment plus a certain amount of dollars). In CY 2018, the outlier
threshold was met when the hospital's cost of furnishing a service
exceeded 1.75 times (the multiplier threshold) the APC payment amount
and exceeded the APC payment amount plus $4,150 (the fixed-dollar
amount threshold) (82 FR 59267 through 59268). If the cost of a service
exceeds both the multiplier threshold and the fixed-dollar threshold,
the outlier payment is calculated as 50 percent of the amount by which
the cost of furnishing the service exceeds 1.75 times the APC payment
amount. Beginning with CY 2009 payments, outlier payments are subject
to a reconciliation process similar to the IPPS outlier reconciliation
process for cost reports, as discussed in the CY 2009 OPPS/ASC final
rule with comment period (73 FR 68594 through 68599).
It has been our policy to report the actual amount of outlier
payments as a percent of total spending in the claims being used to
model the OPPS. Our estimate of total outlier payments as a percent of
total CY 2017 OPPS payments, using CY 2017 claims available for this
proposed rule, is approximately 1.0 percent of the total aggregated
OPPS payments. Therefore, for CY 2017, we estimate that we paid the
outlier target of 1.0 percent of total aggregated OPPS payments.
For this proposed rule, using CY 2017 claims data and CY 2018
payment rates, we estimate that the aggregate outlier payments for CY
2018 would be approximately 1.02 percent of the total CY 2018 OPPS
payments. We are providing estimated CY 2019 outlier payments for
hospitals and CMHCs with claims included in the claims data that we
used to model impacts in the Hospital-Specific Impacts--Provider-
Specific Data file on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html.
[[Page 37081]]
2. Proposed Outlier Calculation for CY 2019
For CY 2019, we are proposing to continue our policy of estimating
outlier payments to be 1.0 percent of the estimated aggregate total
payments under the OPPS. We are proposing that a portion of that 1.0
percent, an amount equal to less than 0.01 percent of outlier payments
(or 0.0001 percent of total OPPS payments) would be allocated to CMHCs
for PHP outlier payments. This is the amount of estimated outlier
payments that would result from the proposed CMHC outlier threshold as
a proportion of total estimated OPPS outlier payments. As discussed in
section VIII.C. of this proposed rule, we are proposing to continue our
longstanding policy that if a CMHC's cost for partial hospitalization
services, paid under APC 5853 (Partial Hospitalization for CMHCs),
exceeds 3.40 times the payment rate for proposed APC 5853, the outlier
payment would be calculated as 50 percent of the amount by which the
cost exceeds 3.40 times the proposed APC 5853 payment rate. For further
discussion of CMHC outlier payments, we refer readers to section
VIII.C. of this proposed rule.
To ensure that the estimated CY 2019 aggregate outlier payments
would equal 1.0 percent of estimated aggregate total payments under the
OPPS, we are proposing that the hospital outlier threshold be set so
that outlier payments would be triggered when a hospital's cost of
furnishing a service exceeds 1.75 times the APC payment amount and
exceeds the APC payment amount plus $4,600.
We calculated this proposed fixed-dollar threshold of $4,600 using
the standard methodology most recently used for CY 2018 (82 FR 59267
through 59268). For purposes of estimating outlier payments for this
proposed rule, we used the hospital-specific overall ancillary CCRs
available in the April 2018 update to the Outpatient Provider-Specific
File (OPSF). The OPSF contains provider-specific data, such as the most
current CCRs, which are maintained by the MACs and used by the OPPS
Pricer to pay claims. The claims that we use to model each OPPS update
lag by 2 years.
In order to estimate the CY 2019 hospital outlier payments for this
proposed rule, we inflated the charges on the CY 2017 claims using the
same inflation factor of 1.085868 that we used to estimate the IPPS
fixed-dollar outlier threshold for the FY 2019 IPPS/LTCH PPS proposed
rule (83 FR 20581). We used an inflation factor of 1.04205 to estimate
CY 2018 charges from the CY 2017 charges reported on CY 2017 claims.
The methodology for determining this charge inflation factor is
discussed in the FY 2018 IPPS/LTCH PPS final rule (82 FR 20581). As we
stated in the CY 2005 OPPS final rule with comment period (69 FR
65845), we believe that the use of these charge inflation factors are
appropriate for the OPPS because, with the exception of the inpatient
routine service cost centers, hospitals use the same ancillary and
outpatient cost centers to capture costs and charges for inpatient and
outpatient services.
As noted in the CY 2007 OPPS/ASC final rule with comment period (71
FR 68011), we are concerned that we could systematically overestimate
the OPPS hospital outlier threshold if we did not apply a CCR inflation
adjustment factor. Therefore, we are proposing to apply the same CCR
inflation adjustment factor that we proposed to apply for the FY 2019
IPPS outlier calculation to the CCRs used to simulate the proposed CY
2019 OPPS outlier payments to determine the fixed-dollar threshold.
Specifically, for CY 2019, we are proposing to apply an adjustment
factor of 0.987842 to the CCRs that were in the April 2018 OPSF to
trend them forward from CY 2018 to CY 2019. The methodology for
calculating this proposed adjustment is discussed in the FY 2019 IPPS/
LTCH PPS proposed rule (83 FR 20582).
To model hospital outlier payments for the proposed rule, we
applied the overall CCRs from the April 2018 OPSF after adjustment
(using the proposed CCR inflation adjustment factor of 0.987842 to
approximate CY 2019 CCRs) to charges on CY 2017 claims that were
adjusted (using the proposed charge inflation factor of 1.085868 to
approximate CY 2019 charges). We simulated aggregated CY 2019 hospital
outlier payments using these costs for several different fixed-dollar
thresholds, holding the 1.75 multiplier threshold constant and assuming
that outlier payments would continue to be made at 50 percent of the
amount by which the cost of furnishing the service would exceed 1.75
times the APC payment amount, until the total outlier payments equaled
1.0 percent of aggregated estimated total CY 2019 OPPS payments. We
estimated that a proposed fixed-dollar threshold of $4,600, combined
with the proposed multiplier threshold of 1.75 times the APC payment
rate, would allocate 1.0 percent of aggregated total OPPS payments to
outlier payments. For CMHCs, we are proposing that, if a CMHC's cost
for partial hospitalization services, paid under APC 5853, exceeds 3.40
times the payment rate for APC 5853, the outlier payment would be
calculated as 50 percent of the amount by which the cost exceeds 3.40
times the APC 5853 payment rate.
Section 1833(t)(17)(A) of the Act, which applies to hospitals as
defined under section 1886(d)(1)(B) of the Act, requires that hospitals
that fail to report data required for the quality measures selected by
the Secretary, in the form and manner required by the Secretary under
section 1833(t)(17)(B) of the Act, incur a 2.0 percentage point
reduction to their OPD fee schedule increase factor; that is, the
annual payment update factor. The application of a reduced OPD fee
schedule increase factor results in reduced national unadjusted payment
rates that will apply to certain outpatient items and services
furnished by hospitals that are required to report outpatient quality
data and that fail to meet the Hospital OQR Program requirements. For
hospitals that fail to meet the Hospital OQR Program requirements, we
are proposing to continue the policy that we implemented in CY 2010
that the hospitals' costs will be compared to the reduced payments for
purposes of outlier eligibility and payment calculation. For more
information on the Hospital OQR Program, we referred readers to section
XIII. of this proposed rule.
H. Proposed Calculation of an Adjusted Medicare Payment From the
National Unadjusted Medicare Payment
The basic methodology for determining prospective payment rates for
HOPD services under the OPPS is set forth in existing regulations at 42
CFR part 419, subparts C and D. For this CY 2019 OPPS/ASC proposed
rule, the proposed payment rate for most services and procedures for
which payment is made under the OPPS is the product of the conversion
factor calculated in accordance with section II.B. of this proposed
rule and the proposed relative payment weight determined under section
II.A. of this proposed rule. Therefore, the proposed national
unadjusted payment rate for most APCs contained in Addendum A to this
proposed rule (which is available via the internet on the CMS website)
and for most HCPCS codes to which separate payment under the OPPS has
been assigned in Addendum B to this proposed rule (which is available
via the internet on the CMS website) was calculated by multiplying the
proposed CY 2019 scaled weight for the APC by the proposed CY 2019
conversion factor.
[[Page 37082]]
We note that section 1833(t)(17) of the Act, which applies to
hospitals as defined under section 1886(d)(1)(B) of the Act, requires
that hospitals that fail to submit data required to be submitted on
quality measures selected by the Secretary, in the form and manner and
at a time specified by the Secretary, incur a reduction of 2.0
percentage points to their OPD fee schedule increase factor, that is,
the annual payment update factor. The application of a reduced OPD fee
schedule increase factor results in reduced national unadjusted payment
rates that apply to certain outpatient items and services provided by
hospitals that are required to report outpatient quality data and that
fail to meet the Hospital OQR Program (formerly referred to as the
Hospital Outpatient Quality Data Reporting Program (HOP QDRP))
requirements. For further discussion of the payment reduction for
hospitals that fail to meet the requirements of the Hospital OQR
Program, we refer readers to section XIII. of this proposed rule.
We demonstrate below the steps on how to determine the APC payments
that would be made in a calendar year under the OPPS to a hospital that
fulfills the Hospital OQR Program requirements and to a hospital that
fails to meet the Hospital OQR Program requirements for a service that
has any of the following status indicator assignments: ``J1'', ``J2'',
``P'', ``Q1'', ``Q2'', ``Q3'', ``Q4'', ``R'', ``S'', ``T'', ``U'', or
``V'' (as defined in Addendum D1 to this proposed rule, which is
available via the internet on the CMS website), in a circumstance in
which the multiple procedure discount does not apply, the procedure is
not bilateral, and conditionally packaged services (status indicator of
``Q1'' and ``Q2'') qualify for separate payment. We note that, although
blood and blood products with status indicator ``R'' and brachytherapy
sources with status indicator ``U'' are not subject to wage adjustment,
they are subject to reduced payments when a hospital fails to meet the
Hospital OQR Program requirements.
Individual providers interested in calculating the payment amount
that they would receive for a specific service from the proposed
national unadjusted payment rates presented in Addenda A and B to this
proposed rule (which are available via the internet on the CMS website)
should follow the formulas presented in the following steps. For
purposes of the payment calculations below, we refer to the proposed
national unadjusted payment rate for hospitals that meet the
requirements of the Hospital OQR Program as the ``full'' national
unadjusted payment rate. We refer to the proposed national unadjusted
payment rate for hospitals that fail to meet the requirements of the
Hospital OQR Program as the ``reduced'' national unadjusted payment
rate. The proposed reduced national unadjusted payment rate is
calculated by multiplying the reporting ratio of 0.980 times the
``full'' national unadjusted payment rate. The proposed national
unadjusted payment rate used in the calculations below is either the
full national unadjusted payment rate or the reduced national
unadjusted payment rate, depending on whether the hospital met its
Hospital OQR Program requirements in order to receive the proposed full
CY 2019 OPPS fee schedule increase factor.
Step 1. Calculate 60 percent (the labor-related portion) of the
national unadjusted payment rate. Since the initial implementation of
the OPPS, we have used 60 percent to represent our estimate of that
portion of costs attributable, on average, to labor. We refer readers
to the April 7, 2000 OPPS final rule with comment period (65 FR 18496
through 18497) for a detailed discussion of how we derived this
percentage. During our regression analysis for the payment adjustment
for rural hospitals in the CY 2006 OPPS final rule with comment period
(70 FR 68553), we confirmed that this labor-related share for hospital
outpatient services is appropriate.
The formula below is a mathematical representation of Step 1 and
identifies the labor-related portion of a specific payment rate for a
specific service.
X is the labor-related portion of the national unadjusted payment rate.
X = .60 * (national unadjusted payment rate).
Step 2. Determine the wage index area in which the hospital is
located and identify the wage index level that applies to the specific
hospital. We note that, under the proposed CY 2019 OPPS policy for
continuing to use the OMB labor market area delineations based on the
2010 Decennial Census data for the wage indexes used under the IPPS, a
hold harmless policy for the wage index may apply, as discussed in
section II.C. of this proposed rule. The proposed wage index values
assigned to each area reflect the geographic statistical areas (which
are based upon OMB standards) to which hospitals are assigned for FY
2019 under the IPPS, reclassifications through the Metropolitan
Geographic Classification Review Board (MGCRB), section 1886(d)(8)(B)
``Lugar'' hospitals, reclassifications under section 1886(d)(8)(E) of
the Act, as defined in Sec. 412.103 of the regulations, and hospitals
designated as urban under section 601(g) of Public Law 98-21. For
further discussion of the proposed changes to the FY 2019 IPPS wage
indexes, as applied to the CY 2019 OPPS, we refer readers to section
II.C. of this proposed rule. We are proposing to continue to apply a
wage index floor of 1.00 to frontier States, in accordance with section
10324 of the Affordable Care Act of 2010.
Step 3. Adjust the wage index of hospitals located in certain
qualifying counties that have a relatively high percentage of hospital
employees who reside in the county, but who work in a different county
with a higher wage index, in accordance with section 505 of Public Law
108-173. Addendum L to this proposed rule (which is available via the
internet on the CMS website) contains the qualifying counties and the
associated wage index increase developed for the proposed FY 2019 IPPS,
which are listed in Table 2 in the FY 2019 IPPS/LTCH PPS proposed rule
available via the internet on the CMS website at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/index.html.
(Click on the link on the left side of the screen titled ``FY 2019 IPPS
Proposed Rule Home Page'' and select ``FY 2019 Proposed Rule Tables.'')
This step is to be followed only if the hospital is not reclassified or
redesignated under section 1886(d)(8) or section 1886(d)(10) of the
Act.
Step 4. Multiply the applicable wage index determined under Steps 2
and 3 by the amount determined under Step 1 that represents the labor-
related portion of the national unadjusted payment rate.
The formula below is a mathematical representation of Step 4 and
adjusts the labor-related portion of the national unadjusted payment
rate for the specific service by the wage index.
Xa is the labor-related portion of the national unadjusted payment rate
(wage adjusted).
Xa = .60 * (national unadjusted payment rate) * applicable wage index.
Step 5. Calculate 40 percent (the nonlabor-related portion) of the
national unadjusted payment rate and add that amount to the resulting
product of Step 4. The result is the wage index adjusted payment rate
for the relevant wage index area.
The formula below is a mathematical representation of Step 5 and
calculates the remaining portion of the national payment rate, the
amount not attributable to labor, and the adjusted payment for the
specific service.
Y is the nonlabor-related portion of the national unadjusted payment
rate.
[[Page 37083]]
Y = .40 * (national unadjusted payment rate).
Adjusted Medicare Payment = Y + Xa.
Step 6. If a provider is an SCH, as set forth in the regulations at
Sec. 412.92, or an EACH, which is considered to be an SCH under
section 1886(d)(5)(D)(iii)(III) of the Act, and located in a rural
area, as defined in Sec. 412.64(b), or is treated as being located in
a rural area under Sec. 412.103, multiply the wage index adjusted
payment rate by 1.071 to calculate the total payment.
The formula below is a mathematical representation of Step 6 and
applies the rural adjustment for rural SCHs.
Adjusted Medicare Payment (SCH or EACH) = Adjusted Medicare Payment *
1.071.
We are providing examples below of the calculation of both the
proposed full and reduced national unadjusted payment rates that would
apply to certain outpatient items and services performed by hospitals
that meet and that fail to meet the Hospital OQR Program requirements,
using the steps outlined above. For purposes of this example, we used a
provider that is located in Brooklyn, New York that is assigned to CBSA
35614. This provider bills one service that is assigned to APC 5071
(Level 1 Excision/Biopsy/Incision and Drainage). The proposed CY 2019
full national unadjusted payment rate for APC 5071 is approximately
$581.99. The proposed reduced national unadjusted payment rate for APC
5071 for a hospital that fails to meet the Hospital OQR Program
requirements is approximately $570.35. This proposed reduced rate is
calculated by multiplying the proposed reporting ratio of 0.980 by the
proposed full unadjusted payment rate for APC 5071.
The proposed FY 2019 wage index for a provider located in CBSA
35614 in New York is 1.2850. The labor-related portion of the proposed
full national unadjusted payment is approximately $448.71 (.60 *
$581.99 * 1.2850). The labor-related portion of the proposed reduced
national unadjusted payment is approximately $439.74 (.60 * 570.35*
1.2850). The nonlabor-related portion of the proposed full national
unadjusted payment is approximately $232.80 (.40 * $581.99). The
nonlabor-related portion of the proposed reduced national unadjusted
payment is approximately $228.14 (.40 * $570.35). The sum of the labor-
related and nonlabor-related portions of the proposed full national
adjusted payment is approximately $681.51 ($448.71 + $232.80). The sum
of the portions of the proposed reduced national adjusted payment is
approximately $667.88 ($439.74 + $228.14).
I. Proposed Beneficiary Copayments
1. Background
Section 1833(t)(3)(B) of the Act requires the Secretary to set
rules for determining the unadjusted copayment amounts to be paid by
beneficiaries for covered OPD services. Section 1833(t)(8)(C)(ii) of
the Act specifies that the Secretary must reduce the national
unadjusted copayment amount for a covered OPD service (or group of such
services) furnished in a year in a manner so that the effective
copayment rate (determined on a national unadjusted basis) for that
service in the year does not exceed a specified percentage. As
specified in section 1833(t)(8)(C)(ii)(V) of the Act, the effective
copayment rate for a covered OPD service paid under the OPPS in CY
2006, and in calendar years thereafter, shall not exceed 40 percent of
the APC payment rate. Section 1833(t)(3)(B)(ii) of the Act provides
that, for a covered OPD service (or group of such services) furnished
in a year, the national unadjusted copayment amount cannot be less than
20 percent of the OPD fee schedule amount. However, section
1833(t)(8)(C)(i) of the Act limits the amount of beneficiary copayment
that may be collected for a procedure (including items such as drugs
and biologicals) performed in a year to the amount of the inpatient
hospital deductible for that year.
Section 4104 of the Affordable Care Act eliminated the Medicare
Part B coinsurance for preventive services furnished on and after
January 1, 2011, that meet certain requirements, including flexible
sigmoidoscopies and screening colonoscopies, and waived the Part B
deductible for screening colonoscopies that become diagnostic during
the procedure. Our discussion of the changes made by the Affordable
Care Act with regard to copayments for preventive services furnished on
and after January 1, 2011, may be found in section XII.B. of the CY
2011 OPPS/ASC final rule with comment period (75 FR 72013).
2. Proposed OPPS Copayment Policy
For CY 2019, we are proposing to determine copayment amounts for
new and revised APCs using the same methodology that we implemented
beginning in CY 2004. (We refer readers to the November 7, 2003 OPPS
final rule with comment period (68 FR 63458).) In addition, we are
proposing to use the same standard rounding principles that we have
historically used in instances where the application of our standard
copayment methodology would result in a copayment amount that is less
than 20 percent and cannot be rounded, under standard rounding
principles, to 20 percent. (We refer readers to the CY 2008 OPPS/ASC
final rule with comment period (72 FR 66687) in which we discuss our
rationale for applying these rounding principles.) The proposed
national unadjusted copayment amounts for services payable under the
OPPS that would be effective January 1, 2019 are included in Addenda A
and B to this proposed rule (which are available via the internet on
the CMS website).
As discussed in section XIII.E. of this proposed rule, for CY 2019,
the proposed Medicare beneficiary's minimum unadjusted copayment and
national unadjusted copayment for a service to which a reduced national
unadjusted payment rate applies will equal the product of the reporting
ratio and the national unadjusted copayment, or the product of the
reporting ratio and the minimum unadjusted copayment, respectively, for
the service.
We note that OPPS copayments may increase or decrease each year
based on changes in the calculated APC payment rates due to updated
cost report and claims data, and any changes to the OPPS cost modeling
process. However, as described in the CY 2004 OPPS final rule with
comment period, the development of the copayment methodology generally
moves beneficiary copayments closer to 20 percent of OPPS APC payments
(68 FR 63458 through 63459).
In the CY 2004 OPPS final rule with comment period (68 FR 63459),
we adopted a new methodology to calculate unadjusted copayment amounts
in situations including reorganizing APCs, and we finalized the
following rules to determine copayment amounts in CY 2004 and
subsequent years.
When an APC group consists solely of HCPCS codes that were
not paid under the OPPS the prior year because they were packaged or
excluded or are new codes, the unadjusted copayment amount would be 20
percent of the APC payment rate.
If a new APC that did not exist during the prior year is
created and consists of HCPCS codes previously assigned to other APCs,
the copayment amount is calculated as the product of the APC payment
rate and the lowest coinsurance percentage of the codes comprising the
new APC.
If no codes are added to or removed from an APC and, after
recalibration of its relative payment weight, the new payment rate is
equal to or greater than
[[Page 37084]]
the prior year's rate, the copayment amount remains constant (unless
the resulting coinsurance percentage is less than 20 percent).
If no codes are added to or removed from an APC and, after
recalibration of its relative payment weight, the new payment rate is
less than the prior year's rate, the copayment amount is calculated as
the product of the new payment rate and the prior year's coinsurance
percentage.
If HCPCS codes are added to or deleted from an APC and,
after recalibrating its relative payment weight, holding its unadjusted
copayment amount constant results in a decrease in the coinsurance
percentage for the reconfigured APC, the copayment amount would not
change (unless retaining the copayment amount would result in a
coinsurance rate less than 20 percent).
If HCPCS codes are added to an APC and, after
recalibrating its relative payment weight, holding its unadjusted
copayment amount constant results in an increase in the coinsurance
percentage for the reconfigured APC, the copayment amount would be
calculated as the product of the payment rate of the reconfigured APC
and the lowest coinsurance percentage of the codes being added to the
reconfigured APC.
We noted in the CY 2004 OPPS final rule with comment period that we
would seek to lower the copayment percentage for a service in an APC
from the prior year if the copayment percentage was greater than 20
percent. We noted that this principle was consistent with section
1833(t)(8)(C)(ii) of the Act, which accelerates the reduction in the
national unadjusted coinsurance rate so that beneficiary liability will
eventually equal 20 percent of the OPPS payment rate for all OPPS
services to which a copayment applies, and with section 1833(t)(3)(B)
of the Act, which achieves a 20-percent copayment percentage when fully
phased in and gives the Secretary the authority to set rules for
determining copayment amounts for new services. We further noted that
the use of this methodology would, in general, reduce the beneficiary
coinsurance rate and copayment amount for APCs for which the payment
rate changes as the result of the reconfiguration of APCs and/or
recalibration of relative payment weights (68 FR 63459).
3. Proposed Calculation of an Adjusted Copayment Amount for an APC
Group
Individuals interested in calculating the national copayment
liability for a Medicare beneficiary for a given service provided by a
hospital that met or failed to meet its Hospital OQR Program
requirements should follow the formulas presented in the following
steps.
Step 1. Calculate the beneficiary payment percentage for the APC by
dividing the APC's national unadjusted copayment by its payment rate.
For example, using APC 5071, $116.40 is approximately 20 percent of the
proposed full national unadjusted payment rate of $581.99. For APCs
with only a minimum unadjusted copayment in Addenda A and B to this
proposed rule (which are available via the internet on the CMS
website), the beneficiary payment percentage is 20 percent.
The formula below is a mathematical representation of Step 1 and
calculates the national copayment as a percentage of national payment
for a given service.
B is the beneficiary payment percentage.
B = National unadjusted copayment for APC/national unadjusted payment
rate for APC.
Step 2. Calculate the appropriate wage-adjusted payment rate for
the APC for the provider in question, as indicated in Steps 2 through 4
under section II.H. of this proposed rule. Calculate the rural
adjustment for eligible providers as indicated in Step 6 under section
II.H. of this proposed rule.
Step 3. Multiply the percentage calculated in Step 1 by the payment
rate calculated in Step 2. The result is the wage-adjusted copayment
amount for the APC. The formula below is a mathematical representation
of Step 3 and applies the beneficiary payment percentage to the
adjusted payment rate for a service calculated under section II.H. of
this proposed rule, with and without the rural adjustment, to calculate
the adjusted beneficiary copayment for a given service.
Wage-adjusted copayment amount for the APC = Adjusted Medicare Payment
* B.
Wage-adjusted copayment amount for the APC (SCH or EACH) = (Adjusted
Medicare Payment * 1.071) * B.
Step 4. For a hospital that failed to meet its Hospital OQR Program
requirements, multiply the copayment calculated in Step 3 by the
reporting ratio of 0.980.
The proposed unadjusted copayments for services payable under the
OPPS that would be effective January 1, 2019, are shown in Addenda A
and B to this proposed rule (which are available via the internet on
the CMS website). We note that the proposed national unadjusted payment
rates and copayment rates shown in Addenda A and B to this proposed
rule reflect the proposed CY 2019 OPD fee schedule increase factor
discussed in section II.B. of this proposed rule.
In addition, as noted earlier, section 1833(t)(8)(C)(i) of the Act
limits the amount of beneficiary copayment that may be collected for a
procedure performed in a year to the amount of the inpatient hospital
deductible for that year.
III. Proposed OPPS Ambulatory Payment Classification (APC) Group
Policies
A. Proposed OPPS Treatment of New CPT and Level II HCPCS Codes
CPT and Level II HCPCS codes are used to report procedures,
services, items, and supplies under the hospital OPPS. Specifically,
CMS recognizes the following codes on OPPS claims:
Category I CPT codes, which describe surgical procedures
and medical services;
Category III CPT codes, which describe new and emerging
technologies, services, and procedures; and
Level II HCPCS codes, which are used primarily to identify
products, supplies, temporary procedures, and services not described by
CPT codes.
CPT codes are established by the American Medical Association (AMA)
and the Level II HCPCS codes are established by the CMS HCPCS
Workgroup. These codes are updated and changed throughout the year. CPT
and HCPCS code changes that affect the OPPS are published both through
the annual rulemaking cycle and through the OPPS quarterly update
Change Requests (CRs). CMS releases new Level II HCPCS codes to the
public or recognizes the release of new CPT codes by the AMA and makes
these codes effective (that is, the codes can be reported on Medicare
claims) outside of the formal rulemaking process via OPPS quarterly
update CRs. Based on our review, we assign the new CPT and Level II
HCPCS codes to interim status indicators (SIs) and APCs. These interim
assignments are finalized in the OPPS/ASC final rules. This quarterly
process offers hospitals access to codes that may more accurately
describe items or services furnished and provides payment or more
accurate payment for these items or services in a timelier manner than
if we waited for the annual rulemaking process. We solicit public
comments on these new codes and finalize our proposals related to these
codes through our annual rulemaking process.
We note that, under the OPPS, the APC assignment determines the
[[Page 37085]]
payment rate for an item, procedure, or service. Those items,
procedures, or services not paid separately under the hospital OPPS are
assigned to appropriate status indicators. Certain payment status
indicators provide separate payment, while other payment status
indicators do not. Section XI. of this proposed rule discusses the
various status indicators used under the OPPS.
In Table 7 below, we summarize our current process for updating
codes through our OPPS quarterly update CRs, seeking public comments,
and finalizing the treatment of these new codes under the OPPS.
Table 7--Comment Timeframe for New or Revised HCPCS Codes
----------------------------------------------------------------------------------------------------------------
OPPS Quarterly update CR Type of code Effective date Comments sought When finalized
----------------------------------------------------------------------------------------------------------------
April 1, 2018............ Level II HCPCS April 1, 2018............ CY 2019 OPPS/ASC CY 2019 OPPS/ASC
Codes. proposed rule. final rule with
comment period.
July 1, 2018............. Level II HCPCS July 1, 2018............. CY 2019 OPPS/ASC CY 2019 OPPS/ASC
Codes. proposed rule. final rule with
comment period.
Category I July 1, 2018............. CY 2019 OPPS/ASC CY 2019 OPPS/ASC
(certain vaccine proposed rule. final rule with
codes) CPT Codes, comment period.
Category III CPT
codes.
October 1, 2018.......... Level II HCPCS October 1, 2018.......... CY 2019 OPPS/ASC CY 2020 OPPS/ASC
Codes. final rule with final rule with
comment period. comment period.
January 1, 2019.......... Category I and III January 1, 2019.......... CY 2019 OPPS/ASC CY 2019 OPPS/ASC
CPT Codes. proposed rule. final rule with
comment period.
Level II HCPCS January 1, 2019.......... CY 2019 OPPS/ASC CY 2020 OPPS/ASC
Codes. final rule with final rule with
comment period. comment period.
----------------------------------------------------------------------------------------------------------------
1. Proposed Treatment of New HCPCS Codes That Were Effective April 1,
2018 for Which we Are Soliciting Public Comments in This CY 2019 OPPS/
ASC Proposed Rule
Through the April 2018 OPPS quarterly update CR (Transmittal 4005,
Change Request 10515, dated March 20, 2018), we made effective nine new
Level II HCPCS codes for separate payment under the OPPS. In this CY
2019 OPPS/ASC proposed rule, we are soliciting public comments on the
proposed APC and status indicator assignments for these Level II HCPCS
codes, which are listed in Table 8 of this proposed rule. The proposed
payment rates for these codes, where applicable, can be found in
Addendum B to this proposed rule (which is available via the internet
on the CMS website).
Table 8--New Level II HCPCS Codes Effective April 1, 2018
----------------------------------------------------------------------------------------------------------------
Proposed CY
CY 2018 HCPCS code CY 2018 Long descriptor Proposed CY 2019 SI 2019 APC
----------------------------------------------------------------------------------------------------------------
C9462........................... Injection, delafloxacin, 1 mg... G 9462
C9463........................... Injection, aprepitant, 1 mg..... G 9463
C9464........................... Injection, rolapitant, 0.5 mg... G 9464
C9465........................... Hyaluronan or derivative, G 9465
Durolane, for intra-articular
injection, per dose.
C9466........................... Injection, benralizumab, 1 mg... G 9466
C9467........................... Injection, rituximab and G 9467
hyaluronidase, 10 mg.
C9468........................... Injection, factor ix G 9468
(antihemophilic factor,
recombinant), glycopegylated,
Rebinyn, 1 i.u..
C9469 *......................... Injection, triamcinolone G 9469
acetonide, preservative-free,
extended-release, microsphere
formulation, 1 mg.
C9749........................... Repair of nasal vestibular J1 5164
lateral wall stenosis with
implant(s).
----------------------------------------------------------------------------------------------------------------
* HCPCS code C9469 (Injection, triamcinolone acetonide, preservative-free, extended-release, microsphere
formulation, 1 mg), which was effective April 1, 2018, was deleted June 30, 2018 and replaced with HCPCS code
Q9993 (Injection, triamcinolone acetonide, preservative-free, extended-release, microsphere formulation, 1 mg)
effective July 1, 2018.
In addition, there were several new laboratory CPT Multianalyte
Assays with Algorithmic Analyses (MAAA) codes (M codes) and Proprietary
Laboratory Analyses (PLA) codes (U codes) that were effective April 1,
2018, but were too late to include in the April 2018 OPPS Update.
Because these codes were released on the American Medical Association's
(AMA) CPT website in February 2018, they were too late for us to
include in the April 2018 OPPS Update CR and in the April 2018
Integrated Outpatient Code Editor (IOCE), and, consequently, were
included in the July 2018 OPPS Update with an effective date of April
1, 2018. These CPT codes are listed below in Table 9. In this CY 2019
OPPS/ASC proposed rule, we are soliciting public comments on the
proposed APC and status indicator assignments for these CPT codes,
which are listed in Table 9 of this proposed rule. The proposed payment
rates for these codes, where applicable, can be found in Addendum B to
this proposed rule (which is available via the internet on the CMS
website).
[[Page 37086]]
Table 9--New CPT MAAA and Proprietary Laboratory Analyses (PLA) Codes Effective April 1, 2018
----------------------------------------------------------------------------------------------------------------
Proposed CY
CY 2018 HCPCS code CY 2018 Long descriptor Proposed CY 2019 SI 2019 APC
----------------------------------------------------------------------------------------------------------------
0012M............................ Oncology (urothelial), mRNA, gene A N/A
expression profiling by real-
time quantitative PCR of five
genes (MDK, HOXA13, CDC2 [CDK1],
IGFBP5, and XCR2), utilizing
urine, algorithm reported as a
risk score for having urothelial
carcinoma.
0013M............................ Oncology (urothelial), mRNA, gene A N/A
expression profiling by real-
time quantitative PCR of five
genes (MDK, HOXA13, CDC2 [CDK1],
IGFBP5, and CXCR2), utilizing
urine, algorithm reported as a
risk score for having recurrent
urothelial carcinoma.
0035U............................ Neurology (prion disease), Q4 N/A
cerebrospinal fluid, detection
of prion protein by quaking-
induced conformational
conversion, qualitative.
0036U............................ Exome (i.e., somatic mutations), A N/A
paired formalin-fixed paraffin-
embedded tumor tissue and normal
specimen, sequence analyses.
0037U............................ Targeted genomic sequence A N/A
analysis, solid organ neoplasm,
DNA analysis of 324 genes,
interrogation for sequence
variants, gene copy number
amplifications, gene
rearrangements, microsatellite
instability and tumor mutational
burden.
0038U............................ Vitamin D, 25 hydroxy D2 and D3, Q4 N/A
by LC-MS/MS, serum microsample,
quantitative.
0039U............................ Deoxyribonucleic acid (DNA) Q4 N/A
antibody, double stranded, high
avidity.
0040U............................ BCR/ABL1 (t(9;22)) (e.g., chronic A N/A
myelogenous leukemia)
translocation analysis, major
breakpoint, quantitative.
0041U............................ Borrelia burgdorferi, antibody Q4 N/A
detection of 5 recombinant
protein groups, by immunoblot,
IgM.
0042U............................ Borrelia burgdorferi, antibody Q4 N/A
detection of 12 recombinant
protein groups, by immunoblot,
IgG.
0043U............................ Tick-borne relapsing fever Q4 N/A
Borrelia group, antibody
detection to 4 recombinant
protein groups, by immunoblot,
IgM.
0044U............................ Tick-borne relapsing fever Q4 N/A
Borrelia group, antibody
detection to 4 recombinant
protein groups, by immunoblot,
IgG.
----------------------------------------------------------------------------------------------------------------
2. Proposed Treatment of New HCPCS Codes That Were Effective July 1,
2018 for Which we Are Soliciting Public Comments in This CY 2019 OPPS/
ASC Proposed Rule
Through the July 2018 OPPS quarterly update CR (Transmittal 4075,
Change Request 1078, dated June 15, 2018), we made 4 new Category III
CPT codes and 10 Level II HCPCS codes effective July 1, 2018 (14 codes
total), and assigned them to appropriate interim OPPS status indicators
and APCs. As listed in Table 10 below, 13 of the 14 HCPCS codes are
separately payable under the OPPS while 1 HCPCS code is not.
Specifically, HCPCS code QQ994 is assigned to status indicator ``E1''
to indicate that the item is not payable by Medicare. In addition, we
note that HCPCS code C9469 was deleted June 30, 2018, and replaced with
HCPCS code Q9993 effective July 1, 2018. Because HCPCS code Q9993
describes the same drug as HCPCS code C9469, we are proposing to
continue the drug's pass-through payment status and to assign HCPCS
code Q9993 to the same APC and status indicators as its predecessor
HCPCS code C9469, as shown in Table 10 below.
In this CY 2019 OPPS/ASC proposed rule, we are soliciting public
comments on the proposed APC and status indicator assignments for CY
2019 for the CPT and Level II HCPCS codes implemented on July 1, 2018,
all of which are listed in Table 10 below.
The proposed payment rates and status indicators for these codes,
where applicable, can be found in Addendum B to this proposed rule
(which is available via the internet on the CMS website).
Table 10--New HCPCS Codes Effective July 1, 2018
----------------------------------------------------------------------------------------------------------------
Proposed CY
CY 2018 HCPCS code CY 2018 long descriptor Proposed CY 2019 SI 2019 APC
----------------------------------------------------------------------------------------------------------------
C9030............................ Injection, copanlisib, 1 mg...... G 9030
C9031............................ Lutetium Lu 177, dotatate, G 9067
therapeutic, 1 mCi.
C9032............................ Injection, voretigene neparvovec- G 9070
rzyl, 1 billion vector genome.
Q5105............................ Injection, epoetin alfa, K 9096
biosimilar, (Retacrit) (for esrd
on dialysis), 100 units.
Q5106............................ Injection, epoetin alfa, K 9097
biosimilar, (Retacrit) (for non-
esrd use), 1000 units.
Q9991............................ Injection, buprenorphine extended- G 9073
release (Sublocade), less than
or equal to 100 mg.
Q9992............................ Injection, buprenorphine extended- G 9239
release (Sublocade), greater
than 100 mg.
Q9993 *.......................... Injection, triamcinolone G 9469
acetonide, preservative-free,
extended-release, microsphere
formulation, 1 mg.
Q9994............................ In-line cartridge containing E1 N/A
digestive enzyme(s) for enteral
feeding, each.
Q9995............................ Injection, emicizumab-kxwh, 0.5 G 9257
mg.
0505T............................ Endovenous femoral-popliteal J1 5193
arterial revascularization, with
transcatheter placement of
intravascular stent graft(s) and
closure by any method, including
percutaneous or open vascular
access, ultrasound guidance for
vascular access when performed,
all catheterization(s) and
intraprocedural roadmapping and
imaging guidance necessary to
complete the intervention, all
associated radiological
supervision and interpretation,
when performed, with crossing of
the occlusive lesion in an
extraluminal fashion.
0506T............................ Macular pigment optical density Q1 5733
measurement by heterochromatic
flicker photometry, unilateral
or bilateral, with
interpretation and report.
0507T............................ Near-infrared dual imaging (i.e., Q1 5733
simultaneous reflective and
trans-illuminated light) of
meibomian glands, unilateral or
bilateral, with interpretation
and report.
[[Page 37087]]
0508T............................ Pulse-echo ultrasound bone S 5522
density measurement resulting in
indicator of axial bone mineral
density, tibia.
----------------------------------------------------------------------------------------------------------------
* HCPCS code C9469 (Injection, triamcinolone acetonide, preservative-free, extended-release, microsphere
formulation, 1 mg), which was effective April 1, 2018, was deleted June 30, 2018 and replaced with HCPCS code
Q9993 (Injection, triamcinolone acetonide, preservative-free, extended-release, microsphere formulation, 1 mg)
effective July 1, 2018.
In addition, there are several new PLA codes (U codes) that will be
effective July 1, 2018, but were too late to include in the July 2018
OPPS Update. Consequently, these codes will instead be included in the
October 2018 OPPS Update with an effective date of July 1, 2018. These
CPT codes are listed below in Table 11 along with the proposed APC and
status indicator assignment for these CPT codes. In this CY 2019 OPPS/
ASC proposed rule, we are soliciting public comments on the proposed
APC and status indicator assignments for these CPT codes. The proposed
payment rates for these codes, where applicable, can be found in
Addendum B to this proposed rule (which is available via the internet
on the CMS website).
Table 11--New CPT Proprietary Laboratory Analyses (PLA) Codes Effective July 1, 2018
----------------------------------------------------------------------------------------------------------------
CY 2018 HCPCS code CY 2018 long descriptor Proposed CY 2019 SI Proposed CY 2019 APC
----------------------------------------------------------------------------------------------------------------
0045U.............................. Oncology (breast ductal A N/A.
carcinoma in situ), mRNA,
gene expression profiling
by real-time RT-PCR of 12
genes (7 content and 5
housekeeping), utilizing
formalin-fixed paraffin-
embedded tissue, algorithm
reported as recurrence
score.
0046U.............................. FLT3 (fms-related tyrosine A N/A.
kinase 3) (e.g., acute
myeloid leukemia) internal
tandem duplication (ITD)
variants, quantitative.
0047U.............................. Oncology (prostate), mRNA, A N/A.
gene expression profiling
by real-time RT-PCR of 17
genes (12 content and 5
housekeeping), utilizing
formalin-fixed paraffin-
embedded tissue, algorithm
reported as a risk score.
0048U.............................. Oncology (solid organ A N/A.
neoplasia), DNA, targeted
sequencing of protein-
coding exons of 468 cancer-
associated genes,
including interrogation
for somatic mutations and
microsatellite
instability, matched with
normal specimens,
utilizing formalin-fixed
paraffin-embedded tumor
tissue, report of
clinically significant
mutation(s).
0049U.............................. NPM1 (nucleophosmin) (e.g., A N/A.
acute myeloid leukemia)
gene analysis,
quantitative.
0050U.............................. Targeted genomic sequence A N/A.
analysis panel, acute
myelogenous leukemia, DNA
analysis, 194 genes,
interrogation for sequence
variants, copy number
variants or rearrangements.
0051U.............................. Prescription drug Q4 N/A.
monitoring, evaluation of
drugs present by LC-MS/MS,
urine, 31 drug panel,
reported as quantitative
results, detected or not
detected, per date of
service.
0052U.............................. Lipoprotein, blood, high Q4 N/A.
resolution fractionation
and quantitation of
lipoproteins, including
all five major lipoprotein
classes and subclasses of
HDL, LDL, and VLDL by
vertical auto profile
ultracentrifugation.
0053U.............................. Oncology (prostate cancer), A N/A.
FISH analysis of 4 genes
(ASAP1, HDAC9, CHD1 and
PTEN), needle biopsy
specimen, algorithm
reported as probability of
higher tumor grade.
0054U.............................. Prescription drug Q4 N/A.
monitoring, 14 or more
classes of drugs and
substances, definitive
tandem mass spectrometry
with chromatography,
capillary blood,
quantitative report with
therapeutic and toxic
ranges, including steady-
state range for the
prescribed dose when
detected, per date of
service.
0055U.............................. Cardiology (heart A N/A.
transplant), cell-free
DNA, PCR assay of 96 DNA
target sequences (94
single nucleotide
polymorphism targets and
two control targets),
plasma.
0056U.............................. Hematology (acute A N/A.
myelogenous leukemia),
DNA, whole genome next-
generation sequencing to
detect gene
rearrangement(s), blood or
bone marrow, report of
specific gene
rearrangement(s).
0057U.............................. Oncology (solid organ A N/A.
neoplasia), mRNA, gene
expression profiling by
massively parallel
sequencing for analysis of
51 genes, utilizing
formalin-fixed paraffin-
embedded tissue, algorithm
reported as a normalized
percentile rank.
0058U.............................. Oncology (Merkel cell Q4 N/A.
carcinoma), detection of
antibodies to the Merkel
cell polyoma virus
oncoprotein (small T
antigen), serum,
quantitative.
0059U.............................. Oncology (Merkel cell Q4 N/A.
carcinoma), detection of
antibodies to the Merkel
cell polyoma virus capsid
protein (VP1), serum,
reported as positive or
negative.
0060U.............................. Twin zygosity, genomic A N/A.
targeted sequence analysis
of chromosome 2, using
circulating cell-free
fetal DNA in maternal
blood.
0061U.............................. Transcutaneous measurement Q4 N/A.
of five biomarkers (tissue
oxygenation [StO2],
oxyhemoglobin [ctHbO2],
deoxyhemoglobin [ctHbR],
papillary and reticular
dermal hemoglobin
concentrations [ctHb1 and
ctHb2]), using spatial
frequency domain imaging
(SFDI) and multi-spectral
analysis.
----------------------------------------------------------------------------------------------------------------
[[Page 37088]]
3. Proposed Process for New Level II HCPCS Codes That Will Be Effective
October 1, 2018 and January 1, 2019 for Which We Will Be Soliciting
Public Comments in the CY 2019 OPPS/ASC Final Rule With Comment Period
As has been our practice in the past, we will solicit comments on
those new Level II HCPCS codes that are effective October 1, 2018 and
January 1, 2019 in the CY 2019 OPPS/ASC final rule with comment period,
thereby allowing us to finalize the status indicators, APCs, and
payment rates for the codes in the CY 2020 OPPS/ASC final rule with
comment period. These codes will be released to the public through the
October and January OPPS quarterly update CRs and via the CMS HCPCS
website (for Level II HCPCS codes).
For CY 2019, we are proposing to continue our established policy of
assigning comment indicator ``NI'' in Addendum B to the OPPS/ASC final
rule with comment period to those new Level II HCPCS codes that are
effective October 1, 2018 and January 1, 2019 to indicate that we are
assigning them an interim payment status, which is subject to public
comment. We will be inviting public comments in the CY 2019 OPPS/ASC
final rule with comment period on the status indicator, APC
assignments, and payment rates for these codes, if applicable, which
would then be finalized in the CY 2020 OPPS/ASC final rule with comment
period.
4. Proposed Treatment of New and Revised CY 2019 Category I and III CPT
Codes That Will Be Effective January 1, 2019 for Which We Are
Soliciting Public Comments in This CY 2019 OPPS/ASC Proposed Rule
In the CY 2015 OPPS/ASC final rule with comment period (79 FR 66841
through 66844), we finalized a revised process of assigning APC and
status indicators for new and revised Category I and III CPT codes that
would be effective January 1. Specifically, for the new/revised CPT
codes that we receive in a timely manner from the AMA's CPT Editorial
Panel, we finalized our proposal to include the codes that would be
effective January 1 in the OPPS/ASC proposed rules, along with proposed
APC and status indicator assignments for them, and to finalize the APC
and status indicator assignments in the OPPS/ASC final rules beginning
with the CY 2016 OPPS update. For those new/revised CPT codes that were
received too late for inclusion in the OPPS/ASC proposed rule, we
finalized our proposal to establish and use HCPCS G-codes that mirror
the predecessor CPT codes and retain the current APC and status
indicator assignments for a year until we can propose APC and status
indicator assignments in the following year's rulemaking cycle. We note
that even if we find that we need to create HCPCS G-codes in place of
certain CPT codes for the PFS proposed rule, we do not anticipate that
these HCPCS G-codes will always be necessary for OPPS purposes. We will
make every effort to include proposed APC and status indicator
assignments for all new and revised CPT codes that the AMA makes
publicly available in time for us to include them in the proposed rule,
and to avoid the resort to HCPCS G-codes and the resulting delay in
utilization of the most current CPT codes. Also, we finalized our
proposal to make interim APC and status indicator assignments for CPT
codes that are not available in time for the proposed rule and that
describe wholly new services (such as new technologies or new surgical
procedures), solicit public comments, and finalize the specific APC and
status indicator assignments for those codes in the following year's
final rule.
For the CY 2019 OPPS update, we received the CY 2019 CPT codes from
AMA in time for inclusion in this CY 2019 OPPS/ASC proposed rule. The
new, revised, and deleted CY 2019 Category I and III CPT codes can be
found in Addendum B to this proposed rule (which is available via the
internet on the CMS website). We note that the new and revised codes
are assigned to new comment indicator ``NP'' to indicate that the code
is new for the next calendar year or the code is an existing code with
substantial revision to its code descriptor in the next calendar year
as compared to current calendar year with a proposed APC assignment,
and that comments will be accepted on the proposed APC assignment and
status indicator.
Further, we remind readers that the CPT code descriptors that
appear in Addendum B are short descriptors and do not accurately
describe the complete procedure, service, or item described by the CPT
code. Therefore, we are including the 5-digit placeholder codes and
their long descriptors for the new and revised CY 2019 CPT codes in
Addendum O to this proposed rule (which is available via the internet
on the CMS website) so that the public can adequately comment on our
proposed APCs and status indicator assignments. The 5-digit placeholder
codes can be found in Addendum O, specifically under the column labeled
``CY 2019 OPPS/ASC Proposed Rule 5-Digit AMA Placeholder Code,'' to
this proposed rule. The final CPT code numbers will be included in the
CY 2019 OPPS/ASC final rule with comment period. We note that not every
code listed in Addendum O is subject to comment. For the new and
revised Category I and III CPT codes, we are requesting comments on
only those codes that are assigned to comment indicator ``NP''.
In summary, we are soliciting public comments on the proposed CY
2019 status indicators and APC assignments for the new and revised
Category I and III CPT codes that will be effective January 1, 2019.
The CPT codes are listed in Addendum B to this proposed rule with short
descriptors only. We list them again in Addendum O to this proposed
rule with long descriptors. We also are proposing to finalize the
status indicator and APC assignments for these codes (with their final
CPT code numbers) in the CY 2019 OPPS/ASC final rule with comment
period. The proposed status indicator and APC assignment for these
codes can be found in Addendum B to this proposed rule (which is
available via the internet on the CMS website).
B. Proposed OPPS Changes--Variations Within APCs
1. Background
Section 1833(t)(2)(A) of the Act requires the Secretary to develop
a classification system for covered hospital outpatient department
services. Section 1833(t)(2)(B) of the Act provides that the Secretary
may establish groups of covered OPD services within this classification
system, so that services classified within each group are comparable
clinically and with respect to the use of resources. In accordance with
these provisions, we developed a grouping classification system,
referred to as Ambulatory Payment Classifications (APCs), as set forth
in regulations at 42 CFR[thinsp]419.31. We use Level I and Level II
HCPCS codes to identify and group the services within each APC. The
APCs are organized such that each group is homogeneous both clinically
and in terms of resource use. Using this classification system, we have
established distinct groups of similar services. We also have developed
separate APC groups for certain medical devices, drugs, biologicals,
therapeutic radiopharmaceuticals, and brachytherapy devices that are
not packaged into the payment for the procedure.
We have packaged into the payment for each procedure or service
within an APC group the costs associated with those items and services
that are typically ancillary and supportive to a
[[Page 37089]]
primary diagnostic or therapeutic modality and, in those cases, are an
integral part of the primary service they support. Therefore, we do not
make separate payment for these packaged items or services. In general,
packaged items and services include, but are not limited to, the items
and services listed in regulations at 42 CFR 419.2(b). A further
discussion of packaged services is included in section II.A.3. of this
proposed rule.
Under the OPPS, we generally pay for covered hospital outpatient
services on a rate-per-service basis, where the service may be reported
with one or more HCPCS codes. Payment varies according to the APC group
to which the independent service or combination of services is
assigned. For CY 2019, we are proposing that each APC relative payment
weight represents the hospital cost of the services included in that
APC, relative to the hospital cost of the services included in APC 5012
(Clinic Visits and Related Services). The APC relative payment weights
are scaled to APC 5012 because it is the hospital clinic visit APC and
clinic visits are among the most frequently furnished services in the
hospital outpatient setting.
2. Application of the 2 Times Rule
Section 1833(t)(9)(A) of the Act requires the Secretary to review,
not less often than annually, and revise the APC groups, the relative
payment weights, and the wage and other adjustments described in
paragraph (2) to take into account changes in medical practice, changes
in technology, the addition of new services, new cost data, and other
relevant information and factors. Section 1833(t)(9)(A) of the Act also
requires the Secretary to consult with an expert outside advisory panel
composed of an appropriate selection of representatives of providers to
review (and advise the Secretary concerning) the clinical integrity of
the APC groups and the relative payment weights. We note that the HOP
Panel recommendations for specific services for the CY 2019 OPPS update
will be discussed in the relevant specific sections throughout the CY
2019 OPPS/ASC final rule with comment period.
In addition, section 1833(t)(2) of the Act provides that, subject
to certain exceptions, the items and services within an APC group
cannot be considered comparable with respect to the use of resources if
the highest cost for an item or service in the group is more than 2
times greater than the lowest cost for an item or service within the
same group (referred to as the ``2 times rule''). The statute
authorizes the Secretary to make exceptions to the 2 times rule in
unusual cases, such as low volume items and services (but the Secretary
may not make such an exception in the case of a drug or biological that
has been designated as an orphan drug under section 526 of the Federal
Food, Drug, and Cosmetic Act). In determining the APCs with a 2 times
rule violation, we consider only those HCPCS codes that are significant
based on the number of claims. We note that, for purposes of
identifying significant procedure codes for examination under the 2
times rule, we consider procedure codes that have more than 1,000
single major claims or procedure codes that both have more than 99
single major claims and contribute at least 2 percent of the single
major claims used to establish the APC cost to be significant (75 FR
71832). This longstanding definition of when a procedure code is
significant for purposes of the 2 times rule was selected because we
believe that a subset of 1,000 or fewer claims is negligible within the
set of approximately 100 million single procedure or single session
claims we use for establishing costs. Similarly, a procedure code for
which there are fewer than 99 single claims and that comprises less
than 2 percent of the single major claims within an APC will have a
negligible impact on the APC cost (75 FR 71832). In this section of
this proposed rule, for CY 2019, we are proposing to make exceptions to
this limit on the variation of costs within each APC group in unusual
cases, such as for certain low-volume items and services.
For the CY 2019 OPPS update, we have identified the APCs with
violations of the 2 times rule. Therefore, we are proposing changes to
the procedure codes assigned to these APCs in Addendum B to this
proposed rule. We note that Addendum B does not appear in the printed
version of the Federal Register as part of this CY 2019 OPPS/ASC
proposed rule. Rather, it is published and made available via the
internet on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html. To eliminate
a violation of the 2 times rule and improve clinical and resource
homogeneity, we are proposing to reassign these procedure codes to new
APCs that contain services that are similar with regard to both their
clinical and resource characteristics. In many cases, the proposed
procedure code reassignments and associated APC reconfigurations for CY
2019 included in this proposed rule are related to changes in costs of
services that were observed in the CY 2017 claims data newly available
for CY 2019 ratesetting. Addendum B to this CY 2019 OPPS/ASC proposed
rule identifies with a comment indicator ``CH'' those procedure codes
for which we are proposing a change to the APC assignment or status
indicator, or both, that were initially assigned in the July 1, 2018
OPPS Addendum B Update (available via the internet on the CMS website
at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Addendum-A-and-Addendum-B-Updates.html).
3. Proposed APC Exceptions to the 2 Times Rule
Taking into account the APC changes that we are proposing to make
for CY 2019, we reviewed all of the APCs to determine which APCs would
not meet the requirements of the 2 times rule. We used the following
criteria to evaluate whether to propose exceptions to the 2 times rule
for affected APCs:
Resource homogeneity;
Clinical homogeneity;
Hospital outpatient setting utilization;
Frequency of service (volume); and
Opportunity for upcoding and code fragments.
Based on the CY 2017 claims data available for this CY 2019
proposed rule, we found 16 APCs with violations of the 2 times rule. We
applied the criteria as described above to identify the APCs for which
we are proposing to make exceptions under the 2 times rule for CY 2019,
and found that all of the 16 APCs we identified meet the criteria for
an exception to the 2 times rule based on the CY 2017 claims data
available for this proposed rule. We did not include in that
determination those APCs where a 2 times rule violation was not a
relevant concept, such as APC 5401 (Dialysis), which only has two HCPCS
codes assigned to it that have a similar geometric mean costs and do
not create a 2 time rule violation. Therefore, we have only identified
those APCs, including those with criteria-based costs, such as device-
dependent CPT/HCPCS codes, with violations of the 2 times rule.
We note that, for cases in which a recommendation by the HOP Panel
appears to result in or allow a violation of the 2 times rule, we may
accept the HOP Panel's recommendation because those recommendations are
based on explicit consideration (that is, a review of the latest OPPS
claims data and group discussion of the issue) of resource use,
clinical homogeneity, site of service,
[[Page 37090]]
and the quality of the claims data used to determine the APC payment
rates.
Table 12 of this proposed rule lists the 16 APCs that we are
proposing to make an exception for under the 2 times rule for CY 2019
based on the criteria cited above and claims data submitted between
January 1, 2017, and December 31, 2017, and processed on or before
December 31, 2017. For the final rule with comment period, we intend to
use claims data for dates of service between January 1, 2017, and
December 31, 2017, that were processed on or before June 30, 2018, and
updated CCRs, if available. The proposed geometric mean costs for
covered hospital outpatient services for these and all other APCs that
were used in the development of this proposed rule can be found on the
CMS website at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.html.
Table 12--Proposed APC Exceptions to the 2 Times Rule for CY 2019
--------------------------------------------------------------------------------------------------------------------------------------------------------
Proposed CY 2019 APC Proposed CY 2019 APC title
--------------------------------------------------------------------------------------------------------------------------------------------------------
5071........................................... Level 1 Excision/Biopsy/Incision and Drainage.
5113........................................... Level 3 Musculoskeletal Procedures.
5521........................................... Level 1 Imaging without Contrast.
5522........................................... Level 2 Imaging without Contrast.
5523........................................... Level 3 Imaging without Contrast.
5571........................................... Level 1 Imaging with Contrast.
5612........................................... Level 2 Therapeutic Radiation Treatment Preparation.
5691........................................... Level 1 Drug Administration.
5692........................................... Level 2 Drug Administration.
5721........................................... Level 1 Diagnostic Tests and Related Services.
5724........................................... Level 4 Diagnostic Tests and Related Services.
5731........................................... Level 1 Minor Procedures.
5732........................................... Level 2 Minor Procedures.
5735........................................... Level 5 Minor Procedures.
5822........................................... Level 2 Health and Behavior Services.
5823........................................... Level 3 Health and Behavior Services.
--------------------------------------------------------------------------------------------------------------------------------------------------------
C. Proposed New Technology APCs
1. Background
In the November 30, 2001 final rule (66 FR 59903), we finalized
changes to the time period in which a service can be eligible for
payment under a New Technology APC. Beginning in CY 2002, we retain
services within New Technology APC groups until we gather sufficient
claims data to enable us to assign the service to an appropriate
clinical APC. This policy allows us to move a service from a New
Technology APC in less than 2 years if sufficient data are available.
It also allows us to retain a service in a New Technology APC for more
than 2 years if sufficient data upon which to base a decision for
reassignment have not been collected.
In the CY 2004 OPPS final rule with comment period (68 FR 63416),
we restructured the New Technology APCs to make the cost intervals more
consistent across payment levels and refined the cost bands for these
APCs to retain two parallel sets of New Technology APCs, one set with a
status indicator of ``S'' (Significant Procedures, Not Discounted when
Multiple. Paid under OPPS; separate APC payment) and the other set with
a status indicator of ``T'' (Significant Procedure, Multiple Reduction
Applies. Paid under OPPS; separate APC payment). These current New
Technology APC configurations allow us to price new technology services
more appropriately and consistently.
For CY 2018, there were 52 New Technology APC levels, ranging from
the lowest cost band assigned to APC 1491 (New Technology--Level 1A
($0-$10)) through the highest cost band assigned to APC 1908 (New
Technology--Level 52 ($145,001-$160,000)). We note that the cost bands
for the New Technology APCs, specifically, APCs 1491 through 1599 and
1901 through 1908, vary with increments ranging from $10 to $14,999.
These cost bands identify the APCs to which new technology procedures
and services with estimated service costs that fall within those cost
bands are assigned under the OPPS. Payment for each APC is made at the
mid-point of the APC's assigned cost band. For example, payment for New
Technology APC 1507 (New Technology--Level 7 ($501-$600)) is made at
$550.50.
Under the OPPS, one of our goals is to make payments that are
appropriate for the services that are necessary for the treatment of
Medicare beneficiaries. The OPPS, like other Medicare payment systems,
is budget neutral and increases are limited to the annual hospital
inpatient market basket increase. We believe that our payment rates
generally reflect the costs that are associated with providing care to
Medicare beneficiaries. Furthermore, we believe that our payment rates
are adequate to ensure access to services (80 FR 70374).
For many emerging technologies, there is a transitional period
during which utilization may be low, often because providers are first
learning about the techniques and their clinical utility. Quite often,
parties request that Medicare make higher payment amounts under the New
Technology APCs for new procedures in that transitional phase. These
requests, and their accompanying estimates for expected total patient
utilization, often reflect very low rates of patient use of expensive
equipment, resulting in high per use costs for which requesters believe
Medicare should make full payment. Medicare does not, and we believe
should not, assume responsibility for more than its share of the costs
of procedures based on projected utilization for Medicare beneficiaries
and does not set its payment rates based on initial projections of low
utilization for services that require expensive capital equipment. For
the OPPS, we rely on hospitals to make informed business decisions
regarding the acquisition of high-cost capital equipment, taking into
consideration their knowledge about their entire patient base (Medicare
beneficiaries included) and an understanding of Medicare's and other
payers' payment policies.
[[Page 37091]]
(We refer readers to the CY 2013 OPPS/ASC final rule with comment
period (77 FR 68314) for further discussion regarding this payment
policy.)
We note that, in a budget neutral system, payments may not fully
cover hospitals' costs in a particular circumstance, including those
for the purchase and maintenance of capital equipment. We rely on
hospitals to make their decisions regarding the acquisition of high-
cost equipment with the understanding that the Medicare program must be
careful to establish its initial payment rates, including those made
through New Technology APCs, for new services that lack hospital claims
data based on realistic utilization projections for all such services
delivered in cost-efficient hospital outpatient settings. As the OPPS
acquires claims data regarding hospital costs associated with new
procedures, we regularly examine the claims data and any available new
information regarding the clinical aspects of new procedures to confirm
that our OPPS payments remain appropriate for procedures as they
transition into mainstream medical practice (77 FR 68314). For CY 2019,
the proposed payment rates for New Technology APCs 1491 to 1599 and
1901 through 1908 can be found in Addendum A to this proposed rule
(which is available via the internet on the CMS website).
2. Establishing Payment Rates for Low-Volume New Technology Procedures
Procedures that are assigned to New Technology APCs are typically
new procedures that do not have sufficient claims history to establish
an accurate payment for the procedures. One of the objectives of
establishing New Technology APCs is to generate sufficient claims data
for a new procedure so that it can be assigned to an appropriate
clinical APC. Some procedures that are assigned to New Technology APCs
have very low annual volume, which we consider to be fewer than 100
claims. We consider procedures with fewer than 100 claims annually as
low-volume procedures because there is a higher probability that the
payment data for a procedure may not have a normal statistical
distribution, which could affect the quality of our standard cost
methodology that is used to assign services to an APC. In addition,
services with fewer than 100 claims per year are not generally
considered to be a significant contributor to the APC ratesetting
calculations and, therefore, are not included in the assessment of the
2 times rule. For these low-volume procedures, we are concerned that
the methodology we use to estimate the cost of a procedure under the
OPPS by calculating the geometric mean for all separately paid claims
for a HCPCS procedure code from the most recent available year of
claims data may not generate an accurate estimate of the actual cost of
the procedure. In accordance with section 1833(t)(2)(B) of the Act,
services classified within each APC must be comparable clinically and
with respect to the use of resources. As described earlier, assigning a
procedure to a new technology APC allows us to gather claims data to
price the procedure and assign it to the APC with services that use
similar resources and are clinically comparable. However, where
utilization of services assigned to a New Technology APC is low, it can
lead to wide variation in payment rates from year to year, resulting in
even lower utilization and potential barriers to access to new
technologies, which ultimately limits our ability to assign the service
to the appropriate clinical APC. To mitigate these issues, we believe
that it is appropriate to utilize our equitable adjustment authority at
section 1833(t)(2)(E) of the Act to adjust how we determine the costs
for low-volume services assigned to New Technology APCs. We have
utilized our equitable adjustment authority at section 1833(t)(2)(E) of
the Act, which states that the Secretary shall establish, in a budget
neutral manner, other adjustments as determined to be necessary to
ensure equitable payments, to estimate an appropriate payment amount
for low-volume new technology procedures in the past (82 FR 59281).
Although we have used this adjustment authority on a case-by-case basis
in the past, we believe that it is appropriate to adopt an adjustment
for low-volume services assigned to New Technology APCs in order
mitigate the wide payment fluctuations that can occur for new
technology services with fewer than 100 claims and to provide more
predictable payment for these services.
For purposes of this adjustment, we believe that it is appropriate
to use up to 4 years of claims data in calculating the applicable
payment rate for the prospective year, rather than using solely the
most recent available year of claims data, when a service assigned to a
New Technology APC has a low annual volume of claims, which, for
purposes of this adjustment, we define as fewer than 100 claims
annually. We consider procedures with fewer than 100 claims annually as
low-volume procedures because there is a higher probability that the
payment data for a procedure may not have a normal statistical
distribution, which could affect the quality of our standard cost
methodology that is used to assign services to an APC. For these low-
volume procedures, we are concerned that the methodology we use to
estimate the cost of a procedure under the OPPS by calculating the
geometric mean for all separately paid claims for a HCPCS procedure
code from the most recent available year of claims data may not
generate an accurate estimate of the actual cost of the procedure.
Using multiple years of claims data will potentially allow for more
than 100 claims to be used to set the payment rate, which would, in
turn, create a more statistically reliable payment rate.
In addition, to better approximate the cost of a low-volume service
within a New Technology APC, we believe that using the median or
arithmetic mean rather than the geometric mean (which ``trims'' the
costs of certain claims out) may be more appropriate in some
circumstances, given the extremely low volume of claims. Low claim
volumes increase the impact of ``outlier'' claims; that is, claims with
either a very low or very high payment rate as compared to the average
claim, which would have a substantial impact on any statistical
methodology used to estimate the most appropriate payment rate for a
service. We believe that having the flexibility to utilize an
alternative statistical methodology to calculate the payment rate in
the case of low-volume new technology services would help to create a
more stable payment rate. Therefore, we are proposing that, in each of
our annual rulemakings, we will seek public comments on which
statistical methodology should be used for each low-volume New
Technology APC. In the preamble of each annual rulemaking (including
this proposed rule), we will present the result of each statistical
methodology and solicit public comment on which methodology should be
used to establish the payment rate for a low-volume new technology
service. In addition, we will use our assessment of the resources used
to perform a service and guidance from the developer or manufacturer of
the service, as well as other stakeholders, to determine the most
appropriate payment rate. Once we identify the most appropriate payment
rate for a service, we would assign the service to the New Technology
APC with the cost band that includes its payment rate.
Accordingly, for CY 2019, we are proposing to establish a different
payment methodology for services assigned to New Technology APCs with
fewer than 100 claims using our equitable adjustment authority under
[[Page 37092]]
section 1833(t)(2)(E) of the Act. Under this proposal, we are proposing
to use up to 4 years of claims data to establish a payment rate for
each applicable service both for purposes of assigning a service to a
New Technology APC and for assigning a service to a regular APC at the
conclusion of payment for the service through a New Technology APC. The
goal of such a policy is to promote transparency and stability in the
payment rates for these low-volume new technology procedures and to
mitigate wide variation from year to year for such services. We also
are proposing to use the geometric mean, the median, or the arithmetic
mean to calculate the cost of furnishing the applicable service,
present the result of each statistical methodology in our annual
rulemaking, and solicit public comment on which methodology should be
used to establish the payment rate. The geometric mean may not be
representative of the actual cost of a service when fewer than 100
claims are present because the payment amounts for the claims may not
be distributed normally. Under this proposal, we would have the option
to use the median payment amount or the arithmetic mean to assign a
more representative payment for the service. Once we identify the
payment rate for a service, we would assign the service to the New
Technology APC with the cost band that includes its payment rate.
3. Proposed Procedures Assigned to New Technology APC Groups for CY
2019
As we explained in the CY 2002 OPPS final rule with comment period
(66 FR 59902), we generally retain a procedure in the New Technology
APC to which it is initially assigned until we have obtained sufficient
claims data to justify reassignment of the procedure to a clinically
appropriate APC.
In addition, in cases where we find that our initial New Technology
APC assignment was based on inaccurate or inadequate information
(although it was the best information available at the time), where we
obtain new information that was not available at the time of our
initial New Technology APC assignment, or where the New Technology APCs
are restructured, we may, based on more recent resource utilization
information (including claims data) or the availability of refined New
Technology APC cost bands, reassign the procedure or service to a
different New Technology APC that more appropriately reflects its cost
(66 FR 59903).
Consistent with our current policy, for CY 2019, in this CY 2019
OPPS/ASC proposed rule, we are proposing to retain services within New
Technology APC groups until we obtain sufficient claims data to justify
reassignment of the service to a clinically appropriate APC. The
flexibility associated with this policy allows us to reassign a service
from a New Technology APC in less than 2 years if sufficient claims
data are available. It also allows us to retain a service in a New
Technology APC for more than 2 years if sufficient claims data upon
which to base a decision for reassignment have not been obtained (66 FR
59902).
a. Magnetic Resonance-Guided Focused Ultrasound Surgery (MRgFUS) (APCs
1537, 5114, and 5414)
Currently, there are four CPT/HCPCS codes that describe magnetic
resonance image-guided, high-intensity focused ultrasound (MRgFUS)
procedures, three of which we are proposing to continue to assign to
standard APCs, and one that we are proposing to reassign to a different
New Technology APC for CY 2019. These codes include CPT codes 0071T,
0072T, and 0398T, and HCPCS code C9734. CPT codes 0071T and 0072T
describe procedures for the treatment of uterine fibroids, CPT code
0398T describes procedures for the treatment of essential tremor, and
HCPCS code C9734 describes procedures for pain palliation for
metastatic bone cancer.
As shown in Table 13 of this proposed rule, and as listed in
Addendum B to this CY 2019 OPPS/ASC proposed rule, we are proposing to
continue to assign the procedures described by CPT codes 0071T and
0072T to APC 5414 (Level 4 Gynecologic Procedures), with a proposed
payment rate of approximately $2,410 for CY 2019. We also are proposing
to continue to assign the APC to status indicator ``J1'' (Hospital Part
B services paid through a comprehensive APC) to indicate that payment
for all covered Part B services reported on the claim are packaged with
the payment for the primary ``J1'' service for the claim, except for
services assigned to OPPS status indicator ``F'', ``G'', ``H'', ``L'',
and ``U''; ambulance services; diagnostic and screening mammography;
all preventive services; and certain Part B inpatient services. In
addition, we are proposing to continue to assign the services described
by HCPCS code C9734 (Focused ultrasound ablation/therapeutic
intervention, other than uterine leiomyomata, with magnetic resonance
(mr) guidance) to APC 5115 (Level 5 Musculoskeletal Procedures), with a
proposed payment rate of approximately $10,936 for CY 2019. We also are
proposing to continue to assign HCPCS code C9734 to status indicator
``J1''.
For procedures described by CPT code 0398T, we have only identified
one paid claim for a procedure in CY 2016 and two paid claims in CY
2017, for a total of three paid claims. We note that the procedures
described by CPT code 0398T were first assigned to a New Technology APC
in CY 2016. Accordingly, there are only 2 years of claims data
available for the OPPS ratesetting purposes. The payment amounts for
the claims vary widely, with a cost of $29,254 for the sole CY 2016
claim and a geometric mean cost of $4,647 for the two CY 2017 claims.
We are concerned that the reported geometric mean cost for CY 2017,
which we would normally use to determine the proposed payment rate for
the procedures described by CPT code 0398T, is significantly lower than
the reported cost of the claim received in CY 2016, as well as the
payment rate for the procedures for CY 2016 ($9,750.50) and for CY 2017
($17,500.50). In accordance with section 1833(t)(2)(B) of the Act, we
must establish that services classified within each APC are comparable
clinically and with respect to the use of resources.
Therefore, as mentioned in section III.C.2. of this proposed rule,
we are proposing to use our equitable adjustment authority under
section 1833(t)(2)(E) of the Act, which states that the Secretary shall
establish, in a budget neutral manner, other adjustments as determined
to be necessary to ensure equitable payments, to establish a payment
rate that is more likely to be representative of the cost of the
procedures described by CPT code 0398T, despite the low geometric mean
costs for procedures described by CPT code 0398T available in the
claims data used for this proposed rule. We continue to believe that
this situation for the procedures described by CPT code 0398T is
unique, given the very limited number of claims for the procedures and
the high variability for the cost of the claims which makes it
challenging to determine a reliable payment rate for the procedures.
Our analysis found that the arithmetic mean of the three claims is
$12,849.11, the geometric mean of the three claims is $8,579.91
(compared to $4,646.56 for CY 2017), and the median of the claims is
$4,676.77. Consistent with what we state in section III.C.2. of this
proposed rule, we have presented the result of each statistical
methodology in this preamble, and we are seeking public comments on
which method should be used to establish payment for the
[[Page 37093]]
procedures described by CPT code 0398T. We believe that the arithmetic
mean is the most appropriate representative cost of the procedures
described by CPT code 0398T, which gives consideration to the payment
rates established for the procedures in CY 2017 and CY 2018, without
any trimming. The arithmetic mean also gives consideration to the range
in cost for the three paid claims, which represent 2 years of claims
data for the procedures. We are proposing to estimate the proposed
payment rate for the procedures described by CPT code 0398T by
calculating the arithmetic mean of the three paid claims for the
procedures in CY 2016 and CY 2017, and assigning the procedures
described by CPT code 0398T to the New Technology APC that includes the
estimated cost. Accordingly, we are proposing to reassign the
procedures described by CPT code 0398T from APC 1576 (New Technology--
Level 39 ($15,001-$20,000)) to APC 1575 (New Technology--Level 38
($10,001-$15,000)), with a proposed payment rate of $12,500.50. We
refer readers to Addendum B to this proposed rule for the proposed
payment rates for all codes reportable under the OPPS. Addendum B is
available via the internet on the CMS website.
Table 13--Proposed CY 2019 Status Indicator (SI), APC Assignment, and Payment Rate for the Magnetic Resonance Image Guided High Intensity Focused
Ultrasound (MRgFUS) Procedures
--------------------------------------------------------------------------------------------------------------------------------------------------------
CY 2018 OPPS CY 2018 OPPS Proposed CY 2019 Proposed CY Proposed CY 2019
CPT/HCPCS code Long descriptor CY 2018 OPPS SI APC payment rate OPPS SI 2019 OPPS APC OPPS payment rate
--------------------------------------------------------------------------------------------------------------------------------------------------------
0071T.................... Focused ultrasound J1 5414 $2,272.77 J1 5414 Refer to OPPS
ablation of Addendum B.
uterine
leiomyomata,
including mr
guidance; total
leiomyomata volume
less than 200 cc
of tissue.
0072T.................... Focused ultrasound J1 5414 2,272.77 J1 5414 Refer to OPPS
ablation of Addendum B.
uterine
leiomyomata,
including mr
guidance; total
leiomyomata volume
greater or equal
to 200 cc of
tissue.
0398T.................... Magnetic resonance S 1576 17,500.50 S 1575 Refer to OPPS
image guided high Addendum B.
intensity focused
ultrasound
(mrgfus),
stereotactic
ablation lesion,
intracranial for
movement disorder
including
stereotactic
navigation and
frame placement
when performed.
C9734.................... Focused ultrasound J1 5115 5,606.42 J1 5115 Refer to OPPS
ablation/ Addendum B.
therapeutic
intervention,
other than uterine
leiomyomata, with
magnetic resonance
(mr) guidance.
--------------------------------------------------------------------------------------------------------------------------------------------------------
b. Retinal Prosthesis Implant Procedure
CPT code 0100T (Placement of a subconjunctival retinal prosthesis
receiver and pulse generator, and implantation of intra-ocular retinal
electrode array, with vitrectomy) describes the implantation of a
retinal prosthesis, specifically, a procedure involving the use of the
Argus[supreg] II Retinal Prosthesis System. This first retinal
prosthesis was approved by the Food and Drug Administration (FDA) in
2013 for adult patients diagnosed with severe to profound retinitis
pigmentosa. Pass-through payment status was granted for the
Argus[supreg] II device under HCPCS code C1841 (Retinal prosthesis,
includes all internal and external components) beginning October 1,
2013, and this status expired on December 31, 2015. We note that after
pass-through payment status expires for a medical device, the payment
for the device is packaged into the payment for the associated surgical
procedure. Consequently, for CY 2016, the device described by HCPCS
code C1841 was assigned to OPPS status indicator ``N'' to indicate that
payment for the device is packaged and included in the payment rate for
the surgical procedure described by CPT code 0100T. For CY 2016, the
procedure described by CPT code 0100T was assigned to New Technology
APC 1599, with a payment rate of $95,000, which was the highest paying
New Technology APC for that year. This payment includes both the
surgical procedure (CPT code 0100T) and the use of the Argus[supreg] II
device (HCPCS code C1841). However, stakeholders (including the device
manufacturer and hospitals) believed that the CY 2016 payment rate for
the procedure involving the Argus[supreg] II System was insufficient to
cover the hospital cost of performing the procedure, which includes the
cost of the retinal prosthesis at the retail price of approximately
$145,000.
For CY 2017, analysis of the CY 2015 OPPS claims data used for the
CY 2017 final rule with comment period showed 9 single claims (out of
13 total claims) for the procedure described by CPT code 0100T, with a
geometric mean cost of approximately $142,003 based on claims submitted
between January 1, 2015, through December 31, 2015, and processed
through June 30, 2016. Based on the CY 2015 OPPS claims data available
for the final rule with comment period and our understanding of the
Argus[supreg] II procedure, we reassigned the procedure described by
CPT code 0100T from New Technology APC 1599 to New Technology APC 1906,
with a final payment rate of $150,000.50 for CY 2017. We noted that
this payment rate included the cost of both the surgical procedure (CPT
code 0100T) and the retinal prosthesis device (HCPCS code C1841).
For CY 2018, the reported cost of the Argus[supreg] II procedure
based on CY 2016 hospital outpatient claims data used for the CY 2018
OPPS/ASC final rule with comment period was approximately $94,455,
which was more than $55,000 less than the payment rate for the
procedure in CY 2017. We noted that the costs of the Argus[supreg] II
procedure are extraordinarily high compared to many other procedures
paid under the OPPS. In addition, the number of claims submitted has
been very low and has not exceeded 10 claims within a single year. We
believed that it is important to mitigate significant payment
differences, especially shifts of several tens of thousands of dollars,
while also basing payment rates on available cost information and
claims data. In CY 2016, the payment rate for the Argus[supreg] II
procedure was $95,000.50. The payment rate increased to $150,000.50
[[Page 37094]]
in CY 2017. For CY 2018, if we had established the payment rate based
on updated final rule claims data, the payment rate would have
decreased to $95,000.50 for CY 2018, a decrease of $55,000 relative to
CY 2017. We were concerned that these large changes in payment could
potentially create an access to care issue for the Argus[supreg] II
procedure, and we wanted to establish a payment rate to mitigate the
potential sharp decline in payment from CY 2017 to CY 2018.
In accordance with section 1833(t)(2)(B) of the Act, we must
establish that services classified within each APC are comparable
clinically and with respect to the use of resources. Therefore, we used
our equitable adjustment authority under section 1833(t)(2)(E) of the
Act, which states that the Secretary shall establish, in a budget
neutral manner, other adjustments as determined to be necessary to
ensure equitable payments, to maintain the payment rate for this
procedure, despite the lower geometric mean costs available in the
claims data used for the final rule with comment period. For CY 2018,
we reassigned the Argus[supreg] II procedure to APC 1904 (New
Technology--Level 50 ($115,001-$130,000)), which established a payment
rate for the Argus[supreg] II procedure of $122,500.50, which was the
arithmetic mean of the payment rates for the procedure for CY 2016 and
CY 2017.
For CY 2019, the reported cost of the Argus[supreg] II procedure
based on CY 2017 hospital outpatient claims data used for this CY 2019
OPPS/ASC proposed rule is approximately $152,021, which is $29,520 more
than the payment rate for the procedure for CY 2018. We continue to
note that the costs of the Argus[supreg] II procedure are
extraordinarily high compared to many other procedures paid under the
OPPS. In addition, the number of claims submitted has been very low and
did not exceed 10 claims for CY 2017. We continue to believe that it is
important to mitigate significant payment differences, especially
shifts of several tens of thousands of dollars, while also basing
payment rates on available cost information and claims data because we
are concerned that large decreases in the payment rate could
potentially create an access to care issue for the Argus[supreg] II
procedure. In addition, we want to establish a payment rate to mitigate
the potential sharp increase in payment from CY 2018 to CY 2019, and
potentially ensure a more stable payment rate in future years.
In accordance with section 1833(t)(2)(B) of the Act, we must
establish that services classified within each APC are comparable
clinically and with respect to the use of resources. Therefore, as
discussed in section III.C.2. of this proposed rule, we are proposing
to use our equitable adjustment authority under section 1833(t)(2)(E)
of the Act, which states that the Secretary shall establish, in a
budget neutral manner, other adjustments as determined to be necessary
to ensure equitable payments, to establish a payment rate that is more
representative of the likely cost of the service. We believe the likely
cost of the Argus[supreg] II procedure is lower than the geometric mean
cost calculated from the CY 2017 claims data used for this proposed
rule and closer to the CY 2018 payment rate.
We analyzed claims data for the Argus[supreg] II procedure using
the last 3 years of available data from CY 2015 through CY 2017. These
data include claims from the last year (CY 2015) that the Argus[supreg]
II received transitional device pass-through payments and the first 2
years since device pass-through payment status for the Argus[supreg] II
expired. We found the geometric mean for the procedure to be $129,891
(compared to $152,021 in CY 2017 alone), the arithmetic mean to be
$134,619, and the median to be $133,679. As indicated in our proposal
in section III.C.2. of this proposed rule, we have presented the result
of each statistical methodology in this preamble, and are requesting
public comment on which methodology should be used to establish a
payment rate. We are proposing to use the arithmetic mean, which
generates the highest payment rate of the three statistical
methodologies, to estimate the cost of the Argus[supreg] II procedure
as a means to balance the fluctuations in the costs of the procedure
that have occurred from CY 2015 through CY 2017, while acknowledging
the higher payment rates for the procedure in CY 2015 and CY 2017.
Therefore, for CY 2019, we are proposing to reassign the Argus[supreg]
II procedure from APC 1904 (New Technology--Level 50 ($115,001-
$130,000)) to APC 1906 (New Technology--Level 51 ($130,001-$145,000)),
which would result in a proposed payment rate for the Argus[supreg] II
procedure of $137,500.50.
As we do each year, we acquired claims data regarding hospital
costs associated with new procedures. We regularly examine the claims
data and any available new information regarding the clinical aspects
of new procedures to confirm that our OPPS payments remain appropriate
for procedures like the Argus[supreg] II procedure as they transition
into mainstream medical practice (77 FR 68314). We note that this
proposed payment rate includes both the surgical procedure (CPT code
0100T) and the use of the Argus[supreg] II device (HCPCS code C1841).
The most recent claims data available have shown another payment
issue with regard to the Argus[supreg] II procedure. We have found that
payment for the Argus[supreg] II procedure is sometimes bundled into
the payment for another procedure. We have identified two possible
instances in the CY 2017 claims data in which this may have occurred.
The bundling of payment for the Argus[supreg] II procedure occurs when
the procedure is reported with other eye procedures assigned to a
comprehensive APC (C-APC). A C-APC bundles payment for all services
related to the primary service into one payment rate. We are concerned
that when payment for new technology services is bundled into the
payment for comprehensive procedures, there is not complete claims
information to estimate accurately the cost of these services to allow
their assignment to clinical APCs. Therefore, we are proposing to
exclude payment for all procedures assigned to New Technology APCs from
being bundled into the payment for procedures assigned to a C-APC. This
action would allow for separate payment for the Argus[supreg] II
procedure even when it is performed with another comprehensive service,
which would provide more cost information regarding the procedure. This
proposal is also discussed in section II.A.2.c. of this proposed rule.
D. Proposed OPPS APC-Specific Policies
Section 1833(t)(9)(A) of the Act requires the Secretary to review,
not less often than annually, and to revise the APC groups, the
relative payment weights, and the wage and other adjustments to take
into account changes in medical practices, changes in technology, the
addition of new services, new cost data, and other relevant information
and factors. Each year, under the OPPS, we revise and make changes to
the APC groupings based on the latest hospital outpatient claims data
to appropriately place procedures and services in APCs based on
clinical characteristics and resource similarity. Although we do not
discuss every APC change in the proposed and final rules, these changes
are listed in the OPPS Addendum B of the proposed and final rules.
Specifically, the procedure and service codes with revised APC and/or
status indicator assignments are identified with comment indicator
``CH'' (Active HCPCS code in current year and next
[[Page 37095]]
calendar year, status indicator and/or APC assignment has changed) in
the OPPS Addendum B payment file.
1. Endovascular Procedures (APCs 5191 Through 5194)
At the annual meeting for the HOP Panel held on August 21, 2017,
the HOP Panel recommended that, for CY 2018, CMS examine the number of
APCs for endovascular procedures. The HOP Panel also recommended that
the appropriate Panel subcommittee review the APCs for endovascular
procedures to determine whether more granularity (that is, more APCs)
is warranted.
In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59293
through 59294), we stated that we believed that the current C-APC
levels for the Endovascular Procedures C-APC family provide an
appropriate distinction between the resource costs at each level and
clinical homogeneity. We also stated that we would continue to review
the C-APC structure for endovascular procedures to determine if any
additional granularity is necessary for this C-APC family.
Using the most recent data available for this proposed rule, we
have analyzed the four existing levels of the Endovascular Procedures
C-APCs. We did not observe any violations of the 2 times rule within
the current Endovascular Procedures C-APC structure. Some stakeholders
have suggested that for certain procedures, such as angioplasty
procedures involving the use of a drug-coated balloon in addition to a
nondrug-coated balloon, resource costs are significantly higher than
the geometric mean cost (and associated C-APC payment) for all of the
angioplasty procedures combined. We recognize that the costs of a given
procedure involving additional devices will be higher than the costs of
the procedure when it does not involve such additional devices.
However, the OPPS is a prospective payment system based on a system of
averages in which the costs of some cases within an APC will be more
costly than the APC payment rate, while the costs of other cases will
be less costly. While we believe that there is sufficient granularity
within the existing Endovascular Procedures C-APC structure and at
least one stakeholder agrees, we have also received input from other
stakeholders who have suggested alternative structures for this C-APC
family that include a five-level structure and a six-level structure.
An illustration of these proposed C-APC structure levels is displayed
in Table 15 and Table 16, respectively. Because interested stakeholders
have suggested a variety of options for the endovascular procedures C-
APC structure, including keeping the existing C-APC structure, in this
CY 2019 OPPS/ASC proposed rule, we are proposing to maintain the
existing four-level structure for this C-APC family listed in Table 14
below. However, we are inviting public comments on our proposal, as
well as the stakeholder-requested five-level and six-level structures
displayed in the tables below. We note that the approximate geometric
mean costs associated with the suggested five-level and six-level C-APC
structures shown in Tables 15 and 16 are only estimates and, if either
of the suggested structure levels are adopted, they would be subject to
change, depending on the final rule with comment period data and the
particular services that are assigned to each C-APC.
Table 14--Proposed CY 2019 C-APC Structure for Endovascular Procedures
------------------------------------------------------------------------
Proposed
C-APC geometric mean
cost
------------------------------------------------------------------------
5191--Level 1 Endovascular Procedures................... $2,882
5192--Level 2 Endovascular Procedures................... 4,843
5193--Level 3 Endovascular Procedures................... 9,945
5194--Level 4 Endovascular Procedures................... 15,789
------------------------------------------------------------------------
Table 15--Requested CY 2019 Five-Level Endovascular C-APC Structure
------------------------------------------------------------------------
Potential
approximate
C-APC geometric mean
cost
------------------------------------------------------------------------
5191--Level 1 Endovascular Procedures................... $2,881
5192--Level 2 Endovascular Procedures................... 4,476
5193--Level 3 Endovascular Procedures................... 9,207
5194--Level 4 Endovascular Procedures................... 13,524
5195--New Level 5 Endovascular Procedures............... 16,926
------------------------------------------------------------------------
Table 16--Requested CY 2019 Six-Level Endovascular C-APC Structure
------------------------------------------------------------------------
Potential
approximate
C-APC geometric mean
cost
------------------------------------------------------------------------
5191--Level 1 Endovascular Procedures................... $2,880
5192--Level 2 Endovascular Procedures................... 4,722
5193--New Level 3 Endovascular Procedures............... 7,743
5194--Level 4 Endovascular Procedures................... 10,128
5195--New Level 5 Endovascular Procedures............... 12,216
5196--Level 6 Endovascular Procedures................... 16,140
------------------------------------------------------------------------
2. Imaging Procedures and Services (APCs 5521 Through 5524 and 5571
Through 5573)
Section 1833(t)(2)(G) of the Act requires the Secretary to create
additional groups of covered OPD services that classify separately
those procedures that utilize contrast agents from those procedures
that do not utilize contrast agents. In CY 2016, as a part of our
comprehensive review of the structure of the APCs and procedure code
assignments, we restructured the APCs that contain imaging services (80
FR 70392). The purpose of this restructuring was to more appropriately
reflect the resource costs and clinical characteristics of the services
classified within the Imaging APCs. The restructuring of the Imaging
APCs resulted in broader groupings that removed the excessive
granularity of grouping imaging services according to organ or
physiologic system, which did not necessarily reflect either
significant differences in resources or how these services are
delivered in the hospital outpatient setting. In CY 2017, in response
to public comments on the CY 2017 OPPS/ASC proposed rule, we further
consolidated the Imaging APCs from 17 APCs in CY 2016 to 7 APCs in CY
2017 (81 FR 79633). These included four Imaging without Contrast APCs
and three Imaging with Contrast APCs.
For CY 2018, we proposed to establish a new Level 5 Imaging without
Contrast APC to more appropriately group certain imaging services with
higher resource costs and stated that our latest claims data supported
splitting the CY 2017 Level 4 Imaging without Contrast APC into two
APCs such that the Level 4 Imaging without Contrast APC would include
high frequency, low-cost services and the proposed Level 5 Imaging
without Contrast APC would include low frequency high-cost services.
Therefore, for CY 2018, we proposed to add a fifth level within the
[[Page 37096]]
Imaging without Contrast APCs (82 FR 33608). However, based on public
comments, we did not finalize this proposal. In general, commenters
disagreed with CMS' proposal to add a fifth level within the Imaging
without Contrast APC series because they believed that the addition of
a fifth level would reduce payment for several imaging services,
including vascular ultrasound procedures (82 FR 59309 through 59311).
Commenters also noted that the lower payment rates under the OPPS would
also apply under the PFS.
For this CY 2019 proposed rule, we reviewed the services assigned
to the seven imaging APCs listed below in Table 17. Specifically, we
evaluated the resource costs and clinical coherence of the procedures
associated with the four levels of Imaging without Contrast APCs and
the three levels of Imaging with Contrast APCs, as well as identified
for correction any 2 times rule violations, to the extent feasible.
Based on the geometric mean cost for each APC, which is listed in Table
17, for CY 2019, we are proposing to maintain the seven Imaging APCs,
which consist of four levels of Imaging without Contrast APCs and three
levels of Imaging with Contrast APCs, and to make minor reassignments
to the HCPCS codes within this series to resolve or mitigate any
violations of the 2 times rule, or both.
Table 17--Proposed CY 2019 Imaging APCs
----------------------------------------------------------------------------------------------------------------
Proposed CY
CY 2018 APC 2019 APC
CY 2019 APC CY 2019 APC title geometric mean geometric mean
cost cost
----------------------------------------------------------------------------------------------------------------
5521................................... Level 1 Imaging without Contrast....... $62.08 $64.02
5522................................... Level 2 Imaging without Contrast....... 114.39 115.89
5523................................... Level 3 Imaging without Contrast....... 232.17 236.05
5524................................... Level 4 Imaging without Contrast....... 486.38 502.75
5571................................... Level 1 Imaging with Contrast.......... 252.58 206.94
5572................................... Level 2 Imaging with Contrast.......... 456.08 395.84
5573................................... Level 3 Imaging with Contrast.......... 681.45 699.02
----------------------------------------------------------------------------------------------------------------
We are inviting public comments on our proposal to maintain the
seven Imaging APCs and the current APC structure level of the imaging
APCs. Moreover, we are specifically interested in receiving public
comments and recommendations on the proposed HCPCS code reassignments
associated with each of the seven Imaging APCs. We refer readers to
Addendum B to this proposed rule (which is available via the internet
on the CMS website) for the proposed list of specific codes that would
be reassigned to each Imaging APC.
3. Musculoskeletal Procedures (APCs 5111 Through 5116)
Prior to the CY 2016 OPPS, payment for musculoskeletal procedures
was primarily divided according to anatomy and the type of
musculoskeletal procedure. As part of the CY 2016 reorganization to
better structure the OPPS payments towards prospective payment
packages, we consolidated those individual APCs so that they became a
general Musculoskeletal APC series (80 FR 70397 through 70398).
In the CY 2018 OPPS/ASC final rule with comment period (82 FR
59300), we continued to apply a six-level structure for the
Musculoskeletal APCs because doing so provided an appropriate
distinction for resource costs at each level and to provide clinical
homogeneity. However, we also indicated that we would continue to
review the structure of these APCs to determine whether additional
granularity would be necessary.
While we are not proposing any changes to the 2019 OPPS structure
of the Musculoskeletal APC series in this proposed rule, we recognize
that commenters have previously expressed concerns regarding the
granularity of the current APC levels and requested establishment of
additional levels. Therefore, we are soliciting comments on the
creation of a new APC level between the current Level 5 and Level 6
within the Musculoskeletal APC series.
Table 18--Proposed CY 2019 Musculoskeletal Procedures APCs
----------------------------------------------------------------------------------------------------------------
HCPCS codes Proposed APC
APC Group title assigned to geometric mean
APC cost
----------------------------------------------------------------------------------------------------------------
5111................................... Level 1 Musculoskeletal Procedures..... 102 $229.40
5112................................... Level 2 Musculoskeletal Procedures..... 133 $1,345.93
5113................................... Level 3 Musculoskeletal Procedures..... 442 $2,673.08
5114................................... Level 4 Musculoskeletal Procedures..... 287 $5,816.78
5115................................... Level 5 Musculoskeletal Procedures..... 67 $10,935.83
5116................................... Level 6 Musculoskeletal Procedures..... 15 $15,785.37
----------------------------------------------------------------------------------------------------------------
4. Level 5 Intraocular Procedures (APC 5495)
In prior years, CPT code 0308T (Insertion of ocular telescope
prosthesis including removal of crystalline lens or intraocular lens
prosthesis) has been assigned to the APC 5495 (Level 5 Intraocular
Procedures) based on its estimated costs. In addition, its relative
payment weight has been based on its median under our payment policy
for low-volume device-intensive procedures because the APC contained a
low volume of claims. The low-volume device-intensive procedures policy
is discussed in more detail in section III.C.2. of this proposed rule.
[[Page 37097]]
In reviewing the claims data available for this proposed rule for
CY 2019 OPPS ratesetting, there are only two claims containing
procedures described by CPT code 0308T. Based on those two claims, APC
5495 would have a proposed geometric mean of $5,438.99 and a proposed
median of $8,237.56. Based on its estimated costs in the most recently
available claims data, we believe that the procedure described by CPT
code 0308T is more appropriately placed in the APC 5493, which has a
geometric mean of $9,821.47, which is more comparable to that of CPT
code 0308T. Therefore, for CY 2019, we are proposing to reassign the
procedure described by CPT code 0308T from APC 5495 to APC 5493 (Level
3 Intraocular Procedures) and to delete APC 5495. We will continue to
monitor the volume of claims reporting a procedure described by CPT
code 0308T available to us for future ratesetting.
IV. Proposed OPPS Payment for Devices
A. Pass-Through Payments for Devices
1. Beginning Eligibility Date for Device Pass-Through Status and
Quarterly Expiration of Device Pass-Through Payments
a. Background
Under section 1833(t)(6)(B)(iii) of the Act, the period for which a
device category eligible for transitional pass-through payments under
the OPPS can be in effect is at least 2 years but not more than 3
years. Prior to CY 2017, our regulation at 42 CFR 419.66(g) provided
that this pass-through payment eligibility period began on the date CMS
established a particular transitional pass-through category of devices,
and we based the pass-through status expiration date for a device
category on the date on which pass-through payment was effective for
the category. In the CY 2017 OPPS/ASC final rule with comment period
(81 FR 79654), in accordance with section 1833(t)(6)(B)(iii)(II) of the
Act, we amended Sec. 419.66(g) to provide that the pass-through
eligibility period for a device category begins on the first date on
which pass-through payment is made under the OPPS for any medical
device described by such category. In addition, prior to CY 2017, our
policy was to propose and finalize the dates for expiration of pass-
through status for device categories as part of the OPPS annual update.
This means that device pass-through status would expire at the end of a
calendar year when at least 2 years of pass-through payments have been
made, regardless of the quarter in which the device was approved. In
the CY 2017 OPPS/ASC final rule with comment period (81 FR 79655), we
changed our policy to allow for quarterly expiration of pass-through
payment status for devices, beginning with pass-through devices
approved in CY 2017 and subsequent calendar years, to afford a pass-
through payment period that is as close to a full 3 years as possible
for all pass-through payment devices. We refer readers to the CY 2017
OPPS/ASC final rule with comment period (81 FR 79648 through 79661) for
a full discussion of the changes to the device pass-through payment
policy. We also have an established policy to package the costs of the
devices that are no longer eligible for pass-through payments into the
costs of the procedures with which the devices are reported in the
claims data used to set the payment rates (67 FR 66763).
b. Expiration of Transitional Pass-Through Payments for Certain Devices
As stated earlier, section 1833(t)(6)(B)(iii) of the Act requires
that, under the OPPS, a category of devices be eligible for
transitional pass-through payments for at least 2 years, but not more
than 3 years. There currently are no device categories eligible for
pass-through payment.
2. New Device Pass-Through Applications
a. Background
Section 1833(t)(6) of the Act provides for pass-through payments
for devices, and section 1833(t)(6)(B) of the Act requires CMS to use
categories in determining the eligibility of devices for pass-through
payments. As part of implementing the statute through regulations, we
have continued to believe that it is important for hospitals to receive
pass-through payments for devices that offer substantial clinical
improvement in the treatment of Medicare beneficiaries to facilitate
access by beneficiaries to the advantages of the new technology.
Conversely, we have noted that the need for additional payments for
devices that offer little or no clinical improvement over previously
existing devices is less apparent. In such cases, these devices can
still be used by hospitals, and hospitals will be paid for them through
appropriate APC payment. Moreover, a goal is to target pass-through
payments for those devices where cost considerations might be most
likely to interfere with patient access (66 FR 55852; 67 FR 66782; and
70 FR 68629).
As specified in regulations at 42 CFR 419.66(b)(1) through (b)(3),
to be eligible for transitional pass-through payment under the OPPS, a
device must meet the following criteria: (1) If required by FDA, the
device must have received FDA approval or clearance (except for a
device that has received an FDA investigational device exemption (IDE)
and has been classified as a Category B device by the FDA), or another
appropriate FDA exemption; and the pass-through payment application
must be submitted within 3 years from the date of the initial FDA
approval or clearance, if required, unless there is a documented,
verifiable delay in U.S. market availability after FDA approval or
clearance is granted, in which case CMS will consider the pass-through
payment application if it is submitted within 3 years from the date of
market availability; (2) the device is determined to be reasonable and
necessary for the diagnosis or treatment of an illness or injury or to
improve the functioning of a malformed body part, as required by
section 1862(a)(1)(A) of the Act; and (3) the device is an integral
part of the service furnished, is used for one patient only, comes in
contact with human tissue, and is surgically implanted or inserted
(either permanently or temporarily), or applied in or on a wound or
other skin lesion. In addition, according to Sec. 419.66(b)(4), a
device is not eligible to be considered for device pass-through payment
if it is any of the following: (1) Equipment, an instrument, apparatus,
implement, or item of this type for which depreciation and financing
expenses are recovered as depreciation assets as defined in Chapter 1
of the Medicare Provider Reimbursement Manual (CMS Pub. 15-1); or (2) a
material or supply furnished incident to a service (for example, a
suture, customized surgical kit, or clip, other than a radiological
site marker).
Separately, we use the following criteria, as set forth under Sec.
419.66(c), to determine whether a new category of pass-through payment
devices should be established. The device to be included in the new
category must--
Not be appropriately described by an existing category or
by any category previously in effect established for transitional pass-
through payments, and was not being paid for as an outpatient service
as of December 31, 1996;
Have an average cost that is not ``insignificant''
relative to the payment amount for the procedure or service with which
the device is associated as determined under Sec. 419.66(d) by
demonstrating: (1) The estimated average reasonable costs of devices in
the category exceeds 25 percent of the applicable APC payment amount
for the service related to the category of devices; (2) the estimated
average
[[Page 37098]]
reasonable cost of the devices in the category exceeds the cost of the
device-related portion of the APC payment amount for the related
service by at least 25 percent; and (3) the difference between the
estimated average reasonable cost of the devices in the category and
the portion of the APC payment amount for the device exceeds 10 percent
of the APC payment amount for the related service (with the exception
of brachytherapy and temperature-monitored cryoblation, which are
exempt from the cost requirements as specified at Sec. Sec.
419.66(c)(3) and (e)); and
Demonstrate a substantial clinical improvement, that is,
substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part compared to
the benefits of a device or devices in a previously established
category or other available treatment.
Beginning in CY 2016, we changed our device pass-through evaluation
and determination process. Device pass-through applications are still
submitted to CMS through the quarterly subregulatory process, but the
applications will be subject to notice-and-comment rulemaking in the
next applicable OPPS annual rulemaking cycle. Under this process, all
applications that are preliminarily approved upon quarterly review will
automatically be included in the next applicable OPPS annual rulemaking
cycle, while submitters of applications that are not approved upon
quarterly review will have the option of being included in the next
applicable OPPS annual rulemaking cycle or withdrawing their
application from consideration. Under this notice-and-comment process,
applicants may submit new evidence, such as clinical trial results
published in a peer-reviewed journal or other materials for
consideration during the public comment process for the proposed rule.
This process allows those applications that we are able to determine
meet all the criteria for device pass-through payment under the
quarterly review process to receive timely pass-through payment status,
while still allowing for a transparent, public review process for all
applications (80 FR 70417 through 70418).
More details on the requirements for device pass-through payment
applications are included on the CMS website in the application form
itself at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/passthrough_payment.html, in the
``Downloads'' section. In addition, CMS is amenable to meeting with
applicants or potential applicants to discuss research trial design in
advance of any device pass-through application or to discuss
application criteria, including the substantial clinical improvement
criterion.
b. Applications Received for Device Pass-Through Payment for CY 2019
We received seven applications by the March 1, 2018 quarterly
deadline, which is the last quarterly deadline for applications to be
received in time to be included in this CY 2019 OPPS/ASC proposed rule.
We received four of the applications in the second quarter of 2017, one
of the applications in the third quarter of 2017, and two of the
applications in the first quarter of 2018. None of the seven
applications were approved for device pass-through payment during the
quarterly review process.
Applications received for the later deadlines for the remaining
2018 quarters (June 1, September 1, and December 1), if any, will be
presented in the CY 2020 OPPS/ASC proposed rule. We note that the
quarterly application process and requirements have not changed in
light of the addition of rulemaking review. Detailed instructions on
submission of a quarterly device pass-through payment application are
included on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Downloads/catapp.pdf. A
discussion of the seven applications received by the March 1, 2018
deadline is presented below.
(1) AquaBeam System
PROCEPT BioRobotics Corporation submitted an application for a new
device category for transitional pass-through payment status for the
AquaBeam System. The AquaBeam System is intended for the resection and
removal of prostate tissue in males suffering from lower urinary tract
symptoms (LUTS) due to benign prostatic hyperplasia (BPH). The
applicant stated that this is a very common condition typically
occurring in elderly men. The clinical symptoms of this condition can
include diminished urinary stream and partial urethral obstruction.\13\
According to the applicant, the AquaBeam system resects the prostate to
relieve symptoms of urethral compression. The resection is performed
robotically using a high velocity, nonheated sterile saline water jet
(in a procedure called Aquablation). The applicant stated that the
AquaBeam System utilizes real-time intra-operative ultrasound guidance
to allow the surgeon to precisely plan the surgical resection area of
the prostate and then the system delivers Aquablation therapy to
accurately resect the obstructive prostate tissue without the use of
heat. The materials submitted by the applicant state that the AquaBeam
System consists of a disposable, single-use handpiece as well as other
components that are considered capital equipment.
---------------------------------------------------------------------------
\13\ Chungtai B. Forde JC. Thomas DDM et al. Benign Prostatic
Hyperplasia. Nature Reviews Disease Primers 2 (2016) article 16031.
---------------------------------------------------------------------------
With respect to the newness criterion at Sec. 419.66(b)(1), FDA
granted a De Novo request classifying the AquaBeam System as a class II
device under section 513(f)(2) of the Federal Food, Drug, and Cosmetic
Act on December 21, 2017. The application for a new device category for
transitional pass-through payment status for the AquaBeam System was
received on March 1, 2018, which is within 3 years of the date of the
initial FDA approval or clearance. We are inviting public comments on
whether the AquaBeam System meets the newness criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
according to the applicant, the AquaBeam System is integral to the
service provided, is used for one patient only, comes in contact with
human skin, and is applied in or on a wound or other skin lesion. The
applicant also claimed the AquaBeam System meets the device eligibility
requirements of Sec. 419.66(b)(4) because it is not an instrument,
apparatus, implement, or items for which depreciation and financing
expenses are recovered, and it is not a supply or material furnished
incident to a service. However, in the CY 2000 interim final rule with
comment period (65 FR 67804 through 67805), we explained how we
interpreted Sec. 419.43(e)(4)(iv). We stated that we consider a device
to be surgically implanted or inserted if is surgically inserted or
implanted via a natural or surgically created orifice, or inserted or
implanted via a surgically created incision. We also stated that we do
not consider an item used to cut or otherwise create a surgical opening
to be a device that is surgically implanted or inserted. We consider
items used to create incisions, such as scalpels, electrocautery units,
biopsy apparatuses, or other commonly used operating room instruments,
to be supplies or capital equipment, not eligible for transitional
pass-through payments. We stated that we believe the function of these
items is different and distinct from that of devices that are
[[Page 37099]]
used for surgical implantation or insertion. Finally, we stated that,
generally, we would expect that surgical implantation or insertion of a
device occurs after the surgeon uses certain primary tools, supplies,
or instruments to create the surgical path or site for implanting the
device. In the CY 2006 final rule with comment period (70 FR 68329 and
68630), we adopted as final our interpretation that surgical insertion
or implantation criteria include devices that are surgically inserted
or implanted via a natural or surgically created orifice, as well as
those devices that are inserted or implanted via a surgically created
incision. We reiterated that we maintain all of the other criteria in
Sec. 419.66 of the regulations, namely, that we do not consider an
item used to cut or otherwise create a surgical opening to be a device
that is surgically implanted or inserted. We are inviting public
comments on whether the AquaBeam System meets the eligibility criteria
at Sec. 419.66(b).
The criteria for establishing new device categories are specified
at Sec. 419.66(c). The first criterion, at Sec. 419.66(c)(1),
provides that CMS determines that a device to be included in the
category is not appropriately described by any of the existing
categories or by any category previously in effect, and was not being
paid for as an outpatient service as of December 31, 1996. We have not
identified an existing pass-through payment category that describes the
AquaBeam System. The applicant proposed a category descriptor for the
AquaBeam System of ``Probe, image guided, robotic resection of
prostate.'' We are inviting public comments on this issue.
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines that a device to be included
in the category has demonstrated that it will substantially improve the
diagnosis or treatment of an illness or injury or improve the
functioning of a malformed body part compared to the benefits of a
device or devices in a previously established category or other
available treatment. With respect to this criterion, the applicant
submitted several articles that examined the use of a current standard
treatment for BPH--transurethral prostatectomy (TURP), including
complications associated with the procedure and the comparison of the
effectiveness of TURP to other modalities used to treat BPH, including
holmium laser enucleation of the prostate (HoLEP) \14\ and
photoselective vaporization (PVP).\15\
---------------------------------------------------------------------------
\14\ Montorsi, F. et al. (2004). Holmium Laser Enucleation
Versus Transurethral Resection of The Prostate: Results from A 2-
Center, Prospective, Randomized Trial In Patients With Obstructive
Benign Prostatic Hyperplasia. J. Urol. 172, 1926-1929.
\15\ Bachmann A, et al. (2014). 180-W XPS GreenLight laser
vaporisation versus transurethral resection of the prostate for the
treatment of benign prostatic obstruction: 6-month safety and
efficacy results of a European Multicentre Randomised Trial--the
GOLIATH study. Eur Urol, 65(5): 931-42.
---------------------------------------------------------------------------
The most recent clinical study involving the AquaBeam System was an
accepted manuscript describing a double-blind trial that compared men
treated with the AquaBeam System versus men treated with traditional
TURP.\16\ This was a multicenter study in four countries with 17 sites,
6 of which contributed 5 patients or fewer. Patients were randomized to
receive either the AquaBeam System or TURP in a two-to-one ratio. With
exclusions and dropouts, 117 patients were treated with the AquaBeam
System and 67 patients with TURP. The data on efficacy supported the
equivalence of the two procedures based upon noninferiority analysis.
The safety data were reported as showing superiority of the AquaBeam
System over TURP, although the data were difficult to track because
adverse consequences were combined into categories. The applicant
claimed that the International Prostate Symptom Scores (IPPS) were
significantly improved in AquaBeam System patients as compared to TURP
patients in men whose prostate was greater the 50 ml in size.
---------------------------------------------------------------------------
\16\ Gilling P. Barber M. Anderson P et al.: WATER--A Double-
Blind Randomized Controlled Trial of Aquablation vs Transurethal
Resection of the Prostate in Benign Prostatic Hyperplasia. J Urol.
Accepted December 29, 2017 doi 10.1016/j.juro.2017.12.065.
---------------------------------------------------------------------------
Although there may be some evidence of the improved safety of the
AquaBeam System over TURP, we believe that the comparison of the
AquaBeam System with TURP does not recognize that there are other
treatment modalities available that are likely to have a similar safety
profile as the AquaBeam System. No studies comparing other treatment
modalities can be cited to show that AquaBeam System is a significant
improvement over other available procedures.
Based on the evidence submitted with the application, we have
insufficient evidence that the AquaBeam System provides a substantial
clinical improvement over other similar products. We are inviting
public comments on whether the AquaBeam System meets the substantial
clinical improvement criterion.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. The applicant stated that the AquaBeam
System would be reported with CPT code 0421T. CPT code 0421T is
assigned to APC 5375 (Level 5 Urology and Related Services). To meet
the cost criterion for device pass-through payment, a device must pass
all three tests of the cost criterion for at least one APC. For our
calculations, we used APC 5375, which has a CY 2018 payment rate of
$3,706.03. Beginning in CY 2017, we calculate the device offset amount
at the HCPCS/CPT code level instead of the APC level (81 FR 79657). CPT
code 0421T had device offset amount of $0.00 at the time the
application was received. According to the applicant, the cost of the
handpiece for the AquaBeam System is $2,500.
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $2,500 for the AquaBeam System exceeds 68
percent of the applicable APC payment amount for the service related to
the category of devices of $3,706.03 ($2,500/$3,706.03 x 100 = 67.5
percent). Therefore, we believe the AquaBeam System meets the first
cost significance test.
The second cost significance test, at Sec. 419.66(d)(2), provides
that the estimated average reasonable cost of the devices in the
category must exceed the cost of the device-related portion of the APC
payment amount for the related service by at least 25 percent, which
means that the device cost needs to be at least 125 percent of the
offset amount (the device-related portion of the APC found on the
offset list). The estimated average reasonable cost of $2,500 for the
AquaBeam System exceeds the cost of the device-related portion of the
APC payment amount for the related service of $0.00 by at least 25
percent. Therefore, we believe that the AquaBeam System meets the
second cost significance test.
The third cost significance test, at Sec. 419.66(d)(3), requires
that the difference between the estimated average reasonable cost of
the devices in the category and the portion of the APC payment amount
for the device must
[[Page 37100]]
exceed 10 percent of the APC payment amount for the related service.
The difference between the estimated average reasonable cost of $2,500
for the AquaBeam System and the portion of the APC payment amount for
the device of $0.00 exceeds the APC payment amount for the related
service of $3,706.03 by 68 percent (($2,500-$0.00)/$3,706.03 x 100 =
67.5 percent). Therefore, we believe that the AquaBeam System meets the
third cost significance test.
We are inviting public comments on whether the AquaBeam System
meets the device pass-through payment criteria discussed in this
section, including the cost criteria.
(2) BioBag[supreg] (Larval Debridement Therapy in a Contained Dressing)
BioMonde US, LLC resubmitted an application for a new device pass-
through category for the BioBag[supreg] (larval debridement therapy in
a contained dressing), hereinafter referred to as the BioBag[supreg].
The application submitted contained similar information to the previous
application received in March 2016 that was evaluated in the CY 2017
OPPS/ASC final rule with comment period (81 FR 79650). The only new
information provided by the applicant were additional studies completed
since the original application addressing the substantial clinical
improvement criterion.
According to the applicant, BioBag[supreg] is a biosurgical wound
treatment (``maggot therapy'') consisting of disinfected, living larvae
(Lucilia sericata) in a polyester net bag; the larvae remove dead
tissue from wounds. The BioBag[supreg] is indicated for debridement of
nonhealing necrotic skin and soft tissue wounds, including pressure
ulcers, venous stasis ulcers, neuropathic foot ulcers, and nonhealing
traumatic or postsurgical wounds. Debridement, which is the action of
removing devitalized tissue and bacteria from a wound, is required to
treat or prevent infection and to allow the wound to progress through
the healing process. This system contains disinfected, living larvae
that remove the dead tissue from wounds and leave healthy tissue
undisturbed. The larvae are provided in a sterile polyester net bag,
available in different sizes. The only other similar product is free-
range (that is, uncontained) larvae. Free-range larvae are not widely
used in the United States because application is time consuming, there
is a fear of larvae escaping from the wound, and there are concerns
about proper and safe handling of the larvae. The total number of
treatment cycles depends on the characteristics of the wound, the
response of the wound, and the aim of the therapy. Most ulcers are
completely debrided within 1 to 6 treatment cycles.
With respect to the newness criterion at Sec. 419.66(b)(1), the
applicant received FDA clearance for BioBag[supreg] through the
premarket notification section 510(k) process on August 28, 2013, and
the first U.S. sale of BioBag[supreg] occurred in April 2015. The June
1, 2017 application is more than 3 years after FDA clearance but less
than 3 years after its first U.S. sale. We are inviting public comments
on whether BioBag[supreg] meets the newness criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
the applicant claimed that the BioBag[supreg] is an integral part of
the wound debridement, is used for one patient only, comes in contact
with human skin, and is applied in or on a wound. In addition, the
applicant stated that the BioBag[supreg] meets the device eligibility
requirements of Sec. 419.66(b)(4) because it is not an instrument,
apparatus, or item for which depreciation and financing expenses are
recovered. We had also determined in the CY 2017 OPPS/ASC final rule
with comment period (81 FR 79650) that the BioBag[supreg] is not a
material or supply furnished incident to a service. We are inviting
public comments on whether BioBag[supreg] meets the eligibility
criterion.
The criteria for establishing new device categories are specified
at Sec. 419.66(c). The first criterion, at Sec. 419.66(c)(1),
provides that CMS determines that a device to be included in the
category is not appropriately described by any existing categories or
by any category previously in effect, and was not being paid for as an
outpatient service as of December 31, 1996. With respect to the
existence of a previous pass-through device category that describes the
BioBag[supreg], the applicant suggested a category descriptor of
``Contained medicinal larvae for the debridement of necrotic non-
healing skin and soft tissue wounds.'' We have not identified an
existing pass-through payment category that describes the
BioBag[supreg].
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines that a device to be included
in the category has demonstrated that it will substantially improve the
diagnosis or treatment of an illness or injury or improve the
functioning of a malformed body part compared to the benefits of a
device or devices in a previously established category or other
available treatment. With respect to the substantial clinical
improvement criterion, the applicant provided substantial evidence that
larval therapy may improve outcomes compared to other methods of wound
debridement. However, given the existence of the Medical
Maggots[supreg], another form of larval therapy that has been on the
market since 2004, the relevant comparison is between the
BioBag[supreg] and the Medical Maggots[supreg]. There are many reasons
to suspect that the BioBag[supreg] could improve outcomes and be
preferable to the Medical Maggots[supreg]. In essence, with the latter,
the maggots are directly placed on the wound, which may result in
escape, leading to infection control issues as well as dosing
variability. In addition, there are the issues with patient comfort.
With the Biobag[supreg], the maggots are in a sealed container so
escape is not an issue. The applicant cited a study showing large
decreases in maggot escape with the BioBag[supreg] as opposed to the
Medical Maggots[supreg]. However, the applicant did not provide any
data that clinical outcomes are improved using the BioBag[supreg] as
opposed to the Medical Maggots[supreg]. Based on the studies presented,
we believe there is insufficient data to determine whether the
BioBag[supreg] offers a substantial clinical improvement over other
treatments for wound care. We are inviting public comments on whether
BioBag[supreg] meets the substantial clinical improvement criterion.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of device is not
insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. With
respect to the cost criterion, the applicant stated that the
BioBag[supreg] would be reported with CPT code 97602 (Removal of
devitalized tissue from wound(s), non-selective debridement, without
anesthesia (e.g., wet-to-moist dressings, enzymatic, abrasion, larval
therapy), including topical application(s), wound assessment, and
instruction(s) for ongoing care, per session). CPT code 97602 is
assigned to APC 5051 (Level 1 Skin Procedures), with a proposed CY 2019
payment rate of $178.60, and the device offset is $0.02. The price of
the BioBag[supreg] varies with the size of the bag ($375 to $435 per
bag), and bag size selection is based on the size of the wound.
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
reasonable cost of $435 for the BioBag[supreg]
[[Page 37101]]
exceeds the applicable APC amount for the service related to the
category of devices of $178.60 by 243.56 percent ($435/$178.60 x 100 =
243.56 percent). Thus, the BioBag[supreg] appears to meet the first
cost significance test.
The second cost significance test, at Sec. 419.66(d)(2), provides
that the estimated average reasonable cost of devices in the category
must exceed the cost of the device-related portion of the APC payment
amount by at least 25 percent, which means the device cost needs to be
at least 125 percent of the device offset amount (the device-related
portion of the APC found on the offset list). The estimated average
reasonable cost of $435 for the BioBag[supreg] exceeds the device-
related portion of the APC amount for the related service of $0.02 by
2,175,000 percent ($435/$0.02 x 100 = 2,175,000 percent). Thus, the
BioBag[supreg] appears to meet the second cost significance test.
Section 419.66(d)(3), the third cost significance test, requires
that the difference between the estimated average reasonable cost of
the devices in the category and the portion of the APC payment amount
determined to be associated with the device exceeds 10 percent of the
APC payment amount for the related service. The difference between the
estimated average reasonable cost of $435 for the BioBag[supreg] and
the portion of the APC payment for the device of $0.02 exceeds 10
percent at 243.55 percent (($435 - $0.02)/$178.60 x 100 = 243.55
percent). Thus, the BioBag[supreg] appears to meet the third cost
significance test and satisfies the cost significance criterion. We are
inviting public comments on whether the BioBag[supreg] Wound Matrix
meets the device pass-through payment criteria discussed in this
section, including the cost criteria.
(3) BlastX\TM\ Antimicrobial Wound Gel
Next Science\TM\ has submitted an application for a new device
category for transitional pass-through payment status for BlastX\TM\.
According to the manufacturer, BlastX\TM\ is a PEG-based aqueous
hydrogel which contains citric acid, sodium citrate, and benzalkonium
chloride, buffered to a pH of 4.0 at 2.33 osmolarity. BlastX\TM\
received a 510(k) clearance from the FDA on March 6, 2017. BlastX\TM\
is indicated for the management of wounds such as Stage I-IV pressure
ulcers, partial and full thickness wounds, diabetic foot and leg
ulcers, postsurgical wounds, first and second degree burns, and grafted
and donor sites.
The manufacturer stated in its application for transitional pass-
through payment status that BlastX\TM\ works by disrupting the biofilm
matrix in a wound and eliminating the bacteria absorbed within the gel.
The manufacturer asserted that disrupting and eliminating the biofilm
removes a major barrier to wound healing. The manufacturer also
asserted that BlastX\TM\ is not harmful to host tissue and stated that
BlastX\TM\ is applied to the wound every other day as a thin layer
throughout the entire wound healing process.
When used as an adjunct to debridement, BlastX\TM\ is applied
immediately after debridement to eliminate any remaining biofilm and
prevent the growth of new biofilm. Based on the evidence provided in
the manufacturer's application, BlastX\TM\ is not a skin substitute and
cannot be considered for transitional pass-through payment status as a
device. To be considered a device for purposes of the medical device
pass-through payment process under the OPPS, a skin substitute needs to
be applied in or on a wound or other skin lesion based on 42 CFR
419.66(b)(3). It should be a product that is primarily used in
conjunction with the skin graft procedures described by CPT codes 15271
through 15278 or HCPCS codes C5271 through C5278 (78 FR 74937). The
skin substitute should only be applied a few times during a typical
treatment episode. BlastX\TM\, according to the manufacturer, may be
used in many other procedures other than skin graft procedures,
including several debridement and active wound care management
procedures. The manufacturer also stated that BlastX\TM\ would be used
in association with any currently available skin substitute product and
that the product should be applied every other day, which is not how
skin substitute products for skin graft procedures are used to heal
wounds. BlastX\TM\ is not a required component of the skin graft
service, and is used as a supply that may assist with the wound healing
process that occurs primarily because of the use of sheet skin
substitute product in a skin graft procedure.
Therefore, with respect to the eligibility criterion at Sec.
419.66(b)(3), we have determined that BlastX\TM\ is not integral to the
service provided (which is a skin graft procedure using a sheet skin
substitute), is a material or supply furnished incidentally to a
service, and is not surgically inserted into a patient. BlastX\TM\ does
not meet the basic criterion of being an eligible device for
transitional pass-through payment. Therefore, it is not feasible to
evaluate the product on the other criteria required for transitional
pass-through payment for devices, including the newness criterion, the
substantial clinical improvement criterion, and the cost criterion. We
are inviting public comments on the eligibility of BlastX\TM\ for
transitional pass-through payment for devices.
(4) EpiCord[supreg]
MiMedx[supreg] submitted an application for a new OPPS device
category for transitional pass-through payment status for
EpiCord[supreg], a skin substitute product. According to the applicant,
EpiCord[supreg] is a minimally manipulated, dehydrated, devitalized
cellular umbilical cord allograft for homologous use that provides a
protective environment for the healing process. According to the
applicant, EpiCord[supreg] is comprised of the protective elements of
the umbilical cord with a thin amnion layer and a thicker Wharton's
Jelly mucopolysaccharides component. The Wharton's Jelly contains
collagen, hyaluronic acid, and chondroitin sulfate, which are the
components principally responsible for its mechanical properties.
The applicant stated that EpiCord[supreg] is packaged as an
individual unit in two sizes, 2 cm x 3 cm and 3 cm x 5 cm. The
applicant asserted that EpiCord[supreg] is clinically superior to other
skin substitutes because it is much thicker than dehydrated amnion/
chorion allografts, which allows for application over exposed bone,
tendon, nerves, muscle, joint capsule and hardware. According to the
applicant, due to its unique thicker, stiffer structure, clinicians are
able to apply or suture EpiCord[supreg] for deep, tunneling wounds
where other products cannot fill the entire wound bed or dead spaces.
With respect to the newness criterion at Sec. 419.66(b)(1),
EpiCord[supreg] was added to the MiMedx[supreg] registration for human
cells, tissues, and cellular and tissue-based products (HCT/Ps) on
December 31, 2015. In adding EpiCord, MiMedx[supreg] asserted that
EpiCord[supreg] conformed to the requirements for HCT/Ps regulated
solely under section 361 of the Public Health Service Act and the
regulations at 21 CFR part 1271. For these products, FDA requires that
the manufacturer register and list its HCT/Ps with the FDA's Center for
Biologics Evaluation and Research (CBER) within 5 days after beginning
operations and update its registration annually, and MiMedx[supreg]
provided documentation verifying that EpiCord[supreg] had been
registered. However, no documentation regarding an FDA determination
that EpiCord[supreg] is appropriate for regulation solely under section
361 of the Public Health Service Act had been submitted. According to
[[Page 37102]]
the applicant, December 31, 2015 was the first date of sale within the
United States for EpiCord[supreg]. Therefore, it appears that market
availability of EpiCord[supreg] is within 3 years of this application.
We note that a product that is regulated solely under section 361
of the Public Health Service Act and the regulations in 21 CFR part
1271 is not regulated as a device. The regulations at 21 CFR 1271.20
state that ``If you are an establishment that manufactures an HCT/P
that does not meet the criteria set out in Sec. 1271.10(a), and you do
not qualify for any of the exceptions in Sec. 1271.15, your HCT/P will
be regulated as a drug, device, and/or biological product . . . .'').
The Federal Food, Drug, and Cosmetic Act requires that manufacturers of
devices that are not exempt obtain marketing approval or clearance for
their products from FDA before they may offer them for sale in the
United States. We did not receive documentation from the applicant that
EpiCord[supreg] is regulated as a device by FDA in accordance with
Medicare regulations at 42 CFR 419.66(b)(1). We are inviting public
comments on whether EpiCord[supreg] meets the newness criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
according to the applicant, EpiCord[supreg] is a skin substitute
product that is integral to the service provided, is used for one
patient only, comes in contact with human tissue, and is surgically
inserted into the patient. The applicant also claimed EpiCord[supreg]
meets the device eligibility requirements of Sec. 419.66(b)(4) because
EpiCord[supreg] is not an instrument, apparatus, implement, or item for
which depreciation and financing expenses are recovered, and it is not
a supply or material. We are inviting public comments on whether
EpiCord[supreg] meets these eligibility criteria.
The criteria for establishing new device categories are specified
at Sec. 419.66(c). The first criterion, at Sec. 419.66(c)(1),
provides that CMS determines that a device to be included in the
category is not appropriately described by any of the existing
categories or by any category previously in effect, and was not being
paid for as an outpatient service as of December 31, 1996. We have not
identified an existing pass-through category that describes
EpiCord[supreg]. There are no present or previously established device
categories for pass-through status that describe minimally manipulated,
lyophilized, non-viable cellular umbilical membrane allografts.
MiMedx[supreg] proposed a new device category descriptor of
``Dehydrated Human Umbilical Cord Allografts'' for EpiCord[supreg].
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines that a device to be included
in the category has demonstrated that it will substantially improve the
diagnosis or treatment of an illness or injury or improve the
functioning of a malformed body part compared to the benefits of a
device or devices in a previously established category or other
available treatment. With regard to the substantial clinical
improvement criterion, the applicant asserted that EpiCord[supreg]
reduces the mortality rate with use of the device; reduces the rate of
device-related complications; decreases the rate of subsequent
diagnostic or therapeutic interventions; decreases the number of future
hospitalizations or physician visits; provides more rapid beneficial
resolution of the disease process treated because of the use of the
device; decreases pain, bleeding, or other quantifiable symptom; and
reduces recovery time.
To determine if the product meets the substantial improvement
criterion, we compared EpiCord[supreg] to other skin substitute
products. Compared to NEOX CORD 1K Wound Allograft, EpiCord[supreg] has
half the levels of Vascular Endothelial Growth Factor (VEGF) and
insulin-like growth factor binding protein-4 (IGFBP-4) and lower levels
of Glial Cell Line Derived Neurotrophic Factor (GDNF) and Epidermal
Growth Factor (EGF). Despite EpiCord[supreg] having higher levels of
other growth factors, the cumulative effect of these differences has
not been sufficiently demonstrated in the application. Moreover, most
professional opinions do not compare EpiCord[supreg] to specific
alternative skin substitutes; the few that do are, for the most part,
of limited specificity (in terms of foci of superiority to other skin
substitutes). Studies demonstrated 41 percent higher relative rates
(4.1 percent higher absolute rates) of severe complications for
EpiCord[supreg] compared to standard of care. Additionally, the control
group was moist dressings and offloading (instead of another umbilical
or biologic product). Furthermore, 38 percent of EpiCord[supreg]
patients in the study were smokers versus 58 percent of control
patients (smoking impairs wound healing; thus, this important
dissimilarity between intervention and study populations casts doubt on
attributing observed benefit to the intervention).
Based on the evidence submitted with the application, we have
insufficient evidence that EpiCord[supreg] provides a substantial
clinical improvement over other treatments for wound care. We are
inviting public comments on whether EpiCord[supreg] meets the
substantial clinical improvement criterion.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. EpiCord[supreg] would be reported with CPT
code 15271 or 15275. CPT code 15271 describes the application of skin
substitute graft to trunk, arms, legs, total wound surface area up to
100 sq cm; first 25 sq cm or less wound surface area. CPT code 15275
describes the application of skin substitute graft to face, scalp,
eyelids, mouth, neck, ears, orbits, genitalia, hands, feet, and/or
multiple digits, total wound surface area up to 100 sq cm; first 25 sq
cm or less wound surface area. Both codes are assigned to APC 5054
(Level 4 Skin Procedures). CPT codes 15271 through 15278 are assigned
to either APC 5054 (Level 4 Skin Procedures), with a proposed CY 2019
payment rate of $1,593.38 and a device offset of $4.62, or APC 5055
(Level 5 Skin Procedures), with a proposed CY 2019 payment rate of
$2,811.13 and a device offset of $37.11. The price of EpiCord[supreg]
is $1,595 for the 2 cm x 3 cm and $3,695 for the 3 cm x 5 cm product
size. To meet the cost criterion for device pass-through payment, a
device must pass all three tests of the cost criterion for at least one
APC. Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $3,695 for the 3 cm x 5 cm product exceeds
the applicable APC amount for the service related to the category of
devices of $1,593.38 by 231.90 percent ($3,695/$1,593.38 x 100 percent
= 231.90 percent). Therefore, it appears that EpiCord[supreg] meets the
first cost significance test.
The second cost significance test, at Sec. 419.66(d)(2), provides
that the estimated average reasonable cost of the devices in the
category must exceed the cost of the device-related portion of the APC
payment amount for the related service by at least 25 percent, which
means that the device cost needs to be at least 125 percent of the
offset amount (the device-related portion of the APC found on the
offset list). The estimated
[[Page 37103]]
average reasonable cost of $3,695 for the 3 cm x 5 cm product exceeds
the device-related portion of the APC payment amount for the related
service of $4.62 by 79,978.35 percent ($3,695/$4.62 x 100 percent =
79,978.35 percent). Therefore, it appears that EpiCord[supreg] meets
the second cost significance test.
Section 419.66(d)(3), the third cost significance test, requires
that the difference between the estimated average reasonable cost of
the devices in the category and the portion of the APC payment amount
for the device must exceed 10 percent of the APC payment amount for the
related service. The difference between the estimated average
reasonable cost of $3,695 for the 3 cm x 5 cm product and the portion
of the APC payment amount for the device of $4.62 exceeds 10 percent at
231.61 percent (($3,695 - $4.62)/$1,593.38) x 100 percent = 231.61
percent). Therefore, it appears that EpiCord[supreg] meets the third
cost significance test. Based on the costs submitted by the applicant
and the calculations noted earlier, it appears that EpiCord[supreg]
meets the cost criterion at Sec. 419.66(c)(3) for new device
categories. We are inviting public comments on whether EpiCord[supreg]
meets the cost criterion for device pass-through payment.
(5) remed[emacr][supreg] System Transvenous Neurostimulator
Respicardia, Inc. submitted an application for a new device
category for transitional pass-through payment status for the
remed[emacr][supreg] System Transvenous Neurostimulator. According to
the applicant, the remed[emacr][supreg] System is an implantable
phrenic nerve stimulator indicated for the treatment of moderate to
severe central sleep apnea (CSA) in adult patients. The applicant
stated that the remed[emacr][supreg] System is the first and only
implantable neurostimulator to use transvenous sensing and stimulation
technology. The applicant also stated that the remed[emacr][supreg]
System consists of an implantable pulse generator, a transvenous lead
to stimulate the phrenic nerve and a transvenous sensing lead to sense
respiration via transthoracic impedance. Lastly, the applicant stated
that the device stimulates a nerve located in the chest (phrenic nerve)
that is responsible for sending signals to the diaphragm to stimulate
breathing to restore normal sleep and respiration in patients with
moderate to severe central sleep apnea (CSA).
With respect to the newness criterion at Sec. 419.66(b)(1), the
applicant received a Category B Investigational Device Exemption (IDE)
from FDA on April 18, 2013. Subsequently, the applicant received
approval of its premarket approval (PMA) application from FDA on
October 6, 2017. The application for a new device category for
transitional pass-through payment status for the remed[emacr][supreg]
System was received on May 31, 2017, which is within 3 years of the
date of the initial FDA approval or clearance. We are inviting public
comments on whether the remed[emacr][supreg] System meets the newness
criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
according to the applicant, the remed[emacr][supreg] System is integral
to the service provided, is used for one patient only, comes in contact
with human skin, and is applied in or on a wound or other skin lesion.
The applicant also claimed the remed[emacr][supreg] System meets the
device eligibility requirements of Sec. 419.66(b)(4) because it is not
an instrument, apparatus, implement, or items for which depreciation
and financing expenses are recovered, and it is not a supply or
material furnished incident to a service.
The criteria for establishing new device categories are specified
at Sec. 419.66(c). The first criterion, at Sec. 419.66(c)(1),
provides that CMS determines that a device to be included in the
category is not appropriately described by any of the existing
categories or by any category previously in effect, and was not being
paid for as an outpatient service as of December 31, 1996. We have not
identified an existing pass-through payment category that describes the
remed[emacr][supreg] System. The applicant proposed a category
descriptor for the remed[emacr][supreg] System of ``generator,
neurostimulator (implantable), non-rechargeable, with transvenous
sensing and stimulation.'' We are inviting public comments on this
issue.
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines that a device to be included
in the category has demonstrated that it will substantially improve the
diagnosis or treatment of an illness or injury or improve the
functioning of a malformed body part compared to the benefits of a
device or devices in a previously established category or other
available treatment. With respect to this criterion, the applicant
submitted several journal articles that discussed the health effects of
central sleep apnea (CSA) which include fatigue, decreased mental
acuity, myocardial ischemia, and dysrhythmias. The applicant stated
that patients with CSA may suffer from poor clinical outcomes,
including myocardial infarction and congestive heart failure.\17\
---------------------------------------------------------------------------
\17\ Costanzo, M.R., et al., Mechanisms and Clinical
Consequences of Untreated Central Sleep Apnea in Heart Failure.
Journal of the American College of Cardiology, 2015. 65(1): p. 72-
84.
---------------------------------------------------------------------------
The applicant claims that the remed[emacr][supreg] System has been
found to significantly improve apnea-hypopnea index (AHI), which is an
index used to indicate the severity of sleep apnea. AHI is represented
by the number of apnea and hypopnea events per hour of sleep and was
used as the primary effectiveness endpoint in the remed[emacr][supreg]
System pivotal trial. The applicant noted that the remed[emacr][supreg]
System was shown to improve AHI in small, self-controlled studies as
well as in larger trials.
The applicant reported that in the pivotal study, a large,
multicenter, randomized controlled trial of CSA patients, intention-to-
treat analysis found that 51 percent (35/68) of CSA patients using the
remed[emacr][supreg] System had greater than 50 percent reduction of
apnea-hypopnea index (AHI) from baseline at 6 months compared to 11
percent (8/73) of the control group (p < 0.0001). Per-protocol analysis
found that 60 percent (35/58) of remed[emacr][supreg] System patients
had a greater than 50 percent reduction of AHI and in 74 percent (26/
35) of these patients AHI dropped to <20.\18\
---------------------------------------------------------------------------
\18\ Costanzo, M.R., et al. (2016). Transvenous neurostimulation
for central sleep apnoea: a randomised controlled trial. The Lancet,
388(10048): p. 974-982.
---------------------------------------------------------------------------
According to the applicant, an exploratory post-hoc analysis of
patients with CSA and congestive heart failure (CHF) in the Pivotal
trial found that, at 6 months, the remed[emacr][supreg] System group
had a greater percentage of patients with >=50 percent reduction in AHI
compared to control group (63 percent versus 4 percent, p < 0.001).\19\
---------------------------------------------------------------------------
\19\ Goldberg, L.R., et al. (2017). In Heart Failure Patients
with CSA, Stimulation of the Phrenic Nerve Improves Sleep and
Quality of Life. Journal of Cardiac Failure, 23(8): p. S15.
---------------------------------------------------------------------------
The applicant noted that patient symptoms and quality of life were
improved with the remed[emacr][supreg] System therapy. The mean Epworth
Sleepiness Scale (ESS) score significantly decreased in
remed[emacr][supreg] System patients, indicating less daytime
sleepiness.\20\ Adverse events associated with remed[emacr][supreg]
System insertion and therapy included lead dislodgement/dislocation,
hematoma, migraine, atypical chest pain, pocket perforation, pocket
infection, extra-respiratory stimulation,
[[Page 37104]]
concomitant device interaction, and elevated transaminases.\21\ There
were no patient deaths that were related to the device implantation or
therapy.
---------------------------------------------------------------------------
\20\ Costanzo, M.R., et al. (2016). Transvenous neurostimulation
for central sleep apnoea: a randomised controlled trial. The Lancet,
388(10048): p. 974-982.
\21\ Costanzo, M.R., et al. (2016).Transvenous neurostimulation
for central sleep apnoea: a randomised controlled trial. The Lancet,
388(10048): p. 974-982.
---------------------------------------------------------------------------
One concern regarding the remed[emacr][supreg] System is the
potential for complications in patients with coexisting cardiac
devices, such as pacemakers or ICDs, given that the
remed[emacr][supreg] System device requires lead placement and
generation of electric impulses. Another concern with the evidence of
substantial clinical improvement is that there is limited long-term
data on patients with remed[emacr][supreg] System implants. The pivotal
trial included only 6 months of follow-up. Also, while the applicant
reported a reduction in AHI in the treatment group, the applicant did
not establish that that level of change was biologically meaningful in
the population(s) being studied. The applicant did not conduct a power
analysis to determine the necessary size of the study population and
the necessary duration of the study to detect both early and late
events.
In addition, patients in the pivotal study were not characterized
by the use of cardiac devices. Cardiac resynchronization therapy (CRT),
in particular, is known to improve chronic sleep apnea in addition to
its primary effects on heart failure, and central apnea is a marker of
the severity of the congestive heart failure. The applicant did not
conduct subset analyses to assess the impact of cardiac
resynchronization therapy.
Lastly, while evaluation of AHI and quality of life metrics show
improvement with the remed[emacr][supreg] System, the translation of
those effects to mortality benefit is yet to be determined. Further
studies of the remed[emacr][supreg] System are likely needed to
determine long-term effects of the device, and as well as its efficacy
compared to existing treatments of CPAP or medications.
Based on the evidence submitted with the application, we have
insufficient evidence that the remed[emacr][supreg] System provides a
substantial clinical improvement over other similar products. We are
inviting public comments on whether the remed[emacr][supreg] System
meets the substantial clinical improvement criterion.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. The applicant stated that the
remed[emacr][supreg] System would be reported with CPT code 0424T. CPT
code 0424T is assigned to APC 5464 (Level 4 Neurostimulator and Related
Procedures). To meet the cost criterion for device pass-through
payment, a device must pass all three tests of the cost criterion for
at least one APC. For our calculations, we used APC 5464, which had a
CY 2017 payment rate of $27,047.11 at the time the application was
received. Beginning in CY 2017, we calculate the device offset amount
at the HCPCS/CPT code level instead of the APC level (81 FR 79657). CPT
code 0424T had a device offset amount of $11,089 at the time the
application was received. According to the applicant, the cost of the
remed[emacr][supreg] System was $34,500. Section 419.66(d)(1), the
first cost significance requirement, provides that the estimated
average reasonable cost of devices in the category must exceed 25
percent of the applicable APC payment amount for the service related to
the category of devices. The estimated average reasonable cost of
$34,500 for the remed[emacr][supreg] System exceeds 127 percent of the
applicable APC payment amount for the service related to the category
of devices of $27,047.11 ($34,500/$27,047.11 x 100 = 127.5 percent).
Therefore, we believe the remed[emacr][supreg] System meets the first
cost significance test.
The second cost significance test, at Sec. 419.66(d)(2), provides
that the estimated average reasonable cost of the devices in the
category must exceed the cost of the device-related portion of the APC
payment amount for the related service by at least 25 percent, which
means that the device cost needs to be at least 125 percent of the
offset amount (the device-related portion of the APC found on the
offset list). The estimated average reasonable cost of $34,500 for the
remed[emacr][supreg] System exceeds the cost of the device-related
portion of the APC payment amount for the related service of $11,089 by
311 percent ($34,500/$11,089) x 100 = 311 percent). Therefore, we
believe that the remed[emacr][supreg] System meets the second cost
significance test.
The third cost significance test, at Sec. 419.66(d)(3), requires
that the difference between the estimated average reasonable cost of
the devices in the category and the portion of the APC payment amount
for the device must exceed 10 percent of the APC payment amount for the
related service. The difference between the estimated average
reasonable cost of $34,500 for the remed[emacr][supreg] System and the
portion of the APC payment amount for the device of $11,089 exceeds the
APC payment amount for the related service of $27,047.11 by 87 percent
(($34,500-$11,089)/$27,047.11 x 100 = 86.6 percent). Therefore, we
believe that the remed[emacr][supreg] System meets the third cost
significance test.
We are inviting public comments on whether the remed[emacr][supreg]
System meets the device pass-through payment criteria discussed in this
section, including the cost criteria for device pass-through payment.
(6) Restrata[supreg] Wound Matrix
Acera Surgical, Inc. submitted an application for a new device
category for transitional pass-through payment status for
Restrata[supreg] Wound Matrix. Restrata[supreg] Wound Matrix is a
sterile, single-use product intended for use in local management of
wounds. According to the applicant, Restrata[supreg] Wound Matrix is a
soft, white, conformable, non-friable, absorbable matrix that works as
a wound care management product by acting as a protective covering for
wound defects, providing a moist environment for the body's natural
healing process to occur. Restrata[supreg] Wound Matrix is made from
synthetic biocompatible materials and was designed with a nanoscale
non-woven fibrous structure with high porosity, similar to native
extracellular matrix. Restrata[supreg] Wound Matrix allows for cellular
infiltration, new tissue formation, neovascularization, and wound
healing before completely degrading via hydrolysis. The product permits
the ingress of cells and soft tissue formation in the defect space/
wound bed. Restrata[supreg] Wound Matrix can be used to manage wounds,
including: Partial and full-thickness wounds, pressure sores/ulcers,
venous ulcers, diabetic ulcers, chronic vascular ulcers, tunneled/
undermined wounds, surgical wounds (for example, donor site/grafts,
post-laser surgery, post-Mohs surgery, podiatric wounds, wound
dehiscence), trauma wounds (for example, abrasions, lacerations,
partial thickness burns, skin tears), and draining wounds.
With respect to the newness criterion at Sec. 419.66(b)(1), the
applicant received FDA clearance for Restrata[supreg] Wound Matrix
through the premarket notification section 510(k) process on April 26,
2017 and its February 27, 2018 application for pass-through payment
status was within 3 years of FDA clearance. We are inviting public
[[Page 37105]]
comment on whether Restrata[supreg] Wound Matrix meets the newness
criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
according to the applicant, Restrata[supreg] Wound Matrix is a product
that is integral to the service provided, is used for one patient only,
comes in contact with human skin, and is surgically inserted into the
patient. The description of Restrata[supreg] Wound Matrix shows the
product meets the device eligibility requirements of Sec. 419.66(b)(4)
because Restrata[supreg] Wound Matrix is not an instrument, apparatus,
implement, or item for which depreciation and financing expenses are
recovered, and it is not a supply or material. We are inviting public
comment on whether Restrata[supreg] Wound Matrix meets the eligibility
criteria.
The criteria for establishing new device categories are specified
at Sec. 419.66(c). The first criterion, at Sec. 419.66(c)(1),
provides that CMS determines that a device to be included in the
category is not appropriately described by any of the existing
categories or by any category previously in effect, and was not being
paid for as an outpatient service as of December 31, 1996. We have not
identified an existing pass-through category that describes
Restrata[supreg] Wound Matrix. The applicant proposed a new device
category descriptor of ``Nanofiber Skin Substitute'' for
Restrata[supreg] Wound Matrix. We are inviting public comments on this
issue.
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines that a device to be included
in the category has demonstrated that it will substantially improve the
diagnosis or treatment of an illness or injury or improve the
functioning of a malformed body part compared to the benefits of a
device or devices in a previously established category or other
available treatment. With regard to the substantial clinical
improvement criterion, the applicant submitted three clinical studies
about Restrata[supreg] to address this criterion. The largest study is
non-randomized, non-blinded, uncontrolled single site retrospective
analysis of 70 patients with 82 wounds. This study has not been
published but has been submitted to a journal. The study included
different types of wounds including diabetic wounds, venous wounds, and
other wounds. The study asserted that the wounds had not responded to
other wound care treatments, but provides little information on the
reasons for the failure of previous treatments.
The study had no power analysis of the results. There were no
corrections for multiple comparisons or peeks at the data, and the
study did not address if participants dropped out or why there was a
lack of drop-outs. The conclusions were descriptive statistics and were
compared to the findings in another study where the average wound
duration was nearly twice as long as in the original study. There was
no previously established endpoint for the most important aspect of
functionality, which would be the proportion of wounds with total
closure that remained closed after six months despite weight bearing.
The other two studies were extremely small. One study was performed
on two non-human subjects (pigs) with a competitor skin matrix product
compared to Restrata[supreg]. The results of the study were mixed with
Restrata[supreg] performing better on some measures and the competitor
product performing better on other measures. The other study was a case
series of six patients that was non-randomized without a control group.
It was not clear how the results of these non-randomly selected pre-
treated patients relate to the larger population of ulcer patients.
Based on the evidence submitted, we believe there is insufficient
data to determine whether Restrata[supreg] offers a substantial
clinical improvement over other treatments for wound care. We are
inviting public comments on whether Restrata[supreg] meets the
substantial clinical improvement criterion.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires CMS to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. Restrata[supreg] Wound Matrix would be
reported with CPT codes 15271 through 15278, which cover the
application of skin substitute grafts to different areas of the body
for high-cost skin substitutes. To meet the cost criterion for device
pass-through payment, a device must pass all three tests of the cost
criterion for at least one APC. CPT codes 15271 through 15278 are
assigned to either APC 5054 (Level 4 Skin Procedures), with a proposed
CY 2019 payment rate of $1,593.38 and a device offset of $4.62, or APC
5055 (Level 5 Skin Procedures), with a proposed CY 2019 payment rate of
$2,811.13 and a device offset of $37.11. According to the applicant,
the highest retail cost of Restrata[supreg] Wound Matrix is $11,718.
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $11,718 for Restrata[supreg] Wound Matrix
exceeds the applicable APC amount for the service related to the
category of devices of $1,593.38 by 735.42 percent ($11,718/$1,593.38 x
100 percent = 735.42 percent). Therefore, it appears that
Restrata[supreg] Wound Matrix meets the first cost significance test.
The second cost significance test, at Sec. 419.66(d)(2), provides
that the estimated average reasonable cost of the devices in the
category must exceed the cost of the device-related portion of the APC
payment amount for the related service by at least 25 percent, which
means the device cost needs to be at least 125 percent of the offset
amount (the device-related portion of the APC found on the offset
list). The estimated average reasonable cost of $11,718 for
Restrata[supreg] Wound Matrix exceeds the device-related portion of the
APC payment amount for the related service of $4.62 by 253,636.36
percent ($11,718/$4.62 x 100 percent = 253,636.36 percent). Therefore,
it appears that Restrata[supreg] Wound Matrix meets the second cost
significance test.
Section 419.66(d)(3), the third cost significance test, requires
that the difference between the estimated average reasonable cost of
the devices in the category and the portion of the APC payment amount
for the device must exceed 10 percent of the APC payment amount for the
related service. The difference between the estimated average
reasonable cost of $11,718 for Restrata[supreg] Wound Matrix and the
portion of the APC payment amount for the device of $4.62 exceeds 10
percent at 735.13 percent (($11,718-$4.62)/$1,593.38 x 100 percent =
735.13 percent). Therefore, it appears that Restrata[supreg] Wound
Matrix meets the third cost significance test. Based on the costs
submitted by the applicant and the calculations noted earlier, we
believe that Restrata[supreg] Wound Matrix appears to meet the cost
criterion at Sec. 419.66(c)(3) for new device categories. We are
inviting public comments on whether Restrata[supreg] Wound Matrix meets
the device pass-through payment criteria discussed in this section,
including the cost criteria.
(7) SpaceOAR[supreg] System
Augmenix, Inc. submitted an application for a new device category
for transitional pass-through payment status for the SpaceOAR[supreg]
System. According to the applicant, the
[[Page 37106]]
SpaceOAR[supreg] System is a polyethylene glycol hydrogel spacer that
temporarily positions the anterior rectal wall away from the prostate
to reduce the radiation delivered to the anterior rectum during
prostate cancer radiotherapy treatment. The applicant stated that the
SpaceOAR[supreg] System reduces some of the side effects associated
with radiotherapy, which are collectively known as ``rectal toxicity''
(diarrhea, rectal bleeding, painful defecation, and erectile
dysfunction, among other conditions). The applicant also stated that
the SpaceOAR[supreg] is implanted several weeks before radiotherapy;
the hydrogel maintains space between the prostate and rectum for the
entire course of radiotherapy and is completely absorbed by patient's
body within 6 months.
With respect to the newness criterion at Sec. 419.66(b)(1), FDA
granted a De Novo request classifying the SpaceOAR[supreg] System as a
class II device under section 513(f)(2) of the Federal Food, Drug, and
Cosmetic Act on April 1, 2015. We received the application for a new
device category for transitional pass-through payment status for the
SpaceOAR[supreg] System on June 1, 2017, which is within 3 years of the
date of the initial FDA approval or clearance. We are inviting public
comments on whether the SpaceOAR[supreg] System meets the newness
criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
according to the applicant, the SpaceOAR[supreg] System is integral to
the service provided, is used for one patient only, comes in contact
with human skin, and is applied in or on a wound or other skin lesion.
The applicant also claimed the SpaceOAR[supreg] System meets the device
eligibility requirements of Sec. 419.66(b)(4) because it is not an
instrument, apparatus, implement, or item for which depreciation and
financing expenses are recovered, and it is not a supply or material
furnished incident to a service.
The criteria for establishing new device categories are specified
at Sec. 419.66(c). The first criterion, at Sec. 419.66(c)(1),
provides that CMS determines that a device to be included in the
category is not appropriately described by any of the existing
categories or by any category previously in effect, and was not being
paid for as an outpatient service as of December 31, 1996. We have not
identified an existing pass-through payment category that describes the
SpaceOAR[supreg] System. The applicant proposed a category descriptor
for the SpaceOAR[supreg] System of ``Absorbable perirectal spacer''. We
are inviting public comments on this issue.
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines that a device to be included
in the category has demonstrated that it will substantially improve the
diagnosis or treatment of an illness or injury or improve the
functioning of a malformed body part compared to the benefits of a
device or devices in a previously established category or other
available treatment. With respect to this criterion, the applicant
submitted several studies which generally discussed the benefits and
techniques for using hydrogel spacers to limit radiation exposure to
the rectum in prostate radiotherapy. The applicant also submitted
several studies that specifically examined the effect that the
SpaceOAR[supreg] System had on mitigating outcomes such as rectal dose,
toxicity, and quality of life declines after image guided intensity
modulated radiation therapy for prostate cancer. Articles by Hamstra et
al.\22\ and Mariados et al.\23\ discussed the results of a single-blind
phase III trial of image guided intensity modulated radiation therapy
with 3 years of follow up. A total of 222 men were randomized 2:1 to
the spacer or control group and received 79.2 Gy in 1.8-Gy fractions to
the prostate with or without the seminal vesicles. The results of this
study showed that after 3 years, compared with the control group, the
participants who received the SpaceOAR[supreg] System injection had a
statistically significant smaller volume of the rectum receiving a
threshold radiation exposure, which was the primary effectiveness
endpoint. The results also showed that in an extended follow up period,
the control group experienced larger declines in bowel and urinary
quality of life compared to participants who received the
SpaceOAR[supreg] System treatment. Lastly, in an extended follow-up
period, the probability of grade >=1 rectal toxicity was decreased in
the SpaceOAR[supreg] System arm (9 percent control group, 2 percent
SpaceOAR[supreg] System group, p<.03) and no >= grade 2 rectal toxicity
was observed in the SpaceOAR[supreg] System arm. However, the control
arm had low rates of rectal toxicity in general. The results of this 3-
year follow-up of these participants showed that the differences
identified in the 15-month follow-up study were maintained or
increased.\24\
---------------------------------------------------------------------------
\22\ Hamstra DA, et al. (2017). Continued Benefit to Rectal
Separation for Prostate Radiation Therapy: Final Results of a Phase
III Trial. Int J Radiat Oncol Biol PhysApr 1;97(5):976-985. Epub
2016 Dec 23. PMID:28209443.
\23\ Mariados N, et al. (2015). Hydrogel Spacer Prospective
Multicenter Randomized Controlled Pivotal Trial: Dosimetric and
Clinical Effects of Perirectal Spacer Application in Men Undergoing
Prostate Image Guided Intensity Modulated Radiation Therapy. Int J
Radiat Oncol Biol Phys.92(5):971-977. Epub 2015 Apr 23. PMID:
26054865.
\24\ Ibid.
---------------------------------------------------------------------------
The applicant also included a secondary analysis of the phase III
trial data which showed that participants who received lower radiation
doses to the penile bulb, associated with the SpaceOAR[supreg] System
injection, reported similar erectile function compared with the control
group based on patient-reported sexual quality of life.\25\ A 2017
retrospective cohort study by Pinkawa et al.\26\ evaluated quality of
life changes up to 5 years after RT for prostate cancer with the
SpaceOAR[supreg] System and showed that 5 years after radiation
therapy, no patients who received the SpaceOAR[supreg] System reported
moderate/big problems with bowel urgency, losing control of stools, or
with bowel habits overall. However, there were no statistically
significant differences in mean score changes for urinary, bowel, or
sexual bother between the percentage of participants in the
SpaceOAR[supreg] System and control groups at either 1.5 or 5 years
post radiation therapy. Concerns regarding the phase III trial include
inclusion of only low to moderate risk prostate cancer in the study
population and failing to use a clinical outcome as a primary endpoint,
although the purpose of the spacer is to reduce the side effects of
undesired radiation to the rectum including bleeding, diarrhea,
fistula, pain, and/or stricture. Notwithstanding acknowledgement that
rectal complications may be reduced using biodegradable biomaterials
placed to increase the distance between the rectum and the prostate, it
is not clear that SpaceOAR[supreg] System is superior to existing
alternative biodegradable biomaterials currently utilized for spacing
in the context of prostate radiotherapy.
---------------------------------------------------------------------------
\25\ Hamstra, DA et al. (2018) Sexual quality of life following
prostate intensity modulated radiation therapy (IMRT) with a rectal/
prostate spacer: secondary analysis of a phase 3 trial. Practical
Radiation Oncology, 8, e7-e15.
\26\ Pinkawa, M. et al. (2017). Quality of Life after Radiation
Therapy for Prostate Cancer With a Hydrogel Spacer: Five Year
Results. Int J Radiat Oncol Biol Phys., Vol. 99, No. 2, pp. 374e377.
---------------------------------------------------------------------------
Based on the evidence submitted with the application, we have
insufficient evidence that the SpaceOAR[supreg] System provides a
substantial clinical improvement over other similar products. We are
inviting public comments on whether the SpaceOAR[supreg] System meets
the substantial clinical improvement criterion.
[[Page 37107]]
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. The applicant stated that the
SpaceOAR[supreg] System would be reported with CPT code 0438T (which
was deleted and replaced with CPT code 55874, effective January 1,
2018). CPT code 0438T was assigned to APC 5374 (Level 4 Urology and
Related Services). To meet the cost criterion for device pass-through
payment, a device must pass all three tests of the cost criterion for
at least one APC. For our calculations, we used APC 5374, which had a
CY 2017 payment rate of $2,542.56 at the time the application was
received. Beginning in CY 2017, we calculate the device offset amount
at the HCPCS/CPT code level instead of the APC level (81 FR 79657). CPT
code 0438T had device offset amount of $587.07 at the time the
application was received. According to the applicant, the cost of the
SpaceOAR[supreg] System was $2,850.
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $2,850 for the SpaceOAR[supreg] System
exceeds 112 percent of the applicable APC payment amount for the
service related to the category of devices of $2,542.56 ($2850/
$2,542.56 x 100 = 112 percent). Therefore, we believe the
SpaceOAR[supreg] system meets the first cost significance test.
The second cost significance test, at Sec. 419.66(d)(2), provides
that the estimated average reasonable cost of the devices in the
category must exceed the cost of the device-related portion of the APC
payment amount for the related service by at least 25 percent, which
means that the device cost needs to be at least 125 percent of the
offset amount (the device-related portion of the APC found on the
offset list). The estimated average reasonable cost of $2,850 for the
SpaceOAR[supreg] System exceeds the cost of the device-related portion
of the APC payment amount for the related service of $587.07 by 485
percent ($2,850/$587.07) x 100 = 485 percent). Therefore, we believe
that the SpaceOAR[supreg] System meets the second cost significance
test.
The third cost significance test, at Sec. 419.66(d)(3), requires
that the difference between the estimated average reasonable cost of
the devices in the category and the portion of the APC payment amount
for the device must exceed 10 percent of the APC payment amount for the
related service. The difference between the estimated average
reasonable cost of $2,850 for the SpaceOAR[supreg] System and the
portion of the APC payment amount for the device of $587.07 exceeds the
APC payment amount for the related service of $2,542.56 by 89 percent
(($2,850-$587.07)/$2,542.56 x 100 = percent). Therefore, we believe
that the SpaceOAR[supreg] System meets the third cost significance
test.
We are inviting public comments on whether the SpaceOAR[supreg]
System meets the device pass-through payment criteria discussed in this
section, including the cost criteria.
B. Proposed Device-Intensive Procedures
1. Background
Under the OPPS, prior to CY 2017, device-intensive status for
procedures was determined at the APC level for APCs with a device
offset percentage greater than 40 percent (79 FR 66795). Beginning in
CY 2017, CMS began determining device-intensive status at the HCPCS
code level. In assigning device-intensive status to an APC prior to CY
2017, the device costs of all the procedures within the APC were
calculated and the geometric mean device offset of all of the
procedures had to exceed 40 percent. Almost all of the procedures
assigned to device-intensive APCs utilized devices, and the device
costs for the associated HCPCS codes exceeded the 40-percent threshold.
The no cost/full credit and partial credit device policy (79 FR 66872
through 66873) applied to device-intensive APCs and is discussed in
detail in section IV.B.4. of this proposed rule. A related device
policy was the requirement that certain procedures assigned to device-
intensive APCs require the reporting of a device code on the claim (80
FR 70422). For further background information on the device-intensive
APC policy, we refer readers to the CY 2016 OPPS/ASC final rule with
comment period (80 FR 70421 through 70426).
a. HCPCS Code-Level Device-Intensive Determination
As stated earlier, prior to CY 2017, the device-intensive
methodology assigned device-intensive status to all procedures
requiring the implantation of a device that were assigned to an APC
with a device offset greater than 40 percent and, beginning in CY 2015,
that met the three criteria listed below. Historically, the device-
intensive designation was at the APC level and applied to the
applicable procedures within that given APC. In the CY 2017 OPPS/ASC
final rule with comment period (81 FR 79658), we changed our
methodology to assign device-intensive status at an individual HCPCS
code level rather than at the APC level. Under this policy, a procedure
could be assigned device-intensive status regardless of its APC
assignment, and device-intensive APCs were no longer employed under the
OPPS or the ASC payment system.
We believe that a HCPCS code-level device offset is, in most cases,
a better representation of a procedure's device cost than an APC-wide
average device offset based on the average device offset of all of the
procedures assigned to an APC. Unlike a device offset calculated at the
APC level, which is a weighted average offset for all devices used in
all of the procedures assigned to an APC, a HCPCS code-level device
offset is calculated using only claims for a single HCPCS code. We
believe that this methodological change results in a more accurate
representation of the cost attributable to implantation of a high-cost
device, which ensures consistent device-intensive designation of
procedures with a significant device cost. Further, we believe a HCPCS
code-level device offset removes inappropriate device-intensive status
for procedures without a significant device cost that are granted such
status because of APC assignment.
Under our existing policy, procedures that meet the criteria listed
below are identified as device-intensive procedures and are subject to
all the policies applicable to procedures assigned device-intensive
status under our established methodology, including our policies on
device edits and no cost/full credit and partial credit devices
discussed in sections IV.B.3. and IV.B.4. of this proposed rule,
respectively.
b. Use of the Three Criteria To Designate Device-Intensive Procedures
We clarified our established policy in the CY 2018 OPPS/ASC final
rule with comment period (82 FR 52474), where we explained that device-
intensive procedures require the implantation of a device and
additionally are subject to the following criteria:
All procedures must involve implantable devices that would
be reported if device insertion procedures were performed;
[[Page 37108]]
The required devices must be surgically inserted or
implanted devices that remain in the patient's body after the
conclusion of the procedure (at least temporarily); and
The device offset amount must be significant, which is
defined as exceeding 40 percent of the procedure's mean cost.
We changed our policy to apply these three criteria to determine
whether procedures qualify as device-intensive in the CY 2015 OPPS/ASC
final rule with comment period (79 FR 66926), where we stated that we
would apply the no cost/full credit and partial credit device policy--
which includes the three criteria listed above--to all device-intensive
procedures beginning in CY 2015. We reiterated this position in the CY
2016 OPPS/ASC final rule with comment period (80 FR 70424), where we
explained that we were finalizing our proposal to continue using the
three criteria established in the CY 2007 OPPS/ASC final rule with
comment period for determining the APCs to which the CY 2016 device
intensive policy will apply. Under the policies we adopted in CYs 2015,
2016, and 2017, all procedures that require the implantation of a
device and meet the above criteria are assigned device-intensive
status, regardless of their APC placement.
2. Proposed Changes to the Device-Intensive Procedure Policy for CY
2019
As part of CMS' effort to better capture costs for procedures with
significant device costs, for CY 2019, we are proposing to modify our
criteria for device-intensive procedures. We have heard from
stakeholders that the current criteria exclude some procedures that
stakeholders believe should qualify as device-intensive procedures.
Specifically, we were persuaded by stakeholder arguments that
procedures requiring expensive surgically inserted or implanted devices
that are not capital equipment should nonetheless qualify as device-
intensive procedures, regardless of whether the device remains in the
patient's body after the conclusion of the procedure. We agree that a
broader definition of device-intensive procedures is warranted, and are
proposing two modifications to the current criteria. First, we are
proposing to allow procedures that involve surgically inserted or
implanted, single-use devices that meet the device offset percentage
threshold to qualify as device-intensive procedures, regardless of
whether the device remains in the patient's body after the conclusion
of the procedure, because we no longer believe that whether a device
remains in the patient's body should affect its designation as a
device-intensive procedure because such devices could, nonetheless,
comprise a large cost of the applicable procedure. Second, we are
proposing to modify our criteria to lower the device offset percentage
threshold from 40 percent to 30 percent, to allow a greater number of
procedures to qualify as device-intensive. We believe allowing these
additional procedures to qualify for device-intensive status will help
ensure these procedures receive more appropriate payment in the ASC
setting, which will help encourage the provision of these services in
the ASC setting. In addition, this proposed change would help to ensure
that more procedures containing relatively high-cost devices are
subject to the device edits, which leads to more correctly coded claims
and greater accuracy in our claims data. Specifically, for CY 2019 and
subsequent years, we are proposing that device-intensive procedures
would be subject to the following criteria:
All procedures must involve implantable devices assigned a
CPT or HCPCS code;
The required devices (including single-use devices) must
be surgically inserted or implanted; and
The device offset amount must be significant, which is
defined as exceeding 30 percent of the procedure's mean cost.
In addition, to further align the device-intensive policy with the
criteria used for device pass-through status, we are proposing to
specify, for CY 2019 and subsequent years, that for purposes of
satisfying the device-intensive criteria, a device-intensive procedure
must involve a device that:
Has received FDA marketing authorization, has received an
FDA investigational device exemption (IDE) and has been classified as a
Category B device by the FDA in accordance with 42 CFR 405.203 through
405.207 and 405.211 through 405.215, or meets another appropriate FDA
exemption from premarket review;
Is an integral part of the service furnished;
Is used for one patient only;
Comes in contact with human tissue;
Is surgically implanted or inserted (either permanently or
temporarily); and
Is not any of the following:
(a) Equipment, an instrument, apparatus, implement, or item of this
type for which depreciation and financing expenses are recovered as
depreciable assets as defined in Chapter 1 of the Medicare Provider
Reimbursement Manual (CMS Pub. 15-1); or
(b) A material or supply furnished incident to a service (for
example, a suture, customized surgical kit, scalpel, or clip, other
than a radiological site marker).
As part of this proposal, we also are soliciting public comment on
these proposed revised criteria, including whether there are any
devices that are not capital equipment that commenters believe should
be deemed part of device-intensive procedures that would not meet the
proposed definition of single-use devices. In addition, we are
soliciting public comments on the full list of proposed CY 2019 OPPS
device-intensive procedures provided in Addendum P to this proposed
rule, which is available at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.html. Specifically, we are inviting public
comment on whether any procedures proposed to receive device-intensive
status for CY 2019 should not receive device-intensive status according
to the proposed criteria, or if we did not assign device-intensive
status for CY 2019 to any procedures commenters believed should receive
device-intensive status based on the proposed criteria.
In addition, for new HCPCS codes describing procedures requiring
the implantation of medical devices that do not yet have associated
claims data, in the CY 2017 OPPS/ASC final rule with comment period (81
FR 79658), we finalized a policy for CY 2017 to apply device-intensive
status with a default device offset set at 41 percent for new HCPCS
codes describing procedures requiring the implantation or insertion of
a medical device that do not yet have associated claims data until
claims data are available to establish the HCPCS code-level device
offset for the procedures. This default device offset amount of 41
percent is not calculated from claims data; instead, it is applied as a
default until claims data are available upon which to calculate an
actual device offset for the new code. The purpose of applying the 41-
percent default device offset to new codes that describe procedures
that implant or insert medical devices is to ensure ASC access for new
procedures until claims data become available.
In accordance with our proposal above to lower the device offset
percentage threshold for procedures to qualify as device-intensive from
greater than 40 percent to greater than 30 percent, for CY 2019 and
subsequent years, we are proposing to modify this
[[Page 37109]]
policy and apply a 31-percent default device offset to new HCPCS codes
describing procedures requiring the implantation of a medical device
that do not yet have associated claims data until claims data are
available to establish the HCPCS code-level device offset for the
procedures. In conjunction with the proposal to lower the default
device offset from 41 percent to 31 percent, we are proposing to
continue our current policy of, in certain rare instances (for example,
in the case of a very expensive implantable device), temporarily
assigning a higher offset percentage if warranted by additional
information such as pricing data from a device manufacturer (81 FR
79658). Once claims data are available for a new procedure requiring
the implantation of a medical device, device-intensive status will be
applied to the code if the HCPCS code-level device offset is greater
than 30 percent, according to our policy of determining device-
intensive status by calculating the HCPCS code-level device offset.
In addition, we are clarifying that since the adoption of our
current policy, the associated claims data used for purposes of
determining whether or not to apply the default device offset are the
associated claims data for either the new HCPCS code or any predecessor
code, as described by CPT coding guidance, for the new HCPCS code.
Additionally, for CY 2019 and subsequent years, in limited instances
where a new HCPCS code does not have a predecessor code as defined by
CPT, but describes a procedure that was previously described by an
existing code, we are proposing to use clinical discretion to identify
HCPCS codes that are clinically related or similar to the new HCPCS
code but are not officially recognized as a predecessor code by CPT,
and to use the claims data of the clinically related or similar code(s)
for purposes of determining whether or not to apply the default device
offset to the new HCPCS code. Clinically related and similar procedures
for purposes of this policy are procedures that have little to no
clinical differences and use the same devices as the new HCPCS code. In
addition, clinically related and similar codes for purposes of this
policy are codes that either currently or previously describe the
procedure described by the new HCPCS code. Under this proposal, claims
data from clinically related and similar codes will be included as
associated claims data for a new code, and where an existing HCPCS code
is found to be clinically related or similar to a new HCPCS code, we
are proposing to apply the device offset percentage derived from the
existing clinically related or similar HCPCS code's claims data to the
new HCPCS code for determining the device offset percentage. We believe
that claims data for HCPCS codes describing procedures that have very
minor differences from the procedures described by new HCPCS codes
would provide an accurate depiction of the cost relationship between
the procedure and the device(s) that are used, and would be appropriate
to use to set a new code's device offset percentage, in the same way
that predecessor codes are used. For instance, for CY 2019, we are
proposing to use the claims data from existing CPT code 36568
(Insertion of peripherally inserted central venous catheter (PICC),
without subcutaneous port or pump; younger than 5 years of age), for
which the description as of January 1, 2019 is changing to ``(Insertion
of peripherally inserted central venous catheter (PICC), without
subcutaneous port or pump, without imaging guidance; younger than 5
years of age)'', to determine the appropriate device offset percentage
for new CPT code 36X72 (Insertion of peripherally inserted central
venous catheter (PICC), without subcutaneous port or pump, including
all imaging guidance, image documentation, and all associated
radiological supervision and interpretation required to perform the
insertion; younger than 5 years of age). We believe that although CPT
code 36568 is not identified as a predecessor code by CPT, the
procedure described by new CPT code 36X72 was previously described by
CPT code 36568 and, therefore, CPT code 36X72 is clinically related and
similar to CPT code 36568, and the device offset percentage for CPT
code 36568 can be accurately applied to both codes. If a new HCPCS code
has multiple predecessor codes, the claims data for the predecessor
code that has the highest individual HCPCS-level device offset
percentage will be used to determine whether the new HCPCS code
qualifies for device-intensive status. Similarly, in the event that a
new HCPCS code does not have a predecessor code but has multiple
clinically related or similar codes, the claims data for the clinically
related or similar code that has the highest individual HCPCS level
device offset percentage will be used to determine whether the new
HCPCS code qualifies for device-intensive status.
Additional information for our consideration of an offset
percentage higher than the proposed default of 31 percent for new HCPCS
codes describing procedures requiring the implantation (or, in some
cases, the insertion) of a medical device that do not yet have
associated claims data, such as pricing data or invoices from a device
manufacturer, should be directed to the Division of Outpatient Care,
Mail Stop C4-01-26, Centers for Medicare and Medicaid Services, 7500
Security Boulevard, Baltimore, MD 21244-1850, or electronically at
[email protected]. Additional information can be submitted
prior to issuance of an OPPS/ASC proposed rule or as a public comment
in response to an issued OPPS/ASC proposed rule. Device offset
percentages will be set in each year's final rule.
The full listing of proposed CY 2019 device-intensive procedures is
included in Addendum P to this proposed rule (which is available via
the internet on the CMS website).
3. Device Edit Policy
In the CY 2015 OPPS/ASC final rule with comment period (79 FR
66795), we finalized a policy and implemented claims processing edits
that require any of the device codes used in the previous device-to-
procedure edits to be present on the claim whenever a procedure code
assigned to any of the APCs listed in Table 5 of the CY 2015 OPPS/ASC
final rule with comment period (the CY 2015 device-dependent APCs) is
reported on the claim. In addition, in the CY 2016 OPPS/ASC final rule
with comment period (80 FR 70422), we modified our previously existing
policy and applied the device coding requirements exclusively to
procedures that require the implantation of a device that are assigned
to a device-intensive APC. In the CY 2016 OPPS/ASC final rule with
comment period, we also finalized our policy that the claims processing
edits are such that any device code, when reported on a claim with a
procedure assigned to a device-intensive APC (listed in Table 42 of the
CY 2016 OPPS/ASC final rule with comment period (80 FR 70422)) will
satisfy the edit.
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79658
through 79659), we changed our policy for CY 2017 and subsequent years
to apply the CY 2016 device coding requirements to the newly defined
device-intensive procedures. For CY 2017 and subsequent years, we also
specified that any device code, when reported on a claim with a device-
intensive procedure, will satisfy the edit. In addition, we created
HCPCS code C1889 to recognize devices furnished during a device-
intensive procedure that are not described by a specific Level II HCPCS
Category C-code. Reporting HCPCS code C1889
[[Page 37110]]
with a device-intensive procedure will satisfy the edit requiring a
device code to be reported on a claim with a device-intensive
procedure.
We are not proposing any changes to this policy for CY 2019.
4. Adjustment to OPPS Payment for No Cost/Full Credit and Partial
Credit Devices
a. Background
To ensure equitable OPPS payment when a hospital receives a device
without cost or with full credit, in CY 2007, we implemented a policy
to reduce the payment for specified device-dependent APCs by the
estimated portion of the APC payment attributable to device costs (that
is, the device offset) when the hospital receives a specified device at
no cost or with full credit (71 FR 68071 through 68077). Hospitals were
instructed to report no cost/full credit device cases on the claim
using the ``FB'' modifier on the line with the procedure code in which
the no cost/full credit device is used. In cases in which the device is
furnished without cost or with full credit, hospitals were instructed
to report a token device charge of less than $1.01. In cases in which
the device being inserted is an upgrade (either of the same type of
device or to a different type of device) with a full credit for the
device being replaced, hospitals were instructed to report as the
device charge the difference between the hospital's usual charge for
the device being implanted and the hospital's usual charge for the
device for which it received full credit. In CY 2008, we expanded this
payment adjustment policy to include cases in which hospitals receive
partial credit of 50 percent or more of the cost of a specified device.
Hospitals were instructed to append the ``FC'' modifier to the
procedure code that reports the service provided to furnish the device
when they receive a partial credit of 50 percent or more of the cost of
the new device. We refer readers to the CY 2008 OPPS/ASC final rule
with comment period for more background information on the ``FB'' and
``FC'' modifiers payment adjustment policies (72 FR 66743 through
66749).
In the CY 2014 OPPS/ASC final rule with comment period (78 FR 75005
through 75007), beginning in CY 2014, we modified our policy of
reducing OPPS payment for specified APCs when a hospital furnishes a
specified device without cost or with a full or partial credit. For CY
2013 and prior years, our policy had been to reduce OPPS payment by 100
percent of the device offset amount when a hospital furnishes a
specified device without cost or with a full credit and by 50 percent
of the device offset amount when the hospital receives partial credit
in the amount of 50 percent or more of the cost for the specified
device. For CY 2014, we reduced OPPS payment, for the applicable APCs,
by the full or partial credit a hospital receives for a replaced
device. Specifically, under this modified policy, hospitals are
required to report on the claim the amount of the credit in the amount
portion for value code ``FD'' (Credit Received from the Manufacturer
for a Replaced Medical Device) when the hospital receives a credit for
a replaced device that is 50 percent or greater than the cost of the
device. For CY 2014, we also limited the OPPS payment deduction for the
applicable APCs to the total amount of the device offset when the
``FD'' value code appears on a claim. For CY 2015, we continued our
existing policy of reducing OPPS payment for specified APCs when a
hospital furnishes a specified device without cost or with a full or
partial credit and to use the three criteria established in the CY 2007
OPPS/ASC final rule with comment period (71 FR 68072 through 68077) for
determining the APCs to which our CY 2015 policy will apply (79 FR
66872 through 66873). In the CY 2016 OPPS/ASC final rule with comment
period (80 FR 70424), we finalized our policy to no longer specify a
list of devices to which the OPPS payment adjustment for no cost/full
credit and partial credit devices would apply and instead apply this
APC payment adjustment to all replaced devices furnished in conjunction
with a procedure assigned to a device-intensive APC when the hospital
receives a credit for a replaced specified device that is 50 percent or
greater than the cost of the device.
b. Proposed Policy for No Cost/Full Credit and Partial Credit Devices
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79659
through 79660), for CY 2017 and subsequent years, we finalized our
policy to reduce OPPS payment for device-intensive procedures, by the
full or partial credit a provider receives for a replaced device, when
a hospital furnishes a specified device without cost or with a full or
partial credit. Under our current policy, hospitals continue to be
required to report on the claim the amount of the credit in the amount
portion for value code ``FD'' when the hospital receives a credit for a
replaced device that is 50 percent or greater than the cost of the
device.
For CY 2019 and subsequent years, we are proposing to apply our no
cost/full credit and partial credit device policies to all procedures
that qualify as device-intensive under our proposed modified criteria
discussed in section IV.B.2. of this proposed rule.
5. Payment Policy for Low-Volume Device-Intensive Procedures
In CY 2016, we used our equitable adjustment authority under
section 1833(t)(2)(E) of the Act and used the median cost (instead of
the geometric mean cost per our standard methodology) to calculate the
payment rate for the implantable miniature telescope procedure
described by CPT code 0308T (Insertion of ocular telescope prosthesis
including removal of crystalline lens or intraocular lens prosthesis),
which is the only code assigned to APC 5494 (Level 4 Intraocular
Procedures) (80 FR 70388). We note that, as stated in the CY 2017 OPPS/
ASC proposed rule (81 FR 45656), we proposed to reassign the procedure
described by CPT code 0308T to APC 5495 (Level 5 Intraocular
Procedures) for CY 2017, but it would be the only procedure code
assigned to APC 5495. The payment rates for a procedure described by
CPT code 0308T (including the predecessor HCPCS code C9732) were
$15,551 in CY 2014, $23,084 in CY 2015, and $17,551 in CY 2016. The
procedure described by CPT code 0308T is a high-cost device-intensive
surgical procedure that has a very low volume of claims (in part
because most of the procedures described by CPT code 0308T are
performed in ASCs), and we believe that the median cost is a more
appropriate measure of the central tendency for purposes of calculating
the cost and the payment rate for this procedure because the median
cost is impacted to a lesser degree than the geometric mean cost by
more extreme observations. We stated that, in future rulemaking, we
would consider proposing a general policy for the payment rate
calculation for very low-volume device-intensive APCs (80 FR 70389).
For CY 2017, we proposed and finalized a payment policy for low-
volume device-intensive procedures that is similar to the policy
applied to the procedure described by CPT code 0308T in CY 2016. In the
CY 2017 OPPS/ASC final rule with comment period (81 FR 79660 through
79661), we established our current policy that the payment rate for any
device-intensive procedure that is assigned to a clinical APC with
fewer than 100 total claims for all procedures in the APC be calculated
using the median cost instead
[[Page 37111]]
of the geometric mean cost, for the reasons described above for the
policy applied to the procedure described by CPT code 0308T in CY 2016.
The CY 2018 final rule geometric mean cost for the procedure described
by CPT code 0308T (based on 19 claims containing the device HCPCS C-
code, in accordance with the device-intensive edit policy) was
approximately $21,302, and the median cost was approximately $19,521.
The final CY 2018 payment rate (calculated using the median cost) was
approximately $17,560.
For CY 2019, we are proposing to continue with our current policy
of establishing the payment rate for any device-intensive procedure
that is assigned to a clinical APC with fewer than 100 total claims for
all procedures in the APC based on calculations using the median cost
instead of the geometric mean cost. For CY 2019, there are no
procedures to which this policy would apply. Due to the proposed change
in APC assignment for CPT code 0308T to APC 5493 (Level 3 Intraocular
Procedures) from APC 5495 (Level 5 Intraocular Procedures), our payment
policy for low-volume device-intensive procedures would not apply to
CPT code 0308T for CY 2019 because there are now more than 100 total
claims for the APC to which CPT code 0308T is assigned. For more
information on the proposed APC assignment change for CPT code 0308T,
we refer readers to section III.D.4. of this proposed rule.
V. Proposed OPPS Payment Changes for Drugs, Biologicals, and
Radiopharmaceuticals
A. Proposed OPPS Transitional Pass-Through Payment for Additional Costs
of Drugs, Biologicals, and Radiopharmaceuticals
1. Background
Section 1833(t)(6) of the Act provides for temporary additional
payments or ``transitional pass-through payments'' for certain drugs
and biologicals. Throughout this proposed rule, the term ``biological''
is used because this is the term that appears in section 1861(t) of the
Act. A ``biological'' as used in this proposed rule includes (but is
not necessarily limited to) a ``biological product'' or a ``biologic''
as defined in the Public Health Service Act. As enacted by the
Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999
(BBRA) (Pub. L. 106-113), this pass-through payment provision requires
the Secretary to make additional payments to hospitals for: Current
orphan drugs, as designated under section 526 of the Federal Food,
Drug, and Cosmetic Act; current drugs and biologicals and brachytherapy
sources used in cancer therapy; and current radiopharmaceutical drugs
and biologicals. ``Current'' refers to those types of drugs or
biologicals mentioned above that are hospital outpatient services under
Medicare Part B for which transitional pass-through payment was made on
the first date the hospital OPPS was implemented.
Transitional pass-through payments also are provided for certain
``new'' drugs and biologicals that were not being paid for as an HOPD
service as of December 31, 1996 and whose cost is ``not insignificant''
in relation to the OPPS payments for the procedures or services
associated with the new drug or biological. For pass-through payment
purposes, radiopharmaceuticals are included as ``drugs.'' As required
by statute, transitional pass-through payments for a drug or biological
described in section 1833(t)(6)(C)(i)(II) of the Act can be made for a
period of at least 2 years, but not more than 3 years, after the
payment was first made for the product as a hospital outpatient service
under Medicare Part B. Proposed CY 2019 pass-through drugs and
biologicals and their designated APCs are assigned status indicator
``G'' in Addenda A and B to this proposed rule (which are available via
the internet on the CMS website). Section 1833(t)(6)(D)(i) of the Act
specifies that the pass-through payment amount, in the case of a drug
or biological, is the amount by which the amount determined under
section 1842(o) of the Act for the drug or biological exceeds the
portion of the otherwise applicable Medicare OPD fee schedule that the
Secretary determines is associated with the drug or biological. The
methodology for determining the pass-through payment amount is set
forth in regulations at 42 CFR 419.64. These regulations specify that
the pass-through payment equals the amount determined under section
1842(o) of the Act minus the portion of the APC payment that CMS
determines is associated with the drug or biological.
Section 1847A of the Act establishes the average sales price (ASP)
methodology, which is used for payment for drugs and biologicals
described in section 1842(o)(1)(C) of the Act furnished on or after
January 1, 2005. The ASP methodology, as applied under the OPPS, uses
several sources of data as a basis for payment, including the ASP, the
wholesale acquisition cost (WAC), and the average wholesale price
(AWP). In this proposed rule, the term ``ASP methodology'' and ``ASP-
based'' are inclusive of all data sources and methodologies described
therein. Additional information on the ASP methodology can be found on
the CMS website at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Part-B-Drugs/McrPartBDrugAvgSalesPrice/index.html.
The pass-through application and review process for drugs and
biologicals is described on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/passthrough_payment.html.
2. Three-Year Transitional Pass-Through Payment Period for All Pass-
Through Drugs, Biologicals, and Radiopharmaceuticals and Quarterly
Expiration of Pass-Through Status
As required by statute, transitional pass-through payments for a
drug or biological described in section 1833(t)(6)(C)(i)(II) of the Act
can be made for a period of at least 2 years, but not more than 3
years, after the payment was first made for the product as a hospital
outpatient service under Medicare Part B. Our current policy is to
accept pass-through applications on a quarterly basis and to begin
pass-through payments for newly approved pass-through drugs and
biologicals on a quarterly basis through the next available OPPS
quarterly update after the approval of a product's pass-through status.
However, prior to CY 2017, we expired pass-through status for drugs and
biologicals on an annual basis through notice-and-comment rulemaking
(74 FR 60480). In the CY 2017 OPPS/ASC final rule with comment period
(81 FR 79662), we finalized a policy change, beginning with pass-
through drugs and biologicals newly approved in CY 2017 and subsequent
calendar years, to allow for a quarterly expiration of pass-through
payment status for drugs, biologicals, and radiopharmaceuticals to
afford a pass-through payment period that is as close to a full 3 years
as possible for all pass-through drugs, biologicals, and
radiopharmaceuticals.
This change eliminated the variability of the pass-through payment
eligibility period, which previously varied based on when a particular
application was initially received. We adopted this change for pass-
through approvals beginning on or after CY 2017, to allow, on a
prospective basis, for the maximum pass-through payment period for each
pass-through drug without exceeding the statutory limit of 3 years.
[[Page 37112]]
3. Proposed Drugs and Biologicals With Expiring Pass-Through Payment
Status in CY 2018
We are proposing that the pass-through payment status of 23 drugs
and biologicals would expire on December 31, 2018, as listed in Table
19 below. All of these drugs and biologicals will have received OPPS
pass-through payment for at least 2 years and no more than 3 years by
December 31, 2018. These drugs and biologicals were approved for pass-
through payment status on or before January 1, 2017. In accordance with
the policy finalized in CY 2017 and described earlier, pass-through
payment status for drugs and biologicals newly approved in CY 2017 and
subsequent years will expire on a quarterly basis, with a pass-through
payment period as close to 3 years as possible. With the exception of
those groups of drugs and biologicals that are always packaged when
they do not have pass-through payment status (specifically, anesthesia
drugs; drugs, biologicals, and radiopharmaceuticals that function as
supplies when used in a diagnostic test or procedure (including
diagnostic radiopharmaceuticals, contrast agents, and stress agents);
and drugs and biologicals that function as supplies when used in a
surgical procedure), our standard methodology for providing payment for
drugs and biologicals with expiring pass-through payment status in an
upcoming calendar year is to determine the product's estimated per day
cost and compare it with the OPPS drug packaging threshold for that
calendar year (which is proposed to be $125 for CY 2019), as discussed
further in section V.B.2. of this proposed rule. We are proposing that
if the estimated per day cost for the drug or biological is less than
or equal to the applicable OPPS drug packaging threshold, we would
package payment for the drug or biological into the payment for the
associated procedure in the upcoming calendar year. If the estimated
per day cost of the drug or biological is greater than the OPPS drug
packaging threshold, we are proposing to provide separate payment at
the applicable relative ASP-based payment amount (which is proposed at
ASP+6 percent for CY 2019, as discussed further in section V.B.3. of
this proposed rule).
Table 19--Proposed Drugs and Biologicals for Which PasS-Through Payment Status Expires December 31, 2018
----------------------------------------------------------------------------------------------------------------
CY 2018 Pass- through
CY 2018 HCPCS code CY 2018 long descriptor status CY 2018 APC payment
indicator effective date
----------------------------------------------------------------------------------------------------------------
A9515............................ Choline C 11, diagnostic, per G 9461 04/01/2016
study dose.
C9460............................ Injection, cangrelor, 1 mg....... G 9460 01/01/2016
C9482............................ Injection, sotalol hydrochloride, G 9482 10/01/2016
1 mg.
J1942............................ Injection, aripiprazole lauroxil, G 9470 04/01/2016
1 mg.
J2182............................ Injection, mepolizumab, 1 mg..... G 9473 04/01/2016
J2786............................ Injection, reslizumab, 1 mg...... G 9481 10/01/2016
J2840............................ Injection, sebelipase alfa, 1 mg. G 9478 07/01/2016
J7202............................ Injection, Factor IX, albumin G 9171 10/01/2016
fusion protein (recombinant),
Idelvion, 1 i.u..
J7207............................ Injection, Factor VIII G 1844 04/01/2016
(antihemophilic factor,
recombinant) PEGylated, 1 I.U..
J7209............................ Injection, Factor VIII G 1846 04/01/2016
(antihemophilic factor,
recombinant) (Nuwiq), per i.u..
J7322............................ Hyaluronan or derivative, G 9471 04/01/2016
Hymovis, for intra-articular
injection, 1 mg.
J7342............................ Instillation, ciprofloxacin otic G 9479 07/01/2016
suspension, 6 mg.
J7503............................ Tacrolimus, extended release, G 1845 04/01/2016
(envarsus xr), oral, 0.25 mg.
J9022............................ Injection, atezolizumab, 10 mg... G 9483 10/01/2016
J9145............................ Injection, daratumumab, 10 mg.... G 9476 07/01/2016
J9176............................ Injection, elotuzumab, 1 mg...... G 9477 07/01/2016
J9205............................ Injection, irinotecan liposome, 1 G 9474 04/01/2016
mg.
J9295............................ Injection, necitumumab, 1 mg..... G 9475 04/01/2016
J9325............................ Injection, talimogene G 9472 04/01/2016
laherparepvec, 1 million plaque
forming units (PFU).
J9352............................ Injection, trabectedin, 0.1 mg... G 9480 07/01/2016
Q5101............................ Injection, filgrastim-sndz, G 1822 07/01/2015
biosimilar, (zarxio), 1
microgram.
Q9982............................ Flutemetamol F18, diagnostic, per G 9459 01/01/2016
study dose, up to 5 millicuries.
Q9983............................ Florbetaben F18, diagnostic, per G 9458 01/01/2016
study dose, up to 8.1
millicuries.
----------------------------------------------------------------------------------------------------------------
The proposed packaged or separately payable status of each of these
drugs or biologicals is listed in Addendum B to this proposed rule
(which is available via the internet on the CMS website).
4. Proposed Drugs, Biologicals, and Radiopharmaceuticals With New or
Continuing Pass-Through Payment Status in CY 2019
We are proposing to continue pass-through payment status in CY 2019
for 45 drugs and biologicals. These drugs and biologicals, which were
approved for pass-through payment status between January 1, 2017, and
July 1, 2018, are listed in Table 20 below. The APCs and HCPCS codes
for these drugs and biologicals approved for pass-through payment
status through December 31, 2018 are assigned status indicator ``G'' in
Addenda A and B to this proposed rule (which are available via the
internet on the CMS website). In addition, there are four drugs and
biologicals that have already had 3 years of pass-through payment
status but for which pass-through payment status is required to be
extended for an additional 2 years under section 1833(t)(6)(G) of the
Act, as added by section 1301(a)(1)(C) of the Consolidated
Appropriations Act of 2018 (Pub. L. 115-141). Because of this
requirement, these drugs and biologicals are also included in Table 20,
which brings the total number of drugs and biologicals with proposed
pass-through payment status in CY 2019 to 49. The requirements of
section 1301 of Pub. L. 115-141 are described in further detail in
section V.A.5. of this proposed rule.
Section 1833(t)(6)(D)(i) of the Act sets the amount of pass-through
payment for pass-through drugs and biologicals (the pass-through
payment amount) as the difference between the amount authorized under
section 1842(o) of the
[[Page 37113]]
Act and the portion of the otherwise applicable OPD fee schedule that
the Secretary determines is associated with the drug or biological. For
CY 2019, we are proposing to continue to pay for pass-through drugs and
biologicals at ASP+6 percent, equivalent to the payment rate these
drugs and biologicals would receive in the physician's office setting
in CY 2019. We are proposing that a $0 pass-through payment amount
would be paid for pass-through drugs and biologicals under the CY 2019
OPPS because the difference between the amount authorized under section
1842(o) of the Act, which is proposed at ASP+6 percent, and the portion
of the otherwise applicable OPD fee schedule that the Secretary
determines is appropriate, which is proposed at ASP+6 percent, is $0.
In the case of policy-packaged drugs (which include the following:
Anesthesia drugs; drugs, biologicals, and radiopharmaceuticals that
function as supplies when used in a diagnostic test or procedure
(including contrast agents, diagnostic radiopharmaceuticals, and stress
agents); and drugs and biologicals that function as supplies when used
in a surgical procedure), we are proposing that their pass-through
payment amount would be equal to ASP+6 percent for CY 2019 minus a
payment offset for any predecessor drug products contributing to the
pass-through payment as described in section V.A.6. of this proposed
rule. We are making this proposal because, if not for the pass-through
payment status of these policy-packaged products, payment for these
products would be packaged into the associated procedure.
We are proposing to continue to update pass-through payment rates
on a quarterly basis on the CMS website during CY 2019 if later quarter
ASP submissions (or more recent WAC or AWP information, as applicable)
indicate that adjustments to the payment rates for these pass-through
payment drugs or biologicals are necessary. For a full description of
this policy, we refer readers to the CY 2006 OPPS/ASC final rule with
comment period (70 FR 68632 through 68635).
For CY 2019, consistent with our CY 2018 policy for diagnostic and
therapeutic radiopharmaceuticals, we are proposing to provide payment
for both diagnostic and therapeutic radiopharmaceuticals that are
granted pass-through payment status based on the ASP methodology. As
stated earlier, for purposes of pass-through payment, we consider
radiopharmaceuticals to be drugs under the OPPS. Therefore, if a
diagnostic or therapeutic radiopharmaceutical receives pass-through
payment status during CY 2019, we are proposing to follow the standard
ASP methodology to determine the pass-through payment rate that drugs
receive under section 1842(o) of the Act, which is proposed at ASP+6
percent. If ASP data are not available for a radiopharmaceutical, we
are proposing to provide pass-through payment at WAC+3 percent
(consistent with our proposed policy in section V.B.2.b. of this
proposed rule), the equivalent payment provided to pass-through payment
drugs and biologicals without ASP information. If WAC information also
is not available, we are proposing to provide payment for the pass-
through radiopharmaceutical at 95 percent of its most recent AWP.
The 49 drugs and biologicals that we are proposing to continue to
have pass-through payment status for CY 2019 or have been granted pass-
through payment status as of July 2018 are shown in Table 20 below.
Table 20--Proposed Drugs and Biologicals With Pass-Through Payment Status in CY 2019
----------------------------------------------------------------------------------------------------------------
Proposed
CY 2019 long CY 2019 Proposed CY Pass- through
CY 2018 HCPCS code CY 2019 HCPCS code descriptor status 2019 APC payment
indicator effective date
----------------------------------------------------------------------------------------------------------------
A9586................. A9586 Florbetapir f18, G 9084 10/01/2018
diagnostic, per
study dose, up to 10
millicuries.
A9587................. A9587 Gallium ga-68, G 9056 01/01/2017
dotatate,
diagnostic, 0.1
millicurie.
A9588................. A9588 Fluciclovine f-18, G 9052 01/01/2017
diagnostic, 1
millicurie.
C9014................. C9014 Injection, G 9014 01/01/2018
cerliponase alfa, 1
mg.
C9015................. C9015 Injection, c-1 G 9015 01/01/2018
esterase inhibitor
(human), Haegarda,
10 units.
C9016................. C9016 Injection, G 9016 01/01/2018
triptorelin extended
release, 3.75 mg.
C9024................. C9024 Injection, liposomal, G 9302 01/01/2018
1 mg daunorubicin
and 2.27 mg
cytarabine.
C9028................. C9028 Injection, inotuzumab G 9028 01/01/2018
ozogamicin, 0.1 mg.
C9029................. C9029 Injection, G 9029 01/01/2018
guselkumab, 1 mg.
C9030................. C9030 Injection, G 9030 07/01/2018
copanlisib, 1 mg.
C9031................. C9031 Lutetium Lu 177, G 9067 07/01/2018
dotatate,
therapeutic, 1 mCi.
C9032................. C9032 Injection, voretigene G 9070 07/01/2018
neparvovec-rzyl, 1
billion vector
genome.
C9447................. C9447 Injection, G 9083 10/01/2018
phenylephrine and
ketorolac, 4 ml vial.
C9462................. C9462 Injection, G 9462 04/01/2018
delafloxacin, 1 mg.
C9463................. C9463 Injection, G 9463 04/01/2018
aprepitant, 1 mg.
C9465................. C9465 Hyaluronan or G 9465 04/01/2018
derivative,
Durolane, for intra-
articular injection,
per dose.
C9466................. C9466 Injection, G 9466 04/01/2018
benralizumab, 1 mg.
C9467................. C9467 Injection, rituximab G 9467 04/01/2018
and hyaluronidase,
10 mg.
C9468................. C9468 Injection, factor ix G 9468 04/01/2018
(antihemophilic
factor,
recombinant),
glycopegylated,
Rebinyn, 1 i.u..
C9469................. C9469 Injection, G 9469 04/01/2018
triamcinolone
acetonide,
preservative-free,
extended-release,
microsphere
formulation, 1 mg.
C9488................. C9488 Injection, conivaptan G 9488 04/01/2017
hydrochloride, 1 mg.
C9492................. C9492 Injection, G 9492 10/01/2017
durvalumab, 10 mg.
C9493................. C9493 Injection, edaravone, G 9493 10/01/2017
1 mg.
J0565................. J0565 Injection, G 9490 07/01/2017
bezlotoxumab, 10 mg.
J0570................. J0570 Buprenorphine G 9058 01/01/2017
implant, 74.2 mg.
[[Page 37114]]
J0606................. J0606 Injection, G 9031 01/01/2018
etelcalcetide, 0.1
mg.
J1428................. J1428 Injection, G 9484 04/01/2017
eteplirsen, 10 mg.
J1627................. J1627 Injection, G 9486 04/01/2017
granisetron extended
release, 0.1 mg.
J2326................. J2326 Injection, G 9489 07/01/2017
nusinersen, 0.1 mg.
J2350................. J2350 Injection, G 9494 10/01/2017
ocrelizumab, 1 mg.
J3358................. J3358 Ustekinumab, for G 9487 04/01/2017
Intravenous
Injection, 1 mg.
J7179................. J7179 Injection, von G 9059 01/01/2017
willebrand factor
(recombinant),
(Vonvendi), 1 i.u.
vwf:rco.
J7210................. J7210 Injection, factor G 9043 01/01/2017
viii,
(antihemophilic
factor,
recombinant),
(afstyla), 1 i.u.
J7328................. J7328 Hyaluronan or G 1862 01/01/2016
derivative, gelsyn-
3, for intra-
articular injection,
0.1 mg.
J7345................. J7345 Aminolevulinic acid G 9301 01/01/2018
hcl for topical
administration, 10%
gel, 10 mg.
J9023................. J9023 Injection, avelumab, G 9491 10/01/2017
10 mg.
J9034................. J9034 Injection, G 1861 01/01/2017
bendamustine hcl
(Bendeka), 1 mg.
J9203................. J9203 Injection, gemtuzumab G 9495 01/01/2018
ozogamicin, 0.1 mg.
J9285................. J9285 Injection, G 9485 04/01/2017
olaratumab, 10 mg.
Q2040................. Q2040 Tisagenlecleucel, up G 9081 01/01/2018
to 250 million car-
positive viable t
cells, including
leukapheresis and
dose preparation
procedures, per
infusion.
Q2041................. Q2041 Axicabtagene G 9035 04/01/2018
Ciloleucel, up to
200 Million
Autologous Anti-CD19
CAR T Cells,
Including
Leukapheresis And
Dose Preparation
Procedures, Per
Infusion.
Q4172................. Q4172 PuraPly, and PuraPly G 9082 10/01/2018
Antimicrobial, any
type, per square
centimeter.
Q5103................. Q5103 Injection, infliximab- G 1847 04/01/2018
dyyb, biosimilar,
(inflectra), 10 mg.
Q5104................. Q5104 Injection, infliximab- G 9036 04/01/2018
abda, biosimilar,
(renflexis), 10 mg.
Q9950................. Q9950 Injection, sulfur G 9085 10/01/2018
hexafluoride lipid
microsphere, per ml.
Q9991................. Q9991 Injection, G 9073 07/01/2018
buprenorphine
extended-release
(Sublocade), less
than or equal to 100
mg.
Q9992................. Q9992 Injection, G 9239 07/01/2018
buprenorphine
extended-release
(Sublocade), greater
than 100 mg.
Q9993................. Q9993 Injection, G 9464 04/01/2018
rolapitant, 0.5 mg.
Q9995................. Q9995 Injection, emicizumab- G 9257 07/01/2018
kxwh, 0.5 mg.
----------------------------------------------------------------------------------------------------------------
5. Proposed Drugs, Biologicals, and Radiopharmaceuticals With Pass-
Through Status as a Result of Section 1301 of the Consolidated
Appropriations Act of 2018 (Pub. L. 115-141)
As mentioned earlier, section 1301(a)(1) of the Consolidated
Appropriations Act of 2018 (Pub. L. 115-141) amended section 1833(t)(6)
of the Act and added a new section 1833(t)(6)(G), which provides that
for drugs or biologicals whose period of pass-through payment status
ended on December 31, 2017 and for which payment was packaged into a
covered hospital outpatient service furnished beginning January 1,
2018, such pass-through payment status shall be extended for a 2-year
period beginning on October 1, 2018 through September 30, 2020. There
are four products whose period of drugs and biologicals pass-through
payment status ended on December 31, 2017. These products are listed in
Table 21 below. For CY 2019, we are proposing to continue pass-through
payment status for the drugs and biologicals listed in Table 21 (we
note that these drugs and biologicals are also listed in Table 20
above). The APCs and HCPCS codes for these drugs and biologicals
approved for pass-through payment status are assigned status indicator
``G'' in Addenda A and B to this proposed rule (which are available via
the internet on the CMS website).
In addition, new section 1833(t)(6)(H) of the Act specifies that
the payment amount for such drug or biological under this subsection
that is furnished during the period beginning on October 1, 2018, and
ending on March 31, 2019, shall be the greater of: (i) The payment
amount that would otherwise apply under section 1833(t)(6)(D)(i) of the
Act for such drug or biological during such period; or (ii) the payment
amount that applied under section 1833(t)(6)(D)(i) of the Act for such
drug or biological on December 31, 2017. We intend to address pass-
through payment for these drugs and biologicals for the last quarter of
CY 2018 through program instruction. For January 1, 2019 through March
31, 2019, we are proposing that pass-through payment for these four
drugs and biologicals would be the greater of: (1) ASP+6 percent based
on current ASP data; or (2) the payment rate for the drug or biological
on December 31, 2017. We also are proposing for the period of April 1,
2019 through December 31, 2019 that the pass-through payment amount for
these drugs and biologicals would be the amount that applies under
section 1833(t)(6)(D)(i) of the Act.
We are proposing to continue to update pass-through payment rates
for these four drugs and biologicals on a quarterly basis on the CMS
website during CY 2019 if later quarter ASP submissions (or more recent
WAC or AWP information, as applicable) indicate that adjustments to the
payment rates for these pass-through drugs or biologicals are
necessary. For a full description of this policy, we refer readers to
the CY 2006 OPPS/ASC final rule with comment period (70 FR 68632
through 68635).
[[Page 37115]]
The four drugs and biologicals that we are proposing would have
pass-through payment status for CY 2019 under section 1833(t)(6)(G) of
the Act, as added by section 1301(a)(1)(C) of the Consolidated
Appropriations Act of 2018, are shown in Table 21 below. Included as
one of the four drugs and biologicals with pass-through payment status
for CY 2019 is HCPCS code Q4172 (PuraPly, and PuraPly Antimicrobial,
any type, per square centimeter). PuraPly is a skin substitute product
that was approved for pass-through payment status on January 1, 2015,
through the drug and biological pass-through payment process. Beginning
on April 1, 2015, skin substitute products are evaluated for pass-
through payment status through the device pass-through payment process.
However, we stated in the CY 2015 OPPS/ASC final rule with comment
period (79 FR 66887) that skin substitutes that are approved for pass-
through payment status as biologicals effective on or before January 1,
2015 would continue to be paid as pass-through biologicals for the
duration of their pass-through payment period. Because PuraPly was
approved for pass-through payment status through the drug and
biological pass-through payment pathway, we are proposing to consider
PuraPly to be a drug or biological as described by section
1833(t)(6)(G) of the Act, as added by section 1301(a)(1)(C) of the
Consolidated Appropriations Act of 2018, and to be eligible for
extended pass-through payment under our proposal for CY 2019.
Table 21--Proposed Drugs and Biologicals With Pass-Through Payment Status in CY 2019 in Accordance With Public
Law 115-141
----------------------------------------------------------------------------------------------------------------
Proposed
CY 2019 long CY 2019 Proposed CY Pass- through
CY 2018 HCPCS code CY 2019 HCPCS code descriptor status 2019 APC payment
indicator effective date
----------------------------------------------------------------------------------------------------------------
A9586................. A9586 Florbetapir f18, G 9084 10/01/2018
diagnostic, per
study dose, up to 10
millicuries.
C9447................. C9447 Injection, G 9083 10/01/2018
phenylephrine and
ketorolac, 4 ml vial.
Q4172................. Q4172 PuraPly, and PuraPly G 9082 10/01/2018
Antimicrobial, any
type, per square
centimeter.
Q9950................. Q9950 Injection, sulfur G 9085 10/01/2018
hexafluoride lipid
microsphere, per ml.
----------------------------------------------------------------------------------------------------------------
6. Proposed Provisions for Reducing Transitional Pass-Through Payments
for Policy-Packaged Drugs, Biologicals, and Radiopharmaceuticals To
Offset Costs Packaged Into APC Groups
Under the regulations at 42 CFR 419.2(b), nonpass-through drugs,
biologicals, and radiopharmaceuticals that function as supplies when
used in a diagnostic test or procedure are packaged in the OPPS. This
category includes diagnostic radiopharmaceuticals, contrast agents,
stress agents, and other diagnostic drugs. Also under 42 CFR 419.2(b),
nonpass-through drugs and biologicals that function as supplies in a
surgical procedure are packaged in the OPPS. This category includes
skin substitutes and other surgical-supply drugs and biologicals. As
described earlier, section 1833(t)(6)(D)(i) of the Act specifies that
the transitional pass-through payment amount for pass-through drugs and
biologicals is the difference between the amount paid under section
1842(o) of the Act and the otherwise applicable OPD fee schedule
amount. Because a payment offset is necessary in order to provide an
appropriate transitional pass-through payment, we deduct from the pass-
through payment for policy-packaged drugs, biologicals, and
radiopharmaceuticals an amount reflecting the portion of the APC
payment associated with predecessor products in order to ensure no
duplicate payment is made. This amount reflecting the portion of the
APC payment associated with predecessor products is called the payment
offset.
The payment offset policy applies to all policy packaged drugs,
biologicals, and radiopharmaceuticals. For a full description of the
payment offset policy as applied to diagnostic radiopharmaceuticals,
contrast agents, stress agents, and skin substitutes, we refer readers
to the discussion in the CY 2016 OPPS/ASC final rule with comment
period (80 FR 70430 through 70432). For CY 2019, as we did in CY 2018,
we are proposing to continue to apply the same policy packaged offset
policy to payment for pass-through diagnostic radiopharmaceuticals,
pass-through contrast agents, pass-through stress agents, and pass-
through skin substitutes. The proposed APCs to which a payment offset
may be applicable for pass-through diagnostic radiopharmaceuticals,
pass-through contrast agents, pass-through stress agents, and pass-
through skin substitutes are identified in Table 22 below.
Table 22--Proposed APCS To Which a Policy-Packaged Drug or
Radiopharmaceutical Offset May Be Applicable in CY 2019
------------------------------------------------------------------------
Proposed CY 2019 APC Proposed CY 2019 APC title
------------------------------------------------------------------------
Diagnostic Radiopharmaceutical
------------------------------------------------------------------------
5591.................................. Level 1 Nuclear Medicine and
Related Services.
5592.................................. Level 2 Nuclear Medicine and
Related Services.
5593.................................. Level 3 Nuclear Medicine and
Related Services.
5594.................................. Level 4 Nuclear Medicine and
Related Services.
------------------------------------------------------------------------
Contrast Agent
------------------------------------------------------------------------
5571.................................. Level 1 Imaging with Contrast.
5572.................................. Level 2 Imaging with Contrast.
5573.................................. Level 3 Imaging with Contrast.
------------------------------------------------------------------------
Stress Agent
------------------------------------------------------------------------
5722.................................. Level 2 Diagnostic Tests and
Related Services.
5593.................................. Level 3 Nuclear Medicine and
Related Services.
------------------------------------------------------------------------
Skin Substitute
------------------------------------------------------------------------
5054.................................. Level 4 Skin Procedures.
5055.................................. Level 5 Skin Procedures.
------------------------------------------------------------------------
[[Page 37116]]
We are proposing to continue to post annually on the CMS website
at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Annual-Policy-Files.html a file that contains the
APC offset amounts that will be used for that year for purposes of both
evaluating cost significance for candidate pass-through payment device
categories and drugs and biologicals and establishing any appropriate
APC offset amounts. Specifically, the file will continue to provide the
amounts and percentages of APC payment associated with packaged
implantable devices, policy-packaged drugs, and threshold packaged
drugs and biologicals for every OPPS clinical APC.
B. Proposed OPPS Payment for Drugs, Biologicals, and
Radiopharmaceuticals Without Pass-Through Payment Status
1. Proposed Criteria for Packaging Payment for Drugs, Biologicals, and
Radiopharmaceuticals
a. Proposed Packaging Threshold
In accordance with section 1833(t)(16)(B) of the Act, the threshold
for establishing separate APCs for payment of drugs and biologicals was
set to $50 per administration during CYs 2005 and 2006. In CY 2007, we
used the four quarter moving average Producer Price Index (PPI) levels
for Pharmaceutical Preparations (Prescription) to trend the $50
threshold forward from the third quarter of CY 2005 (when the Pub. L.
108-173 mandated threshold became effective) to the third quarter of CY
2007. We then rounded the resulting dollar amount to the nearest $5
increment in order to determine the CY 2007 threshold amount of $55.
Using the same methodology as that used in CY 2007 (which is discussed
in more detail in the CY 2007 OPPS/ASC final rule with comment period
(71 FR 68085 through 68086)), we set the packaging threshold for
establishing separate APCs for drugs and biologicals at $120 for CY
2018 (82 FR 59343).
Following the CY 2007 methodology, for this CY 2019 OPPS/ASC
proposed rule, we used the most recently available four quarter moving
average PPI levels to trend the $50 threshold forward from the third
quarter of CY 2005 to the third quarter of CY 2019 and rounded the
resulting dollar amount ($126.03) to the nearest $5 increment, which
yielded a figure of $125. In performing this calculation, we used the
most recent forecast of the quarterly index levels for the PPI for
Pharmaceuticals for Human Use (Prescription) (Bureau of Labor
Statistics series code WPUSI07003) from CMS' Office of the Actuary.
Based on these calculations, we are proposing a packaging threshold for
CY 2019 of $125.
b. Proposed Packaging of Payment for HCPCS Codes That Describe Certain
Drugs, Certain Biologicals, and Therapeutic Radiopharmaceuticals Under
the Cost Threshold (``Threshold-Packaged Drugs'')
To determine the proposed CY 2019 packaging status for all nonpass-
through drugs and biologicals that are not policy packaged, we
calculated, on a HCPCS code-specific basis, the per day cost of all
drugs, biologicals, and therapeutic radiopharmaceuticals (collectively
called ``threshold-packaged'' drugs) that had a HCPCS code in CY 2017
and were paid (via packaged or separate payment) under the OPPS. We
used data from CY 2017 claims processed before January 1, 2018 for this
calculation. However, we did not perform this calculation for those
drugs and biologicals with multiple HCPCS codes that include different
dosages, as described in section V.B.1.d. of this proposed rule, or for
the following policy-packaged items that we are proposing to continue
to package in CY 2019: Anesthesia drugs; drugs, biologicals, and
radiopharmaceuticals that function as supplies when used in a
diagnostic test or procedure; and drugs and biologicals that function
as supplies when used in a surgical procedure.
In order to calculate the per day costs for drugs, biologicals, and
therapeutic radiopharmaceuticals to determine their proposed packaging
status in CY 2019, we used the methodology that was described in detail
in the CY 2006 OPPS proposed rule (70 FR 42723 through 42724) and
finalized in the CY 2006 OPPS final rule with comment period (70 FR
68636 through 68638). For each drug and biological HCPCS code, we used
an estimated payment rate of ASP+6 percent (which is the payment rate
we are proposing for separately payable drugs and biologicals for CY
2019, as discussed in more detail in section V.B.2.b. of this proposed
rule) to calculate the CY 2019 proposed rule per day costs. We used the
manufacturer submitted ASP data from the fourth quarter of CY 2017
(data that were used for payment purposes in the physician's office
setting, effective April 1, 2018) to determine the proposed rule per
day cost. As is our standard methodology, for CY 2019, we are proposing
to use payment rates based on the ASP data from the first quarter of CY
2018 for budget neutrality estimates, packaging determinations, impact
analyses, and completion of Addenda A and B to this proposed rule
(which are available via the internet on the CMS website) because these
are the most recent data available for use at the time of development
of this proposed rule. These data also were the basis for drug payments
in the physician's office setting, effective April 1, 2018. For items
that did not have an ASP-based payment rate, such as some therapeutic
radiopharmaceuticals, we used their mean unit cost derived from the CY
2017 hospital claims data to determine their per day cost.
We are proposing to package items with a per day cost less than or
equal to $125, and identify items with a per day cost greater than $125
as separately payable unless they are policy-packaged. Consistent with
our past practice, we cross-walked historical OPPS claims data from the
CY 2017 HCPCS codes that were reported to the CY 2018 HCPCS codes that
we display in Addendum B to this proposed rule (which is available via
the internet on the CMS website) for proposed payment in CY 2019.
Our policy during previous cycles of the OPPS has been to use
updated ASP and claims data to make final determinations of the
packaging status of HCPCS codes for drugs, biologicals, and therapeutic
radiopharmaceuticals for the OPPS/ASC final rule with comment period.
We note that it is also our policy to make an annual packaging
determination for a HCPCS code only when we develop the OPPS/ASC final
rule with comment period for the update year. Only HCPCS codes that are
identified as separately payable in the final rule with comment period
are subject to quarterly updates. For our calculation of per day costs
of HCPCS codes for drugs and biologicals in this CY 2019 OPPS/ASC
proposed rule, we are proposing to use ASP data from the fourth quarter
of CY 2017, which is the basis for calculating payment rates for drugs
and biologicals in the physician's office setting using the ASP
methodology, effective April 1, 2018, along with updated hospital
claims data from CY 2017. We note that we also are proposing to use
these data for budget neutrality estimates and impact analyses for this
CY 2019 OPPS/ASC proposed rule.
Payment rates for HCPCS codes for separately payable drugs and
biologicals included in Addenda A and B for the final rule with comment
period will be based on ASP data from the third quarter of CY 2018.
These data will be the basis for calculating payment rates for drugs
and biologicals in the physician's office setting using the ASP
[[Page 37117]]
methodology, effective October 1, 2018. These payment rates would then
be updated in the January 2019 OPPS update, based on the most recent
ASP data to be used for physician's office and OPPS payment as of
January 1, 2019. For items that do not currently have an ASP-based
payment rate, we are proposing to recalculate their mean unit cost from
all of the CY 2017 claims data and updated cost report information
available for the CY 2019 final rule with comment period to determine
their final per day cost.
Consequently, the packaging status of some HCPCS codes for drugs,
biologicals, and therapeutic radiopharmaceuticals in this proposed rule
may be different from the same drug HCPCS code's packaging status
determined based on the data used for the final rule with comment
period. Under such circumstances, we are proposing to continue to
follow the established policies initially adopted for the CY 2005 OPPS
(69 FR 65780) in order to more equitably pay for those drugs whose cost
fluctuates relative to the proposed CY 2019 OPPS drug packaging
threshold and the drug's payment status (packaged or separately
payable) in CY 2018. These established policies have not changed for
many years and are the same as described in the CY 2016 OPPS/ASC final
rule with comment period (80 FR 70434). Specifically, for CY 2019,
consistent with our historical practice, we are proposing to apply the
following policies to these HCPCS codes for drugs, biologicals, and
therapeutic radiopharmaceuticals whose relationship to the drug
packaging threshold changes based on the updated drug packaging
threshold and on the final updated data:
HCPCS codes for drugs and biologicals that were paid
separately in CY 2018 and that were proposed for separate payment in CY
2019, and that then have per day costs equal to or less than the CY
2019 final rule drug packaging threshold, based on the updated ASPs and
hospital claims data used for the CY 2019 final rule, would continue to
receive separate payment in CY 2019.
HCPCS codes for drugs and biologicals that were packaged
in CY 2018 and that were proposed for separate payment in CY 2019, and
that then have per day costs equal to or less than the CY 2019 final
rule drug packaging threshold, based on the updated ASPs and hospital
claims data used for the CY 2019 final rule, would remain packaged in
CY 2019.
HCPCS codes for drugs and biologicals for which we
proposed packaged payment in CY 2019 but then have per day costs
greater than the CY 2019 final rule drug packaging threshold, based on
the updated ASPs and hospital claims data used for the CY 2019 final
rule, would receive separate payment in CY 2019.
c. Policy Packaged Drugs, Biologicals, and Radiopharmaceuticals
As mentioned earlier in this section, in the OPPS, we package
several categories of drugs, biologicals, and radiopharmaceuticals,
regardless of the cost of the products. Because the products are
packaged according to the policies in 42 CFR 419.2(b), we refer to
these packaged drugs, biologicals, and radiopharmaceuticals as
``policy-packaged'' drugs, biologicals, and radiopharmaceuticals. These
policies are either longstanding or based on longstanding principles
and inherent to the OPPS and are as follows:
Anesthesia, certain drugs, biologicals, and other
pharmaceuticals; medical and surgical supplies and equipment; surgical
dressings; and devices used for external reduction of fractures and
dislocations (Sec. 419.2(b)(4));
Intraoperative items and services (Sec. 419.2(b)(14));
Drugs, biologicals, and radiopharmaceuticals that function
as supplies when used in a diagnostic test or procedure (including but
not limited to, diagnostic radiopharmaceuticals, contrast agents, and
pharmacologic stress agents (Sec. 419.2(b)(15)); and
Drugs and biologicals that function as supplies when used
in a surgical procedure (including, but not limited to, skin
substitutes and similar products that aid wound healing and implantable
biologicals) (Sec. 419.2(b)(16)).
The policy at Sec. 419.2(b)(16) is broader than that at Sec.
419.2(b)(14). As we stated in the CY 2015 OPPS/ASC final rule with
comment period: ``We consider all items related to the surgical outcome
and provided during the hospital stay in which the surgery is
performed, including postsurgical pain management drugs, to be part of
the surgery for purposes of our drug and biological surgical supply
packaging policy'' (79 FR 66875). The category described by Sec.
419.2(b)(15) is large and includes diagnostic radiopharmaceuticals,
contrast agents, stress agents, and some other products. The category
described by Sec. 419.2(b)(16) includes skin substitutes and some
other products. We believe it is important to reiterate that cost
consideration is not a factor when determining whether an item is a
surgical supply (79 FR 66875).
d. Proposed High Cost/Low Cost Threshold for Packaged Skin Substitutes
In the CY 2014 OPPS/ASC final rule with comment period (78 FR
74938), we unconditionally packaged skin substitute products into their
associated surgical procedures as part of a broader policy to package
all drugs and biologicals that function as supplies when used in a
surgical procedure. As part of the policy to finalize the packaging of
skin substitutes, we also finalized a methodology that divides the skin
substitutes into a high cost group and a low cost group, in order to
ensure adequate resource homogeneity among APC assignments for the skin
substitute application procedures (78 FR 74933).
Skin substitutes assigned to the high cost group are described by
HCPCS codes 15271 through 15278. Skin substitutes assigned to the low
cost group are described by HCPCS codes C5271 through C5278. Geometric
mean costs for the various procedures are calculated using only claims
for the skin substitutes that are assigned to each group. Specifically,
claims billed with HCPCS code 15271, 15273, 15275, or 15277 are used to
calculate the geometric mean costs for procedures assigned to the high
cost group, and claims billed with HCPCS code C5271, C5273, C5275, or
C5277 are used to calculate the geometric mean costs for procedures
assigned to the low cost group (78 FR 74935).
Each of the HCPCS codes described above are assigned to one of the
following three skin procedure APCs according to the geometric mean
cost for the code: APC 5053 (Level 3 Skin Procedures) (HCPCS codes
C5271, C5275, and C5277); APC 5054 (Level 4 Skin Procedures) (HCPCS
codes C5273, 15271, 15275, and 15277); or APC 5055 (Level 5 Skin
Procedures) (HCPCS code 15273). In CY 2018, the payment rate for APC
5053 (Level 3 Skin Procedures) was $488.20, the payment rate for APC
5054 (Level 4 Skin Procedures) was $1,568.43, and the payment rate for
APC 5055 (Level 5 Skin Procedures) was $2,710.48. This information also
is available in Addenda A and B of the CY 2018 OPPS/ASC final rule with
comment period (which is available via the internet on the CMS
website).
We have continued the high cost/low cost categories policy since CY
2014, and we are proposing to continue it for CY 2019. Under this
current policy, skin substitutes in the high cost category are reported
with the skin substitute application CPT codes, and skin substitutes in
the low cost category are reported with the analogous skin substitute
HCPCS C-codes. For a
[[Page 37118]]
discussion of the CY 2014 and CY 2015 methodologies for assigning skin
substitutes to either the high cost group or the low cost group, we
refer readers to the CY 2014 OPPS/ASC final rule with comment period
(78 FR 74932 through 74935) and the CY 2015 OPPS/ASC final rule with
comment period (79 FR 66882 through 66885).
For a discussion of the high cost/low cost methodology that was
adopted in CY 2016 and has been in effect since then, we refer readers
to the CY 2016 OPPS/ASC final rule with comment period (80 FR 70434
through 70435). For CY 2019, as with our policy since CY 2016, we are
proposing to continue to determine the high cost/low cost status for
each skin substitute product based on either a product's geometric mean
unit cost (MUC) exceeding the geometric MUC threshold or the product's
per day cost (PDC) (the total units of a skin substitute multiplied by
the mean unit cost and divided by the total number of days) exceeding
the PDC threshold. For CY 2019, as for CY 2018, we are proposing to
assign each skin substitute that exceeds either the MUC threshold or
the PDC threshold to the high cost group. In addition, as described in
more detail later in this section, for CY 2019, as for CY 2018, we are
proposing to assign any skin substitute with a MUC or a PDC that does
not exceed either the MUC threshold or the PDC threshold to the low
cost group. For CY 2019, we are proposing that any skin substitute
product that was assigned to the high cost group in CY 2018 would be
assigned to the high cost group for CY 2019, regardless of whether it
exceeds or falls below the CY 2019 MUC or PDC threshold.
For this CY 2019 OPPS/ASC proposed rule, consistent with the
methodology as established in the CY 2014 through CY 2017 final rules
with comment period, we analyzed CY 2017 claims data to calculate the
MUC threshold (a weighted average of all skin substitutes' MUCs) and
the PDC threshold (a weighted average of all skin substitutes' PDCs).
The proposed CY 2019 MUC threshold is $49 per cm\2\ (rounded to the
nearest $1) and the proposed CY 2019 PDC threshold is $895 (rounded to
the nearest $1).
For CY 2019, we are proposing to continue to assign skin
substitutes with pass-through payment status to the high cost category.
We are proposing to assign skin substitutes with pricing information
but without claims data to calculate a geometric MUC or PDC to either
the high cost or low cost category based on the product's ASP+6 percent
payment rate as compared to the MUC threshold. If ASP is not available,
we are proposing to use WAC+3 percent to assign a product to either the
high cost or low cost category. Finally if neither ASP nor WAC is
available, we would use 95 percent of AWP to assign a skin substitute
to either the high cost or low cost category. We are proposing to use
WAC+3 percent instead of WAC+6 percent to conform to our proposed
policy described in section V.B.2.b. of this proposed rule to establish
a payment rate of WAC+3 percent for separately payable drugs and
biologicals that do not have ASP data available. New skin substitutes
without pricing information would be assigned to the low cost category
until pricing information is available to compare to the CY 2019 MUC
threshold. For a discussion of our existing policy under which we
assign skin substitutes without pricing information to the low cost
category until pricing information is available, we refer readers to
the CY 2016 OPPS/ASC final rule with comment period (80 FR 70436).
Some skin substitute manufacturers have raised concerns about
significant fluctuation in both the MUC threshold and the PDC threshold
from year to year. The fluctuation in the thresholds may result in the
reassignment of several skin substitutes from the high cost group to
the low cost group which, under current payment rates, can be a
difference of approximately $1,000 in the payment amount for the same
procedure. In addition, these stakeholders were concerned that the
inclusion of cost data from skin substitutes with pass-through payment
status in the MUC and PDC calculations would artificially inflate the
thresholds. Skin substitute stakeholders requested that CMS consider
alternatives to the current methodology used to calculate the MUC and
PDC thresholds and also requested that CMS consider whether it might be
appropriate to establish a new cost group in between the low cost group
and the high cost group to allow for assignment of moderately priced
skin substitutes to a newly created middle group.
We share the goal of promoting payment stability for skin
substitute products and their related procedures as price stability
allows hospitals using such products to more easily anticipate future
payments associated with these products. We have attempted to limit
year to year shifts for skin substitute products between the high cost
and low cost groups through multiple initiatives implemented since CY
2014, including: Establishing separate skin substitute application
procedure codes for low-cost skin substitutes (78 FR 74935); using a
skin substitute's MUC calculated from outpatient hospital claims data
instead of an average of ASP+6 percent as the primary methodology to
assign products to the high cost or low cost group (79 FR 66883); and
establishing the PDC threshold as an alternate methodology to assign a
skin substitute to the high cost group (80 FR 70434 through 70435).
To allow additional time to evaluate concerns and suggestions from
stakeholders about the volatility of the MUC and PDC thresholds, in the
CY 2018 OPPS/ASC proposed rule (82 FR 33627), for CY 2018, we proposed
that a skin substitute that was assigned to the high cost group for CY
2017 would be assigned to the high cost group for CY 2018, even if it
does not exceed the CY 2018 MUC or PDC thresholds. We finalized this
policy in the CY 2018 OPPS/ASC final rule with comment period (82 FR
59347). We stated in the CY 2018 OPPS/ASC proposed rule that the goal
of our proposal to retain the same skin substitute cost group
assignments in CY 2018 as in CY 2017 was to maintain similar levels of
payment for skin substitute products for CY 2018 while we study our
skin substitute payment methodology to determine whether refinement to
the existing policies is consistent with our policy goal of providing
payment stability for skin substitutes.
We stated in the CY 2018 OPPS/ASC final rule with comment period
(82 FR 59347) that we would continue to study issues related to the
payment of skin substitutes and take these comments into consideration
for future rulemaking. We received many responses to our requests for
comments in the CY 2018 OPPS/ASC proposed rule about possible
refinements to the existing payment methodology for skin substitutes
that would be consistent with our policy goal of providing payment
stability for these products. In addition, several stakeholders have
made us aware of additional concerns and recommendations since the
release of the CY 2018 OPPS/ASC final rule with comment period. We have
identified four potential methodologies that have been raised to us
that we encourage the public to review and provide comments on. We are
especially interested in any specific feedback on policy concerns with
any of the options presented as they relate to skin substitutes with
differing per day or per episode costs and sizes and other factors that
may differ among the dozens of skin substitutes currently on the
market. We also are interested in any new ideas that are not
represented below along with an analysis of how different skin
[[Page 37119]]
substitute products would fare under such ideas. We intend to explore
the full array of public comments on these ideas for the CY 2020
rulemaking, and we will consider the feedback received in response to
this proposed rule in developing proposals for CY 2020.
Establish a lump-sum ``episode-based'' payment for a wound
care episode. Under this option, a hospital would receive a lump sum
payment for all wound care services involving procedures using skin
substitutes. The payment would be made for a wound care ``episode''
(such as 12 weeks) for one wound. The lump sum payment could be the
same for all skin substitutes or could vary based on the estimated
number of applications for a given skin substitute during the wound
care episode. Under this option, payment to the provider could be made
at the start of treatment, or at a different time, and could be made
once or split into multiple payments. Quality metrics, such as using
the recommended number of treatments for a given skin substitute during
a treatment episode, and establishing a plan of care for patients who
do not experience 30-percent wound healing after 4 weeks, could be
established to ensure the beneficiary receives appropriate care while
limiting excessive additional applications of skin substitute products.
Eliminate the high cost/low cost categories for skin
substitutes and only have one payment category and set of procedure
codes for all skin substitute products. This option would reduce the
financial incentives to use expensive skin substitutes and would
provide incentives to use less costly skin substitute products that
have been shown to have similar efficacy treating wounds as more
expensive skin substitute products. A single payment category would
likely have a payment rate that is between the current rates paid for
high cost and low cost skin substitute procedures. Initially, a single
payment category may lead to substantially higher payment for skin
graft procedures performed with cheaper skin substitutes as compared to
their costs. However, over time, payment for skin graft procedures
using skin substitutes might reflect the lower cost of the procedures.
Allow for the payment of current add-on codes or create
additional procedure codes to pay for skin graft services between 26
cm\2\ and 99 cm\2\ and substantially over 100 cm\2\. Under this option,
payment for skin substitutes would be made more granularly based on the
size of the skin substitute product being applied. This option also
would reduce the risk that hospitals may not use enough of a skin
substitute to save money when performing a procedure. However, such
granularity in the use of skin substitutes could conflict with the
goals of a prospective payment system, which is based on a system of
averages. Specifically, it is expected that some skin graft procedures
will be less than 25 cm\2\ or around 100 cm\2\ and will receive higher
payments compared to the cost of the services. Conversely, services
between 26 cm\2\ and 99 cm\2\ or those that are substantially larger
than 100 cm\2\ will receive lower payments compared to the cost of the
services, but the payments will average over many skin graft procedures
to an appropriate payment rate for the provider.
Keep the high cost/low cost skin substitute categories,
but change the threshold used to assign skin substitutes in the high-
cost or low-cost group. Consider using other benchmarks that would
establish more stable thresholds for the high cost and low cost groups.
Ideas include, but are not limited to, fixing the MUC or PDC threshold
at amount from a prior year, or setting global payment targets for high
cost and low cost skin substitutes and establishing a threshold that
meets the payment targets. Establishing different thresholds for the
high cost and low cost groups could allow for the use of a mix of lower
cost and higher cost skin substitute products that acknowledges that a
large share of skin substitutes products used by Medicare providers are
higher cost products but still providing substantial cost savings for
skin graft procedures. Different thresholds may also reduce the number
of skin substitute products that switch between the high cost and low
cost groups in a given year to give more payment stability for skin
substitute products.
To allow stakeholders time to analyze and comment on the potential
ideas raised above, for CY 2019, we are proposing to continue our
policy established in CY 2018 to assign skin substitutes to the low
cost or high cost group. However, for CY 2020, we may revise our policy
to reflect one of the potential new methodologies discussed above or a
new methodology included in public comments in response to this
proposed rule. Specifically, for CY 2019, we are proposing to assign a
skin substitute with a MUC or a PDC that does not exceed either the MUC
threshold or the PDC threshold to the low cost group, unless the
product was assigned to the high cost group in CY 2018, in which case
we will assign the product to the high cost group for CY 2019,
regardless of whether it exceeds the CY 2019 MUC or PDC threshold. We
also are proposing to assign to the high cost group any skin substitute
product that exceeds the CY 2019 MUC or PDC threshold and assign to the
low cost group any skin substitute product that does not exceed the CY
2019 MUC or PDC thresholds and were not assigned to the high cost group
in CY 2018. We are proposing to continue to use payment methodologies
including ASP+6 percent and 95 percent of AWP for skin substitute
products that have pricing information but do not have claims data to
determine if their costs exceed the CY 2019 MUC. In addition, we are
proposing to use WAC+3 percent instead of WAC+6 percent for skin
substitute products that do not have ASP pricing information or have
claims data to determine if those products' costs exceed the CY 2019
MUC. We also are proposing to retain our established policy to assign
new skin substitute products with pricing information to the low cost
group.
Table 23 below displays the proposed CY 2019 high cost or low cost
category assignment for each skin substitute product.
Table 23--Proposed Skin Substitute Assignments to High Cost and Low Cost Groups for CY 2019
----------------------------------------------------------------------------------------------------------------
CY 2018 high/low Proposed CY 2019 high/low
CY 2019 HCPCS code CY 2019 short descriptor assignment assignment
----------------------------------------------------------------------------------------------------------------
C9363....................... Integra Meshed Bil Wound Mat High..................... High.
Q4100....................... Skin Substitute, NOS........ Low...................... Low.
Q4101....................... Apligraf.................... High..................... High.
Q4102....................... Oasis Wound Matrix.......... Low...................... Low.
Q4103....................... Oasis Burn Matrix........... High..................... High.*
Q4104....................... Integra BMWD................ High..................... High.
[[Page 37120]]
Q4105....................... Integra DRT................. High..................... High.*
Q4106....................... Dermagraft.................. High..................... High.
Q4107....................... GraftJacket................. High..................... High.
Q4108....................... Integra Matrix.............. High..................... High.
Q4110....................... Primatrix................... High..................... High.*
Q4111....................... Gammagraft.................. Low...................... Low.
Q4115....................... Alloskin.................... Low...................... Low.
Q4116....................... Alloderm.................... High..................... High.
Q4117....................... Hyalomatrix................. Low...................... Low.
Q4121....................... Theraskin................... High..................... High.*
Q4122....................... Dermacell................... High..................... High.
Q4123....................... Alloskin.................... High..................... High.
Q4124....................... Oasis Tri-layer Wound Matrix Low...................... Low.
Q4126....................... Memoderm/derma/tranz/integup High..................... High.*
Q4127....................... Talymed..................... High..................... High.
Q4128....................... Flexhd/Allopatchhd/Matrixhd. High..................... High.
Q4131....................... Epifix...................... High..................... High.
Q4132....................... Grafix core and grafixpl High..................... High.
core, per square centimeter.
Q4133....................... Grafix prime and grafixpl High..................... High.
prime, per square
centimeter.
Q4134....................... hMatrix..................... Low...................... Low.
Q4135....................... Mediskin.................... Low...................... Low.
Q4136....................... Ezderm...................... Low...................... Low.
Q4137....................... Amnioexcel or Biodexcel, 1cm High..................... High.
Q4138....................... Biodfence DryFlex, 1cm...... High..................... High.
Q4140....................... Biodfence 1cm............... High..................... High.
Q4141....................... Alloskin ac, 1cm............ High..................... High.*
Q4143....................... Repriza, 1cm................ High..................... High.
Q4146....................... Tensix, 1CM................. High..................... High.
Q4147....................... Architect ecm, 1cm.......... High..................... High.*
Q4148....................... Neox cord 1k, neox cord rt, High..................... High.
or clarix cord 1k, per
square centimeter.
Q4150....................... Allowrap DS or Dry 1 sq cm.. High..................... High.
Q4151....................... AmnioBand, Guardian 1 sq cm. High..................... High.
Q4152....................... Dermapure 1 square cm....... High..................... High.
Q4153....................... Dermavest 1 square cm....... High..................... High.
Q4154....................... Biovance 1 square cm........ High..................... High.
Q4156....................... Neox 100 or clarix 100, per High..................... High.
square centimeter.
Q4157....................... Revitalon 1 square cm....... High..................... High.*
Q4158....................... Kerecis omega3, per square High..................... High.*
centimeter.
Q4159....................... Affinity 1 square cm........ High..................... High.
Q4160....................... NuShield 1 square cm........ High..................... High.
Q4161....................... Bio-Connekt per square cm... High..................... High.
Q4163....................... Woundex, bioskin, per square High..................... High.
centimeter.
Q4164....................... Helicoll, per square cm..... High..................... High.*
Q4165....................... Keramatrix, per square cm... Low...................... Low.
Q4166....................... Cytal, per square cm........ Low...................... Low.
Q4167....................... Truskin, per square cm...... Low...................... Low.
Q4169....................... Artacent wound, per square High..................... High.*
cm.
Q4170....................... Cygnus, per square cm....... Low...................... Low.
Q4172 \+\................... PuraPly, PuraPly antimic.... High..................... High.
Q4173....................... Palingen or palingen xplus, High..................... High.
per sq cm.
Q4175....................... Miroderm, per square cm..... High..................... High.
Q4176....................... Neopatch, per square Low...................... Low.
centimeter.
Q4178....................... Floweramniopatch, per square High..................... High.
centimeter.
Q4179....................... Flowerderm, per square Low...................... Low.
centimeter.
Q4180....................... Revita, per square High..................... High.
centimeter.
Q4181....................... Amnio wound, per square Low...................... Low.
centimeter.
Q4182....................... Transcyte, per square Low...................... Low.
centimeter.
----------------------------------------------------------------------------------------------------------------
* These products do not exceed either the MUC or PDC threshold for CY 2019, but are assigned to the high cost
group because they were assigned to the high cost group in CY 2018.
+ Pass-through payment status in CY 2019.
[[Page 37121]]
e. Proposed Packaging Determination for HCPCS Codes That Describe the
Same Drug or Biological But Different Dosages
In the CY 2010 OPPS/ASC final rule with comment period (74 FR 60490
through 60491), we finalized a policy to make a single packaging
determination for a drug, rather than an individual HCPCS code, when a
drug has multiple HCPCS codes describing different dosages because we
believed that adopting the standard HCPCS code-specific packaging
determinations for these codes could lead to inappropriate payment
incentives for hospitals to report certain HCPCS codes instead of
others. We continue to believe that making packaging determinations on
a drug-specific basis eliminates payment incentives for hospitals to
report certain HCPCS codes for drugs and allows hospitals flexibility
in choosing to report all HCPCS codes for different dosages of the same
drug or only the lowest dosage HCPCS code. Therefore, we are proposing
to continue our policy to make packaging determinations on a drug-
specific basis, rather than a HCPCS code-specific basis, for those
HCPCS codes that describe the same drug or biological but different
dosages in CY 2019.
For CY 2019, in order to propose a packaging determination that is
consistent across all HCPCS codes that describe different dosages of
the same drug or biological, we aggregated both our CY 2017 claims data
and our pricing information at ASP+6 percent across all of the HCPCS
codes that describe each distinct drug or biological in order to
determine the mean units per day of the drug or biological in terms of
the HCPCS code with the lowest dosage descriptor. The following drugs
did not have pricing information available for the ASP methodology for
this CY 2019 OPPS/ASC proposed rule, and as is our current policy for
determining the packaging status of other drugs, we used the mean unit
cost available from the CY 2017 claims data to make the proposed
packaging determinations for these drugs: HCPCS code J1840 (Injection,
kanamycin sulfate, up to 500 mg); HCPCS code J1850 (Injection,
kanamycin sulfate, up to 75 mg); HCPCS code J3472 (Injection,
hyaluronidase, ovine, preservative free, per 1000 usp units); HCPCS
code J7100 (Infusion, dextran 40, 500 ml); and HCPCS code J7110
(Infusion, dextran 75, 500 ml).
For all other drugs and biologicals that have HCPCS codes
describing different doses, we then multiplied the proposed weighted
average ASP+6 percent per unit payment amount across all dosage levels
of a specific drug or biological by the estimated units per day for all
HCPCS codes that describe each drug or biological from our claims data
to determine the estimated per day cost of each drug or biological at
less than or equal to the proposed CY 2019 drug packaging threshold of
$125 (so that all HCPCS codes for the same drug or biological would be
packaged) or greater than the proposed CY 2019 drug packaging threshold
of $125 (so that all HCPCS codes for the same drug or biological would
be separately payable). The proposed packaging status of each drug and
biological HCPCS code to which this methodology would apply in CY 2019
is displayed in Table 24 below.
Table 24--Proposed HCPCS Codes to Which the CY 2019 Drug-Specific
Packaging Determination Methodology Would Apply
------------------------------------------------------------------------
Proposed CY
CY 2019 HCPCS code CY 2019 long descriptor 2019 status
indicator (SI)
------------------------------------------------------------------------
C9257...................... Injection, bevacizumab, K
0.25 mg.
J9035...................... Injection, bevacizumab, 10 K
mg.
J1020...................... Injection, N
methylprednisolone
acetate, 20 mg.
J1030...................... Injection, N
methylprednisolone
acetate, 40 mg.
J1040...................... Injection, N
methylprednisolone
acetate, 80 mg.
J1460...................... Injection, gamma globulin, K
intramuscular, 1 cc.
J1560...................... Injection, gamma globulin, K
intramuscular over 10 cc.
J1642...................... Injection, heparin sodium, N
(heparin lock flush), per
10 units.
J1644...................... Injection, heparin sodium, N
per 1000 units.
J1840...................... Injection, kanamycin N
sulfate, up to 500 mg.
J1850...................... Injection, kanamycin N
sulfate, up to 75 mg.
J2788...................... Injection, rho d immune N
globulin, human,
minidose, 50 micrograms
(250 i.u.).
J2790...................... Injection, rho d immune N
globulin, human, full
dose, 300 micrograms
(1500 i.u.).
J2920...................... Injection, N
methylprednisolone sodium
succinate, up to 40 mg.
J2930...................... Injection, N
methylprednisolone sodium
succinate, up to 125 mg.
J3471...................... Injection, hyaluronidase, N
ovine, preservative free,
per 1 usp unit (up to 999
usp units).
J3472...................... Injection, hyaluronidase, N
ovine, preservative free,
per 1000 usp units.
J7030...................... Infusion, normal saline N
solution, 1000 cc.
J7040...................... Infusion, normal saline N
solution, sterile (500
ml=1 unit).
J7050...................... Infusion, normal saline N
solution, 250 cc.
J7100...................... Infusion, dextran 40, 500 N
ml.
J7110...................... Infusion, dextran 75, 500 N
ml.
J7515...................... Cyclosporine, oral, 25 mg. N
J7502...................... Cyclosporine, oral, 100 mg N
J8520...................... Capecitabine, oral, 150 mg N
J8521...................... Capecitabine, oral, 500 mg N
J9250...................... Methotrexate sodium, 5 mg. N
J9260...................... Methotrexate sodium, 50 mg N
------------------------------------------------------------------------
[[Page 37122]]
2. Proposed Payment for Drugs and Biologicals Without Pass-Through
Status That Are Not Packaged
a. Proposed Payment for Specified Covered Outpatient Drugs (SCODs) and
Other Separately Payable and Packaged Drugs and Biologicals
Section 1833(t)(14) of the Act defines certain separately payable
radiopharmaceuticals, drugs, and biologicals and mandates specific
payments for these items. Under section 1833(t)(14)(B)(i) of the Act, a
``specified covered outpatient drug'' (known as a SCOD) is defined as a
covered outpatient drug, as defined in section 1927(k)(2) of the Act,
for which a separate APC has been established and that either is a
radiopharmaceutical agent or is a drug or biological for which payment
was made on a pass-through basis on or before December 31, 2002.
Under section 1833(t)(14)(B)(ii) of the Act, certain drugs and
biologicals are designated as exceptions and are not included in the
definition of SCODs. These exceptions are--
A drug or biological for which payment is first made on or
after January 1, 2003, under the transitional pass-through payment
provision in section 1833(t)(6) of the Act.
A drug or biological for which a temporary HCPCS code has
not been assigned.
During CYs 2004 and 2005, an orphan drug (as designated by
the Secretary).
Section 1833(t)(14)(A)(iii) of the Act requires that payment for
SCODs in CY 2006 and subsequent years be equal to the average
acquisition cost for the drug for that year as determined by the
Secretary, subject to any adjustment for overhead costs and taking into
account the hospital acquisition cost survey data collected by the
Government Accountability Office (GAO) in CYs 2004 and 2005, and later
periodic surveys conducted by the Secretary as set forth in the
statute. If hospital acquisition cost data are not available, the law
requires that payment be equal to payment rates established under the
methodology described in section 1842(o), section 1847A, or section
1847B of the Act, as calculated and adjusted by the Secretary as
necessary for purposes of paragraph (14). We refer to this alternative
methodology as the ``statutory default.'' Most physician Part B drugs
are paid at ASP+6 percent in accordance with section 1842(o) and
section 1847A of the Act.
Section 1833(t)(14)(E)(ii) of the Act provides for an adjustment in
OPPS payment rates for SCODs to take into account overhead and related
expenses, such as pharmacy services and handling costs. Section
1833(t)(14)(E)(i) of the Act required MedPAC to study pharmacy overhead
and related expenses and to make recommendations to the Secretary
regarding whether, and if so how, a payment adjustment should be made
to compensate hospitals for overhead and related expenses. Section
1833(t)(14)(E)(ii) of the Act authorizes the Secretary to adjust the
weights for ambulatory procedure classifications for SCODs to take into
account the findings of the MedPAC study.\27\
---------------------------------------------------------------------------
\27\ Medicare Payment Advisory Committee. June 2005 Report to
the Congress. Chapter 6: Payment for pharmacy handling costs in
hospital outpatient departments. Available at: http://www.medpac.gov/docs/default-source/reports/June05_ch6.pdf?sfvrsn=0.
---------------------------------------------------------------------------
It has been our policy since CY 2006 to apply the same treatment to
all separately payable drugs and biologicals, which include SCODs, and
drugs and biologicals that are not SCODs. Therefore, we apply the
payment methodology in section 1833(t)(14)(A)(iii) of the Act to SCODs,
as required by statute, but we also apply it to separately payable
drugs and biologicals that are not SCODs, which is a policy
determination rather than a statutory requirement. In this CY 2019
OPPS/ASC proposed rule, we are proposing to apply section
1833(t)(14)(A)(iii)(II) of the Act to all separately payable drugs and
biologicals, including SCODs. Although we do not distinguish SCODs in
this discussion, we note that we are required to apply section
1833(t)(14)(A)(iii)(II) of the Act to SCODs, but we also are applying
this provision to other separately payable drugs and biologicals,
consistent with our history of using the same payment methodology for
all separately payable drugs and biologicals.
For a detailed discussion of our OPPS drug payment policies from CY
2006 to CY 2012, we refer readers to the CY 2013 OPPS/ASC final rule
with comment period (77 FR 68383 through 68385). In the CY 2013 OPPS/
ASC final rule with comment period (77 FR 68386 through 68389), we
first adopted the statutory default policy to pay for separately
payable drugs and biologicals at ASP+6 percent based on section
1833(t)(14)(A)(iii)(II) of the Act. We continued this policy of paying
for separately payable drugs and biologicals at the statutory default
for CYs 2014 through 2018.
b. Proposed CY 2019 Payment Policy
For CY 2019, we are proposing to continue our payment policy that
has been in effect since CY 2013 to pay for separately payable drugs
and biologicals at ASP+6 percent in accordance with section
1833(t)(14)(A)(iii)(II) of the Act (the statutory default). We are
proposing to continue to pay for separately payable nonpass-through
drugs acquired with a 340B discount at a rate of ASP minus 22.5
percent. We refer readers to section V.A.7. of this proposed rule for
more information about how the payment rate for drugs acquired with a
340B discount was established.
In the case of a drug or biological during an initial sales period
in which data on the prices for sales for the drug or biological are
not sufficiently available from the manufacturer, section 1847A(c)(4)
of the Act permits the Secretary to make payments that are based on
WAC. Under section 1833(t)(14)(A)(iii)(II), the amount of payment for a
separately payable drug equals the average price for the drug for the
year established under, among other authorities, section 1847A of the
Act. As explained in greater detail in the CY 2019 PFS proposed rule,
under section 1847A(c)(4), although payments may be based on WAC,
unlike section 1847A(b) of the Act (which specifies that certain
payments must be made with a 6-percent add-on), section 1847A(c)(4) of
the Act does not require that a particular add-on amount be applied to
partial quarter WAC-based pricing. Consistent with section 1847A(c)(4)
of the Act, in the CY 2019 PFS proposed rule, we are proposing that,
effective January 1, 2019, WAC-based payments for Part B drugs made
under section 1847A(c)(4) of the Act would utilize a 3-percent add-on
in place of the 6-percent add-on that is currently being used. For the
OPPS, we also are proposing to utilize a 3-percent add-on instead of a
6-percent add-on for WAC-based drugs pursuant to our authority under
section 1833(t)(14)(A)(iii)(II) of the Act, which provides, in part,
that the amount of payment for a SCOD is the average price of the drug
in the year established under section 1847A of the Act. We also apply
this provision to non-SCOD separately payable drugs. Because we are
proposing to establish the average price for a WAC-based drug under
section 1847A of the Act as WAC+3 percent instead of WAC+6 percent, we
believe it is appropriate to price separately payable WAC-based drugs
at the same amount under the OPPS. We are proposing that, if finalized,
our proposal to pay for drugs or biologicals at WAC+3 percent, rather
than WAC+6 percent, would apply whenever WAC-based pricing is used for
a drug or biological. For drugs and biologicals that would otherwise be
subject to a payment
[[Page 37123]]
reduction because they were acquired under the 340B Program, the 340B
Program rate (in this case, WAC minus 22.5 percent) would continue to
apply. We refer readers to the CY 2019 PFS proposed rule for additional
background on this anticipated proposal.
We are proposing that payments for separately payable drugs and
biologicals are included in the budget neutrality adjustments, under
the requirements in section 1833(t)(9)(B) of the Act. We also are
proposing that the budget neutral weight scalar is not applied in
determining payments for these separately paid drugs and biologicals.
We note that separately payable drug and biological payment rates
listed in Addenda A and B to this proposed rule (available via the
internet on the CMS website), which illustrate the proposed CY 2019
payment of ASP+6 percent for separately payable nonpass-through drugs
and biologicals and ASP+6 percent for pass-through drugs and
biologicals, reflect either ASP information that is the basis for
calculating payment rates for drugs and biologicals in the physician's
office setting effective April 1, 2018, or WAC, AWP, or mean unit cost
from CY 2017 claims data and updated cost report information available
for this proposed rule. In general, these published payment rates are
not the same as the actual January 2019 payment rates. This is because
payment rates for drugs and biologicals with ASP information for
January 2019 will be determined through the standard quarterly process
where ASP data submitted by manufacturers for the third quarter of CY
2018 (July 1, 2018 through September 30, 2018) will be used to set the
payment rates that are released for the quarter beginning in January
2019 near the end of December 2018. In addition, payment rates for
drugs and biologicals in Addenda A and B to this proposed rule for
which there was no ASP information available for April 2018 are based
on mean unit cost in the available CY 2017 claims data. If ASP
information becomes available for payment for the quarter beginning in
January 2019, we will price payment for these drugs and biologicals
based on their newly available ASP information. Finally, there may be
drugs and biologicals that have ASP information available for this
proposed rule (reflecting April 2018 ASP data) that do not have ASP
information available for the quarter beginning in January 2019. These
drugs and biologicals would then be paid based on mean unit cost data
derived from CY 2017 hospital claims. Therefore, the proposed payment
rates listed in Addenda A and B to this proposed rule are not for
January 2019 payment purposes and are only illustrative of the proposed
CY 2019 OPPS payment methodology using the most recently available
information at the time of issuance of this proposed rule.
c. Biosimilar Biological Products
For CY 2016 and CY 2017, we finalized a policy to pay for
biosimilar biological products based on the payment allowance of the
product as determined under section 1847A of the Act and to subject
nonpass-through biosimilar biological products to our annual threshold-
packaged policy (for CY 2016, 80 FR 70445 through 70446; and for CY
2017, 81 FR 79674). In the CY 2018 OPPS/ASC proposed rule (82 FR
33630), for CY 2018, we proposed to continue this same payment policy
for biosimilar biological products.
In the CY 2018 OPPS/ASC final rule with comment period (82 FR
59351), we noted that, with respect to comments we received regarding
OPPS payment for biosimilar biological products, in the CY 2018 PFS
final rule, CMS finalized a policy to implement separate HCPCS codes
for biosimilar biological products. Therefore, consistent with our
established OPPS drug, biological, and radiopharmaceutical payment
policy, HCPCS coding for biosimilar biological products will be based
on policy established under the CY 2018 PFS final rule.
In the CY 2018 OPPS/ASC final rule with comment period (82 FR
59351), after consideration of the public comments we received, we
finalized our proposed payment policy for biosimilar biological
products, with the following technical correction: All biosimilar
biological products will be eligible for pass-through payment and not
just the first biosimilar biological product for a reference product.
For CY 2019, we are proposing to continue the policy in place from CY
2018 to make all biosimilar biological products eligible for pass-
through payment and not just the first biosimilar biological product
for a reference product.
In addition, in CY 2018, we adopted a policy that biosimilars
without pass-through payment status that were acquired under the 340B
Program would be paid ASP (of the biosimilar) minus 22.5 percent of the
reference product (82 FR 59367). We adopted this policy in the CY 2018
OPPS/ASC final rule with comment period because we believe that
biosimilars without pass-through payment status acquired under the 340B
Program should be treated in the same manner as other drugs and
biologicals acquired through the 340B Program. As noted earlier,
biosimilars with pass-through payment status are paid their own ASP+6
percent of the reference's product ASP. Biosimilars that do not have
pass-through payment status and are not acquired under the 340B Program
also are paid their own ASP+6 percent of the reference product's ASP.
Several stakeholders raised concerns to us that the current payment
policy for biosimilars acquired under the 340B Program could unfairly
lower the OPPS payment for biosimilars not on pass-through payment
status because the payment reduction would be based on the reference
product's ASP, which would generally be expected to be priced higher
than the biosimilar, thus resulting in a more significant reduction in
payment than if the 22.5 percent was calculated based on the
biosimilar's ASP. We agree with stakeholders that the current payment
policy could unfairly lower the price of biosimilars without pass-
through payment status that are acquired under the 340B Program. In
addition, we believe that these changes would better reflect the
resources and production costs that biosimilar manufacturers incur, and
we also believe this approach is more consistent with the payment
methodology for 340B-acquired drugs and biologicals, for which the 22.5
percent reduction is calculated based on the drug or biological's ASP,
rather than the ASP of another product. In addition, we believe that
paying for biosimilars acquired under the 340B Program at ASP minus
22.5 percent of the biosimilar's ASP, rather than 22.5 percent of the
reference product's ASP, will more closely approximate hospitals'
acquisition costs for these products.
Accordingly, for CY 2019, we are proposing changes to our Medicare
Part B drug payment methodology for biosimilars acquired under the 340B
Program. Specifically, for CY 2019 and subsequent years, in accordance
with section 1833(t)(14)(A)(iii)(II) of the Act, we are proposing to
pay nonpass-through biosimilars acquired under the 340B Program at ASP
minus 22.5 percent of the biosimilar's ASP instead of the biosimilar's
ASP minus 22.5 percent of the reference product's ASP.
3. Proposed Payment Policy for Therapeutic Radiopharmaceuticals
For CY 2019, we are proposing to continue the payment policy for
therapeutic radiopharmaceuticals that began in CY 2010. We pay for
separately payable therapeutic radiopharmaceuticals under the ASP
methodology adopted for separately
[[Page 37124]]
payable drugs and biologicals. If ASP information is unavailable for a
therapeutic radiopharmaceutical, we base therapeutic
radiopharmaceutical payment on mean unit cost data derived from
hospital claims. We believe that the rationale outlined in the CY 2010
OPPS/ASC final rule with comment period (74 FR 60524 through 60525) for
applying the principles of separately payable drug pricing to
therapeutic radiopharmaceuticals continues to be appropriate for
nonpass-through, separately payable therapeutic radiopharmaceuticals in
CY 2019. Therefore, we are proposing for CY 2019 to pay all nonpass-
through, separately payable therapeutic radiopharmaceuticals at ASP+6
percent, based on the statutory default described in section
1833(t)(14)(A)(iii)(II) of the Act. For a full discussion of ASP-based
payment for therapeutic radiopharmaceuticals, we refer readers to the
CY 2010 OPPS/ASC final rule with comment period (74 FR 60520 through
60521). We also are proposing to rely on CY 2017 mean unit cost data
derived from hospital claims data for payment rates for therapeutic
radiopharmaceuticals for which ASP data are unavailable and to update
the payment rates for separately payable therapeutic
radiopharmaceuticals according to our usual process for updating the
payment rates for separately payable drugs and biologicals on a
quarterly basis if updated ASP information is unavailable. For a
complete history of the OPPS payment policy for therapeutic
radiopharmaceuticals, we refer readers to the CY 2005 OPPS final rule
with comment period (69 FR 65811), the CY 2006 OPPS final rule with
comment period (70 FR 68655), and the CY 2010 OPPS/ASC final rule with
comment period (74 FR 60524). The proposed CY 2019 payment rates for
nonpass-through, separately payable therapeutic radiopharmaceuticals
are included in Addenda A and B to this proposed rule (which are
available via the internet on the CMS website).
4. Proposed Payment Adjustment Policy for Radioisotopes Derived From
Non-Highly Enriched Uranium Sources
Radioisotopes are widely used in modern medical imaging,
particularly for cardiac imaging and predominantly for the Medicare
population. Some of the Technetium-99 (Tc-99m), the radioisotope used
in the majority of such diagnostic imaging services, is produced in
legacy reactors outside of the United States using highly enriched
uranium (HEU).
The United States would like to eliminate domestic reliance on
these reactors, and is promoting the conversion of all medical
radioisotope production to non-HEU sources. Alternative methods for
producing Tc-99m without HEU are technologically and economically
viable, and conversion to such production has begun. We expect that
this change in the supply source for the radioisotope used for modern
medical imaging will introduce new costs into the payment system that
are not accounted for in the historical claims data.
Therefore, beginning in CY 2013, we finalized a policy to provide
an additional payment of $10 for the marginal cost for radioisotopes
produced by non-HEU sources (77 FR 68323). Under this policy, hospitals
report HCPCS code Q9969 (Tc-99m from non-highly enriched uranium
source, full cost recovery add-on per study dose) once per dose along
with any diagnostic scan or scans furnished using Tc-99m as long as the
Tc-99m doses used can be certified by the hospital to be at least 95
percent derived from non-HEU sources (77 FR 68321).
We stated in the CY 2013 OPPS/ASC final rule with comment period
(77 FR 68321) that our expectation is that this additional payment will
be needed for the duration of the industry's conversion to alternative
methods to producing Tc-99m without HEU. We also stated that we would
reassess, and propose if necessary, on an annual basis whether such an
adjustment continued to be necessary and whether any changes to the
adjustment were warranted (77 FR 68316). A 2016 report from the
National Academies of Sciences, Engineering, and Medicine anticipates
the conversion of Tc-99m production from non-HEU sources will not be
complete until the end of 2019.\28\ In addition, one of the
manufacturers of Tc-99m generators supports continuing the payment
adjustment at the current level because approximately 30 percent of Tc-
99m continues to be produced from non-HEU sources. We also received
comments from a trade group of nuclear pharmacies and cyclotron
operators supporting an increase in the payment adjustment by the rate
of inflation to cover more of the cost of Tc-99m from non-HEU sources.
---------------------------------------------------------------------------
\28\ National Academies of Sciences, Engineering, and Medicine.
2016. Molybdenum-99 for Medical Imaging. Washington, DC: The
National Academies Press. Available at: https://doi.org/10.17226/23563.
---------------------------------------------------------------------------
We appreciate the feedback from stakeholders. However, we continue
to believe that the current adjustment is sufficient for the reasons we
have outlined in this and prior rulemakings. The information from
stakeholders and the National Academies of Sciences, Engineering, and
Medicine indicates that the conversion of the production of Tc-99m from
non-HEU sources may take more than 1 year after CY 2018. Therefore, for
CY 2019 and subsequent years, we are proposing to continue to provide
an additional $10 payment for radioisotopes produced by non-HEU
sources. We intend to reassess this payment policy once conversion to
non-HEU sources is closer to completion or has been completed.
5. Proposed Payment for Blood Clotting Factors
For CY 2018, we provided payment for blood clotting factors under
the same methodology as other nonpass-through separately payable drugs
and biologicals under the OPPS and continued paying an updated
furnishing fee (82 FR 59353). That is, for CY 2018, we provided payment
for blood clotting factors under the OPPS at ASP+6 percent, plus an
additional payment for the furnishing fee. We note that when blood
clotting factors are provided in physicians' offices under Medicare
Part B and in other Medicare settings, a furnishing fee is also applied
to the payment. The CY 2018 updated furnishing fee was $0.215 per unit.
For CY 2019, we are proposing to pay for blood clotting factors at
ASP+6 percent, consistent with our proposed payment policy for other
nonpass-through, separately payable drugs and biologicals, and to
continue our policy for payment of the furnishing fee using an updated
amount. Our policy to pay for a furnishing fee for blood clotting
factors under the OPPS is consistent with the methodology applied in
the physician's office and in the inpatient hospital setting. These
methodologies were first articulated in the CY 2006 OPPS final rule
with comment period (70 FR 68661) and later discussed in the CY 2008
OPPS/ASC final rule with comment period (72 FR 66765). The proposed
furnishing fee update is based on the percentage increase in the
Consumer Price Index (CPI) for medical care for the 12-month period
ending with June of the previous year. Because the Bureau of Labor
Statistics releases the applicable CPI data after the PFS and OPPS/ASC
proposed rules are published, we are not able to include the actual
updated furnishing fee in the proposed rules. Therefore, in accordance
with our policy, as finalized in the CY 2008 OPPS/ASC final rule with
comment period (72 FR 66765), we are proposing to announce the actual
figure for the percent change in the
[[Page 37125]]
applicable CPI and the updated furnishing fee calculated based on that
figure through applicable program instructions and posting on the CMS
website at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Part-B-Drugs/McrPartBDrugAvgSalesPrice/index.html.
6. Proposed Payment for Nonpass-Through Drugs, Biologicals, and
Radiopharmaceuticals With HCPCS Codes But Without OPPS Hospital Claims
Data
For CY 2019, we are proposing to continue to use the same payment
policy as in CY 2018 for nonpass-through drugs, biologicals, and
radiopharmaceuticals with HCPCS codes but without OPPS hospital claims
data, which describes how we determine the payment rate for drugs,
biologicals, or radiopharmaceuticals without an ASP. For a detailed
discussion of the payment policy and methodology, we refer readers to
the CY 2016 OPPS/ASC final rule with comment period (80 FR 70442
through 70443). The proposed CY 2019 payment status of each of the
nonpass-through drugs, biologicals, and radiopharmaceuticals with HCPCS
codes but without OPPS hospital claims data is listed in Addendum B to
this proposed rule, which is available via the internet on the CMS
website.
7. CY 2019 Proposed OPPS Payment Methodology for 340B Purchased Drugs
In the CY 2018 OPPS/ASC proposed rule (82 FR 33558 through 33724),
we proposed changes to the Medicare Part B drug payment methodology for
340B hospitals. We proposed these changes to better, and more
appropriately, reflect the resources and acquisition costs that these
hospitals incur. We believed that such changes would allow Medicare
beneficiaries (and the Medicare program) to pay less when hospitals
participating in the 340B Program furnish drugs to Medicare
beneficiaries that are purchased under the 340B Program. Subsequently,
in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59369
through 59370), we finalized our proposal and adjusted the payment rate
for separately payable drugs and biologicals (other than drugs on pass-
through payment status and vaccines) acquired under the 340B Program
from average sales price (ASP) plus 6 percent to ASP minus 22.5
percent. Our goal is to make Medicare payment for separately payable
drugs more aligned with the resources expended by hospitals to acquire
such drugs, while recognizing the intent of the 340B Program to allow
covered entities, including eligible hospitals, to stretch scarce
resources in ways that enable hospitals to continue providing access to
care for Medicare beneficiaries and other patients. Critical access
hospitals (CAHs) are not included in this 340B policy change because
they are paid under section 1834(g) of the Act. We also excepted rural
sole community hospitals (SCHs), children's hospitals, and PPS-exempt
cancer hospitals from the 340B payment adjustment in CY 2018. In
addition, as stated in the CY 2018 OPPS/ASC final rule with comment
period, this policy change does not apply to drugs on pass-through
payment status, which are required to be paid based on the ASP
methodology or vaccines, which are excluded from the 340B Program.
Another topic that has been brought to our attention since we
finalized the payment adjustment for 340B-acquired drugs in the CY 2018
OPPS/ASC final rule with comment period is whether drugs that do not
have ASP pricing but instead receive WAC or AWP pricing are subject to
the 340B payment adjustment. We did not receive public comments on this
topic in response to the CY 2018 OPPS/ASC proposed rule. However, we
have since heard from stakeholders that there has been some confusion
about this issue. We want to clarify that the 340B payment adjustment
does apply to drugs that are priced using either WAC or AWP, and it has
been our policy to subject 340B-acquired drugs that use these pricing
methodologies to the 340B payment adjustment since the policy was first
adopted. The 340B payment adjustment for WAC-priced drugs is WAC minus
22.5 percent and AWP-priced drugs have a payment rate of 69.46 percent
of AWP when the 340B payment adjustment is applied. The 69.46 percent
of AWP is calculated by first reducing the original 95 percent of AWP
price by 6 percent to generate a value that is similar to ASP or WAC
with no percentage markup. Then we apply the 22.5 percent reduction to
ASP/WAC-similar AWP value to obtain the 69.46 percent of AWP, which is
similar to either ASP minus 22.5 percent or WAC minus 22.5 percent. The
number of separately payable drugs receiving WAC or AWP pricing that
are affected by the 340B payment adjustment is small--consisting of
less than 10 percent of all separately payable Medicare Part B drugs in
April 2018.
Data limitations inhibit our ability to identify which drugs were
acquired under the 340B Program in the Medicare OPPS claims data. This
lack of information within the claims data has limited researchers' and
our ability to precisely analyze differences in acquisition cost of
340B and non-340B acquired drugs with Medicare claims data.
Accordingly, in the CY 2018 OPPS/ASC proposed rule (82 FR 33633), we
stated our intent to establish a modifier, to be effective January 1,
2018, for hospitals to report with separately payable drugs that were
not acquired under the 340B Program. Because a significant portion of
hospitals paid under the OPPS participate in the 340B Program, we
stated our belief that it is appropriate to presume that a separately
payable drug reported on an OPPS claim was purchased under the 340B
Program, unless the hospital identifies that the drug was not purchased
under the 340B Program. We stated in the proposed rule that we intended
to provide further details about this modifier in the CY 2018 OPPS/ASC
final rule with comment period and/or through subregulatory guidance,
including guidance related to billing for dually eligible beneficiaries
(that is, beneficiaries covered under Medicare and Medicaid) for whom
covered entities do not receive a discount under the 340B Program. As
discussed in the CY 2018 OPPS/ASC final rule with comment period (82 FR
59369 through 59370), to effectuate the payment adjustment for 340B-
acquired drugs, CMS implemented modifier ``JG'', effective January 1,
2018. Hospitals paid under the OPPS, other than a type of hospital
excluded from the OPPS (such as CAHs or those hospitals paid under the
Maryland waiver), or excepted from the 340B drug payment policy for CY
2018, are required to report modifier ``JG'' on the same claim line as
the drug HCPCS code to identify a 340B-acquired drug. For CY 2018,
rural SCHs, children's hospitals and PPS-exempt cancer hospitals are
excepted from the 340B payment adjustment. These hospitals are required
to report informational modifier ``TB'' for 340B-acquired drugs, and
continue to be paid ASP+6 percent.
We refer readers to the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59353 through 59370) for a full discussion and rationale
for the CY 2018 policies and use of modifier ``JG''.
For CY 2019, we are proposing to continue the 340B Program policies
that were implemented in CY 2018 with the exception of the way we are
calculating payment for 340B-acquired biosimilars. We are proposing, in
accordance with section 1833(t)(14)(A)(iii)(II) of the Act, to pay for
separately payable Medicare Part B drugs (assigned status indicator
``K''), other than vaccines and drugs on pass-through payment status,
that meet
[[Page 37126]]
the definition of ``covered outpatient drug'' as defined in the section
1927(k) of the Act, that are acquired through the 340B Program at ASP
minus 22.5 percent when billed by a hospital paid under the OPPS that
is not excepted from the payment adjustment. Medicare Part B drugs or
biologicals excluded from the 340B payment adjustment include vaccines
(assigned status indicator ``L'' or ``M'') and drugs with OPPS
transitional pass-through payment status (assigned status indicator
``G''). As discussed in section V.A.2.c. of this proposed rule, we are
proposing to pay nonpass-through biosimilars acquired under the 340B
Program at ASP minus 22.5 percent of the biosimilar's ASP. We also are
proposing that Medicare would continue to pay for drugs or biologicals
that were not purchased with a 340B discount at ASP+6 percent.
As stated earlier, to effectuate the payment adjustment for 340B-
acquired drugs, CMS implemented modifier ``JG'', effective January 1,
2018. For CY 2019, we are proposing that hospitals paid under the OPPS,
other than a type of hospital excluded from the OPPS, or excepted from
the 340B drug payment policy for CY 2018, continue to be required to
report modifier ``JG'' on the same claim line as the drug HCPCS code to
identify a 340B-acquired drug. We also are proposing for CY 2019 that
rural sole community hospitals (SCHs), children's hospitals, and PPS-
exempt cancer hospitals continue to be excepted from the 340B payment
adjustment. We are proposing that these hospitals be required to report
informational modifier ``TB'' for 340B-acquired drugs, and continue to
be paid ASP+6 percent.
VI. Proposed Estimate of OPPS Transitional Pass-Through Spending for
Drugs, Biologicals, Radiopharmaceuticals, and Devices
A. Background
Section 1833(t)(6)(E) of the Act limits the total projected amount
of transitional pass-through payments for drugs, biologicals,
radiopharmaceuticals, and categories of devices for a given year to an
``applicable percentage,'' currently not to exceed 2.0 percent of total
program payments estimated to be made for all covered services under
the OPPS furnished for that year. If we estimate before the beginning
of the calendar year that the total amount of pass-through payments in
that year would exceed the applicable percentage, section
1833(t)(6)(E)(iii) of the Act requires a uniform prospective reduction
in the amount of each of the transitional pass-through payments made in
that year to ensure that the limit is not exceeded. We estimate the
pass-through spending to determine whether payments exceed the
applicable percentage and the appropriate prorata reduction to the
conversion factor for the projected level of pass-through spending in
the following year to ensure that total estimated pass-through spending
for the prospective payment year is budget neutral, as required by
section 1833(t)(6)(E) of the Act.
For devices, developing a proposed estimate of pass-through
spending in CY 2019 entails estimating spending for two groups of
items. The first group of items consists of device categories that are
currently eligible for pass-through payment and that will continue to
be eligible for pass-through payment in CY 2019. The CY 2008 OPPS/ASC
final rule with comment period (72 FR 66778) describes the methodology
we have used in previous years to develop the pass-through spending
estimate for known device categories continuing into the applicable
update year. The second group of items consists of items that we know
are newly eligible, or project may be newly eligible, for device pass-
through payment in the remaining quarters of CY 2018 or beginning in CY
2019. The sum of the proposed CY 2019 pass-through spending estimates
for these two groups of device categories equals the proposed total CY
2019 pass-through spending estimate for device categories with pass-
through payment status. We base the device pass-through estimated
payments for each device category on the amount of payment as
established in section 1833(t)(6)(D)(ii) of the Act, and as outlined in
previous rules, including the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75034 through 75036). We note that, beginning in CY 2010,
the pass-through evaluation process and pass-through payment for
implantable biologicals newly approved for pass-through payment
beginning on or after January 1, 2010, that are surgically inserted or
implanted (through a surgical incision or a natural orifice) use the
device pass-through process and payment methodology (74 FR 60476). As
has been our past practice (76 FR 74335), in this proposed rule, we are
proposing to include an estimate of any implantable biologicals
eligible for pass-through payment in our estimate of pass-through
spending for devices. Similarly, we finalized a policy in CY 2015 that
applications for pass-through payment for skin substitutes and similar
products be evaluated using the medical device pass-through process and
payment methodology (76 FR 66885 through 66888). Therefore, as we did
beginning in CY 2015, for CY 2019, we also are proposing to include an
estimate of any skin substitutes and similar products in our estimate
of pass-through spending for devices.
For drugs and biologicals eligible for pass-through payment,
section 1833(t)(6)(D)(i) of the Act establishes the pass-through
payment amount as the amount by which the amount authorized under
section 1842(o) of the Act (or, if the drug or biological is covered
under a competitive acquisition contract under section 1847B of the
Act, an amount determined by the Secretary equal to the average price
for the drug or biological for all competitive acquisition areas and
year established under such section as calculated and adjusted by the
Secretary) exceeds the portion of the otherwise applicable fee schedule
amount that the Secretary determines is associated with the drug or
biological. Our estimate of drug and biological pass-through payment
for CY 2019 for this group of items is $0, as discussed below, because
we are proposing to pay for most nonpass-through separately payable
drugs and biologicals under the CY 2019 OPPS at ASP+6 percent (with the
exception of 340B-acquired separately payable drugs, for which we do
not yet have sufficient data to estimate a share of total drug
payments), and because we are proposing to pay for CY 2019 pass-through
payment drugs and biologicals at ASP+6 percent, as we discuss in
section V.A. of this proposed rule.
Furthermore, payment for certain drugs, specifically diagnostic
radiopharmaceuticals and contrast agents without pass-through payment
status, is packaged into payment for the associated procedures, and
these products will not be separately paid. In addition, we policy-
package all nonpass-through drugs, biologicals, and
radiopharmaceuticals that function as supplies when used in a
diagnostic test or procedure and drugs and biologicals that function as
supplies when used in a surgical procedure, as discussed in section
II.A.3. of this proposed rule. We are proposing that all of these
policy-packaged drugs and biologicals with pass-through payment status
would be paid at ASP+6 percent, like other pass-through drugs and
biologicals, for CY 2019. Therefore, our proposed estimate of pass-
through payment for policy-packaged drugs and biologicals with pass-
through payment status approved prior to CY 2019 is not $0, as
discussed below. In section V.A.5. of this proposed rule, we discussed
our policy to determine if the costs of certain
[[Page 37127]]
policy-packaged drugs or biologicals are already packaged into the
existing APC structure. If we determine that a policy-packaged drug or
biological approved for pass-through payment resembles predecessor
drugs or biologicals already included in the costs of the APCs that are
associated with the drug receiving pass-through payment, we are
proposing to offset the amount of pass-through payment for the policy-
packaged drug or biological. For these drugs or biologicals, the APC
offset amount is the portion of the APC payment for the specific
procedure performed with the pass-through drug or biological, which we
refer to as the policy-packaged drug APC offset amount. If we determine
that an offset is appropriate for a specific policy-packaged drug or
biological receiving pass-through payment, we are proposing to reduce
our estimate of pass-through payments for these drugs or biologicals by
this amount.
Similar to pass-through spending estimates for devices, the first
group of drugs and biologicals requiring a pass-through payment
estimate consists of those products that were recently made eligible
for pass-through payment and that will continue to be eligible for
pass-through payment in CY 2019. The second group contains drugs and
biologicals that we know are newly eligible, or project will be newly
eligible in the remaining quarters of CY 2018 or beginning in CY 2019.
The sum of the CY 2019 pass-through spending estimates for these two
groups of drugs and biologicals equals the total CY 2019 pass-through
spending estimate for drugs and biologicals with pass-through payment
status.
B. Proposed Estimate of Pass-Through Spending
We are proposing to set the applicable pass-through payment
percentage limit at 2.0 percent of the total projected OPPS payments
for CY 2019, consistent with section 1833(t)(6)(E)(ii)(II) of the Act
and our OPPS policy from CY 2004 through CY 2018 (82 FR 59371 through
59373).
For the first group, consisting of device categories that are
currently eligible for pass-through payment and will continue to be
eligible for pass-through payment in CY 2019, there are no active
categories for CY 2019. Because there are no active device categories
for CY 2019, we are proposing an estimate for the first group of
devices of $0. In estimating our proposed CY 2019 pass-through spending
for device categories in the second group, we included: Device
categories that we knew at the time of the development of the proposed
rule will be newly eligible for pass-through payment in CY 2019;
additional device categories that we estimated could be approved for
pass-through status subsequent to the development of the proposed rule
and before January 1, 2019; and contingent projections for new device
categories established in the second through fourth quarters of CY
2019. We are proposing to use the general methodology described in the
CY 2008 OPPS/ASC final rule with comment period (72 FR 66778), while
also taking into account recent OPPS experience in approving new pass-
through device categories. For this proposed rule, the proposed
estimate of CY 2019 pass-through spending for this second group of
device categories is $10 million.
To estimate proposed CY 2019 pass-through spending for drugs and
biologicals in the first group, specifically those drugs and
biologicals recently made eligible for pass-through payment and
continuing on pass-through payment status for CY 2019, we are proposing
to use the most recent Medicare hospital outpatient claims data
regarding their utilization, information provided in the respective
pass-through applications, historical hospital claims data,
pharmaceutical industry information, and clinical information regarding
those drugs or biologicals to project the CY 2019 OPPS utilization of
the products.
For the known drugs and biologicals (excluding policy-packaged
diagnostic radiopharmaceuticals, contrast agents, drugs, biologicals,
and radiopharmaceuticals that function as supplies when used in a
diagnostic test or procedure, and drugs and biologicals that function
as supplies when used in a surgical procedure) that will be continuing
on pass-through payment status in CY 2019, we estimated the pass-
through payment amount as the difference between ASP+6 percent and the
payment rate for nonpass-through drugs and biologicals that will be
separately paid at ASP+6 percent, which is zero for this group of
drugs. Because payment for policy-packaged drugs and biologicals is
packaged if the product was not paid separately due to its pass-through
payment status, we are proposing to include in the CY 2019 pass-through
estimate the difference between payment for the policy-packaged drug or
biological at ASP+6 percent (or WAC+6 percent, or 95 percent of AWP, if
ASP or WAC information is not available) and the policy-packaged drug
APC offset amount, if we determine that the policy-packaged drug or
biological approved for pass-through payment resembles a predecessor
drug or biological already included in the costs of the APCs that are
associated with the drug receiving pass-through payment. For this
proposed rule, using the proposed methodology described above, we
calculated a CY 2019 proposed spending estimate for this first group of
drugs and biologicals of approximately $61.5 million.
To estimate proposed CY 2019 pass-through spending for drugs and
biologicals in the second group (that is, drugs and biologicals that we
knew at the time of development of this proposed rule were newly
eligible for pass-through payment in CY 2019, additional drugs and
biologicals that we estimated could be approved for pass-through status
subsequent to the development of this proposed rule and before January
1, 2018, and projections for new drugs and biologicals that could be
initially eligible for pass-through payment in the second through
fourth quarters of CY 2019), we are proposing to use utilization
estimates from pass-through applicants, pharmaceutical industry data,
clinical information, recent trends in the per unit ASPs of hospital
outpatient drugs, and projected annual changes in service volume and
intensity as our basis for making the CY 2019 pass-through payment
estimate. We also are proposing to consider the most recent OPPS
experience in approving new pass-through drugs and biologicals. Using
our proposed methodology for estimating CY 2019 pass-through payments
for this second group of drugs, we calculated a proposed spending
estimate for this second group of drugs and biologicals of
approximately $55.2 million.
In summary, in accordance with the methodology described earlier in
this section, for this proposed rule, we estimate that total pass-
through spending for the device categories and the drugs and
biologicals that are continuing to receive pass-through payment in CY
2019 and those device categories, drugs, and biologicals that first
become eligible for pass-through payment during CY 2019 is
approximately $126.7 million (approximately $10 million for device
categories and approximately $116.7 million for drugs and biologicals)
which represents 0.18 percent of total projected OPPS payments for CY
2019 (approximately $70 billion). Therefore, we estimate that pass-
through spending in CY 2019 would not amount to 2.0 percent of total
projected OPPS CY 2019 program spending.
[[Page 37128]]
VII. Proposed OPPS Payment for Hospital Outpatient Visits and Critical
Care Services
As we did in the CY 2018 OPPS/ASC final rule with comment period
(82 FR 59373), for CY 2019, we are proposing to continue with our
current clinic and emergency department (ED) hospital outpatient visits
payment policies. For a description of the current clinic and ED
hospital outpatient visits policies, we refer readers to the CY 2016
OPPS/ASC final rule with comment period (80 FR 70448). We also are
proposing to continue our payment policy for critical care services for
CY 2019. For a description of the current payment policy for critical
care services, we refer readers to the CY 2016 OPPS/ASC final rule with
comment period (80 FR 70449), and for the history of the payment policy
for critical care services, we refer readers to the CY 2014 OPPS/ASC
final rule with comment period (78 FR 75043). In this proposed rule, we
are seeking public comments on any changes to these codes that we
should consider for future rulemaking cycles. We continue to encourage
those commenters to provide the data and analysis necessary to justify
any suggested changes.
In section X.V. of this proposed rule, we are proposing a method to
control unnecessary increases in the volume of covered outpatient
department services under section 1833(t)(2)(F) of the Act by utilizing
a Medicare Physician Fee Schedule (MPFS)-equivalent payment rate for
the hospital outpatient clinic visit (HCPCS code G0463) when it is
furnished by excepted off-campus provider-based departments. For a full
discussion of this proposal as well as the comment solicitation on
potential methods to control for unnecessary increases in the volume of
covered outpatient department services, we refer readers to section
X.B. of this proposed rule.
VIII. Proposed Payment for Partial Hospitalization Services
A. Background
A partial hospitalization program (PHP) is an intensive outpatient
program of psychiatric services provided as an alternative to inpatient
psychiatric care for individuals who have an acute mental illness,
which includes, but is not limited to, conditions such as depression,
schizophrenia, and substance use disorders. Section 1861(ff)(1) of the
Act defines partial hospitalization services as the items and services
described in paragraph (2) prescribed by a physician and provided under
a program described in paragraph (3) under the supervision of a
physician pursuant to an individualized, written plan of treatment
established and periodically reviewed by a physician (in consultation
with appropriate staff participating in such program), which sets forth
the physician's diagnosis, the type, amount, frequency, and duration of
the items and services provided under the plan, and the goals for
treatment under the plan. Section 1861(ff)(2) of the Act describes the
items and services included in partial hospitalization services.
Section 1861(ff)(3)(A) of the Act specifies that a PHP is a program
furnished by a hospital to its outpatients or by a community mental
health center (CMHC), as a distinct and organized intensive ambulatory
treatment service, offering less than 24-hour-daily care, in a location
other than an individual's home or inpatient or residential setting.
Section 1861(ff)(3)(B) of the Act defines a CMHC for purposes of this
benefit.
Section 1833(t)(1)(B)(i) of the Act provides the Secretary with the
authority to designate the outpatient department (OPD) services to be
covered under the OPPS. The Medicare regulations that implement this
provision specify, at 42 CFR 419.21, that payments under the OPPS will
be made for partial hospitalization services furnished by CMHCs as well
as Medicare Part B services furnished to hospital outpatients
designated by the Secretary, which include partial hospitalization
services (65 FR 18444 through 18445).
Section 1833(t)(2)(C) of the Act requires the Secretary, in part,
to establish relative payment weights for covered OPD services (and any
groups of such services described in section 1833(t)(2)(B) of the Act)
based on median (or, at the election of the Secretary, mean) hospital
costs using data on claims from 1996 and data from the most recent
available cost reports. In pertinent part, section 1833(t)(2)(B) of the
Act provides that the Secretary may establish groups of covered OPD
services, within a classification system developed by the Secretary for
covered OPD services, so that services classified within each group are
comparable clinically and with respect to the use of resources. In
accordance with these provisions, we have developed the PHP APCs.
Because a day of care is the unit that defines the structure and
scheduling of partial hospitalization services, we established a per
diem payment methodology for the PHP APCs, effective for services
furnished on or after July 1, 2000 (65 FR 18452 through 18455). Under
this methodology, the median per diem costs were used to calculate the
relative payment weights for the PHP APCs. Section 1833(t)(9)(A) of the
Act requires the Secretary to review, not less often than annually, and
revise the groups, the relative payment weights, and the wage and other
adjustments described in section 1833(t)(2) of the Act to take into
account changes in medical practice, changes in technology, the
addition of new services, new cost data, and other relevant information
and factors.
We began efforts to strengthen the PHP benefit through extensive
data analysis, along with policy and payment changes finalized in the
CY 2008 OPPS/ASC final rule with comment period (72 FR 66670 through
66676). In that final rule with comment period, we made two refinements
to the methodology for computing the PHP median: The first remapped 10
revenue codes that are common among hospital-based PHP claims to the
most appropriate cost centers; and the second refined our methodology
for computing the PHP median per diem cost by computing a separate per
diem cost for each day rather than for each bill.
In CY 2009, we implemented several regulatory, policy, and payment
changes, including a two-tier payment approach for partial
hospitalization services under which we paid one amount for days with 3
services under PHP APC 0172 (Level 1 Partial Hospitalization) and a
higher amount for days with 4 or more services under PHP APC 0173
(Level 2 Partial Hospitalization) (73 FR 68688 through 68693). We also
finalized our policy to deny payment for any PHP claims submitted for
days when fewer than 3 units of therapeutic services are provided (73
FR 68694). Furthermore, for CY 2009, we revised the regulations at 42
CFR 410.43 to codify existing basic PHP patient eligibility criteria
and to add a reference to current physician certification requirements
under 42 CFR 424.24 to conform our regulations to our longstanding
policy (73 FR 68694 through 68695). We also revised the partial
hospitalization benefit to include several coding updates (73 FR 68695
through 68697).
For CY 2010, we retained the two-tier payment approach for partial
hospitalization services and used only hospital-based PHP data in
computing the PHP APC per diem costs, upon which PHP APC per diem
payment rates are based. We used only hospital-based PHP data because
we were concerned about further reducing both PHP APC per diem payment
rates without knowing the impact of the policy and
[[Page 37129]]
payment changes we made in CY 2009. Because of the 2-year lag between
data collection and rulemaking, the changes we made in CY 2009 were
reflected for the first time in the claims data that we used to
determine payment rates for the CY 2011 rulemaking (74 FR 60556 through
60559).
In the CY 2011 OPPS/ASC final rule with comment period (75 FR
71994), we established four separate PHP APC per diem payment rates:
two for CMHCs (APC 0172 (for Level 1 services) and APC 0173 (for Level
2 services)) and two for hospital-based PHPs (APC 0175 (for Level 1
services) and 0176 (for Level 2 services)), based on each provider
type's own unique data. For CY 2011, we also instituted a 2-year
transition period for CMHCs to the CMHC APC per diem payment rates
based solely on CMHC data. Under the transition methodology, CMHC APCs
Level 1 and Level 2 per diem costs were calculated by taking 50 percent
of the difference between the CY 2010 final hospital-based PHP median
costs and the CY 2011 final CMHC median costs and then adding that
number to the CY 2011 final CMHC median costs. A 2-year transition
under this methodology moved us in the direction of our goal, which is
to pay appropriately for partial hospitalization services based on each
provider type's data, while at the same time allowing providers time to
adjust their business operations and protect access to care for
Medicare beneficiaries. We also stated that we would review and analyze
the data during the CY 2012 rulemaking cycle and, based on these
analyses, we might further refine the payment mechanism. We refer
readers to section X.B. of the CY 2011 OPPS/ASC final rule with comment
period (75 FR 71991 through 71994) for a full discussion.
In addition, in accordance with section 1301(b) of the Health Care
and Education Reconciliation Act of 2010 (HCERA 2010), we amended the
description of a PHP in our regulations to specify that a PHP must be a
distinct and organized intensive ambulatory treatment program offering
less than 24-hour daily care other than in an individual's home or in
an inpatient or residential setting. In accordance with section 1301(a)
of HCERA 2010, we revised the definition of a CMHC in the regulations
to conform to the revised definition now set forth under section
1861(ff)(3)(B) of the Act (75 FR 71990).
For CY 2012, as discussed in the CY 2012 OPPS/ASC final rule with
comment period (76 FR 74348 through 74352), we determined the relative
payment weights for partial hospitalization services provided by CMHCs
based on data derived solely from CMHCs and the relative payment
weights for partial hospitalization services provided by hospital-based
PHPs based exclusively on hospital data.
In the CY 2013 OPPS/ASC final rule with comment period, we
finalized our proposal to base the relative payment weights that
underpin the OPPS APCs, including the four PHP APCs (APCs 0172, 0173,
0175, and 0176), on geometric mean costs rather than on the median
costs. We established these four PHP APC per diem payment rates based
on geometric mean cost levels calculated using the most recent claims
and cost data for each provider type. For a detailed discussion on this
policy, we refer readers to the CY 2013 OPPS/ASC final rule with
comment period (77 FR 68406 through 68412).
In the CY 2014 OPPS/ASC proposed rule (78 FR 43621 through 43622),
we solicited comments on possible future initiatives that may help to
ensure the long-term stability of PHPs and further improve the accuracy
of payment for PHP services, but proposed no changes. In the CY 2014
OPPS/ASC final rule with comment period (78 FR 75050 through 75053), we
summarized the comments received on those possible future initiatives.
We also continued to apply our established policies to calculate the
four PHP APC per diem payment rates based on geometric mean per diem
costs using the most recent claims data for each provider type. For a
detailed discussion on this policy, we refer readers to the CY 2014
OPPS/ASC final rule with comment period (78 FR 75047 through 75050).
In the CY 2015 OPPS/ASC final rule with comment period (79 FR 66902
through 66908), we continued to apply our established policies to
calculate the four PHP APC per diem payment rates based on PHP APC
geometric mean per diem costs, using the most recent claims and cost
data for each provider type.
In the CY 2016 OPPS/ASC final rule with comment period (80 FR 70455
through 70465), we described our extensive analysis of the claims and
cost data and ratesetting methodology. We found aberrant data from some
hospital-based PHP providers that were not captured using the existing
OPPS 3 standard deviation trims for extreme cost-to-charge
ratios (CCRs) and excessive CMHC charges resulting in CMHC geometric
mean costs per day that were approximately the same as or more than the
daily payment for inpatient psychiatric facility services.
Consequently, we implemented a trim to remove hospital-based PHP
service days that use a CCR that was greater than 5 to calculate costs
for at least one of their component services, and a trim on CMHCs with
a geometric mean cost per day that is above or below 2 (2)
standard deviations from the mean. We stated in the CY 2016 OPPS/ASC
final rule with comment period (80 FR 70456) that, without using a
trimming process, the data from these providers would inappropriately
skew the geometric mean per diem cost for Level 2 CMHC services.
In addition, in the CY 2016 OPPS/ASC final rule with comment period
(80 FR 70459 through 70460), we corrected a cost inversion that
occurred in the final rule data with respect to hospital-based PHP
providers. We corrected the cost inversion with an equitable adjustment
to the actual geometric mean per diem costs by increasing the Level 2
hospital-based PHP APC geometric mean per diem costs and decreasing the
Level 1 hospital-based PHP APC geometric mean per diem costs by the
same factor, to result in a percentage difference equal to the average
percent difference between the hospital-based Level 1 PHP APC and the
Level 2 PHP APC for partial hospitalization services from CY 2013
through CY 2015.
Finally, we renumbered the PHP APCs, which were previously 0172,
0173, 0175, and 0176, to 5851, 5852, 5861, and 5862, respectively. For
a detailed discussion of the PHP ratesetting process, we refer readers
to the CY 2016 OPPS/ASC final rule with comment period (80 FR 70462
through 70467).
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79687
through 79691), we continued to apply our established policies to
calculate the PHP APC per diem payment rates based on geometric mean
per diem costs using the most recent claims and cost data for each
provider type. However, we finalized a policy to combine the Level 1
and Level 2 PHP APCs for CMHCs and to combine the Level 1 and Level 2
APCs for hospital-based PHPs because we believed this would best
reflect actual geometric mean per diem costs going forward, provide
more predictable per diem costs, particularly given the small number of
CMHCs, and generate more appropriate payments for these services, for
example by avoiding the cost inversions for hospital-based PHPs
addressed in the CY 2016 and CY 2017 OPPS/ASC final rules with comment
period (80 FR 70459 and 81 FR 79682). We implemented an 8-percent
outlier cap for CMHCs to mitigate potential outlier billing
vulnerabilities by limiting the impact of inflated CMHC charges on
outlier payments. We will continue to monitor the trends in outlier
payments
[[Page 37130]]
and consider policy adjustments as necessary.
In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59373
through 59381), we continued to apply our established policies to
calculate the PHP APC per diem payment rates based on geometric mean
per diem costs using the most recent claims and cost data for each
provider type. We continued to designate a portion of the estimated 1.0
percent hospital outpatient outlier threshold specifically for CMHCs,
consistent with the percentage of projected payments to CMHCs under the
OPPS, excluding outlier payments.
For a comprehensive description of PHP payment policy, including a
detailed methodology for determining PHP per diem amounts, we refer
readers to the CY 2016 and CY 2017 OPPS/ASC final rules with comment
period (80 FR 70453 through 70455 and 81 FR 79678 through 79680).
B. Proposed PHP APC Update for CY 2019
1. Proposed PHP APC Geometric Mean per Diem Costs
For CY 2019, in this CY 2019 OPPS/ASC proposed rule, we are
proposing to continue to apply our established policies to calculate
the PHP APC per diem payment rates based on geometric mean per diem
costs using the most recent claims and cost data for each provider
type. Specifically, we are proposing to continue to use CMHC APC 5853
(Partial Hospitalization (3 or More Services Per Day)) and hospital-
based PHP APC 5863 (Partial Hospitalization (3 or More Services Per
Day)). We are proposing to continue to calculate the geometric mean per
diem costs for CY 2019 for APC 5853 for CMHCs using only CY 2017 CMHC
claims data and the most recent CMHC cost data, and the CY 2019
geometric mean per diem costs for APC 5863 for hospital-based PHPs
using only CY 2017 hospital-based PHP claims data and the most recent
hospital cost data.
2. Development of the Proposed PHP APC Geometric Mean per Diem Costs
In this CY 2019 OPPS/ASC proposed rule, we are proposing that for
CY 2019 and subsequent years, to follow the PHP ratesetting methodology
described in section VIII.B.2. of the CY 2016 OPPS/ASC final rule with
comment period (80 FR 70462 through 70466) to determine the PHP APCs'
proposed geometric mean per diem costs and to calculate the proposed
payment rates for APCs 5853 and 5863, incorporating the modifications
made in our CY 2017 OPPS/ASC final rule with comment period. As
discussed in section VIII.B.1. of the CY 2017 OPPS/ASC final rule with
comment period (81 FR 79680 through 79687), the proposed geometric mean
per diem cost for hospital-based PHP APC 5863 would be based upon
actual hospital-based PHP claims and costs for PHP service days
providing 3 or more services. Similarly, the proposed geometric mean
per diem cost for CMHC APC 5853 would be based upon actual CMHC claims
and costs for CMHC service days providing 3 or more services.
The CMHC or hospital-based PHP APC per diem costs are the provider-
type specific costs derived from the most recent claims and cost data.
The CMHC or hospital-based PHP APC per diem payment rates are the
national unadjusted payment rates calculated from the CMHC or hospital-
based PHP APC per diem costs, after applying the OPPS budget neutrality
adjustments described in section II.A.4. of this proposed rule.
We are proposing to apply our established methodologies in
developing the CY 2019 proposed geometric mean per diem costs and
payment rates, including the application of a 2 standard
deviation trim on costs per day for CMHCs and a CCR greater than 5
hospital service day trim for hospital-based PHP providers. These two
trims were finalized in the CY 2016 OPPS/ASC final rule with comment
period (80 FR 70455 through 70462) for CY 2016 and subsequent years.
a. CMHC Data Preparation: Data Trims, Exclusions, and CCR Adjustments
For this CY 2019 proposed rule, prior to calculating the proposed
geometric mean per diem cost for CMHC APC 5853, we prepared the data by
first applying trims and data exclusions, and assessing CCRs as
described in the CY 2016 OPPS/ASC final rule with comment period (80 FR
70463 through 70465), so that ratesetting is not skewed by providers
with extreme data. Before any trims or exclusions were applied, there
were 44 CMHCs in the PHP claims data file. Under the 2
standard deviation trim policy, we exclude any data from a CMHC for
ratesetting purposes when the CMHC's geometric mean cost per day is
more than 2 standard deviations from the geometric mean
cost per day for all CMHCs. By applying this trim for CY 2019
ratesetting, in this proposed rule, we excluded 4 CMHCs with geometric
mean costs per day below the trim's lower limit of $53.33 and 4 CMHCs
with geometric mean costs per day above the trim's upper limit of
$274.43 from the proposed ratesetting for CY 2019. This standard
deviation trim removed 8 providers from the ratesetting whose data
would have skewed the calculation of the proposed geometric mean per
diem costs for CMHCs.
In accordance with our PHP ratesetting methodology, we also remove
service days with no wage index values because we use the wage index
data to remove the effects of geographic variation in costs prior to
APC geometric mean per diem cost calculation (80 FR 70465). For this CY
2019 proposed rule ratesetting, no CMHCs were missing wage index data
for all of their service days. Therefore, we did not exclude any CMHCs
due to the lack of wage index data.
In addition to our trims and data exclusions, before determining
the proposed PHP APC geometric mean per diem costs, we also assess CCRs
(80 FR 70463). Our longstanding PHP OPPS ratesetting methodology
defaults any CMHC CCR greater than 1 to the statewide hospital
ancillary CCR (80 FR 70457). For this CY 2019 proposed rule
ratesetting, we identified 3 CMHCs that had CCRs greater than 1. These
CMHCs' CCRs were 1.053, 1.009, and 1.025, and each was defaulted to its
appropriate statewide hospital ancillary CCR for CY 2019 ratesetting
purposes.
In summary, these data preparation steps adjusted the CCR for 3
CMHCs by defaulting to the appropriate statewide hospital ancillary CCR
and excluded 8 CMHCs, resulting in the inclusion of a total of 36 CMHCs
(44 total--8 excluded) in our CY 2019 proposed rule ratesetting
modeling. The trims removed 645 CMHC claims out of a total of 13,152
CMHC claims, resulting in 12,507 CMHC claims used for ratesetting
purposes. We believe that excluding providers with extremely low or
high geometric mean costs per day or extremely low or high CCRs
protects CMHCs from having that data inappropriately skew the
calculation of the proposed CMHC APC geometric mean per diem cost.
Moreover, we believe that these trims, exclusions, and adjustments help
prevent inappropriate fluctuations in the proposed PHP APC geometric
mean per diem payment rates.
After applying all of the above trims, exclusions, and adjustments,
we followed the methodology described in the CY 2016 OPPS/ASC final
rule with comment period (80 FR 70464 through 70465) and modified in
the CY 2017 OPPS/ASC final rule with comment period (81 FR 79687
through 79688, and 79691) to calculate the proposed PHP APC geometric
mean per diem cost.\29\
[[Page 37131]]
The proposed CY 2019 geometric mean per diem cost for all CMHCs for
providing 3 or more services per day (CMHC PHP APC 5853) is $119.51.
---------------------------------------------------------------------------
\29\ Each revenue code on the CMHC claim must have a HCPCS code
and charge associated with it. We multiply each claim service line's
charges by the CMHC's overall CCR (or statewide ancillary CCR, where
the overall CCR was greater than 1) to estimate CMHC costs. Only the
claims service lines containing PHP allowable HCPCS codes and PHP
allowable revenue codes from the CMHC claims remaining after
trimming are retained for CMHC cost determination. The costs,
payments, and service units for all service lines occurring on the
same service date, by the same provider, and for the same
beneficiary are summed. CMHC service days must have 3 or more
services provided to be assigned to CMHC APC 5853. The geometric
mean per diem cost for CMHC APC 5853 is calculated by taking the nth
root of the product of n numbers, for days where 3 or more services
were provided. CMHC service days with costs 3 standard
deviations from the geometric mean costs within APC 5853 are deleted
and removed from modeling. The remaining PHP service days are used
to calculate the geometric mean per diem cost for each PHP APC by
taking the nth root of the product of n numbers for days where 3 or
more services were provided.
---------------------------------------------------------------------------
b. Hospital-Based PHP Data Preparation: Data Trims and Exclusions
For this CY 2019 proposed rule, we followed a data preparation
process for hospital-based PHP providers that is similar to that used
for CMHCs by applying trims and data exclusions as described in the CY
2016 OPPS/ASC final rule with comment period (80 FR 70463 through
70465) so that our ratesetting is not skewed by providers with extreme
data. Before any trimming or exclusions were applied, there were 394
hospital-based PHP providers in the CY 2017 PHP claims data used in
this CY 2019 OPPS/ASC proposed rule.
For hospital-based PHP providers, we applied a trim on hospital
service days when the CCR was greater than 5 at the cost center level.
This trim removed hospital-based PHP service days that use a CCR
greater than 5 to calculate costs for at least one of their component
services. Unlike the 2 standard deviation trim, which
excluded CMHC providers that failed the trim, the CCR greater than 5
trim excluded any hospital-based PHP service day where any of the
services provided on that day were associated with a CCR greater than 5
(in other words, the CCR greater than 5 trim is a (service) day-level
trim in contrast to the CMHC 2 standard deviation trim,
which is a provider-level trim). Applying this CCR greater than 5 trim
removed from our proposed rule ratesetting affected service days from 4
hospital-based PHP providers with CCRs ranging from 5.2024 to 13.1952.
However, 100 percent of the service days for 3 of these affected
hospital-based PHP providers had at least 1 service associated with a
CCR greater than 5, so the trim removed these 3 providers entirely from
our proposed rule ratesetting. The fourth provider remained in the
ratesetting data, but with affected service days trimmed out. In
addition, 16 hospital-based PHPs reported zero daily costs and,
therefore, were removed for having no days with PHP payment; no
hospital-based PHPs were removed for missing wage index data; and 1
hospital-based PHP was removed by the OPPS 3 standard
deviation trim on costs per day.
Therefore, we excluded 20 hospital-based PHP providers [(3 with
CCRs greater than 5) + (16 with zero daily costs) + (1 after applying
the 3 standard deviation trim)], resulting in 374 (394
total--20 excluded) hospital-based PHP providers in the data used for
proposed rule ratesetting. In addition, 5 hospital-based PHP providers
were defaulted to using their overall hospital ancillary CCRs due to
outlier cost center CCR values, which ranged from 0.0331 to 72.7320.
After completing these data preparation steps, we calculated the
proposed CY 2019 geometric mean per diem cost for hospital-based PHP
APC 5863 for hospital-based PHP services by following the methodology
described in the CY 2016 OPPS/ASC final rule with comment period (80 FR
70464 through 70465) and modified in the CY 2017 OPPS/ASC final rule
with comment period (81 FR 79687 and 79691) to calculate the geometric
mean per diem cost.\30\ The proposed CY 2019 geometric mean per diem
cost for hospital-based PHP providers that provide 3 or more services
per service day (hospital-based PHP APC 5863) is $220.52.
---------------------------------------------------------------------------
\30\ Each revenue code on the hospital-based PHP claim must have
a HCPCS code and charge associated with it. We multiply each claim
service line's charges by the hospital's department-level CCR; that
CCR is determined by using the OPPS Revenue-code-to-cost-center
crosswalk. Only the claims service lines containing PHP-allowable
HCPCS codes and PHP-allowable revenue codes from the hospital-based
PHP claims remaining after trimming are retained for hospital-based
PHP cost determination. The costs, payments, and service units for
all service lines occurring on the same service date, by the same
provider, and for the same beneficiary are summed. Hospital-based
PHP service days must have 3 or more services provided to be
assigned to hospital-based PHP APC 5863. The geometric mean per diem
cost for hospital-based PHP APC 5863 is calculated by taking the nth
root of the product of n numbers, for days where 3 or more services
were provided. Hospital-based PHP service days with costs 3 standard deviations from the geometric mean costs within APC
5863 are deleted and removed from modeling. The remaining hospital-
based PHP service days are used to calculate the geometric mean per
diem cost for hospital-based PHP APC 5863.
---------------------------------------------------------------------------
The proposed CY 2019 PHP APC geometric mean per diem costs for CMHC
PHP APC 5853 are $119.51 and for hospital-based PHP APC 5863 are
$220.52, as stated above and shown in Table 25. The proposed PHP APCs
payment rates, which are derived from these proposed PHP APCs geometric
mean per diem costs, are included in Addendum A to this proposed rule
(which is available on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.html).\31\
---------------------------------------------------------------------------
\31\ As discussed in section II.A. of this CY 2019 OPPS/ASC
proposed rule, OPPS APC geometric mean per diem costs (including PHP
APC geometric mean per diem costs) are divided by the geometric mean
per diem costs for APC 5012 (Clinic Visits and Related Services) to
calculate each PHP APC's unscaled relative payment weight. An
unscaled relative payment weight is one that is not yet adjusted for
budget neutrality. Budget neutrality is required under section
1833(t)(9)(B) of the Act, and ensures that the estimated aggregate
weight under the OPPS for a calendar year is neither greater than
nor less than the estimated aggregate weight that would have been
made without the changes. To adjust for budget neutrality (that is,
to scale the weights), we compare the estimated aggregated weight
using the scaled relative payment weights from the previous calendar
year at issue. We refer readers to the ratesetting procedures
described in Part 2 of the OPPS Claims Accounting narrative and in
section II. of this proposed rule for more information on scaling
the weights, and for details on the final steps of the process that
lead to PHP APC per diem payment rates. The OPPS Claims Accounting
narrative is available on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.html.
Table 25--CY 2019 Proposed PHP APC Geometric Mean Per Diem Costs
------------------------------------------------------------------------
Proposed PHP APC
CY 2019 APC Group title geometric mean per
diem costs
------------------------------------------------------------------------
5853..................... Partial Hospitalization $119.51
(3 or more services per
day) for CMHCs.
5863..................... Partial Hospitalization 220.52
(3 or more services per
day) for hospital-based
PHPs.
------------------------------------------------------------------------
[[Page 37132]]
3. Proposed Changes to the Revenue-Code-to-Cost Center Crosswalk
In the CY 2017 OPPS/ASC final rule with comment period (81 FR
79691), we received public comments identifying an issue that may have
contributed to a decreased PHP median [sic] cost for hospital-based
PHPs. The commenters noted that the lack of a required standardized PHP
cost center on the Medicare cost report may be creating some cost-
finding nuances in the cost report itself--that hospital-based PHP
costs are combined with the costs of less expensive non-PHP outpatient
mental health services during CCR calculation, thus ``diluting'' the
CCR values. We agreed with the commenters that, if PHP costs are
combined with other less intensive outpatient mental health treatment
costs in the same cost center, the CCR values could be diluted, leading
to lower geometric mean per diem costs being calculated. We stated in
response that we would consider adding a cost center to the hospital
cost report for PHP costs only.
On November 17, 2017, in Transmittal No. 12, we added a new cost
center, ``Partial Hospitalization Program,'' on Line 93.99 of Worksheet
A (Line 93.99 is also displayed on Worksheets B, Parts I and II, B-1;
and C, Parts I and II) for hospital-based PHPs, for cost reporting
periods ending on or after August 31, 2017 (https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2017Downloads/R12P240.pdf). On January 30, 2018, in Transmittal No. 13, we changed
the implementation date from cost reporting periods ending on or after
August 31, 2017, to cost reporting periods ending on or after September
30, 2017 (https://www.cms.gov/Regulations-and-Guidance/Guidance/Transmittals/2017Downloads/R12P240.pdf). The instructions for this new
PHP cost center (Line 93.99) indicate that effective for cost reporting
periods ending on or after September 30, 2017, the provider is to enter
the costs of providing hospital-based partial hospitalization program
(PHP) services as defined in section 1861(ff) of the Act. Therefore,
this cost center is to include all costs associated with providing PHP
services, as defined in the statute (for example, occupational therapy,
individual and group therapy, among others). It should not include
costs for non-PHP outpatient mental health services, such as costs from
what providers refer to as ``Intensive Outpatient Programs.''
During current hospital-based-PHP ratesetting, costs are estimated
by multiplying revenue code charges on the claim by the appropriate
cost center-level CCR from the hospital cost report (80 FR 70465). Each
PHP revenue code is associated with particular cost centers on the cost
report (80 FR 70464). The appropriate cost center-level CCR is
identified by using the OPPS Revenue-Code-to-Cost-Center crosswalk; the
current crosswalk is discussed in the CY 2018 OPPS/ASC final rule with
comment period (82 FR 59228) and is available on the CMS website at:
https://www.cms.gov/apps/ama/license.asp?file=/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Downloads/CMS-1678-FC-2018-OPPS-FR-Revenue-Code-to-Cost-Center-Crosswalk.zip. The Revenue-Code-to-
Cost-Center crosswalk identifies the primary, secondary (if any), and
tertiary (if any) cost centers that are associated with each PHP
revenue code, and which are the source for the CCRs used in PHP
ratesetting. As discussed in the CY 2002 OPPS interim final rule (66 FR
59885), hospital-based PHP CCRs are assessed by applying the existing
OPPS 3 standard deviation trim to hospital-based PHP CCRs
within each cost center and to the overall hospital ancillary CCR. In
the CY 2016 OPPS/ASC final rule with comment period (80 FR 70464), we
stated that, if the primary cost center has no CCR or if it fails the
3 standard deviation trim, the ratesetting system will look
for a CCR in the secondary cost center. If the secondary cost center
has no CCR or if it fails the 3 standard deviation trim,
the system will move to the tertiary cost center to look for a CCR. If
the tertiary cost center has no CCR or if it fails the 3
standard deviation trim, the ratesetting system will default to using
the hospital's overall ancillary CCR. If the hospital's overall
ancillary CCR fails the 3 standard deviation trim, we
exclude the hospital from ratesetting. While the hierarchy requires a
primary cost center to be associated with a given revenue code, it is
optional for there to be secondary or tertiary cost centers.
With the new PHP cost center, the crosswalk must be updated for
hospital-based PHP cost estimation to correctly match hospital-based
PHP revenue code charges with the PHP cost center CCR for future
ratesetting. However, because the PHP-allowable revenue codes are also
used for reporting non-PHP mental health services, we could not
designate the PHP cost center as the primary cost center in the
existing OPPS Revenue-Code-to-Cost-Center crosswalk. Therefore, we are
proposing to create a separate PHP-only Revenue-Code-to-Cost-Center
crosswalk for use in CY 2019 and subsequent years, which would provide
a more accurate and operationally simpler method of matching hospital-
based PHP charges to the correct hospital-based PHP cost center CCR
without affecting non-PHP ratesetting. We note that, because CMHCs have
their own cost reports, we use each CMHC's overall CCR in estimating
costs for PHP ratesetting (80 FR 70463 and 70464). As such, CMHCs do
not have a crosswalk and, therefore, this proposal to create a PHP-only
crosswalk does not apply to CMHCs. Therefore, we are proposing that,
for CY 2019 and subsequent years, hospital-based PHPs would follow a
new Revenue-Code-to-Cost-Center crosswalk that only applies to
hospital-based PHPs. We are proposing that this new PHP-only Revenue-
Code-to-Cost-Center crosswalk would be comprised of the existing PHP
allowable revenue codes and would map each of those PHP-allowable
revenue codes to the new PHP cost center Line 93.99 as the primary cost
center source for the CCR. We also are proposing to designate as the
new secondary cost center the cost center that is currently listed as
the existing primary cost center, and to designate as the new tertiary
cost center the cost center that is listed as the existing secondary
cost center.
In addition, we are proposing one exception to this policy for the
mapping for revenue code 0904, which is the only PHP-allowable revenue
code in the existing crosswalk with a tertiary cost center source for
the CCR. We are proposing that for revenue code 0904, the secondary
cost center for CY 2019 and subsequent years would be the existing
secondary cost center 3550 (``Psychiatric/Psychological Services'').
Similarly, we are proposing that for revenue code 0904, the tertiary
cost center for CY 2019 and subsequent years would be existing tertiary
cost center 9000 (``Clinic''). We considered expanding the Revenue-
Code-to-Cost-Center crosswalk hierarchy to add a 4th or quaternary
level to the hierarchy, before the system would default to the overall
hospital ancillary CCR. However, we evaluated the usage of the current
hierarchy for revenue code 0904 for the CY 2017, CY 2018, and CY 2019
PHP ratesetting modelling, and found that expanding the hierarchy would
not be necessary. Our analysis showed that the existing primary cost
center 3580 (``Recreational Therapy'') for revenue code 0904 had not
been used during any of the past 3 years.
Our current and proposed PHP-only Revenue-Code-to-Cost-Center
Crosswalks are shown in Table 26 below.
[[Page 37133]]
Table 26--Current and Proposed PHP-Only Revenue--Code-To-Cost-Center Crosswalks
--------------------------------------------------------------------------------------------------------------------------------------------------------
Current hierarchy (applicable in CY 2018) Proposed new PHP-only hierarchy (applicable in CY 2019 and beyond)
------------------------------------------------------------------------------------------------------------------------------------
PHP allowable Primary cost Secondary cost Secondary cost
revenue code center source center source Tertiary cost center Primary cost center center source Tertiary cost center
for CCR for CCR source for CCR source for CCR for CCR source for CCR
--------------------------------------------------------------------------------------------------------------------------------------------------------
0430............... 6700 ................ ......................... 9399 (PHP)............... 6700 ........................
Occupational Occupational
Therapy. Therapy.
0431............... 6700 ................ ......................... 9399 (PHP)............... 6700 ........................
Occupational Occupational
Therapy. Therapy.
0432............... 6700 ................ ......................... 9399 (PHP)............... 6700 ........................
Occupational Occupational
Therapy. Therapy.
0433............... 6700 ................ ......................... 9399 (PHP)............... 6700 ........................
Occupational Occupational
Therapy. Therapy.
0434............... 6700 ................ ......................... 9399 (PHP)............... 6700 ........................
Occupational Occupational
Therapy. Therapy.
0435............... RESERVED. ........................
0436............... RESERVED. ........................
0437............... RESERVED. ........................
0438............... RESERVED. ........................
0439............... 6700 ................ ......................... 9399 (PHP)............... 6700 ........................
Occupational Occupational
Therapy. Therapy.
0900............... 3550 9000 (Clinic)... ......................... 9399 (PHP)............... 3550 9000 (Clinic).
(Psychiatric/ (Psychiatric/
Psychological Psychological
Services. Services).
0904............... 3580 3550 9000 (Clinic)............ 9399 (PHP)............... 3550 9000 (Clinic).
(Recreational (Psychiatric/ (Psychiatric/
Therapy). Psychological Psychological
Services. Services).
0914............... 3550 9000 (Clinic)... ......................... 9399 (PHP)............... 3550 9000 (Clinic).
(Psychiatric/ (Psychiatric/
Psychological Psychological
Services. Services).
0915............... 3550 9000 (Clinic)... ......................... 9399 (PHP)............... 3550 9000 (Clinic).
(Psychiatric/ (Psychiatric/
Psychological Psychological
Services. Services).
0916............... 3550 9000 (Clinic)... ......................... 9399 (PHP)............... 3550 9000 (Clinic).
(Psychiatric/ (Psychiatric/
Psychological Psychological
Services. Services).
0918............... 3550 9000 (Clinic)... ......................... 9399 (PHP)............... 3550 9000 (Clinic).
(Psychiatric/ (Psychiatric/
Psychological Psychological
Services. Services).
0942............... 9000 (Clinic)... ................ ......................... 9399 (PHP)............... 9000 (Clinic).. ........................
--------------------------------------------------------------------------------------------------------------------------------------------------------
4. PHP Service Utilization Updates
While we are not proposing any changes to this policy, we will
continue to monitor the provision of days with only 3 services. In the
CY 2016 OPPS/ASC final rule with comment period (81 FR 79684 through
79685), we expressed concern over the low frequency of individual
therapy provided to beneficiaries. The CY 2017 claims data used for
this CY 2019 proposed rule revealed some changes in the provision of
individual therapy compared to CY 2016 and CY 2015 claims data as shown
in the table below.
Table 27--Provision of Individual Therapy, by Provider Type and Claims
Year
------------------------------------------------------------------------
Percent of Percent of
days with 3 days with 4 or
services only more services
------------------------------------------------------------------------
CMHCs:
CY 2015 Claims...................... 7.9 4.4
CY 2016 Claims...................... 8.5 5.0
CY 2017 Claims...................... 4.8 4.2
Hospital-based PHPs:
CY 2015 Claims...................... 4.0 6.2
CY 2016 Claims...................... 4.7 5.8
CY 2017 Claims...................... 4.1 12.2
------------------------------------------------------------------------
As shown in Table 27, CMHCs have decreased the provision of
individual therapy, based on the CY 2017 claims used for this proposed
rule. In contrast, the CY 2017 claims data show that hospital-based
PHPs have greatly increased the provision of individual therapy.
In the CY 2018 OPPS/ASC proposed rule and final rule with comment
period (82 FR 33640 and 59378), we stated that we are aware that our
single-tier
[[Page 37134]]
payment policy may influence a change in service provision because
providers are able to obtain payment that is heavily weighted to the
cost of providing 4 or more services when they provide only 3 services.
We indicated that we are interested in ensuring that providers furnish
an appropriate number of services to beneficiaries enrolled in PHPs.
Therefore, with the CY 2017 implementation of APC 5853 and APC 5863 for
providing 3 or more PHP services per day, we are continuing to monitor
utilization of days with only 3 PHP services. Table 28 below shows the
utilization findings based on the most recent claims data.
Table 28--Percentage of PHP Days by Service Unit Frequency
----------------------------------------------------------------------------------------------------------------
% Change **
CY 2015 (%) CY 2016 * (%) CY 2017 * (%) (%)
----------------------------------------------------------------------------------------------------------------
CMHCs:
Percent of Days with 3 services............. 4.7 4.8 4.8 0.0
Percent of Days with 4 services............. 62.9 70.3 76.3 8.5
Percent of Days with 5 or more services..... 32.4 24.9 18.9 -24.1
Hospital-based PHPs:
Percent of Days with 3 services............. 12.4 10.95 9.3 -14.7
Percent of Days with 4 services............. 69.8 64.9 56.1 -13.6
Percent of Days with 5 or more services..... 17.8 24.1 34.6 43.6
----------------------------------------------------------------------------------------------------------------
* May not sum to 100 percent by provider type due to rounding.
** (CY 2017-CY 2016)/CY 2016.
As shown in Table 28, the CY 2017 claims data used for this
proposed rule showed that PHPs maintained an appropriately low
utilization of 3 service days compared to CY 2016 and CY 2015. Compared
to CY 2016, hospital-based PHPs have provided fewer days with 3
services only, fewer days with 4 services only, and more days with 5 or
more services. Compared to CY 2016, CMHCs have remained steady in
providing an appropriately low level of 3 service days, increased their
provision of days with 4 services, but have decreased their provision
of days with 5 or more services.
As we noted in the CY 2017 OPPS/ASC final rule with comment period
(81 FR 79685), we will continue to monitor the provision of days with
only 3 services, particularly now that the single-tier PHP APCs 5853
and 5863 are in place for providing 3 or more services per day to CMHCs
and hospital-based PHPs, respectively. The CY 2017 data are the first
year of claims data to reflect the change to the single-tier PHP APCs,
and the level of utilization of days with 3 services only indicates
providers are not reducing care for this patient population by
providing more days with only 3 services.
It is important to reiterate our expectation that days with only 3
services are meant to be an exception and not the typical PHP day. In
the CY 2009 OPPS/ASC final rule with comment period (73 FR 68694), we
clearly stated that we consider the acceptable minimum units of PHP
services required in a PHP day to be 3 and explained that it was never
our intention that 3 units of service represent the number of services
to be provided in a typical PHP day. PHP is furnished in lieu of
inpatient psychiatric hospitalization and is intended to be more
intensive than a half-day program. We further indicated that a typical
PHP day should generally consist of 5 to 6 units of service (73 FR
68689). We explained that days with only 3 units of services may be
appropriate to bill in certain limited circumstances, such as when a
patient might need to leave early for a medical appointment and,
therefore, would be unable to complete a full day of PHP treatment. At
that time, we noted that if a PHP were to only provide days with 3
services, it would be difficult for patients to meet the eligibility
requirement in 42 CFR 410.43(c)(1), that patients must require a
minimum of 20 hours per week of therapeutic services as evidenced in
their plan of care (73 FR 68689).
C. Outlier Policy for CMHCs
In this proposed rule, for CY 2019, we are proposing to continue to
calculate the CMHC outlier percentage, cutoff point and percentage
payment amount, outlier reconciliation, outlier payment cap, and fixed-
dollar threshold according to previously established policies. These
topics are discussed in more detail below. We refer readers to section
II.G. of this proposed rule for our general policies for hospital
outpatient outlier payments.
1. Background
As discussed in the CY 2004 OPPS final rule with comment period (68
FR 63469 through 63470), we noted a significant difference in the
amount of outlier payments made to hospitals and CMHCs for PHP
services. Given the difference in PHP charges between hospitals and
CMHCs, we did not believe it was appropriate to make outlier payments
to CMHCs using the outlier percentage target amount and threshold
established for hospitals. Therefore, beginning in CY 2004, we created
a separate outlier policy specific to the estimated costs and OPPS
payments provided to CMHCs. We designated a portion of the estimated
OPPS outlier threshold specifically for CMHCs, consistent with the
percentage of projected payments to CMHCs under the OPPS each year,
excluding outlier payments, and established a separate outlier
threshold for CMHCs. This separate outlier threshold for CMHCs resulted
in $1.8 million in outlier payments to CMHCs in CY 2004 and $0.5
million in outlier payments to CMHCs in CY 2005 (82 FR 59381). In
contrast, in CY 2003, more than $30 million was paid to CMHCs in
outlier payments (82 FR 59381).
2. CMHC Outlier Percentage
In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59267
through 59268), we described the current outlier policy for hospital
outpatient payments and CMHCs. We note that we also discussed our
outlier policy for CMHCs in more detail in section VIII. C. of that
same final rule (82 FR 59381). For CMHCs, we set our projected target
for aggregate outlier payments at 1.0 percent of the estimated
aggregate total payments under the OPPS (82 FR 59267). We estimate CMHC
per diem payments and outlier payments by using the most recent
available utilization and charges from CMHC claims, updated CCRs, and
the updated payment rate for APC 5853. For increased transparency, we
are providing a more detailed explanation of the existing calculation
process for determining the CMHC outlier
[[Page 37135]]
percentages below. As previously stated, we are proposing to continue
to calculate the CMHC outlier percentage according to previously
established policies, and we are not proposing any changes to our
current methodology for calculating the CMHC outlier percentage for CY
2019. To calculate the CMHC outlier percentage, we follow three steps:
Step 1: We multiply the OPPS outlier threshold, which is
1.0 percent, by the total estimated OPPS Medicare payments (before
outliers) for the prospective year to calculate the estimated total
OPPS outlier payments: (0.01 x Estimated Total OPPS Payments) =
Estimated Total OPPS Outlier Payments.
Step 2: We estimate CMHC outlier payments by taking each
provider's estimated costs (based on their allowable charges multiplied
by the provider's CCR) minus each provider's estimated CMHC outlier
multiplier threshold (we refer readers to section VIII.C.3. of this
proposed rule). That threshold is determined by multiplying the
provider's estimated paid days by 3.4 times the CMHC PHP APC payment
rate. If the provider's costs exceed the threshold, we multiply that
excess by 50 percent, as described in section VIII.C.3. of this
proposed rule, to determine the estimated outlier payments for that
provider. CMHC outlier payments are capped at 8 percent of the
provider's estimated total per diem payments (including the
beneficiary's copayment), as described in section VIII.C.5. of this
proposed rule, so any provider's costs that exceed the CMHC outlier cap
would have its payments adjusted downward. After accounting for the
CMHC outlier cap, we sum all of the estimated outlier payments to
determine the estimated total CMHC outlier payments.
(Each Provider's Estimated Costs-Each Provider's Estimated
Multiplier Threshold) = A. If A > 0, then (A x 0.50) = Estimated CMHC
Outlier Payment (before cap) = B. If B > (0.08 x Provider's Total
Estimated Per Diem Payments), then cap-adjusted B = (0.08 x Provider's
Total Estimated Per Diem Payments); otherwise, B = B. Sum (B or cap-
adjusted B) for Each Provider = Total CMHC Outlier Payments.
Step 3: We determine the percentage of all OPPS outlier
payments that CMHCs represent by dividing the estimated CMHC outlier
payments from Step 2 by the total OPPS outlier payments from Step 1:
(Estimated CMHC Outlier Payments/Total OPPS Outlier Payments).
In CY 2018, we designated approximately 0.03 percent of that
estimated 1.0 percent hospital outpatient outlier threshold for CMHCs
(82 FR 59381), based on this methodology. In this proposed rule, we are
proposing to continue to use the same methodology for CY 2019.
Therefore, based on our CY 2019 payment estimates, CMHCs are projected
to receive 0.02 percent of total hospital outpatient payments in CY
2019, excluding outlier payments. We are proposing to designate
approximately less than 0.01 percent of the estimated 1.0 percent
hospital outpatient outlier threshold for CMHCs. This percentage is
based upon the formula given in Step 3 above.
3. Cutoff Point and Percentage Payment Amount
As described in the CY 2018 OPPS/ASC final rule with comment period
(82 FR 59381), our policy has been to pay CMHCs for outliers if the
estimated cost of the day exceeds a cutoff point. In CY 2006, we set
the cutoff point for outlier payments at 3.4 times the highest CMHC PHP
APC payment rate implemented for that calendar year (70 FR 68551). This
cutoff point is sometimes called a multiplier threshold (70 FR 68550).
For CY 2018, the highest CMHC PHP APC payment rate is the payment rate
for CMHC PHP APC 5853. In addition, in 2002, the final OPPS outlier
payment percentage for costs above the multiplier threshold was set at
50 percent (66 FR 59889). In CY 2018, we continued to apply the same 50
percent outlier payment percentage that applies to hospitals to CMHCs
and continued to use the existing cutoff point (82 FR 59381).
Therefore, for CY 2018, we continued to pay for partial hospitalization
services that exceeded 3.4 times the CMHC PHP APC payment rate at 50
percent of the amount of CMHC PHP APC geometric mean per diem costs
over the cutoff point. For example, for CY 2018, if a CMHC's cost for
partial hospitalization services paid under CMHC PHP APC 5853 exceeds
3.4 times the CY 2018 payment rate for CMHC PHP APC 5853, the outlier
payment would be calculated as 50 percent of the amount by which the
cost exceeds 3.4 times the CY 2018 payment rate for CMHC PHP APC 5853
[0.50 x (CMHC Cost-(3.4 x APC 5853 rate))].
In this proposed rule, for CY 2019, in accordance with our existing
policy, we are proposing to continue to pay for partial hospitalization
services that exceed 3.4 times the proposed CMHC PHP APC payment rate
at 50 percent of the CMHC PHP APC geometric mean per diem costs over
the cutoff point. That is, for CY 2019, if a CMHC's cost for partial
hospitalization services paid under CMHC PHP APC 5853 exceeds 3.4 times
the proposed payment rate for CMHC APC 5853, the outlier payment would
be calculated as [0.50 x (CMHC Cost-(3.4 x APC 5853 rate))].
4. Outlier Reconciliation
In the CY 2009 OPPS/ASC final rule with comment period (73 FR 68594
through 68599), we established an outlier reconciliation policy to
address charging aberrations related to OPPS outlier payments. We
addressed vulnerabilities in the OPPS outlier payment system that lead
to differences between billed charges and charges included in the
overall CCR, which are used to estimate cost and would apply to all
hospitals and CMHCs paid under the OPPS. The main vulnerability in the
OPPS outlier payment system is the time lag between the update of the
CCRs that are based on the latest settled cost report and the current
charges that creates the potential for hospitals and CMHCs to set their
own charges to exploit the delay in calculating new CCRs. CMS initiated
steps to ensure that outlier payments appropriately account for the
financial risk when providing an extraordinarily costly and complex
service, but are only being made for services that legitimately qualify
for the additional payment.
The current outlier reconciliation policy requires that providers
whose outlier payments meet a specified threshold (currently $500,000
for hospitals and any outlier payments for CMHCs) and whose overall
ancillary CCRs change by plus or minus 10 percentage points or more,
are subject to outlier reconciliation, pending approval of the CMS
Central Office and Regional Office (73 FR 68596 through 68599). The
policy also includes provisions related to CCRs and to calculating the
time value of money for reconciled outlier payments due to or due from
Medicare, as detailed in the CY 2009 OPPS/ASC final rule with comment
period and in the Medicare Claims Processing Manual (73 FR 68595
through 68599 and Medicare Claims Processing internet Only Manual,
Chapter 4, Section 10.7.2 and its subsections, available online at:
https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/clm104c04.pdf).
In this proposed rule, we are proposing to continue these policies
for CY 2019.
5. Outlier Payment Cap
In the CY 2017 OPPS/ASC final rule with comment period, we
implemented a CMHC outlier payment cap to be applied at the provider
level, such that
[[Page 37136]]
in any given year, an individual CMHC will receive no more than a set
percentage of its CMHC total per diem payments in outlier payments (81
FR 79692 through 79695). We finalized the CMHC outlier payment cap to
be set at 8 percent of the CMHC's total per diem payments (81 FR 79694
through 79695). This outlier payment cap only affects CMHCs, does not
affect other provider types (that is, hospital-based PHPs), and is in
addition to and separate from the current outlier policy and
reconciliation policy in effect. For CY 2018, we continued this policy
in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59381).
In this proposed rule, we are proposing to continue this policy for
CY 2019, such that the CMHC outlier payment cap would be 8 percent of
the CMHC's total per diem payments.
6. Fixed-Dollar Threshold
Finally, in the CY 2018 OPPS/ASC final rule with comment period (82
FR 59267 through 59268), for the hospital outpatient outlier payment
policy, we set a fixed-dollar threshold in addition to an APC
multiplier threshold. Fixed-dollar thresholds are typically used to
drive outlier payments for very costly items or services, such as
cardiac pacemaker insertions. CMHC PHP APC 5853 is the only APC for
which CMHCs may receive payment under the OPPS, and is for providing a
defined set of services that are relatively low cost when compared to
other OPPS services. Because of the relatively low cost of CMHC
services that are used to comprise the structure of CMHC PHP APC 5853,
it is not necessary to also impose a fixed-dollar threshold on CMHCs.
Therefore, in the CY 2018 OPPS/ASC final rule with comment period, we
did not set a fixed-dollar threshold for CMHC outlier payments (82 FR
59381).
In this proposed rule, we are proposing to continue this policy for
CY 2019.
IX. Proposed Procedures That Would Be Paid Only as Inpatient Procedures
A. Background
We refer readers to the CY 2012 OPPS/ASC final rule with comment
period (76 FR 74352 through 74353) for a full historical discussion of
our longstanding policies on how we identify procedures that are
typically provided only in an inpatient setting (referred to as the
inpatient only (IPO) list) and, therefore, will not be paid by Medicare
under the OPPS, and on the criteria that we use to review the IPO list
each year to determine whether or not any procedures should be removed
from the list. The complete list of codes that describe procedures that
would be paid by Medicare in CY 2019 as inpatient only procedures is
included as Addendum E to this proposed rule (which is available via
the internet on the CMS website).
B. Proposed Changes to the Inpatient Only (IPO) List
1. Methodology for Identifying Appropriate Changes to IPO List
In this proposed rule, for CY 2019, we are proposing to use the
same methodology (described in the November 15, 2004 final rule with
comment period (69 FR 65834)) of reviewing the current list of
procedures on the IPO list to identify any procedures that may be
removed from the list. We have established five criteria that are part
of this methodology. As noted in the CY 2012 OPPS/ASC final rule with
comment period (76 FR 74353), we utilize these criteria when reviewing
procedures to determine whether or not they should be removed from the
IPO list and assigned to an APC group for payment under the OPPS when
provided in the hospital outpatient setting. We note that a procedure
is not required to meet all of the established criteria to be removed
from the IPO list. The criteria include the following:
1. Most outpatient departments are equipped to provide the services
to the Medicare population.
2. The simplest procedure described by the code may be performed in
most outpatient departments.
3. The procedure is related to codes that we have already removed
from the IPO list.
4. A determination is made that the procedure is being performed in
numerous hospitals on an outpatient basis.
5. A determination is made that the procedure can be appropriately
and safely performed in an ASC, and is on the list of approved ASC
procedures or has been proposed by us for addition to the ASC list.
Using the above-listed criteria, for the CY 2019 OPPS, we have
identified two procedures described by the following codes that we are
proposing to remove from the IPO list for CY 2019: CPT code 31241
(Nasal/sinus endoscopy, surgical; with ligation of sphenopalatine
artery) and CPT code 01402 (Anesthesia for open or surgical
arthroscopic procedures on knee joint; total knee arthroplasty). We
also are proposing to add to the IPO list for CY 2019 the procedure
described by HCPCS code C9606 (Percutaneous transluminal
revascularization of acute total/subtotal occlusion during acute
myocardial infarction, coronary artery or coronary artery bypass graft,
any combination of drug-eluting intracoronary stent, atherectomy and
angioplasty, including aspiration thrombectomy when performed, single
vessel). The procedures that we are proposing to remove from the IPO
list for CY 2019 and subsequent years, including the HCPCS codes, long
descriptors, and the proposed CY 2019 payment indicators, are displayed
in Table 29 of this proposed rule.
As noted earlier, we are proposing to remove the procedure
described by CPT code 31241 from the IPO list for CY 2019. After
reviewing the clinical characteristics of the procedure described by
CPT code 31241 and consulting with stakeholders and our clinical
advisors regarding this procedure, we believe that this procedure meets
criterion 3--the procedure is related to codes that we have already
removed from the IPO list. We are proposing that the procedure
described by CPT code 31241 be assigned to C-APC 5153 (Level 3 Airway
Endoscopy) with a status indicator of ``J1''. We are seeking comment on
whether the public believes that the procedure described by CPT code
31241 meets criterion 3 and whether the procedure meets any of the
other five criteria for removal from the IPO list.
We also are proposing to remove the procedure described by CPT code
01402 from the IPO list. After reviewing the clinical characteristics
of the procedure described by CPT code 01402, we believe that this
procedure meets criteria 3 and 4. This procedure is typically billed
with the procedure described by CPT code 27447 (Arthroplasty, knee,
condyle and plateau; medical and lateral compartments with or without
patella resurfacing (total knee arthroplasty)), which was removed from
the IPO list for CY 2018 (82 FR 52526). We are seeking public comment
on whether the procedure described by CPT code 01402 meets criteria 3
and 4 and whether the procedure meets any of the other five criteria
for removal from the IPO list.
In addition, we are proposing to add the procedure described by
HCPCS code C9606 (Percutaneous transluminal revascularization of acute
total/subtotal occlusion during acute myocardial infarction, coronary
artery or coronary artery bypass graft, any combination of drug-eluting
intracoronary stent, atherectomy and angioplasty, including aspiration
thrombectomy when
[[Page 37137]]
performed, single vessel) to the IPO list for CY 2019. The IPO list
specifies those procedures and services for which the hospital will be
paid only when the procedures are provided in the inpatient setting
because of the nature of the procedure, the underlying physical
condition of the patient, or the need for at least 24 hours of
postoperative recovery time or monitoring before the patient can be
safely discharged (76 FR 74353). After evaluating the procedure
described by HCPCS code C9606 against the criteria described above, we
believe that the procedure should be added to the IPO list because this
procedure is performed during acute myocardial infarction and it is
similar to the procedure described by CPT code 92941 (Percutaneous
transluminal revascularization of acute total/subtotal occlusion during
acute myocardial infarction, coronary artery or coronary artery bypass
graft, any combination of intracoronary stent, artherectomy and
angioplasty, including aspiration thrombectomy when performed, single
vessel), which was added to the IPO list for CY 2018 (82 FR 52526). We
are seeking public comment on whether the procedure described by HCPCS
code C9606 should be added to the IPO list for CY 2019.
2. Solicitation of Public Comments on the Potential Removal of
Procedure Described by CPT Code 0266T From the IPO List
CPT code 0266T describes the implantation or replacement of carotid
sinus baroreflex activation device; total system (includes generator
placement, unilateral or bilateral lead placement, intra-operative
interrogation, programming, and repositioning, when performed). The
procedure described by CPT code 0266T has been included on the IPO list
since the procedure code became effective in CY 2011.
There are several codes that describe procedures that are similar
to the procedure described by CPT code 0266T that are not on the IPO
list, including: CPT code 0267T (Implantation or replacement of carotid
sinus baroreflex activation device; lead only, unilateral (includes
intra-operative interrogation, programming, and repositioning, when
performed)) and CPT code 0268T (Implantation or replacement of carotid
sinus baroreflex activation device; pulse generator only (includes
intra-operative interrogation, programming, and repositioning, when
performed)). The device that is billed with these two procedures has
been granted a Category B Investigational Device Exemption (IDE) from
FDA.\32\ Currently, there is limited information available to determine
the typical site of service and the ability for the procedure to be
safely performed in the outpatient setting. At this time, we do not
believe that we have adequate information to determine whether the
procedure described by CPT code 0266T should be removed from the IPO
list. Therefore, we are seeking public comments on the removal of the
procedure described by CPT code 0266T from the IPO list. Specifically,
we are seeking public comments on whether the procedure described by
CPT code 0266T meets any of the criteria to be removed from the IPO
list and the APC assignment and status indicator for this code.
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\32\ Available at: https://www.cms.gov/Medicare/Coverage/IDE/Approved-IDE-Studies.html.
Table 29--Proposed Changes to the Inpatient Only List for CY 2019
----------------------------------------------------------------------------------------------------------------
Proposed CY 2019 OPPS Proposed CY 2019 OPPS
CY 2019 CPT code CY 2019 long descriptor Proposed action APC assignment status indicator
----------------------------------------------------------------------------------------------------------------
31241................ Nasal/sinus endoscopy, Remove from IPO 5153................. J1
surgical; with list.
ligation of
sphenopalatine artery.
01402................ Anesthesia for open or Remove from IPO N/A.................. N
surgical arthroscopic list.
procedures on knee
joint; total knee
arthroplasty.
C9606................ Percutaneous Add to IPO list... N/A.................. C
transluminal
revascularization of
acute total/subtotal
occlusion during acute
myocardial infarction,
coronary artery or
coronary artery bypass
graft, any combination
of drug-eluting
intracoronary stent,
atherectomy and
angioplasty, including
aspiration
thrombectomy when
performed, single
vessel.
----------------------------------------------------------------------------------------------------------------
The complete list of codes (the IPO list) that are proposed to be
placed on the IPO list for CY 2019 are included as Addendum E to this
proposed rule (which is available via the internet on the CMS website).
X. Proposed Nonrecurring Policy Changes
A. Collecting Data on Services Furnished in Off-Campus Provider-Based
Emergency Departments
The June 2017 Report to Congress \33\ by the Medicare Payment
Advisory Commission (MedPAC) states that, in recent years, there has
been significant growth in the number of health care facilities located
apart from hospitals that are devoted primarily to emergency department
services. This includes both off-campus provider-based emergency
departments that are eligible for payment under the OPPS and
independent freestanding emergency departments not affiliated with a
hospital that are not eligible for payment under the OPPS. Since 2010,
we have observed a noticeable increase in the number of hospital
outpatient emergency department visits furnished under the OPPS. MedPAC
and other entities have expressed concern that services may be shifting
to the higher acuity and higher cost emergency department setting due
to: (1) Higher payment rates for services performed in off-campus
provider-based emergency departments compared to similar services
provided in other settings (that is, physician offices or urgent care
clinics); and (2) the exemption for services provided in an emergency
department included under section 603 of the Bipartisan Budget Act of
2015 (Pub. L. 114-25), whereby all items and services (emergency and
nonemergency) furnished in an emergency department are excepted from
the payment implications of section 603, as long as the department
maintains its status as an emergency department under the regulation at
42 CFR 489.24(b).
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\33\ Available at: http://www/medpac.gov/docs/default-source/
reports/jun17_reporttocongress_sec.pdf.
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MedPAC and other entities are concerned that these payment
[[Page 37138]]
incentives may be a key contributing factor to the growth in the number
of emergency departments located off-campus from a hospital. MedPAC
recommended in its March 2017 \34\ and June 2017 Reports to Congress
that CMS require hospitals to append a modifier to claims for all
services furnished in off-campus provider-based emergency departments,
so that CMS can track the growth of OPPS services provided in this
setting.
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\34\ Available at: http://medpac.gov/docs/default-souce/reports/mar17_entirereport.pdf.
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In order to participate in Medicare as a hospital, the facility
must meet the statutory definition of a hospital at section 1861(e) of
the Act, which requires a facility to be primarily engaged in providing
care and services to inpatients. In addition, 42 CFR 482.55 requires
hospital emergency department services (to include off-campus provider-
based emergency departments) to be fully integrated with departments
and services of the hospital. The integration must be such that the
hospital can immediately make available the full extent of its patient
care resources to assess and furnish appropriate care for an emergency
patient. Such services would include, but are not limited to, surgical
services, laboratory services, and radiology services, among others.
The emergency department must also be integrated with inpatient
services, which means the hospital must have a sufficient number of
inpatient beds and nursing units to support the volume of emergency
department patients that could require inpatient services. The
provision of services, equipment, personnel and resources of other
hospital departments and services to emergency department patients must
be within timeframes that protect the health and safety of patients and
is within acceptable standards of practice.
We agree with MedPAC's recommendation and believe we need to
develop data to assess the extent to which OPPS services are shifting
to off-campus provider-based emergency departments. Therefore, we are
announcing in this proposed rule that we are implementing through the
subregulatory HCPCS modifier process a new modifier for this purpose
effective beginning January 1, 2019.
We will create a HCPCS modifier (ER--Items and services furnished
by a provider-based off-campus emergency department) that is to be
reported with every claim line for outpatient hospital services
furnished in an off-campus provider-based emergency department. The
modifier would be reported on the UB-04 form (CMS Form 1450) for
hospital outpatient services. Critical access hospitals (CAHs) would
not be required to report this modifier.
B. Proposal and Comment Solicitation on Method To Control for
Unnecessary Increases in the Volume of Outpatient Services
When the Medicare program was first implemented, payment for
hospital services (inpatient and outpatient) was based on hospital-
specific reasonable costs attributable to furnishing services to
Medicare beneficiaries. Although payment for most Medicare hospital
inpatient services became subject to a prospective payment system (PPS)
under section 1886(d) of the Act in 1983, Medicare hospital outpatient
services continued to be paid based on hospital-specific costs. This
methodology for payment provided little incentive for hospitals to
furnish such outpatient services efficiently and in a cost effective
manner. At the same time, advances in medical technology and changes in
practice patterns were bringing about a shift in the site of medical
care from the hospital inpatient setting to the hospital outpatient
setting.
In the Omnibus Budget Reconciliation Act of 1986 (OBRA 1986) (Pub.
L. 99-509), the Congress paved the way for development of a PPS for
hospital outpatient services. Section 9343(g) of OBRA 1986 mandated
that fiscal intermediaries require hospitals to report claims for
services under the Healthcare Common Procedure Coding System (HCPCS).
Section 9343(c) of OBRA 1986 extended the prohibition against
unbundling of hospital services under section 1862(a)(14) of the Act to
include outpatient services as well as inpatient services. The codes
under the HCPCS enabled us to determine which specific procedures and
services were billed, while the extension of the prohibition against
unbundling ensured that all nonphysician services provided to hospital
outpatients were reported on hospital bills and captured in the
hospital outpatient data that were used to develop an outpatient PPS.
The brisk increase in hospital outpatient services further led to
an interest in creating payment incentives to promote more efficient
delivery of hospital outpatient services through a Medicare outpatient
PPS. Section 9343(f) of OBRA 1986 and section 4151(b)(2) of the Omnibus
Budget Reconciliation Act of 1990 (OBRA 1990) (Pub. L. 101-508)
required that we develop a proposal to replace the existing hospital
outpatient payment system with a PPS and submit a report to the
Congress on a new proposed system. The statutory framework for the
Outpatient Prospective Payment System (OPPS) was established by section
4523 of the Balanced Budget Act (BBA) of 1997 (Pub. L. 105-33), which
amended section 1833 of the Act by adding subsection (t), which
establishes a PPS for hospital outpatient department services, and by
section 201 of the Balanced Budget Reconciliation Act (BBRA) of 1999
(Pub. L. 106-113), which amended section 1833(t) of the Act to require
outlier and transitional pass-through payments. At the onset of the
OPPS, there was significant concern over observed increases in the
volume of outpatient services and corresponding rapidly growing
beneficiary coinsurance. Accordingly, most of the focus was on finding
ways to address those issues.
When section 4523 of the BBA of 1997 established the OPPS, it
included specific authority under section 1833(t)(2)(F) of the Act that
requires the Secretary to develop a method for controlling unnecessary
increases in the volume of covered outpatient department (OPD)
services.\35\ In the initial rule that proposed to implement the OPPS
(63 FR 47585 through 47587), we discussed several possible approaches
for controlling the volume of covered outpatient department services
furnished in subsequent years, solicited comments on those options, and
stated that the agency would propose an appropriate ``volume control''
mechanism for services furnished in CY 2001 and beyond after completing
further analysis. For the CY 2000 OPPS, we proposed to implement a
method that was similar to the one used under the Medicare Physician
Fee Schedule (PFS) (known as the sustainable growth rate or ``SGR''),
which would be triggered when expenditure targets, based on such
factors as volume, intensity, and beneficiary enrollment, were exceeded
(63 FR 47586 through 47587). However, as we discussed in the CY 2001
OPPS final rule (65 FR 18503) and the CY 2002 OPPS final rule (66 FR
59908), we delayed the implementation of the proposed volume control
method as suggested by the ``President's Plan to Modernize and
Strengthen Medicare for the 21st Century'' to give hospitals time to
adjust to the OPPS and CMS time to continue to examine methods to
control unnecessary increases in the volume of covered OPD services.
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\35\ Available at: https://www.ssa.gov/OP_Home/ssact/title18/1833.htm.
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In the CY 2008 OPPS/ASC final rule with comment period (72 FR 66611
through 66612), we noted that we had
[[Page 37139]]
significant concerns about the growth in program expenditures for
hospital outpatient services, and that while the OPPS was developed in
order to address some of those concerns, its implementation had not
generally slowed that growth in expenditures. To address some of those
concerns, we established a set of packaging policies beginning in the
CY 2008 that would explicitly encourage efficiency in the provision of
services in the hospital outpatient setting and potentially control
future growth in the volume of OPPS services (72 FR 66612).
Specifically, in the CY 2008 OPPS/ASC final rule with comment period
(72 FR 66580), we adopted a policy to package seven categories of items
and services into the payment for the primary diagnostic or therapeutic
modality to which we believe these items are typically ancillary or
supportive.
Similarly, in the CY 2014 OPPS/ASC final rule with comment period
(78 FR 74925 through 74948), we expanded our packaging policies to
include more categories of packaged items and services as part of a
broader initiative to make the OPPS more like a prospective payment
system and less like a per service fee schedule. Packaging can
encourage hospitals to furnish services efficiently while also enabling
hospitals to manage their resources with the maximum flexibility,
thereby encouraging long-term cost containment, which is an essential
component of a prospective payment system. While most of the packaging
policies established in the CY 2014 OPPS focused on ancillary services
that were part of a primary procedure, we also introduced the concept
of comprehensive APCs (C-APCs) (78 FR 74861 through 74910), which were
implemented beginning in the CY 2015 OPPS (79 FR 66798 through 66810).
Comprehensive APCs package payment for adjunctive and secondary items,
services, and procedures into the most costly primary procedure under
the OPPS at the claim level.
While we have developed many payment policies with these goals in
mind, growth in program expenditures for hospital outpatient services
paid under the OPPS continues. As illustrated in Table 30 below, total
spending has been growing at a rate of roughly 8 percent per year under
the OPPS, and total spending under the OPPS is projected to further
increase by more than $5 billion from approximately $70 billion in CY
2018 through CY 2019 to nearly $75 billion. This is approximately twice
the total estimated spending in CY 2008, a decade ago. We continue to
be concerned with this rate of increase in program expenditures under
the OPPS for several reasons. The OPPS was originally designed to
manage Medicare spending growth. What was once a cost-based system was
mandated by law to become a prospective payment system, which arguably
should have slowed the increases in program spending. To the contrary,
the OPPS has been the fastest growing sector of Medicare payments out
of all payment systems under Medicare Parts A and B. Furthermore, we
are concerned that the rate of growth suggests that payment incentives,
rather than patient acuity or medical necessity, may be affecting site-
of-service decision-making. This site-of-service selection has an
impact on not only the Medicare program, but also on Medicare
beneficiary out-of-pocket spending. Therefore, to the extent that there
are lower-cost sites-of-service available, we believe that
beneficiaries and the physicians treating them should have that choice
and not be encouraged to receive or provide care in higher paid
settings solely for financial reasons. For example, to provide for
easier comparisons between hospital outpatient departments and ASCs, as
previously discussed in the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59389), we also will make available a website that
provides comparison information between the OPPS and ASC payment and
copayment rates, as required under section 4011 of the 21st Century
Cures Act (Pub. L. 114-255). Making this information available can help
beneficiaries and their physicians determine the cost and
appropriateness of receiving care at different sites of service.
Although resources such as this website will help beneficiaries and
physicians select a site of service, we do not believe this information
alone is enough to control unnecessary volume increases. The growth in
OPPS expenditures and the increase in the volume and intensity of
hospital outpatient services are illustrated in Tables 30 and 31 below,
respectively.
Table 30--Growth in Expenditures Under OPPS From CY 2010 Through CY 2019
*
[In millions]
------------------------------------------------------------------------
Calendar year (CY) Incurred cost Percent increase
------------------------------------------------------------------------
CY 2010......................... $36,774 ..................
CY 2011......................... 39,781 8.2
CY 2012......................... 43,154 8.5
CY 2013......................... 46,462 7.7
CY 2014......................... 52,425 12.8
CY 2015......................... 56,274 7.3
CY 2016......................... 59,896 6.4
CY 2017......................... 64,770 8.1
CY 2018......................... 69,642 7.5
CY 2019 (Estimated)............. 75,315 8.1
------------------------------------------------------------------------
* Includes Medicare Part B Drug Expenditures.
Table 31--Percentage Increase in Volume and Intensity of Hospital
Outpatient Services *
------------------------------------------------------------------------
Percentage
Calendar year (CY) increase
------------------------------------------------------------------------
CY 2011............................................. 3.7
CY 2012............................................. 5.1
CY 2013............................................. 5.5
CY 2014............................................. 8.0
CY 2015............................................. 3.5
[[Page 37140]]
CY 2016............................................. 6.5
CY 2017............................................. 5.8
CY 2018............................................. 5.4
CY 2019 (Estimated)................................. 5.3
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* Includes Medicare Part B Drug Expenditures.
As noted in its March 2018 Report to Congress, the Medicare Payment
Advisory Commission (MedPAC) found that, from 2011 through 2016,
combined program spending and beneficiary cost-sharing on services
covered under the OPPS increased by 51 percent, from $39.8 billion to
$60.0 billion, an average of 8.6 percent per year.\36\ In its 2018
report, MedPAC also noted that ``A large source of growth in spending
on services furnished in hospital outpatient departments (HOPDs)
appears to be the result of the unnecessary shift of services from
(lower cost) physician offices to (higher cost) HOPDs''.\37\ We would
consider these shifts in the sites of service unnecessary if the
beneficiary can safely receive the same services in a lower cost
setting but instead receives care in a higher cost setting.
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\36\ Available at: http://www.medpac.gov/docs/default-source/reports/mar18_medpac_entirereport_sec.pdf?sfvrsn=0.
\37\ http://www.medpac.gov/docs/default-source/reports/mar18_medpac_entirereport_sec.pdf?sfvrsn=0.
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As noted in MedPAC's March 2017 Report to Congress, ``from 2014 to
2015, the use of outpatient services increased by 2.2 percent per
Medicare FFS beneficiary. Over the decade ending in 2015, volume per
beneficiary grew by 47 percent. One-third of the growth in outpatient
volume from 2014 to 2015 was due to an increase in the number of
evaluation and management (E&M) visits billed as outpatient services.
This growth in part reflects hospitals purchasing freestanding
physician practices and converting the billing from the Physician Fee
Schedule to higher paying hospital outpatient department (HOPD) visits.
The conversions shift market share from freestanding physician offices
to HOPDs. From 2012 to 2015, hospital-based E&M visits per beneficiary
grew by 22 percent, compared with a 1-percent decline in physician
office-based visits.'' \38\
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\38\ Available at: http://www.medpac.gov/docs/default-source/reports/mar17_medpac_ch3.pdf?sfvrsn=0.
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MedPAC has documented how the billing for these services has
shifted from physician offices to higher-cost outpatient sites of care
for several years. At the same time, MedPAC has repeated its
recommendation that the difference in payment rates between hospital
outpatient departments and physician offices should be reduced or
eliminated. It specifically recommended in its 2012 Report to Congress
that the payment rates for E&M visits provided in hospital outpatient
departments be reduced so that total payment rates for these visits are
the same, whether the service is provided in a hospital outpatient
department or a physician office. In its 2014 Report to Congress,
MedPAC recommended that Congress direct the Secretary to reduce or
eliminate differences in payment rates between hospital outpatient
departments and physician offices for selected APCs. Both of these
recommendations were reiterated in MedPAC's March 2017 Report to
Congress.
As previously noted, in addition to the concern that the difference
in payment is leading to unnecessary increases in the volume of covered
outpatient department services, we also are concerned that this shift
in care setting increases beneficiary cost-sharing liability because
Medicare payment rates for the same or similar services are generally
higher in hospital outpatient departments than in freestanding
physician offices. For example, MedPAC estimates that ``the Medicare
program spent $1.0 billion more in 2009, $1.3 billion more in 2014, and
$1.6 billion more in 2015 than it would have if payment rates for E&M
office visits in HOPDs were the same as freestanding office rates.
Relatedly, beneficiaries' cost-sharing was $260 million higher in 2009,
$325 million higher in 2014, and $400 million higher in 2015 than it
would have been because of the higher rates paid in HOPD settings.''
\39\ We believe that this volume growth and the resulting increase in
beneficiary cost-sharing is unnecessary because it appears to have been
incentivized by the difference in payment for each setting rather than
patient acuity. If there was not a difference in payment rates, we
believe that we would not have seen the increase in beneficiaries'
cost-sharing and the shift in site-of-service.
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\39\ Ibid.
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In the CY 2015 OPPS/ASC proposed rule (79 FR 41013), we stated that
we continued to seek a better understanding of how the growing trend
toward hospital acquisition of physicians' offices and subsequent
treatment of those locations as off-campus provider-based departments
(PBDs) of hospitals affects payments under the PFS and the OPPS, as
well as beneficiary cost-sharing obligations. We noted that MedPAC
continued to question the appropriateness of increased Medicare payment
and beneficiary cost-sharing when physicians' offices become hospital
outpatient departments and that MedPAC recommended that Medicare pay
selected hospital outpatient services at PFS rates (MedPAC March 2012
and June 2013 Reports to Congress).
To understand how this trend was affecting Medicare, we explained
that we needed information on the extent to which this shift was
occurring. To that end, during the CY 2014 OPPS/ASC rulemaking cycle,
we sought public comment regarding the best method for collecting
information and data that would allow us to analyze the frequency,
type, and payment for physicians' services and hospital outpatient
services furnished in off-campus PBDs of hospitals (78 FR 75061 through
75062 and 78 FR 74427 through 74428). Based on our analysis of the
public comments we received, we believed that the most efficient and
equitable means of gathering this important information across two
different payment systems would be to create a HCPCS modifier to be
reported with every code for physicians' services and hospital
outpatient services furnished in an off-campus PBD of a hospital on
both the CMS-1500 claim form for physicians' services and the UB-04
form (CMS Form 1450 and OMB Control Number 0938-0997) for hospital
outpatient services. We noted that a main provider may treat an off-
campus facility as provider-based if certain requirements at 42 CFR
413.65 are satisfied, and we define a ``campus'' at 42 CFR 413.65(a)(2)
to be the physical
[[Page 37141]]
area immediately adjacent to the provider's main buildings, other areas
and structures that are not strictly contiguous to the main buildings
but are located within 250 yards of the main buildings, and any other
areas determined on an individual case basis, by the CMS regional
office, to be part of the provider's campus.
In 2015, the Congress took steps to address the higher Medicare
payments for services furnished by certain off-campus provider-based
departments (PBDs) that may be associated with hospital acquisition of
physicians' offices through section 603 of the Bipartisan Budget Act of
2015 (Pub. L. 114-74), enacted on November 2, 2015. In the CY 2017
OPPS/ASC proposed rule, we discussed the provision of section 603 of
the Bipartisan Budget Act of 2015, which amended section 1833(t) of the
Act. For the full discussion of our initial implementation of this
provision, we refer readers to the CY 2017 OPPS/ASC final rule with
comment period (81 FR 79699 through 79719) and interim final rule with
comment period (79720 through 79729).
Section 603 of the Bipartisan Budget Act of 2015 (Section 603)
amended section 1833(t) of the Act by amending paragraph (1)(B) and
adding a new paragraph (21). As a general matter, under sections
1833(t)(1)(B)(v) and (t)(21) of the Act, applicable items and services
furnished by certain off-campus outpatient departments of a provider on
or after January 1, 2017 are not considered covered OPD services as
defined under section 1833(t)(1)(B) of the Act for purposes of payment
under the OPPS and are instead paid ``under the applicable payment
system'' under Medicare Part B if the requirements for such payment are
otherwise met. We note that, in order to be considered part of a
hospital, an off-campus department of a hospital must meet the
provider-based criteria established under 42 CFR 413.65.
Section 603 amended section 1833(t)(1)(B) of the Act by adding a
new clause (v), which excludes from the definition of ``covered OPD
services'' applicable items and services (defined in paragraph (21)(A)
of the section) that are furnished on or after January 1, 2017, by an
off-campus PBD, as defined in paragraph (21)(B) of the section. Section
603 also added a new paragraph (21) to section 1833(t) of the Act,
which defines the terms ``applicable items and services'' and ``off-
campus outpatient department of a provider,'' requires the Secretary to
make payments for such applicable items and services furnished by an
off-campus PBD under an applicable payment system (other than the
OPPS), provides that hospitals shall report on information as needed
for implementation of the provision, and establishes a limitation on
administrative and judicial review of the Secretary's determinations of
applicable items and services, applicable payment system, whether a
department meets the definition of an off-campus outpatient department
of a provider, and information hospitals are required to report. In
defining the term ``off-campus outpatient department of a provider,''
section 1833(t)(21)(B)(i) of the Act specifies that the term means a
department of a provider (as defined at 42 CFR 413.65(a)(2) as that
regulation was in effect on November 2, 2015, the date of enactment of
Pub. L. 114-74) that is not located on the campus of such provider, or
within the distance from a remote location of a hospital facility.
Section 1833(t)(21)(B)(ii) of the Act excepts from the definition of
``off-campus outpatient department of a provider,'' for purposes of
paragraphs (1)(B)(v) and (21)(B) of the section, an off-campus PBD that
was billing under section 1833(t) of the Act with respect to covered
OPD services furnished prior to the date of enactment of the Bipartisan
Budget Act of 2015, that is, November 2, 2015. We note that the
definition of ``applicable items and services'' specifically excludes
items and services furnished by a dedicated emergency department as
defined at 42 CFR 489.24(b) and the definition of ``off-campus
outpatient department of a provider'' does not include PBDs located on
the campus of a hospital or within the distance (described in the
definition of campus at Sec. 413.65(a)(2)) from a remote location of a
hospital facility; the items and services furnished by these excepted
off-campus PBDs on or after January 1, 2017 continued to be paid under
the OPPS.
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79699
through 79720), we established a number of policies to implement
section 603 of the Bipartisan Budget Act of 2015. Broadly, we: (1)
Defined applicable items and services in accordance with section
1833(t)(21)(A) of the Act for purposes of determining whether such
items and services are covered OPD services under section
1833(t)(1)(B)(v) of the Act or whether payment for such items and
services will instead be made under the applicable payment system
designated under section 1833(t)(21)(C) of the Act; (2) defined off-
campus PBD for purposes of sections 1833(t)(1)(B)(v) and (t)(21) of the
Act; and (3) established policies for payment for applicable items and
services furnished by an off-campus PBD (nonexcepted items and
services) under section 1833(t)(21)(C) of the Act. To do so, we
finalized policies that define whether certain items and services
furnished by a given off-campus PBD may be considered excepted and,
thus, continue to be paid under the OPPS; established the requirements
for the off-campus PBDs to maintain excepted status (both for the
excepted off-campus PBDs and for the items and services furnished by
such excepted off-campus PBDs); and described the applicable payment
system for nonexcepted items and services (generally, the PFS).
As part of developing policies to implement the section 603
amendments to section 1833(t) of the Act, we solicited public comments
on information collection requirements for implementing this provision
in accordance with section 1833(t)(21)(D) of the Act (81 FR 45686; 81
FR 79709 through 79710). In the CY 2017 OPPS/ASC final rule with
comment period (81 FR 79719 and 79725), we created modifier ``PN'' to
collect data for purposes of implementing section 603 but also to
trigger payment under the newly adopted PFS rates for nonexcepted items
and services.
While the changes required by the section 603 amendments to section
1833(t) of the Act address some of the concerns related to shifts in
settings of care and overutilization in the hospital outpatient
setting, the majority of hospital off-campus departments continue to
receive full OPPS payment (including off-campus emergency departments
and excepted off-campus departments of a hospital), which is often
higher than the payment that would have been made if a similar service
had been furnished in the physician office setting. Therefore, the
current site-based payment creates an incentive for the misallocation
of capital toward higher cost sites of care that could result in higher
costs for providers, taxpayers, beneficiaries, and the Medicare
program. Likewise, the differences in payment rates have unnecessarily
shifted services away from the physician's office to the higher paying
hospital outpatient department. We believe that the higher payment that
is made under the OPPS, as compared to payment under the PFS, is likely
to be incentivizing providers to furnish care in the hospital
outpatient setting rather than the physician office setting. In 2012,
Medicare was paying approximately 80 percent more for a 15-minute
office visit in a hospital outpatient department than in a
[[Page 37142]]
freestanding physician office.\40\ Under current policy, Medicare still
pays more using the G-code for a clinic visit than it would under the
PFS. In the CY 2017 OPPS/ASC interim final rule, we noted that the most
frequently billed service with the ``PO'' modifier was described by
HCPCS code G0463 (Hospital outpatient clinic visit for assessment and
management of a patient), which is paid under APC 5012 (Clinic Visits
and Related Services); the total number of CY 2017 claim lines for this
service was approximately 10.7 million as of May 2017. When services
are furnished in the hospital outpatient setting, an additional payment
for the professional services is generally made under the PFS using the
``facility'' rate. For example, in CY 2017, the OPPS payment rate for
APC 5012, which is the APC to which the outpatient clinic visit code
was assigned, was $106.56. The CY 2017 PFS ``facility'' payment rate
for a Level 3 visit, a service that commonly corresponds to the OPPS
clinic visit, was $77.88 for a new patient and $51.68 for an
established patient.
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\40\ Available at: http://www.medpac.gov/docs/default-source/reports/march-2012-report-to-the-congress-medicare-payment-policy.pdf.
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However, when services are furnished in the physician office
setting, only one payment is made--typically, the ``nonfacility'' rate
under the PFS. The CY 2017 PFS nonfacility payment rates for a Level 3
visit, a commonly billed service under the PFS, was $109.46 for a new
patient and $73.93 for an established patient. Therefore, the total
Medicare Part B payment rate (for the hospital and professional
service) for a new patient when the service was furnished in the
hospital outpatient setting was $184.44 ($106.56 + $77.88) compared to
$109.46 in the physician office setting, or for an established patient,
$158.24 ($106.56 + $51.68) in the hospital outpatient setting compared
to $73.93 in the physician office setting. Under these examples, the
payment rate was approximately $75 to $85 more for the same service
when furnished in the hospital outpatient setting instead of the
physician office setting, 20 percent of which was the responsibility of
the beneficiary.
We have heard that many off-campus departments converted from
physicians' offices to hospital outpatient departments, without a
change in either the physical location or a change in the acuity of the
patients seen. To the extent that similar services can be safely
provided in more than one setting, we do not believe it is prudent for
the Medicare program to pay more for these services in one setting than
another. We believe the difference in payment for these services is a
significant factor in the shift in services from the physician's office
to the hospital outpatient department, thus unnecessarily increasing
hospital outpatient department volume and Medicare program and
beneficiary expenditures.
We consider the shift of services from the physician office to the
hospital outpatient department unnecessary if the beneficiary can
safely receive the same services in a lower cost setting but is instead
receiving services in the higher paid setting due to payment
incentives. We believe the increase in the volume of clinic visits is
due to the payment incentive that exists to provide this service in the
higher cost setting. Because these services could likely be safely
provided in a lower cost setting, we believe that the growth in clinic
visits paid under the OPPS is unnecessary. Further, we believe that
capping the OPPS payment at the PFS-equivalent rate would be an
effective method to control the volume of these unnecessary services
because the payment differential that is driving the site-of-service
decision will be removed. In particular, we believe this method of
capping payment will control unnecessary volume increases as manifested
both in terms of numbers of covered outpatient department services
furnished and costs of those services.
Therefore, given the unnecessary increases in the volume of clinic
visits in hospital outpatient departments, for the CY 2019 OPPS, we are
proposing to use our authority under section 1833(t)(2)(F) of the Act
to apply an amount equal to the site-specific PFS payment rate for
nonexcepted items and services furnished by a nonexcepted off-campus
PBD (the PFS payment rate) for the clinic visit service, as described
by HCPCS code G0463, when provided at an off-campus PBD excepted from
section 1833(t)(21) of the Act (departments that bill the modifier
``PO'' on claim lines). Off-campus PBDs that are not excepted from
section 603 (departments that bill the modifier ``PN'') already receive
a PFS-equivalent payment rate for the clinic visit. In CY 2019, for an
individual Medicare beneficiary, the standard unadjusted Medicare OPPS
proposed payment for the clinic visit is approximately $116, with
approximately $23 being the average copayment. The proposed PFS
equivalent rate for Medicare payment for a clinic visit would be
approximately $46 and the copayment would be approximately $9. This
would save beneficiaries an average of $14 per visit. Under this
proposal, an excepted off-campus PBD would continue to bill HCPCS code
G0463 with the ``PO'' modifier in CY 2019, but the payment rate for
services described by HCPCS code G0463 when billed with modifier ``PO''
would now be equivalent to the payment rate for services described by
HCPCS code G0463 when billed with modifier ``PN''. For a discussion of
the PFS relativity adjuster that will now also be used to pay for all
outpatient clinic visits provided at all off-campus PBDs, we refer
readers to the CY 2018 PFS final rule (82 FR 53023 through 53024), as
well as the CY 2019 PFS proposed rule.
In addition, we are proposing to implement this proposed method in
a non-budget neutral manner. Specifically, while section 1833(t)(9)(B)
of the Act generally requires that changes made under the OPPS be made
in a budget neutral manner, we note that this section does not apply to
the volume control method under section 1833(t)(2)(F) of the Act. In
particular, section 1833(t)(9)(A) of the Act, titled ``Periodic
review,'' provides, in part, that the Secretary must annually review
and revise the groups, the relative payment weights, and the wage and
other adjustments described in paragraph (2) to take into account
changes in medical practice, changes in technology, the addition of new
services, new cost data, and other relevant information and factors
(emphasis added).'' Section 1833(t)(9)(B) of the Act, titled ``Budget
neutrality adjustment'' provides that if ``the Secretary makes
adjustments under subparagraph (A), then the adjustments for a year may
not cause the estimated amount of expenditures under this part for the
year to increase or decrease from the estimated amount of expenditures
under this part that would have been made if the adjustments had not
been made (emphasis added).'' However, section 1833(t)(2)(F) of the Act
is not an ``adjustment'' under paragraph (2). Unlike the wage
adjustment under section 1833(t)(2)(D) of the Act and the outlier,
transitional pass-through, and equitable adjustments under section
1833(t)(2)(E) of the Act, section 1833(t)(2)(F) of the Act refers to a
``method'' for controlling unnecessary increases in the volume of
covered OPD services, not an adjustment. Likewise, sections
1833(t)(2)(D) and (E) of the Act also explicitly require the
adjustments authorized by those paragraphs to be budget neutral, while
the volume control method authority at section 1833(t)(2)(F) of the Act
does not. Therefore, the volume control method proposed under section
1833(t)(2)(F) of the Act is not one of the adjustments
[[Page 37143]]
under section 1833(t)(2) of the Act that is referenced under section
1833(t)(9)(A) of the Act that must be included in the budget neutrality
adjustment under section 1833(t)(9)(B) of the Act. Moreover, section
1833(t)(9)(C) of the Act specifies that if the Secretary determines
under methodologies described in paragraph (2)(F) that the volume of
services paid for under this subsection increased beyond amounts
established through those methodologies, the Secretary may
appropriately adjust the update to the conversion factor otherwise
applicable in a subsequent year. We interpret this provision to mean
that the Secretary will have implemented a volume control method under
section 1833(t)(2)(F) of the Act in a nonbudget neutral manner in the
year in which the method is implemented, and that the Secretary may
then make further adjustments to the conversion factor in a subsequent
year to account for volume increases that are beyond the amounts
estimated by the Secretary under the volume control method.
We believe implementing a volume control method in a budget neutral
manner would not appropriately reduce the overall unnecessary volume of
covered OPD services, and instead would simply shift the movement of
the volume within the OPPS system in the aggregate, a concern similar
to the one we discussed in the CY 2008 OPPS final rule with comment
period (72 FR 66613). This estimated payment impact is displayed in
Column 5 of Table 42--Estimated Impact of the Proposed Changes for the
Hospital Outpatient Prospective Payment System in this proposed rule.
An estimate that includes the effects of estimated changes in
enrollment, utilization, and case-mix based on the FY 2019 President's
budget approximates the estimated savings at $760 million, with $610
million of the savings accruing to Medicare, and $150 million saved by
Medicare beneficiaries in the form of reduced copayments. In order to
effectively establish a method for controlling the unnecessary growth
in the volume of clinic visits furnished by excepted off-campus PBDs
that does not simply reallocate expenditures that are unnecessary
within the OPPS, we believe that this method must be adopted in a non-
budget neutral manner. The impact associated with this proposal is
further described in section XXI. of this proposed rule.
While we are developing a method to systematically control for
unnecessary increases in the volume of other hospital outpatient
department services, we continue to recognize the importance of not
impeding development or beneficiary access to new innovations. We are
soliciting public comments on how to maintain access to new innovations
while controlling for unnecessary increases in the volume of covered
hospital OPD services.
In addition, we are soliciting public comments on how to expand the
application of the Secretary's statutory authority under section
1833(t)(2)(F) of the Act to additional items and services paid under
the OPPS that may represent unnecessary increases in OPD utilization.
Therefore, we are seeking public comment on the following:
How might Medicare define the terms ``unnecessary'' and
``increase'' for services (other than the clinic visit) that can be
performed in multiple settings of care? Should the method to control
for unnecessary increases in the volume of covered OPD services include
consideration of factors such as enrollment, severity of illness, and
patient demographics?
While we are proposing to pay the PFS payment rate for
clinic visits beginning in CY 2019, we also are interested in other
methods to control for unnecessary increases in the volume of
outpatient services. Prior authorization is a requirement that a health
care provider obtain approval from the insurer prior to providing a
given service in order for the insurer to cover the service. Private
health insurance plans often require prior authorization for certain
services. Should prior authorization be considered as a method for
controlling overutilization of services?
For what reasons might it ever be appropriate to pay a
higher OPPS rate for services that can be performed in lower cost
settings?
Several private health plans use utilization management as
a cost-containment strategy. How might Medicare use the authority at
section 1833(t)(2)(F) of the Act to implement an evidence-based,
clinical support process to assist physicians in evaluating the use of
medical services based on medical necessity, appropriateness, and
efficiency?
Could utilization management help reduce the overuse of
inappropriate or unnecessary services?
How should we account for providers that serve Medicare
beneficiaries in provider shortage areas, which may include certain
rural areas? With respect to rural providers, should there be
exceptions from this policy, such as for providers who are at risk of
hospital closure or that are sole community hospitals?
What impact on beneficiaries and the health care market
would such a method to control for unnecessary increases in the volume
of covered OPD services have?
What exceptions, if any, should be made if additional
proposals to control for unnecessary increases in the volume of
outpatient services are made?
C. Proposal To Apply the 340B Drug Payment Policy to Nonexcepted Off-
Campus Departments of a Hospital
1. Historical Perspective
a. Section 603 of the Bipartisan Budget Act of 2015
In the CY 2017 OPPS/ASC final rule with comment period (81 FR
79699), we discussed implementation of section 603 of the Bipartisan
Budget Act of 2015 (Pub. L. 114-74), enacted on November 2, 2015, which
amended section 1833(t) of the Act. Specifically, this provision
amended section 1833(t) of the Act by amending paragraph (1)(B) and
adding a new paragraph (21). As a general matter, under sections
1833(t)(1)(B)(v) and (t)(21) of the Act, applicable items and services
furnished by certain off-campus outpatient departments of a provider on
or after January 1, 2017 are not considered covered OPD services as
defined under section 1833(t)(1)(B) of the Act for purposes of payment
under the OPPS and will instead be paid ``under the applicable payment
system'' under Medicare Part B if the requirements for such payment are
otherwise met. We indicated that, in order to be considered part of a
hospital, an off-campus department of a hospital must meet the
provider-based criteria established under 42 CFR 413.65. Accordingly,
we refer to an ``off-campus outpatient department of a provider,''
which is the term used in section 603 of the Bipartisan Budget Act of
2015, as an ``off-campus outpatient provider-based department'' or an
``off-campus PBD.'' For a detailed discussion of the legislative
history and statutory authority related to payments under section 603
of the Bipartisan Budget Act of 2015, we refer readers to the CY 2017
OPPS/ASC final rule with comment period (81 FR 79699 through 79719) and
interim final rule with comment period (81 FR 79720 through 79729).
b. Applicable Payment System
To implement the amendments made by section 603 of Public Law 114-
74, we issued an interim final rule with comment period (81 FR 79720)
which accompanied the CY 2017 OPPS/ASC final rule with comment period
to establish the PFS as the ``applicable payment system'' that applies
in most
[[Page 37144]]
cases, and we established payment rates under the PFS for those
nonexcepted items and services furnished by nonexcepted off-campus
PBDs. As we discussed in the CY 2017 OPPS/ASC interim final rule with
comment period (81 FR 79718) and reiterated in the CY 2018 PFS final
rule with comment period (82 FR 53028), payment for Medicare Part B
drugs that would be separately payable under the OPPS (assigned a
status indicator of ``K'') but are not payable under the OPPS because
they are furnished by nonexcepted off-campus PBDs is made in accordance
with section 1847A of the Act (generally, at a rate of ASP plus 6
percent), consistent with Part B drug payment policy for items or
services furnished in the physician office (nonfacility) setting. We
did not propose or make an adjustment to payment for 340B-acquired
drugs in nonexcepted off-campus PBDs in CY 2018, but indicated we may
consider doing so through future notice-and-comment rulemaking.
In the interim final rule with comment period that accompanied the
CY 2017 OPPS/ASC final rule with comment period, we established payment
policies under the PFS for nonexcepted items and services furnished by
a nonexcepted off-campus PBD on or after January 1, 2017. In accordance
with sections 1848(b) and (c) of the Act, PFS payment is based on the
relative value of the resources involved in furnishing particular
services (81 FR 79790). Resource-based relative values are established
for each item and service (described by a HCPCS code) based on the work
(time and intensity), practice expense (such as clinical staff,
supplies and equipment, office rent, and overhead), and malpractice
expense required to furnish the typical case of the service. Because
Medicare makes separate payment under institutional payment systems
(such as the OPPS) for the facility costs associated with many of the
same services that are valued under the PFS, we establish two different
PFS payment rates for many of these services--one that applies when the
service is furnished in a location where a facility bills and is paid
for the service under a Medicare payment system other than the PFS (the
facility rate), and another that applies when the billing practitioner
or supplier furnishes and bills for the entire service (the nonfacility
rate). Consistent with the long-established policy under the PFS to
make payment to the billing practitioner at the facility rate when
Medicare makes a corresponding payment to the facility (under the OPPS,
for instance) for the same service, physicians and nonphysician
practitioners furnishing services in nonexcepted PBDs continue to
report their services on a professional claim form and are paid for
their services at the PFS facility rate.
Similarly, there are many (mostly diagnostic) services paid under
the PFS that have two distinct portions of the service: A technical
component (TC) and a professional component (PC). These components can
be furnished independently in time or by different suppliers, or they
may be furnished and billed together as a ``global'' service (82 FR
52981). Payment for these services can also be made under a combination
of payment systems; for example, under the PFS for the professional
component and the OPPS for the facility portion. For instance, for a
diagnostic CT scan, the technical component relates to the portion of
the service during which the image is captured and might be furnished
in an office or HOPD setting, and the professional component relates to
the interpretation and report by a radiologist.
In the CY 2017 interim final rule with comment period, we stated
that we continue to believe that it is operationally infeasible for
nonexcepted off-campus PBDs to bill directly under the PFS for the
subset of PFS services for which there is a separately valued technical
component (81 FR 79721). In addition, we explained that we believe
hospitals that furnish nonexcepted items and services are likely to
furnish a broader range of services than other provider or supplier
types for which there is a separately valued technical component under
the PFS. We stated that we therefore believe it is necessary to
establish a new set of payment rates under the PFS that reflect the
relative resource costs of furnishing the technical component of a
broad range of services to be paid under the PFS that is specific to
one site of service (the off-campus PBD of a hospital) with the
packaging (bundling) rules that are significantly different from
current PFS rules (81 FR 79721).
In continuing to implement the requirements of sections
1833(t)(1)(B) and (t)(21) of the Act, we recognize that there is no
established mechanism for allowing hospitals to report and bill under
the PFS for the portion of resources incurred in furnishing the full
range of nonexcepted items and services. This is because hospitals with
nonexcepted off-campus PBDs that furnish nonexcepted items and services
generally furnish a broader range of services than other provider or
supplier types for which there is a separately valued technical
component under the PFS. As such, we established a new set of payment
rates under the PFS that reflected the relative resource costs of
furnishing the technical component of a broad range of services to be
paid under the PFS specific to the nonexcepted off-campus PBDs of a
hospital. Specifically, we established a PFS relativity adjuster that
is applied to the OPPS rate for the billed nonexcepted items and
services furnished in a nonexcepted off-campus PBD in order to
calculate payment rates under the PFS. The PFS relativity adjuster
reflects the estimated overall difference between the payment that
would otherwise be made to a hospital under the OPPS for the
nonexcepted items and services furnished in nonexcepted off-campus PBDs
and the resource-based payment under the PFS for the technical aspect
of those services with reference to the difference between the facility
and nonfacility (office) rates and policies under the PFS. The current
PFS relativity adjuster is set at 40 percent of the amount that would
have been paid under the OPPS (82 FR 53028). These PFS rates
incorporate the same packaging rules that are unique to the hospital
outpatient setting under the OPPS, including the packaging of drugs
that are unconditionally packaged under the OPPS. This includes
packaging certain drugs and biologicals that would ordinarily be
separately payable under the PFS when furnished in the physician office
setting.
Nonexcepted off-campus PBDs continue to bill for nonexcepted items
and services on the institutional claim utilizing a new claim line
(modifier ``PN'') to indicate that an item or service is a nonexcepted
item or service. For a detailed discussion of the current PFS
relativity adjuster related to payments under section 603 of Public Law
114-74, we refer readers to the CY 2018 OPPS/ASC final rule with
comment period (82 FR 52356 through 52637), the CY 2018 PFS final rule
with comment period (82 FR 53019 through 53025), and the CY 2019 PFS
proposed rule.
c. Section 340B of the Public Health Service Act
The 340B Program, which was established by section 340B of the
Public Health Service Act by the Veterans Health Care Act of 1992, is
administered by the Health Resources and Services Administration (HRSA)
within HHS. The 340B Program allows participating hospitals and other
health care providers to purchase certain ``covered outpatient drugs''
(as defined under section 1927(k) of the Act and interpreted by HRSA
through various
[[Page 37145]]
guidance documents) at discounted prices from drug manufacturers.
In the CY 2018 OPPS/ASC proposed rule (82 FR 33632 through 33635),
we proposed changes to the payment methodology under the OPPS for
separately payable drugs and biologicals acquired under the 340B
Program. We stated that these changes would better, and more
appropriately, reflect the resources and acquisition costs that these
hospitals incur. Such changes would allow Medicare beneficiaries (and
the Medicare program) to pay less when hospitals participating in the
340B Program furnish drugs that are purchased under the 340B Program to
Medicare beneficiaries. Subsequently, in the CY 2018 OPPS/ASC final
rule with comment period, we finalized our proposal that separately
payable, covered outpatient drugs and biologicals (other than drugs on
pass-through payment status and vaccines) acquired under the 340B
Program will be paid ASP minus 22.5 percent, rather than ASP plus 6
percent, when billed by a hospital paid under the OPPS that is not
excepted from the payment adjustment. CAHs are not subject to this 340B
policy change because they are paid under section 1834(g) of the Act.
Rural sole community hospitals, children's hospitals, and PPS-exempt
cancer hospitals are excepted from the alternative payment methodology
for 340B-acquired drugs and biologicals. In addition, as stated in the
CY 2018 OPPS/ASC final rule with comment period, this policy change
does not apply to drugs with pass-through payment status, which are
required to be paid based on the ASP methodology, or to vaccines, which
are excluded from the 340B Program.
2. Proposal To Pay an Adjusted Amount for 340B-Acquired Drugs and
Biologicals Furnished in Nonexcepted Off-Campus PBDs in CY 2019 and
Subsequent Years
As noted in the CY 2017 OPPS/ASC final rule with comment period (81
FR 79716), prior to the implementation of the payment adjustment under
the OPPS for drugs and biologicals acquired under the 340B program,
separately payable drugs and biologicals were paid the same rate at
both excepted and nonexcepted off-campus departments of a hospital. The
policy we finalized in the CY 2018 OPPS/ASC final rule with comment
period, in which we adjust the payment rate for separately payable
drugs and biologicals (other than drugs on pass-through payment status
and vaccines) acquired under the 340B Program from ASP plus 6 percent
to ASP minus 22.5 percent, applies to separately payable drugs and
biologicals paid under the OPPS (81 FR 59353 through 59369). Under
sections 1833(t)(1)(B)(v) and (t)(21) of the Act, however, nonexcepted
items and services furnished by nonexcepted off-campus PBDs are no
longer covered outpatient department services and, therefore, are not
payable under the OPPS. This means that nonexcepted off-campus PBDs are
not subject to the payment changes finalized in the CY 2018 OPPS/ASC
final rule with comment period that apply to hospitals and PBDs paid
under the OPPS. Because the separately payable drugs and biologicals
acquired under the 340B Program and furnished in nonexcepted off campus
PBDs are no longer covered outpatient department services, these drugs
and biologicals are currently paid in the same way Medicare Part B
drugs are paid in the physician office and other nonhospital settings--
typically at ASP plus 6 percent--regardless of whether they are
acquired under the 340B Program.
In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59367
through 59368), we discussed public comments that we received that
noted that the alternative payment methodology for 340B-acquired drugs
and biologicals did not apply to nonexcepted off-campus PBDs of a
hospital and could result in behavioral changes that may undermine CMS'
policy goals of reducing beneficiary cost-sharing liability and
undercut the goals of section 603 of the Public Law 114-74. Commenters
recommended that, if CMS adopted a final policy to establish an
alternative payment methodology for 340B drugs in CY 2018, CMS should
also apply the same adjustment to payment rates for drugs furnished in
nonexcepted off-campus PBDs of a hospital if such drugs were acquired
under the 340B Program (82 FR 59367). While we did not propose to
adjust payment for 340B-acquired drugs in nonexcepted off-campus PBDs
in CY 2018, we indicated that we would consider adopting such a policy
in future rulemaking.
The current PFS payment policies for nonexcepted items and services
incorporate a significant number of payment policies and adjustments
made under the OPPS (81 FR 79726; 82 FR 53024 through 53025). In
establishing these policies in prior rulemaking, we pointed out that
the adoption of these policies was necessary in order to maintain the
integrity of the PFS relativity adjuster because it adjusts payment
rates developed under the OPPS (81 FR 79726). For example, it is
necessary to incorporate OPPS packaging rules into the site-specific
PFS rate because the PFS relativity adjuster is applied to OPPS rates
that were developed based on those packaging rules. In addition, many
of the OPPS policies and adjustments are replicated under the
nonexcepted off-campus PBD site-specific PFS rates because they are
specifically applicable to hospitals as a setting of care. For example,
we adopted the geographic adjustments used for hospitals instead of the
adjustments developed for the PFS localities, which reflect cost
differences calculated for professionals and suppliers rather than
hospitals (81 FR 79726).
We agree with commenters that the difference in the payment amounts
for 340B-acquired drugs furnished by hospital outpatient departments--
excepted off-campus PBDs versus nonexcepted off-campus PBDs--creates an
incentive for hospitals to move drug administration services for 340B-
acquired drugs to nonexcepted off-campus PBDs to receive a higher
payment amount for these drugs, thereby undermining our goals of
reducing beneficiary cost-sharing for these drugs and biologicals and
moving towards site neutrality through the section 603 amendments to
section 1833(t) of the Act. Therefore, for CY 2019, we are proposing
changes to the Medicare Part B drug payment methodology for drugs and
biologicals furnished and billed by nonexcepted off-campus departments
of a hospital that were acquired under the 340B Program. Specifically,
for CY 2019 and subsequent years, we are proposing to pay under the PFS
the adjusted payment amount of ASP minus 22.5 percent for separately
payable drugs and biologicals (other than drugs on pass-through payment
status and vaccines) acquired under the 340B Program when they are
furnished by nonexcepted off-campus PBDs of a hospital. Furthermore, in
this CY 2019 OPPS/ASC proposed rule, we are proposing to except rural
sole community hospitals, children's hospitals, and PPS-exempt cancer
hospitals from this payment adjustment. We believe that our proposed
payment policy would better reflect the resources and acquisition costs
that nonexcepted off-campus PBDs incur for these drugs and biologicals.
We note that, ordinarily, Medicare pays for drugs and biologicals
furnished in the physician's office setting at ASP plus 6 percent. This
is because section 1842(o)(1)(A) of the Act provides that if a
physician's, supplier's, or any other person's bill or request for
payment for services includes a charge for a drug or biological for
which payment may be
[[Page 37146]]
made under Medicare Part B and the drug or biological is not paid on a
cost or prospective payment basis as otherwise provided in this part,
the amount for the drug or biological is equal to the following: The
amount provided under section 1847, section 1847A, section 1847B, or
section 1881(b)(13) of the Act, as the case may be for the drug or
biological.
Generally, in the hospital outpatient department setting, low-cost
drugs and biologicals are packaged into the payment for other services
billed under the OPPS. Separately payable drugs (1) have pass-through
payment status, (2) have a cost per day exceeding a threshold, or (3)
are not policy-packaged or packaged in a C-APC. As described in section
V.A.1. of this proposed rule, section 1847A of the Act establishes the
ASP methodology, which is used for payment for drugs and biologicals
described in section 1842(o)(1)(C) of the Act furnished on or after
January 1, 2005. The ASP methodology, as applied under the OPPS, uses
several sources of data as a basis for payment, including the ASP, the
WAC, and the AWP (82 FR 59337). As noted in section V.B.2.b. of this
proposed rule, since CY 2013, our policy has been to pay for separately
payable drugs and biologicals at ASP plus 6 percent in accordance with
section 1833(t)(14)(A)(iii)(II) of the Act (the statutory default) (82
FR 59350). Consequently, in the case of services furnished in a
hospital outpatient department, Medicare pays ASP plus 6 percent for
separately payable Part B drugs and biologicals unless those drugs or
biologicals are acquired under the 340B Program, in which case they are
paid at ASP minus 22.5 percent. For a detailed discussion of our
current OPPS drug payment policies, we refer readers to the CY 2018
OPPS/ASC final rule with comment period (82 FR 59343 through 59371).
As a general matter, in the nonexcepted off-campus PBD setting, we
pay hospitals under the PFS for all drugs and biologicals that are
packaged under the OPPS based on a percentage of the OPPS payment rate,
which is determined using the PFS relativity adjuster. Because OPPS
packaging rules apply to the PFS payments to nonexcepted off-campus
PBDs, the PFS payment for some nonexcepted items and services that are
packaged includes payment for some drugs and biologicals that would be
separately billable under the PFS if a similar service had been
furnished in the office-based setting. As we noted in the CY 2017 final
rule with comment period, in analyzing the term ``applicable payment
system,'' we considered whether and how the requirements for payment
could be met under alternative payment systems in order to pay for
nonexcepted items and services, and considered several payment systems
under which payment is made for similar items and services (81 FR
79712). Because the PFS relativity adjuster that is applied to
calculate payment to hospitals for nonexcepted items and services
furnished in nonexcepted off-campus PBDs is based on a percentage (40
percent) of the amount determined under the OPPS for a particular item
or service, and the OPPS is a prospective payment system, we believe
that items and services furnished by nonexcepted off-campus PBDs paid
under the PFS are payable on a prospective payment basis. Therefore, we
believe we have flexibility to pay for separately-payable drugs and
biologicals furnished in nonexcepted off-campus PBDs at an amount other
than the amount dictated by sections 1842(o)(1)(C) and 1847A of the
Act.
As we discussed in the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59354), several recent studies and reports on Medicare
Part B payments for 340B-acquired drugs highlight a difference in
Medicare Part B drug spending between 340B hospitals and non-340B
hospitals as well as varying differences in the amount by which the
Part B payment exceeds the drug acquisition cost. When we initially
developed the policy for nonexcepted off-campus PBDs, most separately
payable drugs and biologicals were paid, both in the OPPS and in other
Part B settings, such as physician offices, through similar
methodologies under section 1847A/1842(o) of the Act. For drugs and
biologicals that are packaged in the OPPS, we adopted similar packaging
payment policies for purposes of making the site-specific payment under
the PFS for nonexcepted off-campus PBDs. Because hospitals can, in some
cases, acquire drugs and biologicals under the 340B Program for use in
nonexcepted off-campus PBDs, we believe that not adjusting payment
exclusively for these departments would present a significant
incongruity between the payment amounts for these drugs depending upon
where (for example, excepted or nonexcepted PBD) they are furnished.
This incongruity would distort the relative accuracy of the resource-
based payment amounts under the site-specific PFS rates and could
result in significant perverse incentives for hospitals to acquire
drugs and biologicals under the 340B Program and avoid Medicare payment
adjustments that account for the discount by providing these drugs to
patients predominantly in nonexcepted off-campus PBDs. In light of the
significant drug payment differences between excepted and nonexcepted
off-campus PBDs, in combination with the potential eligibility for
discounts, which result in reduced costs under the 340B Program for
both kinds of departments, our current payment policy could undermine
the validity of the use of the OPPS payment structure in nonexcepted
off campus PBDs. In order to avoid such perverse incentives and the
resulting distortions, we are proposing, pursuant to our authority at
section 1833(t)(21)(C) of the Act to identify the PFS as the
``applicable payment system'' for 340B-acquired drugs and biologicals
and, accordingly, to pay under the PFS instead of under section 1847A/
1842(o) of the Act an amount equal to ASP minus 22.5 percent for drugs
and biologicals acquired under the 340B Program that are furnished by
nonexcepted off-campus PBDs. We believe this proposed change in policy
would eliminate the significant incongruity between the payment amounts
for these drugs, depending upon whether they are furnished by excepted
off-campus PBDs or nonexcepted off-campus PBDs, which we believe is an
unnecessary difference in payment where the 340B Program does not
differentiate between PBDs paid under the OPPS and PBDs paid under the
PFS using the PFS relativity adjuster.
D. Expansion of Clinical Families of Services at Excepted Off-Campus
Departments of a Provider
1. Background
a. Section 603 of the Bipartisan Budget Act of 2015
We refer readers to section X.C.1.a. of this proposed rule for a
discussion of the provisions of section 603 of the Bipartisan Budget
Act of 2015 (Pub. L. 114-74), as implemented in the CY 2017 OPPS/ASC
final rule with comment period (81 FR 79699 through 79719). As
discussed in the CY 2017 OPPS/ASC final rule with comment period, we
adopted the PFS as the applicable payment system for nonexcepted items
and services furnished and billed by off-campus PBDs. In addition, we
indicated that, in order to be considered part of a hospital, an off-
campus department of a hospital must meet the provider-based criteria
established under 42 CFR 413.65. For a detailed discussion of the
history and statutory authority related to payments under section 603
of Public Law 114-74, we refer readers to the CY 2017 OPPS/ASC final
rule with
[[Page 37147]]
comment period (81 FR 79699 through 79719) and the interim final rule
with comment period (81 FR 79720 through 79729).
b. Expansion of Services at an Off-Campus PBD Excepted Under Section
1833(t)(21)(B)(ii) of the Act
In the CY 2017 OPPS/ASC proposed rule (81 FR 45685), we noted that
we had received questions from some hospitals regarding whether an
excepted off-campus PBD could expand the number or type of services the
department furnishes and maintain excepted status for purposes of
paragraphs (1)(B)(v) and (21) of section 1833(t) of the Act. We
indicated that we were concerned that if excepted off-campus PBDs could
expand the types of services provided at the excepted off-campus PBDs
and also be paid OPPS rates for these new types of services, hospitals
may be able to purchase additional physician practices and expand
services furnished by existing excepted off-campus PBDs as a result (81
FR 45685). This could result in newly purchased physician practices
furnishing services that are paid at OPPS rates, which we believed
these amendments to section 1833(t) of the Act were intended to address
(81 FR 45685). We believed section 1833(t)(21)(B)(ii) of the Act
excepted off-campus PBDs and the items and services that are furnished
by such excepted off-campus PBDs for purposes of paragraphs (1)(B)(v)
and (21) of section 1833(t) of the Act as they were being furnished on
the date of enactment of section 603 of the Bipartisan Budget Act of
2015, as guided by our regulatory definition at Sec. 413.65(a)(2) of a
department of a provider (81 FR 45685). Thus, in the CY 2017 OPPS/ASC
proposed rule, we proposed that if an excepted off-campus PBD furnished
items and services from a clinical family of services (clinical
families of services were identified in Table 21 of the CY 2017
proposed rule (81 FR 45685 through 45686)) that it did not furnish
prior to November 2, 2015, and thus did not also bill for, services
from these new expanded clinical families of services would not be
covered OPD services, and instead would be subject to paragraphs
(1)(B)(v) and (21) of section 1833(t) of the Act as described in
section X.A.1.c. of the proposed rule. In addition, in that rule, we
proposed not to limit the volume of excepted items and services within
a clinical family of services that an excepted off-campus PBD could
furnish (81 FR 45685).
The majority of commenters, including several hospital
associations, regional health systems, and medical equipment
manufacturers opposed the proposals primarily because they believed:
(1) CMS exceeded its statutory authority, as the statutory language
included in section 603 does not address changes in service mix by
excepted off-campus PBDs; (2) CMS' proposal does not account for
evolving technologies and would hinder beneficiary access to those
innovative technologies; (3) the term ``clinical families of service''
appeared to be a new term created by CMS for the purpose of
implementing section 603 and it would be difficult for CMS and
hospitals to manage changes in the composition of APCs and HCPCS code
changes contained in those APCs; and (4) the proposal created
significant operational challenges and administrative burden for both
CMS and hospitals because commenters believed it was unnecessarily
complex (81 FR 79706 through 79707).
In addition, MedPAC explained in its comment letter that the
proposal was unnecessarily complex and instead suggested that CMS adopt
a different approach by determining how much the Medicare program had
paid an excepted off-campus PBD for services billed under the OPPS
during a 12-month baseline period that preceded November 2, 2015 and to
cap the OPPS payment made to the off-campus PBD at the amount paid
during the baseline period.\41\ Some commenters, including physician
group stakeholders, supported CMS' intent to monitor service line
expansion and changes in billing patterns by excepted off-campus PBDs.
These commenters urged CMS to work to operationalize a method that
would preclude an excepted off-campus PBD from expanding the excepted
services for which it is paid under the OPPS into wholly new clinical
areas, as they believed an excepted, off-campus PBD should only be able
to bill under the OPPS for those items and services for which it
submitted claims prior to November 2, 2015 (82 FR 33647).
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\41\ Available at: http://medpac.gov/docs/default-source/comment-letters/08172016_opps_asc_comment_2017_medpac_sec.pdf?sfvrsn=0.
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In response to public comments, we did not finalize our proposal to
limit the expansion of excepted services at excepted off-campus PBDs.
However, we stated our intent to monitor this issue and expressed
interest in additional feedback to help us consider whether excepted
off-campus PBDs that expand the types of services offered after
November 2, 2015 should be paid for furnishing those items and services
under the applicable payment system (that is, the PFS) instead of the
OPPS. Specifically, we requested comments on how either a limitation on
volume or a limitation on lines of service would work in practice (81
FR 79707).
In addition, in the CY 2017 OPPS/ASC final rule with comment period
(81 FR 79707), we sought public comments on how either a limitation on
volume of services, or a limitation on lines of service, as we laid out
in the CY 2017 OPPS/ASC proposed rule, could be implemented.
Specifically, we stated that we were interested in what data were
available or could be collected that would have allowed us to implement
a limitation on the expansion of excepted services.
We provided a summary of and responses to comments received in
response to the CY 2017 OPPS/ASC final rule with comment period in the
CY 2018 OPPS/ASC proposed rule. As stated in that rule, several of the
public comments received in response to the comment solicitation
included in the CY 2017 OPPS/ASC final rule with comment period were
repeated from the same stakeholders in response to the CY 2017 OPPS/ASC
proposed rule. These commenters again expressed concern regarding CMS'
authority to address changes in service-mix; that a limitation on
service expansion or volume would stifle innovative care delivery and
use of new technologies; and that limiting service line expansion using
clinical families of service was not workable. Because these commenters
did not provide new information, we referred readers to the CY 2017
OPPS/ASC final rule with comment period for our responses to comments
on statutory authority and concerns about hindering access to
innovative technologies (81 FR 79707 and 82 FR 59388). A summary of and
our responses to the other comments received in response to the comment
solicitation included in the CY 2017 OPPS/ASC final rule with comment
period were included in the CY 2018 OPPS/ASC proposed rule (82 FR 33645
through 33648).
In the CY 2018 OPPS/ASC proposed rule, we did not propose any
policies related to clinical service line expansion or volume increases
at excepted off-campus PBDs. However, we stated that we would continue
to monitor claims data for changes in billing patterns and utilization,
and we again invited public comments on the issue of service line
expansion. In response to the CY 2018 comment solicitation, MedPAC
largely reiterated the comments it submitted in response to the CY 2017
OPPS/ASC rulemaking and acknowledged the challenges of implementing its
recommended approach as such
[[Page 37148]]
approach would necessitate CMS requiring hospitals to report the amount
of OPPS payments received by each excepted off-campus PBD during the
baseline period (such as November 2014 through November 2015) because
CMS was not collecting data on payments made to each individual PBD
during that period. In its comments, MedPAC recommended that, to help
ensure the accuracy of these data, CMS could selectively audit
hospitals.\42\ Another commenter expressed support for CMS' efforts to
continue to implement and expand site-neutral payment policies for
services where payment differentials are not warranted, such as between
HOPDs and ASCs or physician offices.
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\42\ Available at: http://medpac.gov/docs/default-source/comment-letters/09082017_opps_asc_2018_medpac_comment_sec.pdf?sfvrsn=0.
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2. CY 2019 Proposal
As previously expressed in CYs 2017 and 2018 OPPS/ASC rulemaking,
we continue to be concerned that if excepted off-campus PBDs are
allowed to furnish new types of services that were not provided at the
excepted off-campus PBDs prior to the date of enactment of the
Bipartisan Budget Act of 2015 and can be paid OPPS rates for these new
types of services, hospitals may be able to purchase additional
physician practices and add those physicians to existing excepted off-
campus PBDs. This could result in newly purchased physician practices
furnishing services that are paid at OPPS rates, which we believe the
section 603 amendments to section 1833(t) of the Act are intended to
prevent. Of note, these statutory amendments ``came after years of
nonpartisan economists, health policy experts, and providers expressing
concern over the Medicare program's [OPPS] paying more for the same
services provided at HOPDs than in other settings--such as an
ambulatory surgery center, physician office, or community outpatient
facility.'' \43\ Experts raised concerns that this payment inequity
drove the acquisition of ``standalone or independent practices and
facilities by hospitals, resulted in higher costs for the Medicare
system and taxpayers, and also resulted in beneficiaries needlessly
facing higher cost-sharing in some settings than in others.'' \44\ In
addition, some experts argued that, ``to the extent this payment
differential accelerated consolidation of providers, this would result
in reduced competition among both hospitals and nonaffiliated
outpatient service providers. This, in turn, could reduce large
hospital systems' incentives to reduce costs, increase efficiency, or
focus on patient outcomes.'' \45\
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\43\ Available at: https://archives-energycommerce.house.gov/sites/republicans.energycommerce.house.gov/files/114/Letters/20160205SiteNeutralLetter%5b1%5d.pdf.
\44\ Ibid.
\45\ Ibid.
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The Government Accountability Office (GAO) stated in its December
2015 Report to Congress that ``from 2007 through 2013, the number of
vertically consolidated physicians nearly doubled, with faster growth
in more recent years.'' GAO concluded that, ``regardless of what has
driven hospitals and physicians to vertically consolidate, paying
substantially more for the same service when performed in an HOPD
rather than a physician office provides an incentive to shift services
that were once performed in physician offices to HOPDs after
consolidations have occurred.'' \46\
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\46\ GA0-16-189, ``Increasing Hospital-Physician Consolidation
Highlights Need for Payment Reform.'' Available at: https://www.gao.gov/assets/680/674347.pdf.
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While there is no congressional record available for section 603 of
the Bipartisan Budget Act of 2015, we do not believe that Congress
intended to allow for new service lines to be paid OPPS rates because
providing for such payment would allow for excepted off-campus PBDs to
be paid higher rates for types of services they were not performing
prior to enactment of the Bipartisan Budget Act of 2015 that would be
paid at lower rates if performed in a nonexcepted PBD. Similarly, we
are concerned that a potential shift of services from nonexcepted PBDs
to excepted PBDs, or to excepted PBDs generally, may be occurring,
given the higher payment rate in this setting. We believe that the
growth of service lines in currently excepted off-campus PBDs may be an
unintended consequence of our current policy, which allows continued
full OPPS payment for any services furnished by excepted off-campus
PBDs, including services in new service lines.
In prior rulemaking, and as discussed in section X.A. of this
proposed rule, we noted our concerns and discussed our efforts to begin
collecting data and monitoring billing patterns for off-campus PBDs.
Specifically, as described in the CY 2015 OPPS/ASC final rule with
comment period (79 FR 66910 through 66914), we created HCPCS modifier
``PO'' (Services, procedures, and/or surgeries furnished at off-campus
provider-based outpatient departments) for hospital claims to be
reported with every code for outpatient hospital items and services
furnished in an off-campus PBD of a hospital. Reporting of this new
modifier was voluntary for CY 2015, with reporting required beginning
on January 1, 2016. In addition, we established modifier ``PN''
(Nonexcepted service provided at an off-campus, outpatient, provider-
based department of a hospital) to identify and pay nonexcepted items
and services billed on an institutional claim. Effective January 1,
2017, nonexcepted off-campus PBDs of a hospital were required to report
this modifier on each claim line for nonexcepted items and services to
trigger payment under the PFS instead of the OPPS. As a conforming
revision, effective January 1, 2017, the modifier ``PO'' descriptor was
revised to ``excepted service provided at an off-campus, outpatient,
provider-based department of a hospital'' and this modifier continued
to be used to identify items and services furnished by an excepted off-
campus PBD of a hospital.
As discussed in the CY 2018 OPPS/ASC proposed rule (82 FR 33647), a
few commenters supported CMS' intent to monitor service line expansion
and changes in billing patterns by excepted off-campus PBDs. These
commenters urged CMS to work to operationalize a method that would
preclude an excepted off-campus PBD from increasing its payment
advantage under the OPPS by expanding into wholly new clinical areas
(82 FR 33647). Moreover, a few commenters urged CMS to pursue a
limitation on service line expansion to ensure designation as an
excepted off-campus PBD is not ``abused'' (82 FR 33647). One commenter
suggested that CMS evaluate outpatient claims with the ``PO'' modifier
to develop a list of ``grandfathered'' items and services for which the
excepted off-campus PBD may continue to be paid under the OPPS (82 FR
33647). In response to these comments, we stated that we were concerned
with the practicality of developing a list of excepted items and
services for each excepted off-campus PBD, given the magnitude of such
a list (82 FR 33647). We noted in the CY 2018 OPPS/ASC final rule with
comment period, however, that we continued to monitor claims data for
changes in billing patterns and utilization, and invited comments on
this issue (82 FR 59388).
In light of our prior stated concerns about the expansion of
services in excepted off-campus PBDs, for CY 2019 and subsequent years,
we are proposing that if an excepted off-campus PBD furnishes services
from any clinical family of services (as clinical families of services
are defined in Table 32 of this proposed rule) from which it did not
[[Page 37149]]
furnish an item or service during a baseline period from November 1,
2014 through November 1, 2015 (and subsequently bill under the OPPS for
that item or service), items and services from these new clinical
families of services would not be excepted items and services and,
thus, would not be covered OPD services, and instead would be subject
to paragraphs (1)(B)(v) and (21) of section 1833(t) of the Act and paid
under the PFS. Furthermore, in this CY 2019 OPPS/ASC proposed rule, we
are proposing to revise 42 CFR 419.48 to limit the definition of
``excepted items and services'' in accordance with this proposal.
Generally, excepted items and services are items or services that are
furnished on or after January 1, 2017 by an excepted off-campus PBD (as
defined in Sec. 419.48) that has not impermissibly relocated or
changed ownership. Beginning on January 1, 2019, excepted items and
services would be items or services that are furnished and billed by an
excepted off-campus PBD (defined in Sec. 419.48) only from the
clinical families of services (described later in this section) for
which the excepted off-campus PBD furnished (and subsequently billed
under the OPPS) for at least one item or service from November 1, 2014
through November 1, 2015. Further, for purposes of this section, ``new
clinical families of services'' would be items or services: (1) That
are furnished and billed by an excepted off-campus PBD; (2) that are
otherwise paid under the OPPS through one of the APCs included in Table
32 of this proposed rule; and (3) that belong to a clinical family
listed in Table 32 from which the excepted off-campus PBD did not
furnish an item or service during the baseline period from November 1,
2014 through November 1, 2015 (and subsequently bill for that service
under the OPPS). In addition, for CY 2019, we are proposing that if an
excepted off-campus PBD furnishes a new item or service from a clinical
family of services listed in Table 32 from which the off-campus PBD
furnished a service from November 1, 2014 through November 1, 2015,
such service would continue to be paid under the OPPS because items and
services from within a clinical family of services for which the
nonexcepted off-campus PBD furnished an item or service during the
baseline period would not be considered a ``service expansion.''
In order to determine the types of services provided at an excepted
off-campus PBD, for purposes of OPPS payment eligibility, excepted off-
campus PBDs will be required to ascertain the clinical families from
which they furnished services from November 1, 2014 through November 1,
2015 (that were subsequently billed under the OPPS). In addition, items
and services furnished by an excepted off campus PBD that are not
identified below in Table 32 of this proposed rule must be reported
with modifier ``PN''. We selected the year prior to the date of
enactment of the Bipartisan Budget Act of 2015 as the baseline period
because it is the most recent year preceding the date of enactment of
section 603 and we believe that a full year of claims data would
adequately reflect the types of service lines furnished and billed by
an excepted off-campus PBD. We considered expanding the baseline period
to include a timeframe prior to November 2014, but are not proposing
this alternative due to the possibility that hospital claims data for
an earlier time period may not be readily available and reviewing
claims from a longer timeframe may impose undue burden. If an excepted
off-campus PBD did not furnish services under the OPPS until after
November 1, 2014, we are proposing that the 1-year baseline period
begins on the first date the off-campus PBD furnished covered OPD
services prior to November 2, 2015. For providers that met the mid-
build requirement (as defined at section 1833(t)(21)(B)(v) of the Act),
we are proposing to establish a 1-year baseline period that begins on
the first date the off-campus PBDs furnished a service billed under the
OPPS. We are proposing changes to our regulation at 42 CFR 419.48 to
include these alternative baseline periods. For guidance on the
implementation of sections 16001 and 16002 of the 21st Century Cures
Act, we refer readers to the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Downloads/Sections-16001-16002.pdf. We are concerned that a 1-year
baseline may be unnecessarily long to the extent that such baseline
would be, at least in part, a prospective period during which such
departments would have time and an incentive to bill services from as
many service lines as possible, thereby limiting the effect of this
policy. We welcome public comment on whether a different baseline
period, such as 3 or 6 months, should be used for off-campus PBDs that
began furnishing services and billing after November 1, 2014, or that
met the mid-build requirement.
We are aware of past stakeholder concern regarding limiting service
line expansion for excepted off-campus PBDs using the 19 clinical
families identified below in Table 32 of this proposed rule. However,
we believe that the proposed clinical families recognize all clinically
distinct service lines for which a PBD might bill under the OPPS, while
at the same time allow for new services within a clinical family of
services to be considered for designation as ``excepted items and
services'', as defined in the regulations at 42 CFR 419.48 where the
types of services within a clinical family expand due to new technology
or innovation. We believe that requiring excepted off-campus PBDs to
limit their services to the exact same services they furnished during
the proposed baseline period would be too restrictive and
administratively burdensome. We are requesting public comments on the
proposed clinical families. We also are soliciting public comments on
whether any specific groups of hospitals should be excluded from our
proposal to limit the expansion of excepted services, such as certain
rural hospitals (for example, rural sole community hospitals), in light
of recent reports of hospital closures in rural areas.
In addition, we are soliciting public comments on alternate
methodologies to limit the expansion of excepted services in excepted
off-campus PBDs for CY 2019. Specifically, we are inviting public
comments on the adoption and implementation of other methodologies,
such as the approach recommended by MedPAC (discussed earlier in this
section) in response to the CY 2017 and CY 2018 proposals whereby CMS
would establish a baseline service volume for each applicable off-
campus PBD, cap excepted services (regardless of clinical family) at
that limit, and when the hospital reaches the annual cap for that
location, additional services furnished by that off-campus PBD would no
longer be considered covered OPD services and would instead be paid
under the PFS (the annual cap could be updated based on the annual
updates to the OPPS payment rates). Under such alternate approach,
hospitals would need to report service volume for each off-campus PBD
for the applicable period (such as November 1, 2014-November 1, 2015)
and such applicable periods would be subject to audit.
[[Page 37150]]
Table 32--Proposed Clinical Families of Services for Purposes of Section
603 Implementation
------------------------------------------------------------------------
Clinical families APCs
------------------------------------------------------------------------
Airway Endoscopy....................... 5151-5155.
Blood Product Exchange................. 5241-5244.
Cardiac/Pulmonary Rehabilitation....... 5771; 5791.
Diagnostic/Screening Test and Related 5721-5724; 5731-5735; 5741-
Procedures. 5743.
Drug Administration and Clinical 5691-5694.
Oncology.
Ear, Nose, Throat (ENT)................ 5161-5166.
General Surgery and Related Procedures. 5051-5055; 5061; 5071-5073;
5091-5094; 5361-5362.
Gastrointestinal (GI).................. 5301-5303; 5311-5313; 5331;
5341.
Gynecology............................. 5411-5416.
Major Imaging.......................... 5523-5525; 5571-5573; 5593-
5594.
Minor Imaging.......................... 5521-5522; 5591-5592.
Musculoskeletal Surgery................ 5111-5116; 5101-5102.
Nervous System Procedures.............. 5431-5432; 5441-5443; 5461-
5464; 5471.
Ophthalmology.......................... 5481, 5491-5495; 5501-5504.
Pathology.............................. 5671-5674.
Radiation Oncology..................... 5611-5613; 5621-5627; 5661.
Urology................................ 5371-5377.
Vascular/Endovascular/Cardiovascular... 5181-5184; 5191-5194; 5200;
5211-5213; 5221-5224; 5231-
5232.
Visits and Related Services............ 5012; 5021-5025; 5031-5035;
5041; 5045; 5821-5823.
------------------------------------------------------------------------
XI. Proposed CY 2019 OPPS Payment Status and Comment Indicators
A. Proposed CY 2019 OPPS Payment Status Indicator Definitions
Payment status indicators (SIs) that we assign to HCPCS codes and
APCs serve an important role in determining payment for services under
the OPPS. They indicate whether a service represented by a HCPCS code
is payable under the OPPS or another payment system, and also, whether
particular OPPS policies apply to the code.
For CY 2019, we are not proposing to make any changes to the
definitions of status indicators that were listed in Addendum D1 to the
CY 2018 OPPS/ASC final rule with comment period available on the CMS
website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices-Items/CMS-1656-FC.html?DLPage=1&DLEntries=10&DLSort=2&DLSortDir=descending.
The complete list of the payment status indicators and their
definitions that would apply for CY 2019 is displayed in Addendum D1 to
this proposed rule, which is available on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html.
The proposed CY 2019 payment status indicator assignments for APCs
and HCPCS codes are shown in Addendum A and Addendum B, respectively,
to this proposed rule, which are available on the CMS website at:
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html.
B. Proposed CY 2019 Comment Indicator Definitions
In this proposed rule, we are proposing to use four comment
indicators for the CY 2019 OPPS. These comment indicators, ``CH'',
``NC'', ``NI'', and ``NP'', are in effect for CY 2018 and we are
proposing to continue their use in CY 2019. The proposed CY 2019 OPPS
comment indicators are as follows:
``CH''--Active HCPCS code in current and next calendar
year, status indicator and/or APC assignment has changed; or active
HCPCS code that will be discontinued at the end of the current calendar
year.
``NC''--New code for the next calendar year or existing
code with substantial revision to its code descriptor in the next
calendar year, as compared to current calendar year for which we
requested comments in the proposed rule, final APC assignment; comments
will not be accepted on the final APC assignment for the new code.
``NI''--New code for the next calendar year or existing
code with substantial revision to its code descriptor in the next
calendar year, as compared to current calendar year, interim APC
assignment; comments will be accepted on the interim APC assignment for
the new code.
``NP''--New code for the next calendar year or existing
code with substantial revision to its code descriptor in the next
calendar year, as compared to current calendar year, proposed APC
assignment; comments will be accepted on the proposed APC assignment
for the new code.
The definitions of the proposed OPPS comment indicators for CY 2019
are listed in Addendum D2 to this proposed rule, which is available on
the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html.
XII. Proposed Updates to the Ambulatory Surgical Center (ASC) Payment
System
A. Background
1. Legislative History, Statutory Authority, and Prior Rulemaking for
the ASC Payment System
For a detailed discussion of the legislative history and statutory
authority related to payments to ASCs under Medicare, we refer readers
to the CY 2012 OPPS/ASC final rule with comment period (76 FR 74377
through 74378) and the June 12, 1998 proposed rule (63 FR 32291 through
32292). For a discussion of prior rulemaking on the ASC payment system,
we refer readers to the CYs 2012, 2013, 2014, 2015, 2016, 2017 and 2018
OPPS/ASC final rules with comment period (76 FR 74378 through 74379; 77
FR 68434 through 68467; 78 FR 75064 through 75090; 79 FR 66915 through
66940; 80 FR 70474 through 70502; 81 FR 79732 through 79753; and 82 FR
59401 through 59424, respectively).
2. Policies Governing Changes to the Lists of Codes and Payment Rates
for ASC Covered Surgical Procedures and Covered Ancillary Services
Under 42 CFR 416.2 and 416.166 of the Medicare regulations, subject
to certain exclusions, covered surgical procedures in an ASC are
surgical procedures that are separately paid under the OPPS, that would
not be expected to pose a significant risk to
[[Page 37151]]
beneficiary safety when performed in an ASC, and for which standard
medical practice dictates that the beneficiary would not typically be
expected to require active medical monitoring and care at midnight
following the procedure (``overnight stay''). We adopted this standard
for defining which surgical procedures are covered under the ASC
payment system as an indicator of the complexity of the procedure and
its appropriateness for Medicare payment in ASCs. We use this standard
only for purposes of evaluating procedures to determine whether or not
they are appropriate to be furnished to Medicare beneficiaries in ASCs.
We define surgical procedures as those described by Category I CPT
codes in the surgical range from 10000 through 69999 as well as those
Category III CPT codes and Level II HCPCS codes that directly crosswalk
or are clinically similar to procedures in the CPT surgical range that
we have determined do not pose a significant safety risk, that we would
not expect to require an overnight stay when performed in ASCs, and
that are separately paid under the OPPS (72 FR 42478).
In the August 2, 2007 final rule (72 FR 42495), we also established
our policy to make separate ASC payments for the following ancillary
items and services when they are provided integral to ASC covered
surgical procedures: (1) Brachytherapy sources; (2) certain implantable
items that have pass-through payment status under the OPPS; (3) certain
items and services that we designate as contractor-priced, including,
but not limited to, procurement of corneal tissue; (4) certain drugs
and biologicals for which separate payment is allowed under the OPPS;
and (5) certain radiology services for which separate payment is
allowed under the OPPS. In the CY 2015 OPPS/ASC final rule with comment
period (79 FR 66932 through 66934), we expanded the scope of ASC
covered ancillary services to include certain diagnostic tests within
the medicine range of CPT codes for which separate payment is allowed
under the OPPS when they are provided integral to an ASC covered
surgical procedure. Covered ancillary services are specified in Sec.
416.164(b) and, as stated previously, are eligible for separate ASC
payment. Payment for ancillary items and services that are not paid
separately under the ASC payment system is packaged into the ASC
payment for the covered surgical procedure. We update the lists of, and
payment rates for, covered surgical procedures and covered ancillary
services in ASCs in conjunction with the annual proposed and final
rulemaking process to update the OPPS and the ASC payment system (Sec.
416.173; 72 FR 42535). We base ASC payment and policies for most
covered surgical procedures, drugs, biologicals, and certain other
covered ancillary services on the OPPS payment policies, and we use
quarterly change requests (CRs) to update services covered under the
OPPS. We also provide quarterly update CRs for ASC covered surgical
procedures and covered ancillary services throughout the year (January,
April, July, and October). We release new and revised Level II HCPCS
codes and recognize the release of new and revised CPT codes by the AMA
and make these codes effective (that is, the codes are recognized on
Medicare claims) via these ASC quarterly update CRs. We recognize the
release of new and revised Category III CPT codes in the July and
January CRs. These updates implement newly created and revised Level II
HCPCS and Category III CPT codes for ASC payments and update the
payment rates for separately paid drugs and biologicals based on the
most recently submitted ASP data. New and revised Category I CPT codes,
except vaccine codes, are released only once a year, and are
implemented only through the January quarterly CR update. New and
revised Category I CPT vaccine codes are released twice a year and are
implemented through the January and July quarterly CR updates. We refer
readers to Table 41 in the CY 2012 OPPS/ASC proposed rule for an
example of how this process, which we finalized in the CY 2012 OPPS/ASC
final rule with comment period, is used to update HCPCS and CPT codes
(76 FR 42291; 76 FR 74380 through 74381).
In our annual updates to the ASC list of, and payment rates for,
covered surgical procedures and covered ancillary services, we
undertake a review of excluded surgical procedures (including all
procedures newly proposed for removal from the OPPS inpatient list),
new codes, and codes with revised descriptors, to identify any that we
believe meet the criteria for designation as ASC covered surgical
procedures or covered ancillary services. Updating the lists of ASC
covered surgical procedures and covered ancillary services, as well as
their payment rates, in association with the annual OPPS rulemaking
cycle is particularly important because the OPPS relative payment
weights and, in some cases, payment rates, are used as the basis for
the payment of many covered surgical procedures and covered ancillary
services under the revised ASC payment system. This joint update
process ensures that the ASC updates occur in a regular, predictable,
and timely manner.
3. Definition of ASC Covered Surgical Procedures
Since the implementation of the ASC prospective payment system, we
have defined a ``surgical'' procedure under the payment system as any
procedure described within the range of Category I CPT codes that the
CPT Editorial Panel of the American Medical Association (AMA) defines
as ``surgery'' (CPT codes 10000 through 69999) (72 FR 42478). We also
have included as ``surgical,'' procedures that are described by Level
II HCPCS codes or by Category III CPT codes that directly crosswalk or
are clinically similar to procedures in the CPT surgical range that we
have determined do not pose a significant safety risk, would not expect
to require an overnight stay when performed in an ASC, and are
separately paid under the OPPS (72 FR 42478).
As we noted in the CY 2008 final rule that implemented the revised
ASC payment system, using this definition of surgery would exclude from
ASC payment certain invasive, ``surgery-like'' procedures, such as
cardiac catheterization or certain radiation treatment services that
are assigned codes outside the CPT surgical range (72 FR 42477). We
stated in that final rule that we believed continuing to rely on the
CPT definition of surgery is administratively straightforward, is
logically related to the categorization of services by physician
experts who both establish the codes and perform the procedures, and is
consistent with a policy to allow ASC payment for all outpatient
surgical procedures (72 FR 42477).
In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59402
through 59403), we noted that some stakeholders have suggested that
certain procedures that are outside the CPT surgical range but that are
similar to surgical procedures currently covered in an ASC setting
should be ASC covered surgical procedures. For example, some
stakeholders have recommended adding certain cardiovascular procedures
to the ASC Covered Procedures List (CPL) due to their similarity to
currently-covered peripheral endovascular procedures in the surgical
code range for surgery and cardiovascular system. Further, stakeholders
also noted that the AMA's CPT code manual states that the listing of a
procedure in a specific section of the book may reflect historical or
other considerations and should not be interpreted as strictly
classifying the
[[Page 37152]]
procedure as ``surgery'' or ``not surgery'' for insurance purposes. As
the CPT codebook states: ``It is equally important to recognize that as
techniques in medicine and surgery have evolved, new types of services,
including minimally invasive surgery, as well as endovascular,
percutaneous, and endoscopic interventions have challenged the
traditional distinction of Surgery vs Medicine. Thus, the listing of a
service or procedure in a specific section of this book should not be
interpreted as strictly classifying the service or procedure as
`surgery' or `not surgery' for insurance or other purposes. The
placement of a given service in a specific section of the book may
reflect historical or other considerations (e.g., placement of the
percutaneous peripheral vascular endovascular interventions in the
Surgery/Cardiovascular System section, while the percutaneous coronary
interventions appear in the Medicine/Cardiovascular section)''
(emphasis added) (CPT[reg] 2018 Professional Edition, ``Instructions
for Use of the CPT Code Book,'' page xii.). While we continue to
believe that using the CPT code range to define surgery represents a
logical, appropriate, and straightforward approach to defining a
surgical procedure, we also believe it may be appropriate for us to use
the CPT surgical range as a guide rather than a strict determinant as
to whether a procedure is surgical, which would give us more
flexibility to include ``surgery-like'' procedures on the ASC CPL.
We also are cognizant of the dynamic nature of ambulatory surgery
and the continued shift of services from the inpatient setting to the
outpatient setting over the past decade. In the CY 2018 OPPS/ASC final
rule with comment period (82 FR 59402 through 59403), we responded to
public comments that we had solicited regarding services that are
described by Category I CPT codes outside of the surgical range, or
Level II HCPCS codes or Category III CPT codes that do not directly
crosswalk and are not clinically similar to procedures in the CPT
surgical range, but that nonetheless may be appropriate to include as
covered surgical procedures that are payable when furnished in the ASC
setting. Commenters offered mixed views for changing the current
definition of surgery; however, most commenters were supportive of
changing the definition. Some commenters recommended broadening the
definition of surgery to include procedures not described by the CPT
surgical range. Another commenter recommended making all surgical codes
payable in a hospital outpatient department payable in an ASC and
further suggested that CMS at least redefine surgical procedures to
include invasive procedures such as percutaneous transluminal
angioplasty and cardiac catheterization.
One commenter recommended using a definition of surgery developed
by the AMA Specialty Society Relative Value Scale Update Society for
use in the agency's Physician Fee Schedule (PFS) professional liability
insurance relative values. In calculating the professional liability
insurance relative values, certain cardiology codes outside the CPT
surgical range are considered surgical codes for both the calculation
and assignment of the surgery-specific malpractice risk factors.
However, we note that the distinction between ``surgical'' and ``non-
surgical'' codes developed by the AMA Specialty Society Relative Value
Scale Update Society is used by CMS to calculate professional liability
risk factors and not necessarily to define surgery. The codes
considered surgeries by the AMA Society Relative Value Scale Update
Society were most recently displayed on the CMS website for the CY 2018
MPFS final rule under the file ``Invasive Cardiology Services Outside
of Surgical HCPCS Code Range Considered Surgery.'' We refer readers to
that file, which is available on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/Downloads/CY2018-PFS-FR-Invasive-Cardiology.zip.
After further consideration of comments we received in response to
the CY 2018 OPPS/ASC final rule with comment period, we are proposing
to revise our definition of ``surgery'' for CY 2019 to account for
``surgery-like'' procedures that are assigned codes outside the CPT
surgical range (10000-69999). We believe it is appropriate to expand
our definition of covered surgical procedures to include Category I CPT
codes that are not in the Category I CPT surgical range but that
directly crosswalk or are clinically similar to procedures in the
Category I CPT code surgical range because, as commenters have noted,
the CPT Codebook's classification of certain procedures as ``surgical''
should not be considered dispositive of whether a procedure is or is
not surgery. We also believe that considering these codes for potential
inclusion on the covered surgical procedures list is consistent with
our policy for Level II HCPCS codes and Category III CPT codes.
For CY 2019, we are proposing that these newly-eligible ``surgery-
like'' procedures are procedures that are described by Category I CPT
codes that are not in the surgical range but, like procedures described
by Level II HCPCS codes or by Category III CPT codes under our current
policy, directly crosswalk or are clinically similar to procedures in
the Category I CPT surgical range. These Category I CPT codes would be
limited to those that we have determined do not pose a significant
safety risk, would not be expected to require an overnight stay when
performed in an ASC, and are separately paid under the OPPS.
We are inviting comments on our proposal to revise the definition
of surgery for the ASC prospective payment system. We also are
soliciting comments on whether we should expand our definition of
``surgery'' to include procedures that fall outside the CPT surgical
range, but fall within the definition of ``surgery'' developed by the
AMA Specialty Society Relative Value Scale Update Society for use in
the agency's Physician Fee Schedule (PFS) professional liability
insurance relative values, that we determine do not pose a significant
safety risk, would not be expected to require an overnight stay when
performed in an ASC, and are separately paid under the OPPS.
B. Proposed Treatment of New and Revised Codes
1. Background on Current Process for Recognizing New and Revised
Category I and Category III CPT Codes and Level II HCPCS Codes
Category I CPT, Category III CPT, and Level II HCPCS codes are used
to report procedures, services, items, and supplies under the ASC
payment system. Specifically, we recognize the following codes on ASC
claims:
Category I CPT codes, which describe surgical procedures
and vaccine codes;
Category III CPT codes, which describe new and emerging
technologies, services, and procedures; and
Level II HCPCS codes, which are used primarily to identify
items, supplies, temporary procedures, and services not described by
CPT codes.
We finalized a policy in the August 2, 2007 final rule (72 FR 42533
through 42535) to evaluate each year all new and revised Category I and
Category III CPT codes and Level II HCPCS codes that describe surgical
procedures, and to make preliminary determinations during the annual
OPPS/ASC rulemaking process regarding whether
[[Page 37153]]
or not they meet the criteria for payment in the ASC setting as covered
surgical procedures and, if so, whether or not they are office-based
procedures. In addition, we identify new and revised codes as ASC
covered ancillary services based upon the final payment policies of the
revised ASC payment system. In prior rulemakings, we refer to this
process as recognizing new codes. However, this process has always
involved the recognition of new and revised codes. We consider revised
codes to be new when they have substantial revision to their code
descriptors that necessitate a change in the current ASC payment
indicator. To clarify, we refer to these codes as new and revised in
this CY 2018 OPPS/ASC proposed rule.
We have separated our discussion below based on when the codes are
released and whether we are proposing to solicit public comments in
this proposed rule (and respond to those comments in the CY 2019 OPPS/
ASC final rule with comment period) or whether we will be soliciting
public comments in the CY 2019 OPPS/ASC final rule with comment period
(and responding to those comments in the CY 2020 OPPS/ASC final rule
with comment period).
We note that we sought public comments in the CY 2018 OPPS/ASC
final rule with comment period (82 FR 59405 through 59406) on the new
and revised Level II HCPCS codes effective October 1, 2017, or January
1, 2018. These new and revised codes, with an effective date of October
1, 2017, or January 1, 2018, were flagged with comment indicator ``NI''
in Addenda AA and BB to the CY 2018 OPPS/ASC final rule with comment
period to indicate that we were assigning them an interim payment
status and payment rate, if applicable, which were subject to public
comment following publication of the CY 2018 OPPS/ASC final rule with
comment period. We will respond to public comments and finalize the
treatment of these codes under the ASC payment system in the CY 2019
OPPS/ASC final rule with comment period.
In Table 33 below, we summarize our process for updating codes
through our ASC quarterly update CRs, seeking public comments, and
finalizing the treatment of these new codes under the OPPS.
Table 33--Comment and Finalization Timeframes for New or Revised HCPCS Codes
----------------------------------------------------------------------------------------------------------------
ASC quarterly update CR Type of code Effective date Comments sought When finalized
----------------------------------------------------------------------------------------------------------------
April 1, 2018............ Level II HCPCS April 1, 2018............ CY 2019 OPPS/ASC CY 2019 OPPS/ASC
Codes. proposed rule. final rule with
comment period.
July 1, 2018............. Level II HCPCS July 1, 2018............. CY 2019 OPPS/ASC CY 2019 OPPS/ASC
Codes. proposed rule. final rule with
comment period.
Category I July 1, 2018............. CY 2019 OPPS/ASC CY 2019 OPPS/ASC
(certain vaccine proposed rule. final rule with
codes) and III comment period.
CPT codes.
October 1, 2018.......... Level II HCPCS October 1, 2018.......... CY 2019 OPPS/ASC CY 2020 OPPS/ASC
Codes. final rule with final rule with
comment period. comment period.
January 1, 2019.......... Category I and III January 1, 2019.......... CY 2019 OPPS/ASC CY 2019 OPPS/ASC
CPT Codes. proposed rule. final rule with
comment period.
Level II HCPCS January 1, 2019.......... CY 2019 OPPS/ASC CY 2020 OPPS/ASC
Codes. final rule with final rule with
comment period. comment period.
----------------------------------------------------------------------------------------------------------------
Note: In the CY 2015 OPPS/ASC final rule with comment period (79 FR 66841 through 66844), we finalized a revised
process of assigning APC and status indicators for new and revised Category I and III CPT codes that would be
effective January 1. We refer readers to section III.A.3. of this CY 2019 OPPS/ASC proposed rule for further
discussion of this issue.
2. Proposed Treatment of New and Revised Level II HCPCS Codes
Implemented in April 2018 for Which We Are Soliciting Public Comments
in This Proposed Rule
In the April 2018 ASC quarterly update (Transmittal 3996, CR 10530,
dated March 09, 2018), we added nine new Level II HCPCS codes to the
list of covered surgical procedures and ancillary services. Table 34
below lists the new Level II HCPCS codes that were implemented April 1,
2018, along with their proposed payment indicators for CY 2019. The
proposed payment rates, where applicable, for these April codes can be
found in Addendum AA and Addendum BB to this proposed rule (which are
available via the internet on the CMS website).
Table 34--New Level II HCPCS Codes for Covered Surgical Procedures and
Ancillary Services Effective on April 1, 2018
------------------------------------------------------------------------
Proposed CY
CY 2018 HCPCS code CY 2019 long descriptor 2019 payment
indicator
------------------------------------------------------------------------
C9462...................... Injection, delafloxacin, 1 K2
mg.
C9463...................... Injection, aprepitant, 1 K2
mg.
C9464...................... Injection, rolapitant, 0.5 K2
mg.
C9465...................... Hyaluronan or derivative, K2
Durolane, for intra-
articular injection, per
dose.
C9466...................... Injection, benralizumab, 1 K2
mg.
C9467...................... Injection, rituximab and K2
hyaluronidase, 10 mg.
C9468...................... Injection, factor ix K2
(antihemophilic factor,
recombinant),
glycopegylated, Rebinyn,
1 i.u.
C9469 *.................... Injection, triamcinolone K2
acetonide, preservative-
free, extended-release,
microsphere formulation,
1 mg.
C9749...................... Repair of nasal vestibular J8
lateral wall stenosis
with implant(s).
------------------------------------------------------------------------
* HCPCS code C9469 (Injection, triamcinolone acetonide, preservative-
free, extended-release, microsphere formulation, 1 mg), which was
effective April 1, 2018, was deleted June 30, 2018 and replaced with
HCPCS code Q9993 (Injection, triamcinolone acetonide, preservative-
free, extended-release, microsphere formulation, 1 mg) effective July
1, 2018.
[[Page 37154]]
We are inviting public comments on these proposed payment
indicators and the proposed payment rates for the new HCPCS codes that
were recognized as ASC covered surgical procedures and ancillary
services in April 2018 through the quarterly update CRs, as listed in
Table 34 above. We are proposing to finalize their payment indicators
and their payment rates in the CY 2019 OPPS/ASC final rule with comment
period.
3. Proposed Treatment of New and Revised Level II HCPCS Codes
Implemented in July 2018 for Which We Are Soliciting Public Comments in
This Proposed Rule
In the July 2018 ASC quarterly update (Transmittal 4076, Change
Request 10788, dated June 26, 2018), we added eight new Level II HCPCS
codes to the list of covered ancillary services. Table 35 below lists
the new HCPCS codes that are effective July 1, 2018. The proposed
payment rates, where applicable, for these July codes can be found in
Addendum BB to this proposed rule (which is available via the internet
on the CMS website).
Table 35--New Level II HCPCS Codes for Covered Ancillary Services
Effective on July 1, 2018
------------------------------------------------------------------------
Proposed CY
CY 2018 HCPCS code CY 2018 long descriptor 2019 payment
indicator
------------------------------------------------------------------------
C9030...................... Injection, copanlisib, 1 K2
mg.
C9032...................... Injection, voretigene K2
neparvovec-rzyl, 1
billion vector genome.
Q5105...................... Injection, epoetin alfa, K2
biosimilar, (Retacrit)
(for esrd on dialysis),
100 units.
Q5106...................... Injection, epoetin alfa, K2
biosimilar, (Retacrit)
(for non-esrd use), 1000
units.
Q9991...................... Injection, buprenorphine K2
extended-release
(Sublocade), less than or
equal to 100 mg.
Q9992...................... Injection, buprenorphine K2
extended-release
(Sublocade), greater than
100 mg.
Q9993 *.................... Injection, triamcinolone K2
acetonide, preservative-
free, extended-release,
microsphere formulation,
1 mg.
Q9995...................... Injection, emicizumab- K2
kxwh, 0.5 mg.
------------------------------------------------------------------------
* HCPCS code C9469 (Injection, triamcinolone acetonide, preservative-
free, extended-release, microsphere formulation, 1 mg), which was
effective April 1, 2018, was deleted June 30, 2018 and replaced with
HCPCS code Q9993 (Injection, triamcinolone acetonide, preservative-
free, extended-release, microsphere formulation, 1 mg) effective July
1, 2018.
Through the July 2018 quarterly update CR, we are also implementing
an ASC payment for one new Category III CPT code as an ASC covered
ancillary service, effective July 1, 2018. This code is listed in Table
36 below, along with its proposed payment indicator. The CY 2019
proposed payment rate for this new Category III CPT code can be found
in Addendum BB to this proposed rule (which is available via the
internet on the CMS website).
Table 36--New Category III CPT Code for Covered Ancillary Service
Effective on July 1, 2018
------------------------------------------------------------------------
Proposed CY
CY 2018 HCPCS code CY 2018 long descriptor 2019 payment
indicator
------------------------------------------------------------------------
0508T...................... Pulse-echo ultrasound bone Z2
density measurement
resulting in indicator of
axial bone mineral
density, tibia.
------------------------------------------------------------------------
We are inviting public comments on these proposed payment
indicators and the proposed payment rates for the new Category III CPT
code and Level II HCPCS codes that were or are expected to be newly
recognized as ASC covered surgical procedures or covered ancillary
services in July 2018 through the quarterly update CRs, as listed in
Tables 34, 35 and 36 above. We are proposing to finalize their payment
indicators and their payment rates in the CY 2019 OPPS/ASC final rule
with comment period.
4. Proposed Process for New and Revised Level II HCPCS Codes That Will
Be Effective October 1, 2018 and January 1, 2019 for Which We Will Be
Soliciting Public Comments in the CY 2019 OPPS/ASC Final Rule With
Comment Period
As has been our practice in the past, we incorporate those new and
revised Level II HCPCS codes that are effective January 1 in the final
rule with comment period, thereby updating the OPPS and the ASC payment
system for the following calendar year. These codes are released to the
public via the CMS HCPCS website, and also through the January OPPS
quarterly update CRs. In the past, we also released new and revised
Level II HCPCS codes that are effective October 1 through the October
OPPS quarterly update CRs and incorporated these new codes in the final
rule with comment period.
For CY 2019, consistent with our established policy, we are
proposing that the Level II HCPCS codes that will be effective October
1, 2018, and January 1, 2019, would be flagged with comment indicator
``NI'' in Addendum B to the CY 2019 OPPS/ASC final rule with comment
period to indicate that we have assigned the codes an interim OPPS
payment status for CY 2019. We will invite public comments in the CY
2019 OPPS/ASC final rule with comment period on the interim status
indicator and APC assignments, and payment rates for these codes that
will be finalized in the CY 2020 OPPS/ASC final rule with comment
period.
5. Proposed Process for Recognizing New and Revised Category I and
Category III CPT Codes That Will Be Effective January 1, 2019 for Which
We Are Soliciting Public Comments in This CY 2019 OPPS/ASC Proposed
Rule
For new and revised CPT codes effective January 1, 2019, that were
received in time to be included in this proposed rule, we are proposing
APC and status indicator assignments. We will accept comments and
finalize the APC and status indicator assignments in the OPPS/ASC final
rule with comment period. For those new/revised CPT codes that are
received too late for inclusion in this OPPS/ASC proposed rule, we may
either make interim final assignments in the final rule with
[[Page 37155]]
comment period or possibly use HCPCS G-codes that mirror the
predecessor CPT codes and retain the current APC and status indicator
assignments for a year until we can propose APC and status indicator
assignments in the following year's rulemaking cycle.
For the CY 2019 ASC update, the new and revised CY 2019 Category I
and III CPT codes will be effective on January 1, 2019, and can be
found in ASC Addendum AA and Addendum BB to this proposed rule (which
are available via the internet on the CMS website). The new and revised
CY 2019 Category I and III CPT codes are assigned to comment indicator
``NP'' to indicate that the code is new for the next calendar year or
the code is an existing code with substantial revision to its code
descriptor in the next calendar year as compared to current calendar
year and that comments will be accepted on the proposed payment
indicator. Further, we remind readers that the CPT code descriptors
that appear in Addendum AA and Addendum BB are short descriptors and do
not describe the complete procedure, service, or item described by the
CPT code.
Therefore, we include the 5-digit placeholder codes and their long
descriptors for the new and revised CY 2019 CPT codes in Addendum O to
this proposed rule (which is available via the internet on the CMS
website) so that the public can comment on our proposed payment
indicator assignments. The 5-digit placeholder codes can be found in
Addendum O, specifically under the column labeled ``CY 2019 OPPS/ASC
Proposed Rule 5-Digit Placeholder Code,'' to this proposed rule. The
final CPT code numbers will be included in the CY 2019 OPPS/ASC final
rule with comment period. We note that not every code listed in
Addendum O is subject to comment. For the new/revised Category I and
III CPT codes, we are requesting comments on only those codes that are
assigned to comment indicator ``NP''.
In summary, we are soliciting public comments on the proposed CY
2019 payment indicators for the new and revised Category I and III CPT
codes that will be effective January 1, 2019. The CPT codes are listed
in Addendum AA and Addendum BB to this proposed rule with short
descriptors only. We list them again in Addendum O to this proposed
rule with long descriptors. We also are proposing to finalize the
payment indicator for these codes (with their final CPT code numbers)
in the CY 2019 OPPS/ASC final rule with comment period. The proposed
payment indicator for these codes can be found in Addendum AA and
Addendum BB to this proposed rule (which are available via the internet
on the CMS website).
C. Proposed Update to the List of ASC Covered Surgical Procedures and
Covered Ancillary Services
1. Covered Surgical Procedures
a. Covered Surgical Procedures Designated as Office-Based
(1) Background
In the August 2, 2007 ASC final rule, we finalized our policy to
designate as ``office-based'' those procedures that are added to the
ASC list of covered surgical procedures in CY 2008 or later years that
we determine are performed predominantly (more than 50 percent of the
time) in physicians' offices based on consideration of the most recent
available volume and utilization data for each individual procedure
code and/or, if appropriate, the clinical characteristics, utilization,
and volume of related codes. In that rule, we also finalized our policy
to exempt all procedures on the CY 2007 ASC list from application of
the office-based classification (72 FR 42512). The procedures that were
added to the ASC list of covered surgical procedures beginning in CY
2008 that we determined were office-based were identified in Addendum
AA to that rule by payment indicator ``P2'' (Office-based surgical
procedure added to ASC list in CY 2008 or later with MPFS nonfacility
PE RVUs; payment based on OPPS relative payment weight); ``P3''
(Office-based surgical procedures added to ASC list in CY 2008 or later
with MPFS nonfacility PE RVUs; payment based on MPFS nonfacility PE
RVUs); or ``R2'' (Office-based surgical procedure added to ASC list in
CY 2008 or later without MPFS nonfacility PE RVUs; payment based on
OPPS relative payment weight), depending on whether we estimated the
procedure would be paid according to the standard ASC payment
methodology based on its OPPS relative payment weight or at the MPFS
nonfacility PE RVU-based amount.
Consistent with our final policy to annually review and update the
list of covered surgical procedures eligible for payment in ASCs, each
year we identify covered surgical procedures as either temporarily
office-based (these are new procedure codes with little or no
utilization data that we have determined are clinically similar to
other procedures that are permanently office-based), permanently
office-based, or nonoffice-based, after taking into account updated
volume and utilization data.
(2) Proposed Changes for CY 2019 to Covered Surgical Procedures
Designated as Office-Based
In developing this proposed rule, we followed our policy to
annually review and update the covered surgical procedures for which
ASC payment is made and to identify new procedures that may be
appropriate for ASC payment, including their potential designation as
office-based. We reviewed CY 2017 volume and utilization data and the
clinical characteristics for all covered surgical procedures that are
assigned payment indicator ``G2'' (nonoffice-based surgical procedure
added in CY 2008 or later; payment based on OPPS relative payment
weight) in CY 2017, as well as for those procedures assigned one of the
temporary office-based payment indicators, specifically ``P2'', ``P3'',
or ``R2'' in the CY 2018 OPPS/ASC final rule with comment period (82 FR
59406 through 59408).
Our review of the CY 2017 volume and utilization data resulted in
our identification of 4 covered surgical procedures that we believe
meet the criteria for designation as office-based. The data indicate
that these procedures are performed more than 50 percent of the time in
physicians' offices, and we believe that the services are of a level of
complexity consistent with other procedures performed routinely in
physicians' offices. The CPT codes that we are proposing to permanently
designate as office-based for CY 2019 are listed in Table 37 below.
[[Page 37156]]
Table 37--ASC Covered Surgical Procedures Proposed to be Newly Designated as Permanently Office-Based for CY
2019
----------------------------------------------------------------------------------------------------------------
Proposed CY
CY 2018 ASC 2019 ASC
CY 2019 CPT code CY 2019 long descriptor payment payment
indicator indicator *
----------------------------------------------------------------------------------------------------------------
31573................................. Laryngoscopy, flexible; with G2 P3
therapeutic injection(s) (e.g.,
chemodenervation agent or
corticosteroid, injected
percutaneous, transoral, or via
endoscope channel), unilateral.
36513................................. Therapeutic apheresis; for platelets.. G2 R2
36902................................. Introduction of needle(s) and/or G2 P3
catheter(s), dialysis circuit, with
diagnostic angiography of the
dialysis circuit, including all
direct puncture(s) and catheter
placement(s), injection(s) of
contrast, all necessary imaging from
the arterial anastomosis and adjacent
artery through entire venous outflow
including the inferior or superior
vena cava, fluoroscopic guidance,
radiological supervision and
interpretation and image
documentation and report; with
transluminal balloon angioplasty,
peripheral dialysis segment,
including all imaging and
radiological supervision and
interpretation necessary to perform
the angioplasty.
36905................................. Percutaneous transluminal mechanical G2 P3
thrombectomy and/or infusion for
thrombolysis, dialysis circuit, any
method, including all imaging and
radiological supervision and
interpretation, diagnostic
angiography, fluoroscopic guidance,
catheter placement(s), and
intraprocedural pharmacological
thrombolytic injection(s); with
transluminal balloon angioplasty,
peripheral dialysis segment,
including all imaging and
radiological supervision and
interpretation necessary to perform
the angioplasty.
----------------------------------------------------------------------------------------------------------------
* Payment indicators are based on a comparison of the proposed rates according to the ASC standard ratesetting
methodology and the MPFS proposed rates. Current law specifies a 0.25 percent update to the MPFS payment rates
for CY 2019. For a discussion of the MPFS rates, we refer readers to the CY 2019 MPFS proposed rule.
We also reviewed CY 2017 volume and utilization data and other
information for 10 procedures designated as temporary office-based in
Tables 84 and 85 in the CY 2018 OPPS/ASC final rule with comment period
(82 FR 59408). Of these 10 procedures, there were very few claims in
our data and no claims data for 4 procedures described by CPT codes
38222, 65785, 67229, and 0402T. Consequently, we are proposing to
maintain the temporary office-based designations for these 4 codes for
CY 2019. We list all of these codes for which we are proposing to
maintain the temporary office-based designations for CY 2019 in Table
38 below. The procedures for which the proposed office-based
designations for CY 2019 are temporary also were indicated by asterisks
in Addendum AA to this proposed rule (which is available via the
internet on the CMS website).
The volume and utilization data for the remaining six procedures
that have a temporary office-based designation for CY 2018, described
by CPT codes 10030, 36473, 36901, 64461, and 64463, and HCPCS code
G0429, are sufficient to indicate that these procedures are performed
predominantly in physicians' offices and, therefore, should be assigned
an office-based payment indicator in CY 2018. Consequently, we are
proposing to assign payment indicator ``P2'', ``P3'', or ``G2'' to
these covered surgical procedure codes in CY 2019.
[[Page 37157]]
Table 38--Proposed CY 2019 Payment Indicators for ASC Covered Surgical Procedures Designated as Temporary Office-
Based in the CY 2018 OPPS/ASC Final Rule With Comment Period
----------------------------------------------------------------------------------------------------------------
CY 2018 ASC payment CY 2019 ASC proposed
CY 2019 CPT/HCPCS code CY 2019 long descriptor indicator * payment indicator **
----------------------------------------------------------------------------------------------------------------
38222....................... Diagnostic bone marrow; P3 * P3 ***
biopsy(ies) and
aspiration(s).
65785....................... Implantation of intrastromal P2 * P2 ***
corneal ring segments.
67229....................... Treatment of extensive or R2 * R2 ***
progressive retinopathy, 1
or more sessions, preterm
infant (less than 37 weeks
gestation at birth),
performed from birth up to
1 year of age (e.g.,
retinopathy of
prematurity),
photocoagulation or
cryotherapy.
0402T....................... Collagen cross-linking of R2 * R2 ***
cornea (including removal
of the corneal epithelium
and intraoperative
pachymetry when performed).
10030....................... Image-guided fluid P2 * G2
collection drainage by
catheter (e.g., abscess,
hematoma, seroma,
lymphocele, cyst), soft
tissue (e.g., extremity,
abdominal wall, neck),
percutaneous.
36473....................... Endovenous ablation therapy P2 * P3 **
of incompetent vein,
extremity, inclusive of all
imaging guidance and
monitoring, percutaneous,
mechanochemical; first vein
treated.
36901....................... Introduction of needle(s) P2 * P3 **
and/or catheter(s),
dialysis circuit, with
diagnostic angiography of
the dialysis circuit,
including all direct
puncture(s) and catheter
placement(s), injection(s)
of contrast, all necessary
imaging from the arterial
anastomosis and adjacent
artery through entire
venous outflow including
the inferior or superior
vena cava, fluoroscopic
guidance, radiological
supervision and
interpretation and image
documentation and report.
64461....................... Paravertebral block (pvb) P3 * G2
(paraspinous block),
thoracic; single injection
site (includes imaging
guidance, when performed).
64463....................... Paravertebral block (pvb) P3 * G2
(paraspinous block),
thoracic; continuous
infusion by catheter
(includes imaging guidance,
when performed).
G0429....................... Dermal filler injection(s) P3 * P3 **
for the treatment of facial
lipodystrophy syndrome
(lds) (e.g., as a result of
highly active
antiretroviral therapy).
----------------------------------------------------------------------------------------------------------------
* If designation is temporary.
** Payment indicators are based on a comparison of the proposed rates according to the ASC standard ratesetting
methodology and the MPFS proposed rates. Current law specifies a 0.25 percent update to the MPFS payment rates
for CY 2019. For a discussion of the MPFS rates, we refer readers to the CY 2019 MPFS proposed rule.
For CY 2019, we are proposing to designate 8 new CY 2019 CPT codes
for ASC covered surgical procedures as temporary office-based, as
displayed in Table 39 below. After reviewing the clinical
characteristics, utilization, and volume of related procedure codes, we
determined that the procedures described by the new CPT codes would be
predominantly performed in physicians' offices. However, because we had
no utilization data for the procedures specifically described by these
new CPT codes, we are proposing to make the office-based designation
temporary rather than permanent, and we will reevaluate the procedures
when data become available. The procedures for which the proposed
office-based designation for CY 2019 is temporary are indicated by
asterisks in Addendum AA to this proposed rule (which is available via
the internet on the CMS website).
Table 39--Proposed CY 2019 Payment Indicators for New CY 2019 CPT Codes
for ASC Covered Surgical Procedures Designated as Temporary Office-Based
------------------------------------------------------------------------
CY 2019 OPPS/ASC
proposed rule 5-digit CY 2019 long descriptor Proposed CY 2019 ASC
CMS placeholder code payment indicator **
------------------------------------------------------------------------
06X1T................... Extracorporeal shock R2 *
wave for integumentary
wound healing, high
energy, including
topical application
and dressing care;
initial wound.
10X12................... Fine needle aspiration P3 *
biopsy, including
ultrasound guidance;
first lesion.
10X14................... Fine needle aspiration P3 *
biopsy, including
fluoroscopic guidance;
first lesion.
10X16................... Fine needle aspiration P2 *
biopsy, including CT
guidance; first lesion.
10X18................... Fine needle aspiration R2 *
biopsy, including MR
guidance; first lesion.
11X02................... Tangential biopsy of P3 *
skin (e.g., shave,
scoop, saucerize,
curette); single
lesion.
11X04................... Punch biopsy of skin P3 *
(including simple
closure, when
performed); single
lesion.
11X06................... Incisional biopsy of P3 *
skin (e.g., wedge)
(including simple
closure, when
performed); single
lesion.
------------------------------------------------------------------------
* If designation is temporary.
** Payment indicators are based on a comparison of the proposed rates
according to the ASC standard ratesetting methodology and the MPFS
proposed rates. Current law specifies a 0.25 percent update to the
MPFS payment rates for CY 2019. For a discussion of the MPFS rates, we
refer readers to the CY 2019 MPFS proposed rule.
[[Page 37158]]
b. Proposed ASC Covered Surgical Procedures To Be Designated as Device-
Intensive
(1) Background
As discussed in the CY 2017 OPPS/ASC final rule with comment period
(81 FR 79739 through 79740), we implemented a payment methodology for
calculating the ASC payment rates for covered surgical procedures that
are designated as device-intensive.
According to this ASC payment methodology, we apply the device
offset percentage based on the standard OPPS APC ratesetting
methodology to the OPPS national unadjusted payment to determine the
device cost included in the OPPS payment rate for a device-intensive
ASC covered surgical procedure, which we then set as equal to the
device portion of the national unadjusted ASC payment rate for the
procedure. We calculate the service portion of the ASC payment for
device-intensive procedures by applying the uniform ASC conversion
factor to the service (non-device) portion of the OPPS relative payment
weight for the device-intensive procedure. Finally, we sum the ASC
device portion and ASC service portion to establish the full payment
for the device-intensive procedure under the revised ASC payment
system.
We also finalized in the CY 2017 OPPS/ASC final rule that device-
intensive procedures will be subject to all of the payment policies
applicable to procedures designated as an ASC device-intensive
procedure under our established methodology, including our policies on
no cost/full credit and partial credit devices and discontinued
procedures. In addition, in the CY 2017 OPPS/ASC final rule with
comment period (81 FR 79739 through 79740), we adopted a policy for new
HCPCS codes describing procedures involving the implantation of medical
devices that do not yet have associated claims data, to designate these
procedures as device-intensive with a default device offset set at 41
percent until claims data are available to establish the HCPCS code-
level device offset for the procedures. This default device offset
amount of 41 percent is not calculated from claims data; instead, it is
applied as a default until claims data are available upon which to
calculate an actual device offset for the new code. The purpose of
applying the 41-percent default device offset to new codes that
describe procedures that involve the implantation of medical devices
would be to ensure ASC access for new procedures until claims data
become available. However, in certain rare instances, for example, in
the case of a very expensive implantable device, we indicated we might
temporarily assign a higher offset percentage if warranted by
additional information, such as pricing data from a device
manufacturer. Once claims data are available for a new procedure
involving the implantation of a medical device, the device-intensive
designation is applied to the code if the HCPCS code device offset is
greater than 40 percent, according to our policy of determining device-
intensive status, by calculating the HCPCS code-level device offset.
(2) Proposed Changes to List of ASC Covered Surgical Procedures
Designated as Device-Intensive for CY 2019
As discussed in section IV.B.2. of this proposed rule, for CY 2019
we are proposing to modify our criteria for device-intensive procedures
to better capture costs for procedures with significant device costs.
We are proposing to allow procedures that involve surgically inserted
or implanted, high-cost, single-use devices to qualify as device-
intensive procedures. In addition, we are proposing to modify our
criteria to lower the device offset percentage threshold from 40
percent to 30 percent. Specifically, for CY 2019 and subsequent years,
we are proposing that device-intensive procedures would be subject to
the following criteria:
All procedures must involve implantable devices assigned a
CPT or HCPCS code;
The required devices (including single-use devices) must
be surgically inserted or implanted; and
The device offset amount must be significant, which is
defined as exceeding 30 percent of the procedure's mean cost.
Corresponding to this change in the cost criterion we are proposing
that the default device offset for new codes that describe procedures
that involve the implantation of medical devices would be 31 percent
beginning in CY 2019. For new codes describing procedures that are
payable when furnished in an ASC involving the implantation of a
medical device, we are proposing that the default device offset would
be applied in the same manner as proposed in section IV.B.2 of this
proposed rule.
In addition, as also proposed in section IV.B.2 of this proposed
rule, to further align the device-intensive policy with the criteria
used for device pass-through status, we are proposing to specify, for
CY 2019 and subsequent years, that for purposes of satisfying the
device-intensive criteria, a device-intensive procedure must involve a
device that:
Has received FDA marketing authorization, has received an
FDA investigational device exemption (IDE) and has been classified as a
Category B device by the FDA in accordance with 42 CFR 405.203 through
405.207 and 405.211 through 405.215, or meets another appropriate FDA
exemption from premarket review;
Is an integral part of the service furnished;
Is used for one patient only;
Comes in contact with human tissue;
Is surgically implanted or inserted (either permanently or
temporarily); and
Is not any of the following:
(a) Equipment, an instrument, apparatus, implement, or item of this
type for which depreciation and financing expenses are recovered as
depreciable assets as defined in Chapter 1 of the Medicare Provider
Reimbursement Manual (CMS Pub. 15-1); or
(b) A material or supply furnished incident to a service (for
example, a suture, customized surgical kit, scalpel, or clip, other
than a radiological site marker).
In conjunction with our proposed modifications to the device-
intensive criteria, we are proposing to amend Sec. 416.171(b)(2) of
the regulations to reflect the proposed new device criteria.
Based on our proposed modifications to our device-intensive
criteria, for CY 2019, we are proposing to update the ASC list of
covered surgical procedures that are eligible for payment according to
our proposed device-intensive procedure payment methodology, reflecting
the proposed individual HCPCS code device-offset percentages based on
CY 2017 OPPS claims and cost report data available for this proposed
rule.
The ASC covered surgical procedures that we are proposing to
designate as device-intensive, and therefore subject to the device-
intensive procedure payment methodology for CY 2019, are assigned
payment indicator ``J8'' and are included in Addendum AA to this
proposed rule (which is available on the CMS website). The CPT code,
the CPT code short descriptor, and the proposed CY 2019 ASC payment
indicator, and an indication of whether the full credit/partial credit
(FB/FC) device adjustment policy would apply because the procedure is
designated as device intensive also are included in Addendum AA to this
proposed rule. In addition, for CY 2019, we are proposing to only apply
our proposed device-intensive procedure payment
[[Page 37159]]
methodology to device-intensive procedures under the ASC payment system
when the device-intensive procedure is furnished with a surgically
inserted or implanted device (including single use medical devices).
Under this proposal, the payment rate under the ASC payment system for
device-intensive procedures furnished without an implantable or
inserted medical device would be calculated by applying the uniform ASC
conversion factor to both the device portion and service (non-device)
portion of the OPPS relative payment weight for the device-intensive
procedure and summing both portions (device and service) to establish
the ASC payment rate.
c. Proposed Adjustment to ASC Payments for No Cost/Full Credit and
Partial Credit Devices
Our ASC payment policy for costly devices implanted in ASCs at no
cost/full credit or partial credit, as set forth in Sec. 416.179 of
our regulations, is consistent with the OPPS policy that was in effect
until CY 2014. Specifically, the OPPS policy that was in effect through
CY 2013 provided a reduction in OPPS payment by 100 percent of the
device offset amount when a hospital furnishes a specified device
without cost or with a full credit and by 50 percent of the device
offset amount when the hospital receives partial credit in the amount
of 50 percent or more of the cost for the specified device (77 FR 68356
through 68358). The established ASC policy reduces payment to ASCs when
a specified device is furnished without cost or with full credit or
partial credit for the cost of the device for those ASC covered
surgical procedures that are assigned to APCs under the OPPS to which
this policy applies. We refer readers to the CY 2009 OPPS/ASC final
rule with comment period (73 FR 68742 through 68744) for a full
discussion of the ASC payment adjustment policy for no cost/full credit
and partial credit devices.
As discussed in section IV.B. of the CY 2014 OPPS/ASC final rule
with comment period (78 FR 75005 through 75006), we finalized our
proposal to modify our former policy of reducing OPPS payment for
specified APCs when a hospital furnishes a specified device without
cost or with a full or partial credit. Formerly, under the OPPS, our
policy was to reduce OPPS payment by 100 percent of the device offset
amount when a hospital furnished a specified device without cost or
with a full credit and by 50 percent of the device offset amount when
the hospital received partial credit in the amount of 50 percent or
more (but less than 100 percent) of the cost for the specified device.
For CY 2014, we finalized our proposal to reduce OPPS payment for
applicable APCs by the full or partial credit a provider receives for a
replaced device, capped at the device offset amount.
Although we finalized our proposal to modify the policy of reducing
payments when a hospital furnishes a specified device without cost or
with full or partial credit under the OPPS, in that final rule with
comment period (78 FR 75076 through 75080), we finalized our proposal
to maintain our ASC policy for reducing payments to ASCs for specified
device-intensive procedures when the ASC furnishes a device without
cost or with full or partial credit. Unlike the OPPS, there is
currently no mechanism within the ASC claims processing system for ASCs
to submit to CMS the actual credit received when furnishing a specified
device at full or partial credit. Therefore, under the ASC payment
system, we finalized our proposal for CY 2014 to continue to reduce ASC
payments by 100 percent or 50 percent of the device offset amount when
an ASC furnishes a device without cost or with full or partial credit,
respectively.
All ASC covered device-intensive procedures are subject to the no
cost/full credit and partial credit device adjustment policy.
Specifically, when a device-intensive procedure is performed to implant
a device that is furnished at no cost or with full credit from the
manufacturer, the ASC would append the HCPCS ``FB'' modifier on the
line in the claim with the procedure to implant the device. The
contractor would reduce payment to the ASC by the device offset amount
that we estimate represents the cost of the device when the necessary
device is furnished without cost or with full credit to the ASC. We
continue to believe that the reduction of ASC payment in these
circumstances is necessary to pay appropriately for the covered
surgical procedure furnished by the ASC.
For partial credit, we are proposing to reduce the payment for a
device-intensive procedure for which the ASC receives partial credit by
one-half of the device offset amount that would be applied if a device
was provided at no cost or with full credit, if the credit to the ASC
is 50 percent or more (but less than 100 percent) of the cost of the
new device. The ASC would append the HCPCS ``FC'' modifier to the HCPCS
code for the device-intensive surgical procedure when the facility
receives a partial credit of 50 percent or more (but less than 100
percent) of the cost of a device. To report that the ASC received a
partial credit of 50 percent or more (but less than 100 percent) of the
cost of a new device, ASCs would have the option of either: (1)
Submitting the claim for the device replacement procedure to their
Medicare contractor after the procedure's performance, but prior to
manufacturer acknowledgment of credit for the device, and subsequently
contacting the contractor regarding a claim adjustment, once the credit
determination is made; or (2) holding the claim for the device
implantation procedure until a determination is made by the
manufacturer on the partial credit and submitting the claim with the
``FC'' modifier appended to the implantation procedure HCPCS code if
the partial credit is 50 percent or more (but less than 100 percent) of
the cost of the replacement device. Beneficiary coinsurance would be
based on the reduced payment amount. As finalized in the CY 2015 OPPS/
ASC final rule with comment period (79 FR 66926), to ensure our policy
covers any situation involving a device-intensive procedure where an
ASC may receive a device at no cost or receive full credit or partial
credit for the device, we apply our FB/FC policy to all device-
intensive procedures.
d. Proposed Additions to the List of ASC Covered Surgical Procedures
As discussed in section XII.A.3. of this proposed rule, we are
proposing to revise our definition of surgery for CY 2019 to include
certain ``surgery-like'' procedures that are assigned codes outside the
CPT surgical range. For CY 2019, we are proposing to include procedures
that are described by Category I CPT codes that are not in the surgical
range but directly crosswalk or are clinically similar to procedures in
the Category I CPT code surgical range that we have determined do not
pose a significant safety risk, would not be expected to require an
overnight stay when performed in an ASC, and are separately paid under
the OPPS. We also are continuing to include in our definition of
surgical procedures those described by Category I CPT codes in the
surgical range from 10000 through 69999 as well as those Category III
CPT codes and Level II HCPCS codes that directly crosswalk or are
clinically similar to procedures in the CPT surgical range that we have
determined do not pose a significant safety risk, that we would not
expect to require an overnight stay when performed in ASCs, and that
are separately paid under the OPPS.
[[Page 37160]]
We conducted a review of HCPCS codes that currently are paid under
the OPPS, but not included on the ASC list of covered surgical
procedures, and that meet our proposed definition of surgery to
determine if changes in technology and/or medical practice affected the
clinical appropriateness of these procedures for the ASC setting. Based
on this review, we are proposing to update the list of ASC covered
surgical procedures by adding 12 cardiac catheterization procedures to
the list for CY 2019, as shown in Table 40 below. After reviewing the
clinical characteristics of these procedures and consulting with
stakeholders and our clinical advisors, we determined that these 12
procedures are separately paid under the OPPS, would not be expected to
pose a significant risk to beneficiary safety when performed in an ASC,
and would not be expected to require active medical monitoring and care
of the beneficiary at midnight following the procedure. Our regulation
at 42 CFR 416.166(c) lists general exclusions from the list of ASC
covered surgical procedures based on factors relating to safety,
including procedures that generally result in extensive blood loss,
require major or prolonged invasion of body cavities, or directly
involve major blood vessels. We have assessed each of the proposed
added procedures against the regulatory safety criteria and believe
that these procedures meet each of the criteria. Although the proposed
cardiac catheterization procedures may involve blood vessels that could
be considered major, based on our review of the clinical
characteristics of the procedures and their similarity to other
procedures that are currently included on the ASC list of covered
surgical procedures, we believe these procedures may be appropriately
performed in an ASC. Therefore, we are proposing to include these 12
procedures on the list of ASC covered surgical procedures for CY 2019.
As stated in the August 2, 2007 ASC final rule (72 FR 42481), we
believe the involvement of major blood vessels is best considered in
the context of the clinical characteristics of individual procedures,
and we do not believe that it is logically or clinically consistent to
exclude certain cardiac procedures from the list of ASC covered
surgical procedures on the basis of the involvement of major blood
vessels, yet continue to provide ASC payment for similar procedures
involving major blood vessels that have a history of safe performance
in ASCs, such as CPT code 36473 (Mechanicochemical destruction of
insufficient vein of arm or leg, accessed through the skin using
imaging guidance) and CPT code 37223 (Insertion of stents into groin
artery, endovascular, accessed through the skin or open procedure).
However, we are interested in hearing any specific safety concerns from
stakeholders regarding these 12 cardiac catheterization procedures and
are requesting comments on whether these procedures may be safely
performed in an ASC in light of the regulatory criteria governing which
procedures may be added to the ASC covered procedures list.
The procedures that we are proposing to add to the ASC list of
covered surgical procedures, including the HCPCS code long descriptors
and the proposed CY 2019 payment indicators, are displayed in Table 40
below.
Table 40--Proposed Additions to the List of ASC Covered Surgical
Procedures for CY 2019
------------------------------------------------------------------------
Proposed CY 2019 ASC
CY 2019 CPT code CY 2019 long descriptor payment indicator
------------------------------------------------------------------------
93451................... Right heart G2
catheterization
including
measurement(s) of
oxygen saturation and
cardiac output, when
performed.
93452................... Left heart G2
catheterization
including
intraprocedural
injection(s) for left
ventriculography,
imaging supervision
and interpretation,
when performed.
93453................... Combined right and left G2
heart catheterization
including
intraprocedural
injection(s) for left
ventriculography,
imaging supervision
and interpretation,
when performed.
93454................... Catheter placement in G2
coronary artery(s) for
coronary angiography,
including
intraprocedural
injection(s) for
coronary angiography,
imaging supervision
and interpretation.
93455................... Catheter placement in G2
coronary artery(s) for
coronary angiography,
including
intraprocedural
injection(s) for
coronary angiography,
imaging supervision
and interpretation;
with catheter
placement(s) in bypass
graft(s) (internal
mammary, free
arterial, venous
grafts) including
intraprocedural
injection(s) for
bypass graft
angiography.
93456................... Catheter placement in G2
coronary artery(s) for
coronary angiography,
including
intraprocedural
injection(s) for
coronary angiography,
imaging supervision
and interpretation;
with right heart
catheterization.
93457................... Catheter placement in G2
coronary artery(s) for
coronary angiography,
including
intraprocedural
injection(s) for
coronary angiography,
imaging supervision
and interpretation;
with catheter
placement(s) in bypass
graft(s) (internal
mammary, free
arterial, venous
grafts) including
intraprocedural
injection(s) for
bypass graft
angiography and right
heart catheterization.
93458................... Catheter placement in G2
coronary artery(s) for
coronary angiography,
including
intraprocedural
injection(s) for
coronary angiography,
imaging supervision
and interpretation;
with left heart
catheterization
including
intraprocedural
injection(s) for left
ventriculography, when
performed.
93459................... Catheter placement in G2
coronary artery(s) for
coronary angiography,
including
intraprocedural
injection(s) for
coronary angiography,
imaging supervision
and interpretation;
with left heart
catheterization
including
intraprocedural
injection(s) for left
ventriculography, when
performed, catheter
placement(s) in bypass
graft(s) (internal
mammary, free
arterial, venous
grafts) with bypass
graft angiography.
93460................... Catheter placement in G2
coronary artery(s) for
coronary angiography,
including
intraprocedural
injection(s) for
coronary angiography,
imaging supervision
and interpretation;
with right and left
heart catheterization
including
intraprocedural
injection(s) for left
ventriculography, when
performed.
93461................... Catheter placement in G2
coronary artery(s) for
coronary angiography,
including
intraprocedural
injection(s) for
coronary angiography,
imaging supervision
and interpretation;
with right and left
heart catheterization
including
intraprocedural
injection(s) for left
ventriculography, when
performed, catheter
placement(s) in bypass
graft(s) (internal
mammary, free
arterial, venous
grafts) with bypass
graft angiography.
93462................... Left heart N1
catheterization by
transseptal puncture
through intact septum
or by transapical
puncture (list
separately in addition
to code for primary
procedure).
------------------------------------------------------------------------
[[Page 37161]]
e. Proposal To Review Recently-Added Procedures to the ASC Covered
Procedures List
Section 1833(i)(1) of the Act requires us to specify, in
consultation with appropriate medical organizations, surgical
procedures that are appropriately performed on an inpatient basis in a
hospital but that can be safely performed in an ASC, a CAH, or an HOPD
and to review and update the list of ASC procedures at least every 2
years. As noted in section XII.C.1. of this proposed rule, we evaluate
the ASC covered procedures list (ASC CPL) each year to determine
whether procedures should be added or removed from the list, and
changes to the list are often made in response to specific concerns
raised by stakeholders. Often, when a procedure is added to the ASC
CPL, the provider community has limited experience in performing the
procedure on the Medicare population, even if providers have greater
experience with other patient populations. Because ASCs generally
provide a subset of items and services that are offered by hospitals
and because Medicare beneficiaries tend to be frailer and exhibit a
higher number of comorbidities than other populations, we believe it
may be appropriate to reevaluate recently-added procedures.
Specifically, we are proposing to review all procedures that were
added to the ASC CPL within the 3 calendar years prior to the year in
which we are engaging in rulemaking to assess the safety,
effectiveness, and beneficiary experience of these newly-added
procedures when performed in the ASC setting. Our review will begin
with procedures added to the ASC CPL in CYs 2015, 2016, and 2017, and
assess whether newly-added procedures continue to meet our criteria,
including whether they continue not to be expected to pose a
significant safety risk to a Medicare beneficiary when performed in an
ASC and continue not to be expected to require active medical
monitoring and care of the beneficiary at midnight following the
procedure. This review would include taking into account recent
clinical developments and available safety findings related to the
recently-added procedures.
We are proposing to review all 38 procedures that were added to the
ASC CPL for CYs 2015, 2016, and 2017. The 38 procedures that were added
to the ASC CPL during this time are displayed in Table 41 below, along
with their HCPCS code long descriptors, the CY 2018 payment indicators,
and the calendar year that each procedure was added to the ASC CPL. We
also are seeking comment about these recently-added procedures from
members of the public, including Medicare beneficiaries, ASC
facilities, and physicians performing these procedures in the ASC
setting. In addition, we are seeking comment from the public on whether
these procedures continue to meet the criteria to remain on the ASC
CPL. We intend to evaluate each of these 38 procedures using all
available data, including clinical characteristics, utilization
reflected in ASC claims and pricing data, prevailing medical practice,
and any public comments we receive to determine whether they continue
to meet the criteria to be a covered surgical procedure.
In addition, we are soliciting comment regarding how our systematic
review should be structured in the future, including the length of time
procedures should be considered recently-added, how frequently reviews
should be performed in light of the time required to accumulate
meaningful data and whether any future reviews should examine
procedures added during a period of time greater or less than the
previous 3 completed calendar years.
Table 41--Additions to the List of ASC Covered Surgical Procedures for Cy 2015, 2016, and 2017
----------------------------------------------------------------------------------------------------------------
Calendar year
CY 2019 CPT code CY 2019 long descriptor CY 2018 ASC payment indicator added to ASC
CPL
----------------------------------------------------------------------------------------------------------------
0171T........................... Insertion of posterior spinous J8 2016
process distraction device
(including necessary removal
of bone or ligament for
insertion and imaging
guidance), lumbar; single
level.
0172T........................... Insertion of posterior spinous N1 2016
process distraction device
(including necessary removal
of bone or ligament for
insertion and imaging
guidance), lumbar; each
additional level.
20936........................... Autograft for spine surgery N1 2017
only (includes harvesting the
graft); local (e.g., ribs,
spinous process, or laminar
fragments) obtained from same
incision (list separately in
addition to code for primary
procedure).
20937........................... Autograft for spine surgery N1 2017
only (includes harvesting the
graft); morselized (through
separate skin or fascial
incision) (list separately in
addition to code for primary
procedure).
20938........................... Autograft for spine surgery N1 2017
only (includes harvesting the
graft); structural, bicortical
or tricortical (through
separate skin or fascial
incision) (list separately in
addition to code for primary
procedure).
22551........................... Arthrodesis, anterior J8 2015
interbody, including disc
space preparation, discectomy,
osteophytectomy and
decompression of spinal cord
and/or nerve roots; cervical
below c2.
22552........................... Arthrodesis, anterior N1 2017
interbody, including disc
space preparation, discectomy,
osteophytectomy and
decompression of spinal cord
and/or nerve roots; cervical
below c2, each additional
interspace (list separately in
addition to code for separate
procedure).
22554........................... Arthrodesis, anterior interbody J8 2015
technique, including minimal
discectomy to prepare
interspace (other than for
decompression); cervical below
c2.
22612........................... Arthrodesis, posterior or J8 2015
posterolateral technique,
single level; lumbar (with
lateral transverse technique,
when performed).
22614........................... Arthrodesis, posterior or N1 2015
posterolateral technique,
single level; each additional
vertebral segment (list
separately in addition to code
for primary procedure).
22840........................... Posterior non-segmental N1 2017
instrumentation (e.g.,
harrington rod technique,
pedicle fixation across 1
interspace, atlantoaxial
transarticular screw fixation,
sublaminar wiring at c1, facet
screw fixation) (list
separately in addition to code
for primary procedure).
22842........................... Posterior segmental N1 2017
instrumentation (e.g., pedicle
fixation, dual rods with
multiple hooks and sublaminar
wires); 3 to 6 vertebral
segments (list separately in
addition to code for primary
procedure).
22845........................... Anterior instrumentation; 2 to N1 2017
3 vertebral segments (list
separately in addition to code
for primary procedure).
[[Page 37162]]
22853........................... Insertion of interbody N1 2017
biomechanical device(s) (e.g.,
synthetic cage, mesh) with
integral anterior
instrumentation for device
anchoring (e.g., screws,
flanges), when performed, to
intervertebral disc space in
conjunction with interbody
arthrodesis, each interspace
(list separately in addition
to code for primary procedure).
22854........................... Insertion of intervertebral N1 2017
biomechanical device(s) (e.g.,
synthetic cage, mesh) with
integral anterior
instrumentation for device
anchoring (e.g., screws,
flanges), when performed, to
vertebral corpectomy(ies)
(vertebral body resection,
partial or complete) defect,
in conjunction with interbody
arthrodesis, each contiguous
defect (list separately in
addition to code for primary
procedure).
22859........................... Insertion of intervertebral N1 2017
biomechanical device(s) (e.g.,
synthetic cage, mesh,
methylmethacrylate) to
intervertebral disc space or
vertebral body defect without
interbody arthrodesis, each
contiguous defect (list
separately in addition to code
for primary procedure).
37241........................... Vascular embolization or J8 2016
occlusion, inclusive of all
radiological supervision and
interpretation,
intraprocedural roadmapping,
and imaging guidance necessary
to complete the intervention;
venous, other than hemorrhage
(e.g., congenital or acquired
venous malformations, venous
and capillary hemangiomas,
varices, varicoceles).
37242........................... Vascular embolization or J8 2016
occlusion, inclusive of all
radiological supervision and
interpretation,
intraprocedural roadmapping,
and imaging guidance necessary
to complete the intervention;
arterial, other than
hemorrhage or tumor (e.g.,
congenital or acquired
arterial malformations,
arteriovenous malformations,
arteriovenous fistulas,
aneurysms, pseudoaneurysms).
37243........................... Vascular embolization or J8 2016
occlusion, inclusive of all
radiological supervision and
interpretation,
intraprocedural roadmapping,
and imaging guidance necessary
to complete the intervention;
for tumors, organ ischemia, or
infarction.
49406........................... Image-guided fluid collection G2 2016
drainage by catheter (e.g.,
abscess, hematoma, seroma,
lymphocele, cyst); peritoneal
or retroperitoneal,
percutaneous.
57120........................... Colpocleisis (le fort type).... G2 2016
57310........................... Closure of urethrovaginal G2 2016
fistula;.
58260........................... Vaginal hysterectomy, for G2 2016
uterus 250 g or less.
58262........................... Vaginal hysterectomy, for G2 2016
uterus 250 g or less; with
removal of tube(s), and/or
ovary(s).
58543........................... Laparoscopy, surgical, G2 2016
supracervical hysterectomy,
for uterus greater than 250 g.
58544........................... Laparoscopy, surgical, G2 2016
supracervical hysterectomy,
for uterus greater than 250 g;
with removal of tube(s) and/or
ovary(s).
58553........................... Laparoscopy, surgical, with G2 2016
vaginal hysterectomy, for
uterus greater than 250 g;.
58554........................... Laparoscopy, surgical, with G2 2016
vaginal hysterectomy, for
uterus greater than 250 g;
with removal of tube(s) and/or
ovary(s).
58573........................... Laparoscopy, surgical, with G2 2016
total hysterectomy, for uterus
greater than 250 g; with
removal of tube(s) and/or
ovary(s).
63020........................... Laminotomy (hemilaminectomy), G2 2015
with decompression of nerve
root(s), including partial
facetectomy, foraminotomy and/
or excision of herniated
intervertebral disc; 1
interspace, cervical.
63030........................... Laminotomy (hemilaminectomy), G2 2015
with decompression of nerve
root(s), including partial
facetectomy, foraminotomy and/
or excision of herniated
intervertebral disc; 1
interspace, lumbar.
63042........................... Laminotomy (hemilaminectomy), G2 2015
with decompression of nerve
root(s), including partial
facetectomy, foraminotomy and/
or excision of herniated
intervertebral disc,
reexploration, single
interspace; lumbar.
63044........................... Laminotomy (hemilaminectomy), N1 2015
with decompression of nerve
root(s), including partial
facetectomy, foraminotomy and/
or excision of herniated
intervertebral disc,
reexploration, single
interspace; each additional
lumbar interspace (list
separately in addition to code
for primary procedure).
63045........................... Laminectomy, facetectomy and G2 2015
foraminotomy (unilateral or
bilateral with decompression
of spinal cord, cauda equina
and/or nerve root[s], [e.g.,
spinal or lateral recess
stenosis]), single vertebral
segment; cervical.
63046........................... Laminectomy, facetectomy and G2 2016
foraminotomy (unilateral or
bilateral with decompression
of spinal cord, cauda equina
and/or nerve root[s], [e.g.,
spinal or lateral recess
stenosis]), single vertebral
segment; thoracic.
63047........................... Laminectomy, facetectomy and G2 2015
foraminotomy (unilateral or
bilateral with decompression
of spinal cord, cauda equina
and/or nerve root[s], [e.g.,
spinal or lateral recess
stenosis]), single vertebral
segment; lumbar.
63055........................... Transpedicular approach with G2 2016
decompression of spinal cord,
equina and/or nerve root(s)
(e.g., herniated
intervertebral disc), single
segment; thoracic.
63056........................... Transpedicular approach with G2 2015
decompression of spinal cord,
equina and/or nerve root(s)
(e.g., herniated
intervertebral disc), single
segment; lumbar (including
transfacet, or lateral
extraforaminal approach)
(e.g., far lateral herniated
intervertebral disc).
----------------------------------------------------------------------------------------------------------------
[[Page 37163]]
2. Covered Ancillary Services
Consistent with the established ASC payment system policy, we are
proposing to update the ASC list of covered ancillary services to
reflect the payment status for the services under the CY 2019 OPPS (72
FR 42497). Maintaining consistency with the OPPS may result in proposed
changes to ASC payment indicators for some covered ancillary services
because of changes that are being proposed under the OPPS for CY 2019.
For example, if a covered ancillary service was separately paid under
the ASC payment system in CY 2018, but is proposed for packaged status
under the CY 2019 OPPS, to maintain consistency with the OPPS, we would
also propose to package the ancillary service under the ASC payment
system for CY 2019. We are proposing to continue this reconciliation of
packaged status for subsequent calendar years. Comment indicator
``CH'', which is discussed in section XII.F. of this proposed rule, is
used in Addendum BB to this proposed rule (which is available via the
internet on the CMS website) to indicate covered ancillary services for
which we are proposing a change in the ASC payment indicator to reflect
a proposed change in the OPPS treatment of the service for CY 2019.
All ASC covered ancillary services and their proposed payment
indicators for CY 2019 are included in Addendum BB to this proposed
rule (which is available via the internet on the CMS website).
D. Proposed ASC Payment for Covered Surgical Procedures and Covered
Ancillary Services
1. Proposed ASC Payment for Covered Surgical Procedures
a. Background
Our ASC payment policies for covered surgical procedures under the
revised ASC payment system are fully described in the CY 2008 OPPS/ASC
final rule with comment period (72 FR 66828 through 66831). Under our
established policy, we use the ASC standard ratesetting methodology of
multiplying the ASC relative payment weight for the procedure by the
ASC conversion factor for that same year to calculate the national
unadjusted payment rates for procedures with payment indicators ``G2''
and ``A2''. Payment indicator ``A2'' was developed to identify
procedures that were included on the list of ASC covered surgical
procedures in CY 2007 and, therefore, were subject to transitional
payment prior to CY 2011. Although the 4-year transitional period has
ended and payment indicator ``A2'' is no longer required to identify
surgical procedures subject to transitional payment, we retained
payment indicator ``A2'' because it is used to identify procedures that
are exempted from the application of the office-based designation. The
rate calculation established for device-intensive procedures (payment
indicator ``J8'') is structured so that the packaged device payment
amount is the same as under the OPPS, and only the service portion of
the rate is subject to the ASC standard ratesetting methodology. In the
CY 2017 OPPS/ASC final rule with comment period (81 FR 79732 through
79753), we updated the CY 2016 ASC payment rates for ASC covered
surgical procedures with payment indicators of ``A2'', ``G2'', and
``J8'' using CY 2015 data, consistent with the CY 2017 OPPS update. We
also updated payment rates for device-intensive procedures to
incorporate the CY 2017 OPPS device offset percentages calculated under
the standard APC ratesetting methodology, as discussed earlier in this
section.
Payment rates for office-based procedures (payment indicators
``P2'', ``P3'', and ``R2'') are the lower of the MPFS nonfacility PE
RVU-based amount (we refer readers to the CY 2018 MPFS proposed and
final rules) or the amount calculated using the ASC standard rate
setting methodology for the procedure. In the CY 2017 OPPS/ASC final
rule with comment period, we updated the payment amounts for office-
based procedures (payment indicators ``P2'', ``P3'', and ``R2'') using
the most recent available MPFS and OPPS data. We compared the estimated
CY 2017 rate for each of the office-based procedures, calculated
according to the ASC standard rate setting methodology, to the MPFS
nonfacility PE RVU-based amount to determine which was lower and,
therefore, would be the CY 2017 payment rate for the procedure under
our final policy for the revised ASC payment system (Sec. 416.171(d)).
In the CY 2014 OPPS/ASC final rule with comment period (78 FR
75081), we finalized our proposal to calculate the CY 2014 payment
rates for ASC covered surgical procedures according to our established
methodologies, with the exception of device removal procedures. For CY
2014, we finalized a policy to conditionally package payment for device
removal codes under the OPPS. Under the OPPS, a conditionally packaged
code (status indicators ``Q1'' and ``Q2'') describes a HCPCS code where
the payment is packaged when it is provided with a significant
procedure but is separately paid when the service appears on the claim
without a significant procedure. Because ASC services always include a
covered surgical procedure, HCPCS codes that are conditionally packaged
under the OPPS are always packaged (payment indicator ``N1'') under the
ASC payment system. Under the OPPS, device removal procedures are
conditionally packaged and, therefore, would be packaged under the ASC
payment system. There would be no Medicare payment made when a device
removal procedure is performed in an ASC without another surgical
procedure included on the claim; therefore, no Medicare payment would
be made if a device was removed but not replaced. To address this
concern, for the device removal procedures that are conditionally
packaged in the OPPS (status indicator ``Q2''), we assigned the current
ASC payment indicators associated with these procedures and continued
to provide separate payment since CY 2014.
b. Proposed Update to ASC Covered Surgical Procedure Payment Rates for
CY 2019
We are proposing to update ASC payment rates for CY 2019 and
subsequent years using the established rate calculation methodologies
under Sec. 416.171 and using our definition of device-intensive
procedures, as discussed in section XII.C.1.b. of this proposed rule.
Because the proposed OPPS relative payment weights are based on
geometric mean costs, the ASC system would use geometric means to
determine proposed relative payment weights under the ASC standard
methodology. We are proposing to continue to use the amount calculated
under the ASC standard ratesetting methodology for procedures assigned
payment indicators ``A2'' and ``G2''.
We are proposing to calculate payment rates for office-based
procedures (payment indicators ``P2'', ``P3'', and ``R2'') and device-
intensive procedures (payment indicator ``J8'') according to our
established policies and, for device-intensive procedures, using our
modified definition of device-intensive procedures, as discussed in
section XII.C.1.b. of this proposed rule. Therefore, we are proposing
to update the payment amount for the service portion of the device-
intensive procedures using the ASC standard rate setting methodology
and the payment amount for the device portion based on the proposed CY
2019 OPPS device offset percentages that have been calculated using the
standard OPPS APC ratesetting methodology. Payment for office-based
procedures would be at the lesser of the proposed CY 2019
[[Page 37164]]
MPFS nonfacility PE RVU-based amount or the proposed CY 2018 ASC
payment amount calculated according to the ASC standard ratesetting
methodology.
As we did for CYs 2014 through 2018, for CY 2019, we are proposing
to continue our policy for device removal procedures, such that device
removal procedures that are conditionally packaged in the OPPS (status
indicators ``Q1'' and ``Q2'') would be assigned the current ASC payment
indicators associated with these procedures and would continue to be
paid separately under the ASC payment system.
2. Proposed Payment for Covered Ancillary Services
a. Background
Our payment policies under the ASC payment system for covered
ancillary services vary according to the particular type of service and
its payment policy under the OPPS. Our overall policy provides separate
ASC payment for certain ancillary items and services integrally related
to the provision of ASC covered surgical procedures that are paid
separately under the OPPS and provides packaged ASC payment for other
ancillary items and services that are packaged or conditionally
packaged (status indicators ``N'', ``Q1'', and ``Q2'') under the OPPS.
In the CY 2013 OPPS/ASC rulemaking (77 FR 45169 and 77 FR 68457 through
68458), we further clarified our policy regarding the payment indicator
assignment of codes that are conditionally packaged in the OPPS (status
indicators ``Q1'' and ``Q2''). Under the OPPS, a conditionally packaged
code describes a HCPCS code where the payment is packaged when it is
provided with a significant procedure but is separately paid when the
service appears on the claim without a significant procedure. Because
ASC services always include a surgical procedure, HCPCS codes that are
conditionally packaged under the OPPS are always packaged (payment
indictor ``N1'') under the ASC payment system (except for device
removal codes, as discussed in section IV. of this proposed rule).
Thus, our policy generally aligns ASC payment bundles with those under
the OPPS (72 FR 42495). In all cases, in order for those ancillary
services also to be paid, ancillary items and services must be provided
integral to the performance of ASC covered surgical procedures for
which the ASC bills Medicare.
Our ASC payment policies generally provide separate payment for
drugs and biologicals that are separately paid under the OPPS at the
OPPS rates. We generally pay for separately payable radiology services
at the lower of the MPFS nonfacility PE RVU-based (or technical
component) amount or the rate calculated according to the ASC standard
ratesetting methodology (72 FR 42497). However, as finalized in the CY
2011 OPPS/ASC final rule with comment period (75 FR 72050), payment
indicators for all nuclear medicine procedures (defined as CPT codes in
the range of 78000 through 78999) that are designated as radiology
services that are paid separately when provided integral to a surgical
procedure on the ASC list are set to ``Z2'' so that payment is made
based on the ASC standard ratesetting methodology rather than the MPFS
nonfacility PE RVU amount (``Z3''), regardless of which is lower.
Similarly, we also finalized our policy to set the payment
indicator to ``Z2'' for radiology services that use contrast agents so
that payment for these procedures will be based on the OPPS relative
payment weight using the ASC standard ratesetting methodology and,
therefore, will include the cost for the contrast agent (42 CFR
416.171(d)(2)). ASC payment policy for brachytherapy sources mirrors
the payment policy under the OPPS. ASCs are paid for brachytherapy
sources provided integral to ASC covered surgical procedures at
prospective rates adopted under the OPPS or, if OPPS rates are
unavailable, at contractor-priced rates (72 FR 42499). Since December
31, 2009, ASCs have been paid for brachytherapy sources provided
integral to ASC covered surgical procedures at prospective rates
adopted under the OPPS.
Our ASC policies also provide separate payment for: (1) Certain
items and services that CMS designates as contractor-priced, including,
but not limited to, the procurement of corneal tissue; and (2) certain
implantable items that have pass-through payment status under the OPPS.
These categories do not have prospectively established ASC payment
rates according to ASC payment system policies (72 FR 42502 and 42508
through 42509; 42 CFR 416.164(b)). Under the ASC payment system, we
have designated corneal tissue acquisition and hepatitis B vaccines as
contractor-priced. Corneal tissue acquisition is contractor-priced
based on the invoiced costs for acquiring the corneal tissue for
transplantation. Hepatitis B vaccines are contractor-priced based on
invoiced costs for the vaccine.
Devices that are eligible for pass-through payment under the OPPS
are separately paid under the ASC payment system and are contractor-
priced. Under the revised ASC payment system (72 FR 42502), payment for
the surgical procedure associated with the pass-through device is made
according to our standard methodology for the ASC payment system, based
on only the service (non-device) portion of the procedure's OPPS
relative payment weight if the APC weight for the procedure includes
other packaged device costs. We also refer to this methodology as
applying a ``device offset'' to the ASC payment for the associated
surgical procedure. This ensures that duplicate payment is not provided
for any portion of an implanted device with OPPS pass-through payment
status. In the CY 2015 OPPS/ASC final rule with comment period (79 FR
66933 through 66934), we finalized that, beginning in CY 2015, certain
diagnostic tests within the medicine range of CPT codes for which
separate payment is allowed under the OPPS are covered ancillary
services when they are integral to an ASC covered surgical procedure.
We finalized that diagnostic tests within the medicine range of CPT
codes include all Category I CPT codes in the medicine range
established by CPT, from 90000 to 99999, and Category III CPT codes and
Level II HCPCS codes that describe diagnostic tests that crosswalk or
are clinically similar to procedures in the medicine range established
by CPT. In the CY 2015 OPPS/ASC final rule with comment period, we also
finalized our policy to pay for these tests at the lower of the MPFS
nonfacility PE RVU-based (or technical component) amount or the rate
calculated according to the ASC standard ratesetting methodology (79 FR
66933 through 66934). We finalized that the diagnostic tests for which
the payment is based on the ASC standard ratesetting methodology be
assigned to payment indicator ``Z2'' and revised the definition of
payment indicator ``Z2'' to include a reference to diagnostic services
and those for which the payment is based on the MPFS nonfacility PE
RVU-based amount be assigned payment indicator ``Z3,'' and revised the
definition of payment indicator ``Z3'' to include a reference to
diagnostic services.
b. Proposed Payment for Covered Ancillary Services for CY 2019
For CY 2019 and subsequent years, we are proposing to update the
ASC payment rates and to make changes to ASC payment indicators, as
necessary, to maintain consistency between the OPPS and ASC payment
system regarding the packaged or separately payable status of services
and the proposed CY 2019 OPPS and ASC
[[Page 37165]]
payment rates and subsequent year payment rates. We also are proposing
to continue to set the CY 2019 ASC payment rates and subsequent year
payment rates for brachytherapy sources and separately payable drugs
and biologicals equal to the OPPS payment rates for CY 2019 and
subsequent year payment rates.
Covered ancillary services and their proposed payment indicators
for CY 2019 are listed in Addendum BB to this proposed rule (which is
available via the internet on the CMS website). For those covered
ancillary services where the payment rate is the lower of the proposed
rates under the ASC standard rate setting methodology and the MPFS
proposed rates, the proposed payment indicators and rates set forth in
this proposed rule are based on a comparison using the proposed MPFS
rates effective January 1, 2019. For a discussion of the MPFS rates, we
refer readers to the CY 2019 MPFS proposed rule that is available on
the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/PhysicianFeeSched/PFS-Federal-Regulation-Notices.html.
3. Proposed CY 2019 ASC Packaging Policy for Non-Opioid Pain Management
Treatments
In the CY 2018 OPPS/ASC proposed rule (82 FR 33588), within the
framework of existing packaging categories, such as drugs that function
as supplies in a surgical procedure or diagnostic test or procedure, we
requested stakeholder feedback on common clinical scenarios involving
currently packaged items and services described by HCPCS codes that
stakeholders believe should not be packaged under the OPPS. We also
expressed interest in stakeholder feedback on common clinical scenarios
involving separately payable HCPCS codes for which payment would be
most appropriately packaged under the OPPS. Commenters expressed a
variety of views on packaging under the OPPS. In the CY 2018 OPPS/ASC
final rule with comment period, we summarized the comments received in
response to our request (82 FR 59255). The comments ranged from
requests to unpackage most items and services that are either
conditionally or unconditionally packaged under the OPPS, including
drugs and devices, to specific requests for separate payment for a
specific drug or device. We stated in the CY 2018 OPPS/ASC final rule
with comment period that CMS would continue to explore and evaluate
packaging policies under the OPPS and consider these policies in future
rulemaking.
In addition to stakeholder feedback regarding OPPS packaging
policies, the President's Commission on Combating Drug Addiction and
the Opioid Crisis (the Commission) recently recommended that CMS
examine payment policies for certain drugs that function as a supply,
specifically non-opioid pain management treatments. The Commission was
established in 2017 to study ways to combat and treat drug abuse,
addiction, and the opioid crisis. The Commission's report \47\ included
a recommendation for CMS to ``. . . review and modify ratesetting
policies that discourage the use of non-opioid treatments for pain,
such as certain bundled payments that make alternative treatment
options cost prohibitive for hospitals and doctors, particularly those
options for treating immediate post-surgical pain. . . .'' \48\ With
respect to the packaging policy, the Commission's report states that
``. . . the current CMS payment policy for `supplies' related to
surgical procedures creates unintended incentives to prescribe opioid
medications to patients for postsurgical pain instead of administering
non-opioid pain medications. Under current policies, CMS provides one
all-inclusive bundled payment to hospitals for all `surgical supplies,'
which includes hospital-administered drug products intended to manage
patients' postsurgical pain. This policy results in the hospitals
receiving the same fixed fee from Medicare whether the surgeon
administers a non-opioid medication or not.'' \49\ HHS also presented
an Opioid Strategy in April 2017 \50\ that aims, in part, to support
cutting-edge research and advance the practice of pain management. On
October 26, 2017, the opioid crisis was first declared a national
public health emergency under Federal law \51\ and this determination
was renewed on April 20, 2018.\52\
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\47\ President's Commission on Combating Drug Addiction and the
Opioid Crisis, Report (2017). Available at: https://www.whitehouse.gov/sites/whitehouse.gov/files/images/Final_Report_Draft_11-1-2017.pdf.
\48\ Ibid, at page 57, Recommendation 19.
\49\ Ibid.
\50\ Available at: https://www.hhs.gov/about/leadership/secretary/speeches/2017-speeches/secretary-price-announces-hhs-strategy-for-fighting-opioid-crisis/index.html.
\51\ Available at: https://www.hhs.gov/about/news/2017/10/26/hhs-acting-secretary-declares-public-health-emergency-address-national-opioid-crisis.html.
\52\ Available at: https://www.phe.gov/emergency/news/healthactions/phe/Pages/default.aspx.
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In response to stakeholder comments on the CY 2018 OPPS/ASC
proposed rule and in light of the recommendations regarding payment
policies for certain drugs, we recently evaluated the impact of our
packaging policy for drugs that function as a supply when used in a
surgical procedure on the utilization of these drugs in both the HOPD
and the ASC setting. Currently, as noted above, drugs that function as
a supply are packaged under the OPPS and the ASC payment system,
regardless of the costs of the drugs. The costs associated with
packaged drugs that function as a supply are included in the
ratesetting methodology for the surgical procedures with which they are
billed and the payment rate for the associated procedure reflects the
costs of the packaged drugs and other packaged items and services to
the extent they are billed with the procedure. In our evaluation, we
used currently available data to analyze the utilization patterns
associated with specific drugs that function as a supply over a 5-year
time period (2013 through 2017) to determine whether this packaging
policy has reduced the use of these drugs. If the packaging policy
discouraged the use of drugs that function as a supply or impeded
access to these products, we would expect to see a significant decline
in utilization of these drugs over time, although we note that a
decline in utilization could also reflect other factors, such as the
availability of alternative products. We did not observe significant
declines in the total number of units used in the hospital outpatient
department for a majority of the drugs included in our analysis.
In fact, under the OPPS, we observed the opposite effect for
several drugs that function as a supply, including Exparel (HCPCS code
C9290). Exparel is a liposome injection of bupivacaine, an amide local
anesthetic, indicated for single-dose infiltration into the surgical
site to produce postsurgical analgesia. In 2011, Exparel was approved
by the FDA for administration into the postsurgical site to provide
postsurgical analgesia.\53\ Exparel had pass-through payment status
from 2012 through 2014 and was separately paid under both the OPPS and
the ASC payment system during this 3-year period. Beginning in CY 2015,
Exparel was packaged as a surgical supply under both the OPPS and the
ASC payment system. Exparel is currently the only non-opioid pain
management drug that is packaged as a drug that functions as a supply
when used in a surgical procedure under the OPPS and the ASC payment
system.
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\53\ Available at: https://www.accessdata.fda.gov/drugsatfda_docs/label/2011/022496s000lbl.pdf.
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From 2013 through 2017, there was an overall increase in the OPPS
Medicare
[[Page 37166]]
utilization of Exparel of approximately 229 percent (from 2.3 million
units to 7.7 million units) during this 5-year time period. The total
number of claims reporting Exparel increased by 222 percent (from
10,609 claims to 34,183 claims) over this time period. This increase in
utilization continued, even after the 3-year drug pass-through payment
period ended for this product in 2014, with 18 percent overall growth
in the total number of units used from 2015 through 2017 (from 6.5
million units to 7.7 million units). The number of claims reporting
Exparel increased by 21 percent during this time period (from 28,166
claims to 34,183 claims).
Thus, we have not found evidence to support the notion that the
OPPS packaging policy has had an unintended consequence of discouraging
the use of non-opioid treatment for postsurgical pain management in the
hospital outpatient department. Therefore, based on this data analysis,
we do not believe that changes are necessary under the OPPS for the
packaged drug policy for drugs that function as a surgical supply when
used in a surgical procedure in this setting at this time.
In terms of Exparel in particular, we have received several
requests to pay separately for the drug rather than packaging payment
for it as a surgical supply. In the CY 2015 OPPS/ASC final rule with
comment period (79 FR 66874 and 66875), in response to comments from
stakeholders requesting separate payment for Exparel, we stated that we
considered Exparel to be a drug that functions as a surgical supply
because it is indicated for the alleviation of postoperative pain. We
also stated that we consider all items related to the surgical outcome
and provided during the hospital stay in which the surgery is
performed, including postsurgical pain management drugs, to be part of
the surgery for purposes of our drug and biological surgical supply
packaging policy. In the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59345), we reiterated our position with regard to payment
for Exparel, stating that we believed that payment for this drug is
appropriately packaged with the primary surgical procedure. In
addition, we have reviewed recently available literature with respect
to Exparel, including a briefing document \54\ submitted for the FDA
Advisory Committee Meeting held February 14-15, 2018, by the
manufacturer of Exparel that notes that ``. . . Bupivacaine, the active
pharmaceutical ingredient in Exparel, is a local anesthetic that has
been used for infiltration/field block and peripheral nerve block for
decades'' and that ``since its approval, Exparel has been used
extensively, with an estimated 3.5 million patient exposures in the
US.'' \55\ On April 6, 2018, the FDA approved Exparel's new indication
for use as an interscalene brachial plexus nerve block to produce
postsurgical regional analgesia.\56\ Based on our review of currently
available OPPS Medicare claims data and public information from the
manufacturer of the drug, we do not believe that the OPPS packaging
policy has discouraged the use of Exparel for either of the drug's
indications. Accordingly, we continue to believe it is appropriate to
package payment for Exparel as we do with other postsurgical pain
management drugs when it is furnished in a hospital outpatient
department. However, as noted in section II.A.3.b. of this proposed
rule, we are seeking comments on whether separate payment would
nonetheless further incentivize appropriate use of Exparel in the
hospital outpatient setting and peer-reviewed evidence that such
increased utilization would lead to a decrease in opioid use and
addiction among Medicare beneficiaries.
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\54\ Food and Drug Administration, Meeting of the Anesthetic and
Analgesic Drug Products Advisory Committee Briefing Document (2018).
Available at: https://www.fda.gov/downloads/AdvisoryCommittees/CommitteesMeetingMaterials/Drugs/AnestheticAndAnalgesicDrugProductsAdvisoryCommittee/UCM596314.pdf.
\55\ Ibid, page 9.
\56\ https://www.accessdata.fda.gov/drugsatfda_docs/label/2018/022496s009lbledt.pdf.
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Although we found increases in utilization for Exparel when it is
paid under the OPPS, we did notice different effects on Exparel
utilization when examining the effects of our packaging policy under
the ASC payment system. In particular, during the same 5-year period of
2013 through 2017, the total number of units of Exparel used in the ASC
setting decreased by 25 percent (from 98,160 total units to 73,595
total units) and the total number of claims reporting Exparel decreased
by 16 percent (from 527 claims to 441 claims). In the ASC setting,
after the pass-through payment status ended for Exparel at the end of
2014, the total number of units of Exparel used decreased by 70 percent
(from 244,757 units to 73,595 units) between 2015 and 2017. The total
number of claims reporting Exparel also decreased during this time
period by 62 percent (from 1,190 claims to 441 claims). However, there
was an increase of 238 percent (from 98,160 total units to 331,348
total units) in the total number of units of Exparel used in the ASC
setting during the time period of 2013-2014 when the drug received
pass-through payments, which indicates that the payment rate of ASP+6
percent for Exparel may have impact on its usage in the ASC setting.
The total number of claims reporting Exparel also increased during this
time period from 527 total claims to 1,540 total claims, an increase of
192 percent.
While several variables may contribute to this difference between
utilization and claims reporting in the hospital outpatient department
and the ASC setting, one potential explanation is that, in comparison
to hospital outpatient departments, ASCs tend to provide specialized
care and a more limited range of services. Also, ASCs are paid, in
aggregate, approximately 55 percent of the OPPS rate. Therefore,
fluctuations in payment rates for specific services may impact these
providers more acutely than hospital outpatient departments, and,
therefore, ASCs may be less likely to choose to furnish non-opioid
postsurgical pain management treatments, which are typically more
expensive than opioids, as a result. Another possible contributing
factor is that ASCs do not typically report packaged items and services
and, accordingly, our analysis may be undercounting the number of
Exparel units utilized in the ASC setting.
In light of the results of our evaluation of packaging policies
under the OPPS and the ASC payment system, which showed decreased
utilization for certain drugs that function as a supply in the ASC
setting in comparison to the hospital outpatient department setting, as
well as the Commission's recommendation to examine payment policies for
non-opioid pain management drugs that function as a supply, we believe
a change in how we pay for non-opioid pain management drugs that
function as surgical supplies may be warranted. In particular, we
believe it may be appropriate to pay separately for evidence-based non-
opioid pain management drugs that function as a supply in a surgical
procedure in the ASC setting to address the decreased utilization of
these drugs and to encourage use of these types of drugs rather than
prescription opioids. Therefore, we are proposing to unpackage and pay
separately for the cost of non-opioid pain management drugs that
function as surgical supplies when they are furnished in the ASC
setting for CY 2019.
We have stated previously (82 FR 59250) that our packaging policies
are designed to support our strategic goal of using larger payment
bundles in the OPPS to maximize hospitals' incentives to provide care
in the most efficient
[[Page 37167]]
manner. The packaging policies established under the OPPS also
typically apply when services are provided in the ASC setting, and the
policies have the same strategic goals in both settings. While this
proposal is a departure from our current ASC packaging policy for drugs
(specifically, non-opioid pain management drugs) that function as a
supply when used in a surgical procedure, we believe that this proposed
change would incentivize the use of non-opioid postsurgical pain
management drugs and is an appropriate response to the Commission's
recommendation to examine payment policies for non-opioid pain
management drugs that function as a supply with the overall goal of
combating the current opioid addiction crisis. However, we are also
interested in peer-reviewed evidence that demonstrates that use of non-
opioid alternatives, such as Exparel, in the outpatient setting
actually do lead to a decrease in prescription opioid use and addiction
and are seeking comments containing the types of evidence that
demonstrate whether and how such non-opioid alternatives affect
prescription opioid use during or after an outpatient visit or
procedure.
As noted, for CY 2019, we are proposing to pay separately at
average sales price (ASP) plus 6 percent for non-opioid pain management
drugs that function as a supply when used in a surgical procedure when
the procedure is performed in the ASC setting. As described in section
V.A.1. of this proposed rule, section 1847A of the Act establishes the
ASP methodology, which is used for payment for drugs and biologicals
described in section 1842(o)(1)(C) of the Act furnished on or after
January 1, 2005. The ASP methodology, as applied under the OPPS, uses
several sources of data as a basis for payment, including the ASP, the
wholesale acquisition cost (WAC), and the average wholesale price (AWP)
(82 FR 59337). As noted in section V.B.2.b. of this proposed rule,
since CY 2013, our policy has been to pay for separately payable drugs
and biologicals at ASP+6 percent in accordance with section
1833(t)(14)(A)(iii)(II) of the Act (the statutory default) (82 FR
59350).
We are not proposing a change to the packaging policy under the
OPPS for CY 2019. However, we are proposing to pay separately at ASP+6
percent for non-opioid pain management drugs that function as a supply
when used in a surgical procedure when the procedure is performed in
the ASC setting for CY 2019. Because the ASC payment rate also includes
packaged payment for non-opioid pain management drugs, we intend to
remove the packaged costs attributable to non-opioid pain management
drugs--at this time, only Exparel qualifies--from the applicable OPPS
rates prior to establishing the ASC rates in order to prevent potential
overpayment of these procedures when separate payment is provided in
the ASC setting.
Of the drugs that are currently packaged in the ASC setting, this
policy would apply to Exparel. Exparel is the only non-opioid pain
management drug that functions as a supply when used in a surgical
procedure that is covered under Medicare Part B. While there are other
non-opioid pain management drugs available that are also administered
post-surgically, such as non-steroidal anti-inflammatory drugs
(``NSAIDs''), Exparel is the currently the only drug used in the ASC
setting that is both covered under Medicare Part B and policy packaged
as a drug that functions as a supply in a surgical procedure. To the
extent that other non-opioid drugs that function as surgical supplies
come onto the U.S. market, we are proposing that this policy would
apply to them as well in CY 2019. This proposal is also presented in
section II.A.3.b. of this proposed rule for the OPPS. We are proposing
a conforming change to the ASC regulation at 42 CFR 416.164(a)(4) to
exclude non-opioid pain management drugs that function as a supply when
used in a surgical procedure as an ASC service for which payment is
packaged into the payment for a covered surgical procedure. We also are
proposing a conforming change to 42 CFR 416.164 (b)(6) to include non-
opioid pain management drugs that function as a supply when used in a
surgical procedure as a covered ancillary service that is integral to a
covered surgical procedure.
In addition, as noted in section II.A.3.b. of this proposed rule,
we are seeking comment on whether the proposed policy would decrease
the dose, duration and/or number of opioid prescriptions beneficiaries
receive during and following an outpatient visit or procedure
(especially for beneficiaries at high-risk for opioid addiction) as
well as whether there are other non-opioid pain management alternatives
that would have similar effects and may, therefore, warrant separate
payment. For example, we are interested in identifying whether single
post-surgical analgesic injections, such as Exparel, or other non-
opioid drugs or devices that are used during an outpatient visit or
procedure are associated with decreased opioid prescriptions and
reduced cases of associated opioid addiction following such an
outpatient visit or procedure. We are also requesting comments that
provide evidence (such as published peer-reviewed literature), we could
use to determine whether these products help to deter or avoid
prescription opioid use and addiction as well as evidence that the
current packaged payment for such non-opioid alternatives presents a
barrier to access to care and therefore warrants separate payment under
either or both the OPPS and the ASC payment system. The reduction or
avoidance of prescription opioids would be the criteria we would seek
to determine whether separate payment was warranted for CY 2019. Should
evidence change over time, we would consider whether a reexamination of
any policy adopted in the final rule would be necessary.
In addition, we also are inviting the public to submit ideas on
regulatory, subregulatory, policy, practice, and procedural changes to
help prevent opioid use disorder and improve access to treatment under
the Medicare program. We are interested in identifying barriers that
may inhibit access to non-opioid alternatives for pain treatment and
management or access to opioid use disorder treatment, including those
barriers related to payment methodologies or coverage. In addition,
consistent with our ``Patients Over Paperwork'' Initiative, we also are
interested in suggestions to improve existing requirements in order to
more effectively address the opioid epidemic.
As noted above, and discussed in section II.A.3.b.of this proposed
rule we are interested in comments regarding other non-opioid
treatments for acute or chronic pain besides Exparel that might be
affected by OPPS and ASC packaging policies including alternative, non-
opioid pain treatments, such as devices or therapy services that are
not currently separable payable. We are specifically interested in
comments regarding whether CMS should consider separate payment for
such items and services for which payment is currently packaged under
the OPPS and ASC payment systems that are effective non-opioid
alternatives as well as evidence that demonstrates such items and
services lead to a decrease in prescription opioid use during or after
an outpatient visit or procedure in order to determine whether separate
payment may be warranted. We intend to examine the evidence submitted
to determine whether to adopt a final policy that incentivizes use of
non-opioid alternative items and services that have evidence to
demonstrate an associated decrease in prescription opioid use and
addiction following an outpatient visit
[[Page 37168]]
or procedure. Some examples of evidence that may be relevant could
include an indication on the product's FDA label or studies published
in peer-reviewed literature that such product aids in the management of
acute or chronic pain and is an evidence-based non-opioid alternative
for acute and/or chronic pain management. We would also be interested
in evidence relating to products that have shown clinical improvement
over other alternatives, such as a device that has been shown to
provide a substantial clinical benefit over the standard of care for
pain management. This could include, for example, spinal cord
stimulators used to treat chronic pain such as the devices described by
HCPCS codes C1822 (Generator, neurostimulator (implantable), high
frequency, with rechargeable battery and charging system), C1820
(Generator, neurostimulator (implantable), with rechargeable battery
and charging system), and C1767 (Generator, neurostimulator
(implantable), nonrechargeable) which are primarily assigned to APCs
5463-5464 (Levels 3 and 4 Neurostimulator and Related Procedures) with
proposed CY 2019 payment rates of $18,718 and $27,662, respectively,
that have received pass-through payment status as well as other similar
devices.
Currently, all devices are packaged under the OPPS and ASC payment
systems unless they have pass-through status, however, in light of the
Commission's recommendation to review and modify ratesetting policies
that discourage the use of non-opioid treatments for pain, we are
interested in comments from stakeholders regarding whether, similar to
the goals of the proposed payment policy for non-opioid pain management
drugs that function as a supply when used in a surgical procedure, a
policy of providing separate payment (rather than packaged payment) for
these products, indefinitely or for a specified period of time would
also incentivize the use of alternative non-opioid pain management
treatments and improve access to care for non-opioid alternatives,
particularly for innovative and low-volume items and services.
We are also interested in comments regarding whether we should
provide separate payment for non-opioid pain management treatments or
products using a mechanism such as an equitable payment adjustment
under our authority at section 1833(t)(2)(E) of the Act, which states
that the Secretary shall establish, in a budget neutral manner, other
adjustments as determined to be necessary to ensure equitable payments.
For example, we are considering whether an equitable payment adjustment
in the form of an add-on payment for APCs that use a non-opioid pain
management drug, device or service would be appropriate. To the extent
that commenters provide evidence to support this approach being
adopted, we would consider adopting a final policy, which could include
regulatory changes that would allow for an exception to the packaging
of certain non-passthrough devices which represent non-opioid
alternatives for acute or chronic pain that have evidence to
demonstrate that their use leads to a decrease in opioid prescriptions
or addictions, in the final rule to effectuate such change.
Alternatively, we are interested in comments on whether a
reorganization of the APC structure for procedures involving these
products or establishing more granular APC groupings for specific
procedure and device combinations to ensure that the payment rate for
such services is aligned with the resources associated with procedures
involving specific devices would better achieve our goal of
incentivizing increased use of non-opioid alternatives, with the aim of
reducing opioid use and subsequent addiction. For example, we would
consider finalizing a policy to establish new APCs for procedures
involving non-opioid pain management packaged items or services if such
APC would better recognize the resources involved in furnishing such
items and services and decrease or eliminate the need for prescription
opioids. In addition, given the general desire to encourage provider
efficiency through creating larger bundles of care and packaging items
and services that are integral, ancillary, supportive, dependent, or
adjunctive to a primary service, we are also seeking comment on how
such alternative payment structures would continue to balance the goals
of incentivizing provider efficiencies with encouraging the use of non-
opioid alternatives to pain management.
Furthermore, since patients may receive opioid prescriptions
following receipt of a non-opioid drug or implantation of a device, we
are interested in identifying any cost implications for the patient and
Medicare program caused by this potential change in policy. The
implications of incentivizing non-opioid pain management drugs
available for postsurgical acute pain relief during or after an
outpatient visit or procedure are also of interest, including for non-
opioid drugs. The goal is to encourage appropriate use of such non-
opioid alternatives. This comment solicitation is also discussed in
section II.A.3.b. of this proposed rule.
E. New Technology Intraocular Lenses (NTIOLs)
New Technology Intraocular Lenses (NTIOLs) are intraocular lenses
that replace a patient's natural lens that has been removed in cataract
surgery and that also meet the requirements listed in 42 CFR 416.195.
1. NTIOL Application Cycle
Our process for reviewing applications to establish new classes of
NTIOLs is as follows:
Applicants submit their NTIOL requests for review to CMS
by the annual deadline. For a request to be considered complete, we
require submission of the information that is found in the guidance
document entitled ``Application Process and Information Requirements
for Requests for a New Class of New Technology Intraocular Lenses
(NTIOLs) or Inclusion of an IOL in an Existing NTIOL Class'' posted on
the CMS website at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ASCPayment/NTIOLs.html.
We announce annually, in the proposed rule updating the
ASC and OPPS payment rates for the following calendar year, a list of
all requests to establish new NTIOL classes accepted for review during
the calendar year in which the proposal is published. In accordance
with section 141(b)(3) of Public Law 103-432 and our regulations at 42
CFR 416.185(b), the deadline for receipt of public comments is 30 days
following publication of the list of requests in the proposed rule.
In the final rule updating the ASC and OPPS payment rates
for the following calendar year, we--
++ Provide a list of determinations made as a result of our review
of all new NTIOL class requests and public comments;
++ When a new NTIOL class is created, identify the predominant
characteristic of NTIOLs in that class that sets them apart from other
IOLs (including those previously approved as members of other expired
or active NTIOL classes) and that is associated with an improved
clinical outcome.
++ Set the date of implementation of a payment adjustment in the
case of approval of an IOL as a member of a new NTIOL class
prospectively as of 30 days after publication of the ASC payment update
final rule, consistent with the statutory requirement.
++ Announce the deadline for submitting requests for review of an
[[Page 37169]]
application for a new NTIOL class for the following calendar year.
2. Requests to Establish New NTIOL Classes for CY 2019
We did not receive any requests for review to establish a new NTIOL
class for CY 2019 by March 1, 2018, the due date published in the CY
2018 OPPS/ASC final rule with comment period (82 FR 59416).
3. Payment Adjustment
The current payment adjustment for a 5-year period from the
implementation date of a new NTIOL class is $50 per lens. Since
implementation of the process for adjustment of payment amounts for
NTIOLs in 1999, we have not revised the payment adjustment amount, and
we are not proposing to revise the payment adjustment amount for CY
2019.
F. Proposed ASC Payment and Comment Indicators
1. Background
In addition to the payment indicators that we introduced in the
August 2, 2007 final rule, we created final comment indicators for the
ASC payment system in the CY 2008 OPPS/ASC final rule with comment
period (72 FR 66855). We created Addendum DD1 to define ASC payment
indicators that we use in Addenda AA and BB to provide payment
information regarding covered surgical procedures and covered ancillary
services, respectively, under the revised ASC payment system. The ASC
payment indicators in Addendum DD1 are intended to capture policy-
relevant characteristics of HCPCS codes that may receive packaged or
separate payment in ASCs, such as whether they were on the ASC list of
covered services prior to CY 2008; payment designation, such as device-
intensive or office-based, and the corresponding ASC payment
methodology; and their classification as separately payable ancillary
services, including radiology services, brachytherapy sources, OPPS
pass-through devices, corneal tissue acquisition services, drugs or
biologicals, or NTIOLs.
We also created Addendum DD2 that lists the ASC comment indicators.
The ASC comment indicators used in Addenda AA and BB to the proposed
rules and final rules with comment period serve to identify, for the
revised ASC payment system, the status of a specific HCPCS code and its
payment indicator with respect to the timeframe when comments will be
accepted. The comment indicator ``NP'' is used in the OPPS/ASC proposed
rule to indicate new codes for the next calendar year for which the
interim payment indicator assigned is subject to comment. The comment
indicator ``NP'' also is assigned to existing codes with substantial
revisions to their descriptors, such that we consider them to be
describing new services, as discussed in the CY 2010 OPPS/ASC final
rule with comment period (74 FR 60622). In the CY 2017 OPPS/ASC final
rule with comment period, we responded to public comments and finalized
the ASC treatment of all codes that were labeled with comment indicator
``NP'' in Addenda AA and BB to the CY 2016 OPPS/ASC final rule with
comment period (80 FR 70497).
The ``CH'' comment indicator is used in Addenda AA and BB to the
proposed rule (which are available via the internet on the CMS website)
to indicate that the payment indicator assignment has changed for an
active HCPCS code in the current year and the next calendar year, for
example if an active HCPCS code is newly recognized as payable in ASCs;
or an active HCPCS code is discontinued at the end of the current
calendar year. The ``CH'' comment indicators that are published in the
final rule with comment period are provided to alert readers that a
change has been made from one calendar year to the next, but do not
indicate that the change is subject to comment.
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79748
through 79749), for CY 2017 and subsequent years, we finalized our
policy to continue using the current comment indicators of ``NP'' and
``CH''.
2. Proposed ASC Payment and Comment Indicators
For CY 2019, there are proposed new and revised Category I and III
CPT codes as well as new and revised Level II HCPCS codes. Therefore,
proposed Category I and III CPT codes that are new and revised for CY
2018 and any new and existing Level II HCPCS codes with substantial
revisions to the code descriptors for CY 2019 compared to the CY 2018
descriptors that are included in ASC Addenda AA and BB to this proposed
rule are labeled with proposed comment indicator ``NP'' to indicate
that these CPT and Level II HCPCS codes are open for comment as part of
this proposed rule. Proposed comment indicator ``NP'' means a new code
for the next calendar year or an existing code with substantial
revision to its code descriptor in the next calendar year, as compared
to current calendar year; and denotes that comments will be accepted on
the proposed ASC payment indicator for the new code.
We will respond to public comments on ASC payment and comment
indicators and finalize their ASC assignment in the CY 2019 OPPS/ASC
final rule with comment period. We refer readers to Addenda DD1 and DD2
to this proposed rule (which are available via the internet on the CMS
website) for the complete list of ASC payment and comment indicators
proposed for the CY 2019 update.
G. Calculation of the Proposed ASC Payment Rates and the Proposed ASC
Conversion Factor
1. Background
In the August 2, 2007 final rule (72 FR 42493), we established our
policy to base ASC relative payment weights and payment rates under the
revised ASC payment system on APC groups and the OPPS relative payment
weights. Consistent with that policy and the requirement at section
1833(i)(2)(D)(ii) of the Act that the revised payment system be
implemented so that it would be budget neutral, the initial ASC
conversion factor (CY 2008) was calculated so that estimated total
Medicare payments under the revised ASC payment system in the first
year would be budget neutral to estimated total Medicare payments under
the prior (CY 2007) ASC payment system (the ASC conversion factor is
multiplied by the relative payment weights calculated for many ASC
services in order to establish payment rates). That is, application of
the ASC conversion factor was designed to result in aggregate Medicare
expenditures under the revised ASC payment system in CY 2008 being
equal to aggregate Medicare expenditures that would have occurred in CY
2008 in the absence of the revised system, taking into consideration
the cap on ASC payments in CY 2007, as required under section
1833(i)(2)(E) of the Act (72 FR 42522). We adopted a policy to make the
system budget neutral in subsequent calendar years (72 FR 42532 through
42533; 42 CFR 416.171(e)).
We note that we consider the term ``expenditures'' in the context
of the budget neutrality requirement under section 1833(i)(2)(D)(ii) of
the Act to mean expenditures from the Medicare Part B Trust Fund. We do
not consider expenditures to include beneficiary coinsurance and
copayments. This distinction was important for the CY 2008 ASC budget
neutrality model that considered payments across the OPPS, ASC, and
MPFS payment systems. However, because coinsurance is almost
[[Page 37170]]
always 20 percent for ASC services, this interpretation of expenditures
has minimal impact for subsequent budget neutrality adjustments
calculated within the revised ASC payment system.
In the CY 2008 OPPS/ASC final rule with comment period (72 FR 66857
through 66858), we set out a step-by-step illustration of the final
budget neutrality adjustment calculation based on the methodology
finalized in the August 2, 2007 final rule (72 FR 42521 through 42531)
and as applied to updated data available for the CY 2008 OPPS/ASC final
rule with comment period. The application of that methodology to the
data available for the CY 2008 OPPS/ASC final rule with comment period
resulted in a budget neutrality adjustment of 0.65.
For CY 2008, we adopted the OPPS relative payment weights as the
ASC relative payment weights for most services and, consistent with the
final policy, we calculated the CY 2008 ASC payment rates by
multiplying the ASC relative payment weights by the final CY 2008 ASC
conversion factor of $41.401. For covered office-based surgical
procedures, covered ancillary radiology services (excluding covered
ancillary radiology services involving certain nuclear medicine
procedures or involving the use of contrast agents, as discussed in
section XII.D.2. of this proposed rule), and certain diagnostic tests
within the medicine range that are covered ancillary services, the
established policy is to set the payment rate at the lower of the MPFS
unadjusted nonfacility PE RVU-based amount or the amount calculated
using the ASC standard ratesetting methodology.
Further, as discussed in the CY 2008 OPPS/ASC final rule with
comment period (72 FR 66841 through 66843), we also adopted alternative
ratesetting methodologies for specific types of services (for example,
device-intensive procedures).
As discussed in the August 2, 2007 final rule (72 FR 42517 through
42518) and as codified at Sec. 416.172(c) of the regulations, the
revised ASC payment system accounts for geographic wage variation when
calculating individual ASC payments by applying the pre-floor and pre-
reclassified IPPS hospital wage indexes to the labor-related share,
which is 50 percent of the ASC payment amount based on a GAO report of
ASC costs using 2004 survey data. Beginning in CY 2008, CMS accounted
for geographic wage variation in labor costs when calculating
individual ASC payments by applying the pre-floor and pre-reclassified
hospital wage index values that CMS calculates for payment under the
IPPS, using updated Core Based Statistical Areas (CBSAs) issued by OMB
in June 2003.
The reclassification provision in section 1886(d)(10) of the Act is
specific to hospitals. We believe that using the most recently
available pre-floor and pre-reclassified IPPS hospital wage indexes
results in the most appropriate adjustment to the labor portion of ASC
costs. We continue to believe that the unadjusted hospital wage
indexes, which are updated yearly and are used by many other Medicare
payment systems, appropriately account for geographic variation in
labor costs for ASCs. Therefore, the wage index for an ASC is the pre-
floor and pre-reclassified hospital wage index under the IPPS of the
CBSA that maps to the CBSA where the ASC is located.
On February 28, 2013, OMB issued OMB Bulletin No. 13-01, which
provides the delineations of all Metropolitan Statistical Areas,
Metropolitan Divisions, Micropolitan Statistical Areas, Combined
Statistical Areas, and New England City and Town Areas in the United
States and Puerto Rico based on the standards published on June 28,
2010 in the Federal Register (75 FR 37246 through 37252) and 2010
Census Bureau data. (A copy of this bulletin may be obtained at:
https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/bulletins/2013/b13-01.pdf.)
In the FY 2015 IPPS/LTCH PPS final rule (79 FR 49951 through
49963), we implemented the use of the CBSA delineations issued by OMB
in OMB Bulletin 13-01 for the IPPS hospital wage index beginning in FY
2015. In the CY 2015 OPPS/ASC final rule with comment period (79 FR
66937), we finalized a 1-year transition policy that we applied in CY
2015 for all ASCs that experienced any decrease in their actual wage
index exclusively due to the implementation of the new OMB
delineations. This transition does not apply in CY 2019.
Generally, OMB issues major revisions to statistical areas every 10
years, based on the results of the decennial census. However, OMB
occasionally issues minor updates and revisions to statistical areas in
the years between the decennial censuses. On July 15, 2015, OMB issued
OMB Bulletin No. 15-01, which provides updates to and supersedes OMB
Bulletin No. 13-01 that was issued on February 28, 2013. The attachment
to OMB Bulletin No. 15-01 provides detailed information on the update
to statistical areas since February 28, 2013. The updates provided in
OMB Bulletin No. 15-01 are based on the application of the 2010
Standards for Delineating Metropolitan and Micropolitan Statistical
Areas to Census Bureau population estimates for July 1, 2012 and July
1, 2013. The complete list of statistical areas incorporating these
changes is provided in the attachment to OMB Bulletin No. 15-01.
According to OMB, ``[t]his bulletin establishes revised delineations
for the Nation's Metropolitan Statistical Areas, Micropolitan
Statistical Areas, and Combined Statistical Areas. The bulletin also
provides delineations of Metropolitan Divisions as well as delineations
of New England City and Town Areas.'' (A copy of this bulletin may be
obtained at: https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/bulletins/2015/15-01.pdf.)
OMB Bulletin No. 15-01 made changes that are relevant to the IPPS
and ASC wage index. We refer readers to the CY 2017 OPPS/ASC final rule
with comment period (81 FR 79750) for a discussion of these changes and
our implementation of these revisions.
In OMB Bulletin No. 17-01, OMB announced that one Micropolitan
Statistical Area now qualifies as a Metropolitan Statistical Area. The
new urban CBSA is as follows:
Twin Falls, Idaho (CBSA 46300). This CBSA is comprised of
the principal city of Twin Falls, Idaho in Jerome County, Idaho and
Twin Falls County, Idaho.
The OMB bulletin is available at: https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/bulletins/2017/b-17-01.pdf. We note that we
did not have sufficient time to include this change in the computation
of the proposed FY 2019 IPPS wage index. This new CBSA may affect the
budget neutrality factors and wage indexes, depending on the impact of
the overall payments of ASCs located in this new CBSA. We are providing
below an estimate of this new area's wage index based on the average
hourly wages for new CBSA 46300 and the national average hourly wages
from the wage data for the proposed FY 2019 wage index (described in
section III.B. of the preamble of the FY 2019 IPPS/LTCH PPS proposed
rule). Currently, provider 130002 is the only hospital located in Twin
Falls County, Idaho, and there are no hospitals located in Jerome
County, Idaho. Thus, the proposed wage index for CBSA 46300 is
calculated using the average hourly wage data for one provider
(provider 130002).
[[Page 37171]]
------------------------------------------------------------------------
Estimated
Estimated occupational
unadjusted wage mix adjusted
index for new wage index for
CBSA 46300 new CBSA 46300
------------------------------------------------------------------------
Proposed National Average Hourly Wage. 42.990625267 42.948428861
Estimated CBSA Average Hourly Wage.... 35.833564813 38.127590025
Estimated Wage Index.................. 0.8335 0.8878
------------------------------------------------------------------------
Other than the previously described wage index, for CY 2019, the
proposed CY 2019 ASC wage indexes fully reflect the OMB labor market
area delineations (including the revisions to the OMB labor market
delineations discussed above, as set forth in OMB Bulletin No. 15-01).
We note that, in certain instances, there might be urban or rural
areas for which there is no IPPS hospital that has wage index data that
could be used to set the wage index for that area. For these areas, our
policy has been to use the average of the wage indexes for CBSAs (or
metropolitan divisions as applicable) that are contiguous to the area
that has no wage index (where ``contiguous'' is defined as sharing a
border). For example, for CY 2014, we applied a proxy wage index based
on this methodology to ASCs located in CBSA 25980 (Hinesville-Fort
Stewart, GA) and CBSA 08 (Rural Delaware).
When all of the areas contiguous to the urban CBSA of interest are
rural and there is no IPPS hospital that has wage index data that could
be used to set the wage index for that area, we determine the ASC wage
index by calculating the average of all wage indexes for urban areas in
the State (75 FR 72058 through 72059). (In other situations, where
there are no IPPS hospitals located in a relevant labor market area, we
continue our current policy of calculating an urban or rural area's
wage index by calculating the average of the wage indexes for CBSAs (or
metropolitan divisions where applicable) that are contiguous to the
area with no wage index.)
2. Proposed Calculation of the ASC Payment Rates
a. Updating the ASC Relative Payment Weights for CY 2019 and Future
Years
We update the ASC relative payment weights each year using the
national OPPS relative payment weights (and MPFS nonfacility PE RVU-
based amounts, as applicable) for that same calendar year and uniformly
scale the ASC relative payment weights for each update year to make
them budget neutral (72 FR 42533). Consistent with our established
policy, we are proposing to scale the CY 2019 relative payment weights
for ASCs according to the following method. Holding ASC utilization,
the ASC conversion factor, and the mix of services constant from CY
2017, we are proposing to compare the total payment using the CY 2018
ASC relative payment weights with the total payment using the CY 2019
ASC relative payment weights to take into account the changes in the
OPPS relative payment weights between CY 2018 and CY 2019. We are
proposing to use the ratio of CY 2018 to CY 2019 total payments (the
weight scalar) to scale the ASC relative payment weights for CY 2019.
The proposed CY 2019 ASC weight scalar is 0.8854 and scaling would
apply to the ASC relative payment weights of the covered surgical
procedures, covered ancillary radiology services, and certain
diagnostic tests within the medicine range of CPT codes, which are
covered ancillary services for which the ASC payment rates are based on
OPPS relative payment weights.
Scaling would not apply in the case of ASC payment for separately
payable covered ancillary services that have a predetermined national
payment amount (that is, their national ASC payment amounts are not
based on OPPS relative payment weights), such as drugs and biologicals
that are separately paid or services that are contractor-priced or paid
at reasonable cost in ASCs. Any service with a predetermined national
payment amount would be included in the ASC budget neutrality
comparison, but scaling of the ASC relative payment weights would not
apply to those services. The ASC payment weights for those services
without predetermined national payment amounts (that is, those services
with national payment amounts that would be based on OPPS relative
payment weights) would be scaled to eliminate any difference in the
total payment between the current year and the update year.
For any given year's ratesetting, we typically use the most recent
full calendar year of claims data to model budget neutrality
adjustments. At the time of this proposed rule, we had available 98
percent of CY 2017 ASC claims data.
To create an analytic file to support calculation of the weight
scalar and budget neutrality adjustment for the wage index (discussed
below), we summarized available CY 2017 ASC claims by ASC and by HCPCS
code. We used the National Provider Identifier for the purpose of
identifying unique ASCs within the CY 2017 claims data. We used the
supplier zip code reported on the claim to associate State, county, and
CBSA with each ASC. This file, available to the public as a supporting
data file for this proposed rule, is posted on the CMS website at:
http://www.cms.gov/Research-Statistics-Data-and-Systems/Files-for-Order/LimitedDataSets/ASCPaymentSystem.html.
b. Updating the ASC Conversion Factor
Under the OPPS, we typically apply a budget neutrality adjustment
for provider level changes, most notably a change in the wage index
values for the upcoming year, to the conversion factor. Consistent with
our final ASC payment policy, for the CY 2017 ASC payment system and
subsequent years, in the CY 2017 OPPS/ASC final rule with comment
period (81 FR 79751 through 79753), we finalized our policy to
calculate and apply a budget neutrality adjustment to the ASC
conversion factor for supplier level changes in wage index values for
the upcoming year, just as the OPPS wage index budget neutrality
adjustment is calculated and applied to the OPPS conversion factor. For
CY 2019, we calculated the proposed adjustment for the ASC payment
system by using the most recent CY 2017 claims data available and
estimating the difference in total payment that would be created by
introducing the proposed CY 2019 ASC wage indexes. Specifically,
holding CY 2017 ASC utilization, service-mix, and the proposed CY 2019
national payment rates after application of the weight scalar constant,
we calculated the total adjusted payment using the CY 2018 ASC wage
indexes (which would fully reflect the new OMB delineations) and the
total adjusted payment using the
[[Page 37172]]
proposed CY 2019 ASC wage indexes. We used the 50-percent labor-related
share for both total adjusted payment calculations. We then compared
the total adjusted payment calculated with the CY 2018 ASC wage indexes
to the total adjusted payment calculated with the proposed CY 2019 ASC
wage indexes and applied the resulting ratio of 1.0003 (the proposed CY
2019 ASC wage index budget neutrality adjustment) to the CY 2018 ASC
conversion factor to calculate the proposed CY 2019 ASC conversion
factor.
Section 1833(i)(2)(C)(i) of the Act requires that, if the Secretary
has not updated amounts established under the revised ASC payment
system in a calendar year, the payment amounts shall be increased by
the percentage increase in the Consumer Price Index for all urban
consumers (CPI-U), U.S. city average, as estimated by the Secretary for
the 12-month period ending with the midpoint of the year involved. The
statute does not mandate the adoption of any particular update
mechanism, but it requires the payment amounts to be increased by the
CPI-U in the absence of any update. Because the Secretary updates the
ASC payment amounts annually, we adopted a policy, which we codified at
42 CFR 416.171(a)(2)(ii)), to update the ASC conversion factor using
the CPI-U for CY 2010 and subsequent calendar years.
In the CY 2018 OPPS/ASC rulemaking (82 FR 33668 through 33670;
59422 through 59424), we solicited and discussed comments regarding our
current policy, codified at 42 CFR 416.171(a)(2)(ii), to update the ASC
conversion factor using the CPI-U for CY 2010 and subsequent calendar
years. In the CY 2018 OPPS/ASC final rule with comment period, we noted
that in 2008 facilities paid under the ASC payment system received
approximately 65 percent of the payment that hospitals paid under the
OPPS received for an average service. The differential between ASC
facility payment and OPPS provider payment has continued to increase
since 2008, and by 2017, facilities paid under the ASC payment system
received approximately 56 percent of the payment that hospitals paid
under the OPPS received for an average service. At the same time,
indicators of ASC payment adequacy, such as capacity and supply of
providers and providers' access to capital, suggest that Medicare
beneficiaries have adequate access to ASC services.\57\
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\57\ MedPAC. Report to the Congress: March 2018.
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The Administration recognizes the value that ASCs may bring to the
Medicare Program that results in the delivery of efficient, high-
quality care to beneficiaries at a lower cost. The Administration is
promoting greater price transparency across all of Medicare's payment
systems. Both beneficiaries and the Medicare Program benefit from
reduced expenditures when a beneficiary's clinical needs allow for a
procedure to be performed in lower cost settings, such as ASCs relative
to hospital outpatient departments.\58\
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\58\ Medicare Beneficiaries Could Save Billions if CMS Reduces
Hospital Outpatient Department Payment Rates for Ambulatory Surgical
Center-Approved Procedures to Ambulatory Surgical Center Payment
Rates, Department of Health and Human Services, Office of Inspector
General, April 2014.
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As articulated in the FY 2019 President's Budget, the
Administration supports payment reforms that base payment on patient
characteristics rather than the site of care. To that end, we are
exploring ways to align payments with the costs of care and to
incentivize use of the most efficient and clinically appropriate sites
of care including hospital outpatient departments, ASCs, and physician
offices, to the extent feasible, in future rulemaking. In the near
term, however, there is concern by some stakeholders that the
differential between payment updates for HOPDs and ASCs is resulting in
inefficient and unnecessary shifts of care to the hospital outpatient
setting and away from ASCs. We are concerned about the potential
unintended consequences of using the CPI-U to update payments for ASCs,
such as consolidation of ASCs or fewer physician-owned ASCs, which may
contribute to higher prices; stagnation in number of ASC facilities and
number of multispecialty ASC facilities; and payments being misaligned
with the cost of treatment for complex patients.
We recognize commenters' belief that ASCs may incur some of the
same costs that hospitals incur, which may be better reflected in the
hospital market basket update than the CPI-U. Nevertheless, we
recognize also that ASCs are among the only health care facilities in
Medicare that do not submit cost information and therefore their rates
are not updated based on a related market basket. We do not believe
that the ASC cost structure is identical to the hospital cost structure
for a few reasons (these differences are illustrative and not
exhaustive). First, the majority of ASCs are single specialty (61
percent based on 2016 data), whereas hospitals provide a wider variety
of services, and also provide inpatient care and room and board.
Second, the vast majority of ASCs are for-profit and located in urban
areas, whereas hospital ownership is varied and hospitals are located
in more geographically diverse locations. Third, compliance with
certain laws, such as the Emergency Medical Treatment and Labor Act
(EMTALA), apply to hospitals and do not apply to ASCs. These
differences illustrate why there is reason to believe there is a
measure of misalignment between the HOPD and ASC cost structure, and
should be considered when assessing the suitability of using the
hospital market basket as a better proxy for ASC costs than the CPI-U.
According to commenters on last year's proposed rule, only 8.5
percent of the CPI-U inputs are related to health care, and even those
inputs are based on a consumer's experience purchasing health care
items, rather than a provider's experience purchasing the items
necessary to furnish a health care service, and do not measure whether
a facility's costs increase, such as the cost of purchasing supplies
and equipment or personnel labor costs.
We also acknowledge commenters' concern that the disparity in
payments between the OPPS and the ASC payment system may reduce the
migration of services from the HOPD setting to the less costly ASC
setting. For example, one study looked at the impact of the difference
in facility fees paid to ASCs versus hospital outpatient departments on
ASC growth using a fixed effects model.\59\ The study found results
indicating that, as ASC payments increase, patients are more likely to
undergo outpatient procedures in an ASC than they are in a hospital.
Another study found that the opening of an ASC in a hospital service
area resulted in a decline in hospital-based outpatient surgery without
increasing mortality or admission.\60\ In markets where facilities
opened, procedure growth at ASCs was greater than the decline in
outpatient surgery use at their respective hospitals.
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\59\ Munnich EL, Parente ST. Returns to Specialization: Evidence
from the Outpatient Surgery Market. Journal of Health Economics.
Volume 57. January 2018.
\60\ Hollenbeck BK, Dunn RL, et. al. Ambulatory Surgery Centers
and Their Intended Effects on Outpatient Surgery. HSR: Health
Services Research. 50:5. October 2015.
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If a migration of services from the hospital setting to ASCs
occurred, it may potentially yield savings to the Medicare program and
beneficiaries if the savings from the migration of services net of any
increases in total volume of services does not exceed the cost of a
higher rate update factor. ASC
[[Page 37173]]
payment rates would still generally be significantly less than under
the OPPS.
To the extent that it is clinically appropriate for a beneficiary
to receive services in a lower cost setting, we believe it would be
appropriate to continue to develop payment incentives and remove
payment disincentives to facilitate this choice. While there are
several factors that contribute to the divergence in payment between
the two systems (which were identified in the comment solicitation on
ASC payment reform in the CY 2018 OPPS/ASC rulemaking), such as
different distribution of costs between hospitals and ASCs and
different ratesetting methodologies between the OPPS and the ASC
payment system, we believe that an alternative update factor could
stabilize the differential between the OPPS payment and the ASC
payment, to the extent that the CPI-U has been lower than the hospital
market basket, and encourage the migration of services to lower cost
settings as clinically appropriate (82 FR 59422 through 59424). In
addition, we note that there are many services that can safely be
performed in either the hospital setting or the ASC setting and a
common rate update factor recognizes that the two provider types often
compete for the same patients though patient acuity is likely higher in
hospitals.
Therefore, we believe providing ASCs with the same rate update
mechanism as hospitals could encourage the migration of services from
the hospital setting to the ASC setting and increase the presence of
ASCs in health care markets or geographic areas where previously there
were none or few, thus promoting better beneficiary access to care.
However, because physicians have a financial interest in ASCs, higher
payments could also lead to greater utilization of services.\61\ At the
same time, we are cognizant of concerns that Medicare does not
currently collect cost data from ASCs, which makes it difficult to
assess payment adequacy in the same way that it is assessed for
hospitals, to validate alignment between ASC and hospital cost
structure, or to establish an ASC-specific market basket. Accordingly,
until we have information on the ASC cost structure, we would like to
balance our desire to promote migration of services away from the HOPD
to ASCs where clinically appropriate with our desire to minimize
increases in beneficiary out-of-pocket costs. Therefore, as described
in more specific detail below, we are proposing to apply a hospital
market basket update to ASCs for an interim period of 5 years but are
seeking comments on ASC costs to assess whether the hospital market
basket is an appropriate proxy for ASC costs. We note that the hospital
market basket is collected under OMB Control No. 0938-0050 and the
information collected through hospital cost reports is used, in part,
to inform the calculation of the hospital market basket.
---------------------------------------------------------------------------
\61\ Munnich EL, Parente ST. Returns to Specialization: Evidence
from the Outpatient Surgery Market. Journal of Health Economics.
Volume 57. January 2018.
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The hospital market basket update would be derived using the same
hospital inpatient market basket percentage increase that we are
proposing to use to derive the OPD fee increase factor as described in
section II.B. of this proposed rule and is adjusted for multifactor
productivity. We are proposing this payment update methodology for a 5-
year period, during which we would assess whether there is a migration
of procedures from the hospital setting to the ASC setting as a result
of the use of a hospital market basket update, as well as whether there
are any unintended consequences (for example, an unnecessary increase
in the overall volume of services or beneficiaries' out-of-pocket
costs). We believe that 5 years would be an appropriate number of years
to assess changes in the migration of services, as it should provide us
enough time to confirm that trends in the data are consistent over
time. We welcome comment on whether implementing the hospital market
basket update for a different number of years might be more
appropriate.
We are interested in commenter feedback on additional ways we can
evaluate the impacts of this payment change over the 5-year period. For
example, we welcome input on how we should delineate between changes in
the volume of a particular service due to the higher update, versus
changes in the volume of a service due to changes in enrollment,
patient acuity, or utilization, and what would be an appropriate
interval to measure such migration of services. During this 5-year
period, we intend to assess the feasibility of collaborating with
stakeholders to collect ASC cost data in a minimally burdensome manner
and could propose a plan to collect such information. As previously
mentioned, in response to the comment solicitation in the CY 2018 OPPS/
ASC proposed rule, stakeholders indicated a willingness to work with
CMS to collect cost information in the least burdensome manner (82 FR
59422 through 59424).
Therefore, for CY 2019 through 2023, in response to stakeholder
concerns described in the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59420 through 59421) that ASCs may incur some of the same
costs that hospitals incur and that are better reflected in the
hospital market basket update than the CPI-U, and including the concern
that the payment differentials between the different settings of care
due to the use of the CPI-U may stagnate the migration of services from
hospitals to the ASC setting, even though those services can be safely
performed in ASCs, we are proposing to update ASC payment rates using
the hospital market basket and to revise our regulations under 42 CFR
416.171(a)(2), which address the annual update to the ASC conversion
factor, to reflect this proposal. In addition, we are requesting
comments and evidence to assess whether the hospital market basket is
an appropriate proxy for ASC costs. Under this proposal, for CY 2019,
we would use the proposed FY 2019 hospital market basket update as
published in the FY 2019 IPPS/LTCH PPS proposed rule (83 FR 20381).
This proposed update to ASC payment rates would be derived using the
same hospital inpatient market basket percentage increase that we are
proposing to use to derive the OPD fee increase factor as described in
section II.B. of this proposed rule. We also are seeking comments on an
alternative proposal to maintain CPI-U while collecting evidence to
justify a different payent pdate, or adopting the new proposed payhment
update based on the hospital market basket permanently. We are
requesting comments on what type of evidence should be used to justify
a different payment update and how CMS should go about collecting that
information in the least burdensome way possible.
Section 1833(t)(3)(G)(v) of the Act applies an additional
adjustment of 0.75 for CY 2019 to hospitals. We note that such
adjustment was authorized by the Affordable Care Act and that, while
the Affordable Care Act authorized a productivity adjustment for ASCs
(as it did for hospitals), it expressly did not authorize the
``additional adjustment'' that was mandated for hospitals. The
additional adjustment is separate and distinct from the productivity
adjustment that already applies to both hospitals and ASCs and there
does not appear to be a correlation between the productivity adjustment
and the additional adjustment. Further, application of the additional
adjustment may be contrary to the goals we have
[[Page 37174]]
articulated that led us to propose to apply the hospital market basket
to the ASC payment system in the first place; that is, we believe that
proposing to apply the hospital market basket to ASC rates may
encourage the migration of services from the hospital setting to the
ASC setting. However, if we were to propose to apply the additional
adjustment, the ASC rate update would be 1.25 percent, instead of the
proposed 2.0 percent. The 1.25 percent is lower than applying the CPI-U
rate update factor, which would have been 1.3 percent for CY 2019. This
lower update would appear contrary to the goals set forth earlier in
this section. However, we are seeking comment on whether applying this
additional adjustment may nonetheless be appropriate.
While we expect this proposal would increase spending, by both the
government and beneficiaries, relative to the current update factor
over the 5-year period, as previously stated, we believe that the
proposal could encourage the migration of services that are currently
performed in the hospital outpatient setting to the ASC setting, which
could result in savings to beneficiaries and the Medicare program. We
believe that it is important to maximize patient choice to obtain
services at a lower cost to the extent feasible. We believe also that
without cost data from ASCs to examine their cost structure and
adequacy of payment, we lack key data that may help inform the
development of payment policies that are based on patients' clinical
needs rather than the site of care.
If, after review of all comments and all available evidence, we
choose to finalize this proposal, we will continue to monitor site-of-
service shifts for the duration of this policy to determine if services
move safely to lower cost settings and to explore collecting additional
data that may help inform further development of the ASC payment
system. We are proposing to continue to use the adjusted hospital
market basket update through CY 2023 (for 5 years total). We intend to
reassess whether application of the hospital market basket update to
ASC rates has provided more patient choice to obtain services at a
lower cost beginning with the CY 2024 rulemaking period, or sooner if
appropriate. Section 3401(k) of the Affordable Care Act amended section
1833(i)(2)(D) of the Act by adding a new clause (v), which requires
that any annual update under the ASC payment system for the year, after
application of clause (iv), shall be reduced by the productivity
adjustment described in section 1886(b)(3)(B)(xi)(II) of the Act,
effective with the calendar year beginning January 1, 2011. The statute
defines the productivity adjustment to be equal to the 10-year moving
average of changes in annual economy-wide private nonfarm business
multifactor productivity (MFP) (as projected by the Secretary for the
10-year period ending with the applicable fiscal year, year, cost
reporting period, or other annual period) (the ``MFP adjustment'').
Clause (iv) of section 1833(i)(2)(D) of the Act authorizes the
Secretary to provide for a reduction in any annual update for failure
to report on quality measures. Clause (v) of section 1833(i)(2)(D) of
the Act states that application of the MFP adjustment to the ASC
payment system may result in the update to the ASC payment system being
less than zero for a year and may result in payment rates under the ASC
payment system for a year being less than such payment rates for the
preceding year.
In the CY 2012 OPPS/ASC final rule with comment period (76 FR
74516), we finalized a policy that ASCs begin submitting data on
quality measures for services beginning on October 1, 2012 for the CY
2014 payment determination under the ASC Quality Reporting (ASCQR)
Program. In the CY 2013 OPPS/ASC final rule with comment period (77 FR
68499 through 68500), we finalized a methodology to calculate reduced
national unadjusted payment rates using the ASCQR Program reduced
update conversion factor that would apply to ASCs that fail to meet
their quality reporting requirements for the CY 2014 payment
determination and subsequent years. The application of the 2.0
percentage point reduction to the annual update factor, which we are
proposing to be the hospital market basket update, may result in the
update to the ASC payment system being less than zero for a year for
ASCs that fail to meet the ASCQR Program requirements. We amended
Sec. Sec. 416.160(a)(1) and 416.171 to reflect these policies.
In prior years, in accordance with section 1833(i)(2)(C)(i) of the
Act, before applying the MFP adjustment, the Secretary first determined
the ``percentage increase'' in the CPI-U, which we interpreted cannot
be a negative percentage. Thus, in the instance where the percentage
change in the CPI-U for a year was negative, we would hold the CPI-U
update factor for the ASC payment system to zero (75 FR 72062).
Consistent with past practice, in the instance where the percentage
change in the hospital market basket for a year is negative, we are
proposing to hold the hospital market basket update factor for the ASC
payment system to zero. For the CY 2014 payment determination and
subsequent years, under section 1833(i)(2)(D)(iv) of the Act, we would
reduce the annual update by 2.0 percentage points for an ASC that fails
to submit quality information under the policies established by the
Secretary in accordance with section 1833(i)(7) of the Act.
Section 1833(i)(2)(D)(v) of the Act, as added by section 3401(k) of
the Affordable Care Act, requires that the Secretary reduce the annual
update factor, after application of any quality reporting reduction, by
the MFP adjustment, and states that application of the MFP adjustment
to the annual update factor after application of any quality reporting
reduction may result in the update being less than zero for a year. If
the application of the MFP adjustment to the annual update factor after
application of any quality reporting reduction would result in an MFP-
adjusted update factor that is less than zero, the resulting update to
the ASC payment rates would be negative and payments would decrease
relative to the prior year. We refer readers to the CY 2011 OPPS/ASC
final rule with comment period (75 FR 72062 through 72064) for examples
of how the MFP adjustment is applied to the ASC payment system.
For this proposed rule, as published in the FY 2019 IPPS/LTCH PPS
proposed rule (83 FR 20381), based on IHS Global Inc.'s (IGI's) 2017
fourth quarter forecast with historical data through the third quarter
of 2017, the hospital market basket update for CY 2019 is projected to
be 2.8 percent.
We finalized the methodology for calculating the MFP adjustment in
the CY 2011 MPFS final rule with comment period (75 FR 73394 through
73396) and revised it in the CY 2012 MPFS final rule with comment
period (76 FR 73300 through 73301) and the CY 2016 OPPS/ASC final rule
with comment period (80 FR 70500 through 70501). For this proposed
rule, as published in the FY 2019 IPPS/LTCH PPS proposed rule (83 FR
20382) based on IGI's 2017 fourth quarter forecast, the proposed MFP
adjustment for CY 2019 is projected to be 0.8 percent.
We note that the update factor for CY 2019 under the current
policy, which is to increase the payment amounts by the percentage
increase in the CPI-U, U.S. city average, as estimated by the Secretary
for the 12-month period ending with the midpoint of the year involved,
is currently projected to be 2.1 percent (based on IGI's first quarter
2018 forecast). If we were to derive the MFP adjustment that aligns
with this
[[Page 37175]]
payment update under current policy (ending with the midpoint of the
year involved), the MFP adjustment is projected to be 0.8 percent,
which would lead to a proposed update amount of 1.3 percent.
For CY 2019, we are proposing to utilize the hospital market basket
update of 2.8 percent minus the MFP adjustment of 0.8 percentage point,
resulting in an MFP-adjusted hospital market basket update factor of
2.0 percent for ASCs meeting the quality reporting requirements.
Therefore, we are proposing to apply a 2.0 percent MFP-adjusted
hospital market basket update factor to the CY 2018 ASC conversion
factor for ASCs meeting the quality reporting requirements to determine
the CY 2019 ASC payment amounts. The ASCQR Program affected payment
rates beginning in CY 2014 and, under this program, there is a 2.0
percentage point reduction to the update factor for ASCs that fail to
meet the ASCQR Program requirements. We are proposing to utilize the
hospital market basket update of 2.8 percent by 2.0 percentage points
for ASCs that do not meet the quality reporting requirements and then
subtract the 0.8 percentage point MFP adjustment. Therefore, we are
proposing to apply a 0.0 percent MFP-adjusted hospital market basket
update factor to the CY 2018 ASC conversion factor for ASCs not meeting
the quality reporting requirements. We also are proposing that if more
recent data are subsequently available (for example, a more recent
estimate of the hospital market basket update and MFP), we would use
such data, if appropriate, to determine the CY 2019 ASC update for the
final rule with comment period.
For CY 2019, we are proposing to adjust the CY 2018 ASC conversion
factor ($45.575) by the proposed wage index budget neutrality factor of
1.0003 in addition to the MFP-adjusted hospital market basket update
factor of 2.0 percent discussed above, which results in a proposed CY
2019 ASC conversion factor of $46.500 for ASCs meeting the quality
reporting requirements. For ASCs not meeting the quality reporting
requirements, we proposed to adjust the CY 2018 ASC conversion factor
($45.575) by the proposed wage index budget neutrality factor of 1.0003
in addition to the quality reporting/MFP-adjusted hospital market
basket update factor of 0.0 percent discussed above, which results in a
proposed CY 2019 ASC conversion factor of $45.589.
3. Display of Proposed CY 2019 ASC Payment Rates
Addenda AA and BB to this proposed rule (which are available on the
CMS website) display the proposed updated ASC payment rates for CY 2019
for covered surgical procedures and covered ancillary services,
respectively. For those covered surgical procedures and covered
ancillary services where the payment rate is the lower of the proposed
rates under the ASC standard ratesetting methodology and the MPFS
proposed rates, the proposed payment indicators and rates set forth in
this proposed rule are based on a comparison using the proposed MPFS
rates that would be effective January 1, 2019. For a discussion of the
MPFS rates, we refer readers to the CY 2019 MPFS proposed rule.
The proposed payment rates included in these addenda reflect the
full ASC payment update and not the reduced payment update used to
calculate payment rates for ASCs not meeting the quality reporting
requirements under the ASCQR Program. These addenda contain several
types of information related to the proposed CY 2019 payment rates.
Specifically, in Addendum AA, a ``Y'' in the column titled ``To be
Subject to Multiple Procedure Discounting'' indicates that the surgical
procedure would be subject to the multiple procedure payment reduction
policy. As discussed in the CY 2008 OPPS/ASC final rule with comment
period (72 FR 66829 through 66830), most covered surgical procedures
are subject to a 50-percent reduction in the ASC payment for the lower-
paying procedure when more than one procedure is performed in a single
operative session.
Display of the comment indicator ``CH'' in the column titled
``Comment Indicator'' indicates a change in payment policy for the item
or service, including identifying discontinued HCPCS codes, designating
items or services newly payable under the ASC payment system, and
identifying items or services with changes in the ASC payment indicator
for CY 2018. Display of the comment indicator ``NI'' in the column
titled ``Comment Indicator'' indicates that the code is new (or
substantially revised) and that comments will be accepted on the
interim payment indicator for the new code. Display of the comment
indicator ``NP'' in the column titled ``Comment Indicator'' indicates
that the code is new (or substantially revised) and that comments will
be accepted on the ASC payment indicator for the new code.
The values displayed in the column titled ``Proposed CY 2019
Payment Weight'' are the proposed relative payment weights for each of
the listed services for CY 2019. The proposed relative payment weights
for all covered surgical procedures and covered ancillary services
where the ASC payment rates are based on OPPS relative payment weights
were scaled for budget neutrality. Therefore, scaling was not applied
to the device portion of the device-intensive procedures, services that
are paid at the MPFS nonfacility PE RVU-based amount, separately
payable covered ancillary services that have a predetermined national
payment amount, such as drugs and biologicals and brachytherapy sources
that are separately paid under the OPPS, or services that are
contractor-priced or paid at reasonable cost in ASCs.
To derive the proposed CY 2019 payment rate displayed in the
``Proposed CY 2019 Payment Rate'' column, each ASC payment weight in
the ``Proposed CY 2019 Payment Weight'' column was multiplied by the
proposed CY 2019 conversion factor of $46.500. The proposed conversion
factor includes a budget neutrality adjustment for changes in the wage
index values and the annual update factor as reduced by the
productivity adjustment (as discussed in section XII.G.2.b. of this
proposed rule). In Addendum BB, there are no relative payment weights
displayed in the ``Proposed CY 2019 Payment Weight'' column for items
and services with predetermined national payment amounts, such as
separately payable drugs and biologicals. The ``Proposed CY 2019
Payment'' column displays the proposed CY 2019 national unadjusted ASC
payment rates for all items and services. The proposed CY 2019 ASC
payment rates listed in Addendum BB for separately payable drugs and
biologicals are based on ASP data used for payment in physicians'
offices in April 2018.
Addendum EE provides the HCPCS codes and short descriptors for
surgical procedures that are proposed to be excluded from payment in
ASCs for CY 2019.
XIII. Requirements for the Hospital Outpatient Quality Reporting (OQR)
Program
A. Background
1. Overview
CMS seeks to promote higher quality and more efficient healthcare
for Medicare beneficiaries. Consistent with these goals, CMS has
implemented
[[Page 37176]]
quality reporting programs for multiple care settings including the
quality reporting program for hospital outpatient care, known as the
Hospital Outpatient Quality Reporting (OQR) Program, formerly known as
the Hospital Outpatient Quality Data Reporting Program (HOP QDRP). The
Hospital OQR Program is generally aligned with the quality reporting
program for hospital inpatient services known as the Hospital Inpatient
Quality Reporting (IQR) Program (formerly known as the Reporting
Hospital Quality Data for Annual Payment Update (RHQDAPU) Program). In
addition to the Hospital IQR and Hospital OQR Programs, CMS has
implemented quality reporting programs as well as value-based
purchasing programs for other care settings.
We refer readers to section I.A.2. of this proposed rule where we
discuss our new Meaningful Measures Initiative and our approach in
evaluating quality program measures.
2. Statutory History of the Hospital OQR Program
We refer readers to the CY 2011 OPPS/ASC final rule with comment
period (75 FR 72064 through 72065) for a detailed discussion of the
statutory history of the Hospital OQR Program.
3. Regulatory History of the Hospital OQR Program
We refer readers to the CY 2008 through 2018 OPPS/ASC final rules
with comment period (72 FR 66860 through 66875; 73 FR 68758 through
68779; 74 FR 60629 through 60656; 75 FR 72064 through 72110; 76 FR
74451 through 74492; 77 FR 68467 through 68492; 78 FR 75090 through
75120; 79 FR 66940 through 66966; 80 FR 70502 through 70526; and 81 FR
79753 through 79797; 82 FR 59424 through 59445). We have also codified
certain requirements under the Hospital OQR Program at 42 CFR 419.46.
4. Meaningful Measures Initiative
In this proposed rule, we are proposing a number of new policies
for the Hospital OQR Program. We developed these proposals after
conducting an overall review of the program under our new Meaningful
Measures Initiative, which is discussed in more detail in section
I.A.2. of this proposed rule. The proposals reflect our efforts to
ensure that the Hospital OQR Program measure set continues to promote
improved health outcomes for our beneficiaries while minimizing costs,
which can consist of several different types of costs including, but
not limited to: (1) Facility information collection burden and related
cost and burden associated with the submitting/reporting of quality
measures to CMS; (2) the facility cost associated with complying with
other quality programmatic requirements; (3) the facility cost
associated with participating in multiple quality programs, and
tracking multiple similar or duplicative measures within or across
those programs; (4) the CMS cost associated with the program oversight
of the measure, including measure maintenance and public display; and
(5) the facility cost associated with compliance with other federal
and/or State regulations (if applicable). They also reflect our efforts
to improve the usefulness of the data that we publicly report in the
Hospital OQR Program. Our goal is to improve the usefulness and
usability of CMS quality program data by streamlining how facilities
are reporting and accessing data, while maintaining or improving
consumer understanding of the data publicly reported on a Compare
website. We believe this framework will allow hospitals and patients to
continue to obtain meaningful information about HOPD performance and
incentivize quality improvement while also streamlining the measure
sets to reduce duplicative measures and program complexity so that the
costs to hospitals associated with participating in this program do not
outweigh the benefits of improving beneficiary care.
B. Hospital OQR Program Quality Measures
1. Considerations in the Selection of Hospital OQR Program Quality
Measures
We refer readers to the CY 2012 OPPS/ASC final rule with comment
period (76 FR 74458 through 74460) for a detailed discussion of the
priorities we consider for the Hospital OQR Program quality measure
selection. We are not proposing any changes to these policies.
2. Accounting for Social Risk Factors in the Hospital OQR Program
In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59425
through 59427), we discussed the importance of improving beneficiary
outcomes including reducing health disparities. We also discussed our
commitment to ensuring that medically complex patients, as well as
those with social risk factors, receive excellent care. We discussed
how studies show that social risk factors, such as being near or below
the poverty level as determined by HHS, belonging to a racial or ethnic
minority group, or living with a disability, can be associated with
poor health outcomes and how some of this disparity is related to the
quality of health care.\62\ Among our core objectives, we aim to
improve health outcomes, attain health equity for all beneficiaries,
and ensure that complex patients as well as those with social risk
factors receive excellent care. Within this context, reports by the
Office of the Assistant Secretary for Planning and Evaluation (ASPE)
and the National Academy of Medicine have examined the influence of
social risk factors in CMS value-based purchasing programs.\63\ As we
noted in the CY 2018 OPPS/ASC final rule with comment period (82 FR
59425), ASPE's report to Congress found that, in the context of value-
based purchasing programs, dual eligibility was the most powerful
predictor of poor health care outcomes among those social risk factors
that they examined and tested. In addition, as we noted in the CY 2018
OPPS/ASC final rule with comment period (82 FR 59425), the National
Quality Forum (NQF) undertook a 2-year trial period in which certain
new measures and measures undergoing maintenance review have been
assessed to determine if risk adjustment for social risk factors is
appropriate for these measures.\64\ The trial period ended in April
2017 and a final report is available at: http://www.qualityforum.org/SES_Trial_Period.aspx. The trial concluded that ``measures with a
conceptual basis for adjustment generally did not demonstrate an
empirical relationship'' between social risk factors and the outcomes
measured. This discrepancy may be explained in part by the methods used
for adjustment and the limited availability of robust data on social
risk factors. NQF has extended the socioeconomic status (SES)
trial,\65\
[[Page 37177]]
allowing further examination of social risk factors in outcome
measures.
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\62\ See, for example United States Department of Health and
Human Services. ``Healthy People 2020: Disparities. 2014.''
Available at: http://www.healthypeople.gov/2020/about/foundation-health-measures/Disparities; or National Academies of Sciences,
Engineering, and Medicine. Accounting for Social Risk Factors in
Medicare Payment: Identifying Social Risk Factors. Washington, DC:
National Academies of Sciences, Engineering, and Medicine 2016.
\63\ Department of Health and Human Services Office of the
Assistant Secretary for Planning and Evaluation (ASPE), ``Report to
Congress: Social Risk Factors and Performance Under Medicare's
Value-Based Purchasing Programs.'' December 2016. Available at:
https://aspe.hhs.gov/pdf-report/report-congress-social-risk-factors-and-performance-under-medicares-value-based-purchasing-programs.
\64\ National Quality Forum. Final Report-Disparities Project.
September 2017. Available at: http://www.qualityforum.org/SES_Trial_Period.aspx.
\65\ National Quality Forum. Health Equity Program: Social Risk
Initiative 2.0. 2017. Available at: http://www.qualityforum.org/WorkArea/linkit.aspx?LinkIdentifier=id&ItemID=86357.
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In the FY 2018 and CY 2018 proposed rules for our quality reporting
and value-based purchasing programs, we solicited feedback on which
social risk factors provide the most valuable information to
stakeholders and the methodology for illuminating differences in
outcomes rates among patient groups within a hospital or facility that
would also allow for a comparison of those differences, or disparities,
across facilities. Feedback we received through our quality reporting
programs included encouraging CMS to explore whether factors that could
be used to stratify or risk adjust the measures (beyond dual
eligibility); considering the full range of differences in patients'
backgrounds that might affect outcomes; exploring risk adjustment
approaches; and offering careful consideration of what type of
information display would be most useful to the public. We also sought
public comment on confidential reporting and future public reporting of
some of our measures stratified by patient dual eligibility. In
general, commenters noted that stratified measures could serve as tools
for hospitals to identify gaps in outcomes for different groups of
patients, improve the quality of health care for all patients, and
empower beneficiaries and other consumers to make informed decisions
about health care. Commenters encouraged us to stratify measures by
other social risk factors such as age, income, and educational
attainment. With regard to value-based purchasing programs, commenters
also cautioned to balance fair and equitable payment while avoiding
payment penalties that mask health disparities or discourage the
provision of care to more medically complex patients. Commenters also
noted that value-based purchasing program measure selection, domain
weighting, performance scoring, and payment methodology must account
for social risk.
As a next step, CMS is considering options to reduce health
disparities among patient groups within and across health care settings
by increasing the transparency of disparities as shown by quality
measures. We also are considering how this work applies to other CMS
quality programs in the future. We refer readers to the FY 2018 IPPS/
LTCH PPS final rule (82 FR 38403 through 38409) for more details, where
we discuss the potential stratification of certain Hospital IQR Program
outcome measures. Furthermore, we continue to consider options to
address equity and disparities in our value-based purchasing programs.
We plan to continue working with ASPE, the public, and other key
stakeholders on this important issue to identify policy solutions that
achieve the goals of attaining health equity for all beneficiaries and
minimizing unintended consequences.
3. Retention of Hospital OQR Program Measures Adopted in Previous
Payment Determinations
We previously adopted a policy to retain measures from a previous
year's Hospital OQR Program measure set for subsequent years' measure
sets in the CY 2013 OPPS/ASC final rule with comment period (77 FR
68471). Thus, quality measures adopted in a previous year's rulemaking
are retained in the Hospital OQR Program for use in subsequent years
unless otherwise specified. We refer readers to that final rule with
comment period for more information. We are not proposing any changes
to our retention policy; however, we are proposing to codify this
policy at proposed 42 CFR 419.46(h)(1).
4. Removal of Quality Measures From the Hospital OQR Program Measure
Set
In the CY 2010 OPPS/ASC final rule with comment period (74 FR
60315), we finalized a process to use the regular rulemaking process to
remove a measure for circumstances for which we do not believe that
continued use of a measure raises specific patient safety concerns.\66\
We are not proposing any changes to this policy; however, we are
proposing to codify this policy at 42 CFR 419.46(h)(3). We refer
readers to section XIII.B.4.a. of this proposed rule for more details.
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\66\ We initially referred to this process as ``retirement'' of
a measure in the 2010 OPPS/ASC proposed rule, but later changed it
to ``removal'' during final rulemaking.
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a. Considerations in Removing Quality Measures from the Hospital OQR
Program
(1) Immediate Removal
In the CY 2010 OPPS/ASC final rule with comment period (74 FR 60634
through 60635), we finalized a process for immediate retirement, which
we later termed ``removal,'' of Hospital OQR Program measures, based on
evidence that the continued use of the measure as specified raise
patient safety concerns.\67\ We are not proposing any changes to our
policy to immediately remove measures as a result of patient safety
concerns; however, we are proposing to codify that policy at 42 CFR
419.46(h)(2).
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\67\ We refer readers to the CY 2013 OPPS/ASC final rule with
comment period (77 FR 68472 through 68473) for a discussion of our
reasons for changing the term ``retirement'' to ``removal'' in the
Hospital OQR Program.
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(2) Consideration Factors for Removing Measures
In the CY 2013 OPPS/ASC final rule with comment period, we
finalized a set of factors \68\ for determining whether to remove
measures from the Hospital OQR Program (77 FR 68472 through 68473).
These factors are:
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\68\ We note that we previously referred to these factors as
``criteria'' (for example, 77 FR 68472 through 68473); we now use
the term ``factors'' in order to align the Hospital OQR Program
terminology with the terminology we use in other CMS quality
reporting and pay-for-performance (value-based purchasing) programs.
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Factor 1. Measure performance among hospitals is so high
and unvarying that meaningful distinctions and improvements in
performance can no longer be made (``topped out'' measures).
Factor 2. Performance or improvement on a measure does not
result in better patient outcomes.
Factor 3. A measure does not align with current clinical
guidelines or practice.
Factor 4. The availability of a more broadly applicable
(across settings, populations, or conditions) measure for the topic.
Factor 5. The availability of a measure that is more
proximal in time to desired patient outcomes for the particular topic.
Factor 6. The availability of a measure that is more
strongly associated with desired patient outcomes for the particular
topic.
Factor 7. Collection or public reporting of a measure
leads to negative unintended consequences such as patient harm.
In addition, we refer readers to the CY 2015 OPPS/ASC final rule
with comment period where we finalized the criteria for determining
when a measure is ``topped-out'' (79 FR 66769). In that final rule with
comment period, we finalized two criteria for determining when a
measure is ``topped out'' under the Hospital OQR Program: (1) When
there is statistically indistinguishable performance at the 75th and
90th percentiles of national facility performance; and (2) when the
measure's truncated coefficient of variation (TCOV) is less than or
equal to 0.10 (79 FR 66942).
The benefits of removing a measure from the Hospital OQR Program
are
[[Page 37178]]
assessed on a case-by-case basis (79 FR 66941 through 66942). We note
that, under this case-by-case approach, a measure will not be removed
solely on the basis of meeting any specific factor. We note that in the
CY 2015 OPPS/ASC final rule with comment period (79 FR 66967), a
similar measure removal policy was finalized for the ASCQR Program. In
this proposed rule, we are proposing to: (1) Update measure removal
Factor 7; (2) add a new removal Factor 8; and (3) codify our measure
removal policies and factors at 42 CFR 419.46(h) effective upon
finalization of the CY 2019 OPPS/ASC final rule and for subsequent
years. We also are providing clarification of our ``topped-out''
criteria.
(3) Proposed Update to Measure Removal Factor 7
As shown above, Factor 7 under the Hospital OQR Program states,
``collection or public reporting of a measure leads to negative
unintended consequences such as patient harm.'' In contrast, under the
ASCQR Program, Factor 7 reads as follows, ``collection or public
reporting of a measure leads to negative unintended consequences other
than patient harm'' (79 FR 66967). We believe the wording in the ASCQR
Program is more appropriate because measures causing patient harm would
be removed from the program immediately, outside of rulemaking, in
accordance with our previously finalized policy to immediately remove
measures as a result of patient safety concerns (74 FR 60634 and
discussed above). Therefore, in this proposed rule, we are proposing to
change measure removal Factor 7 in the Hospital OQR Program to
``collection or public reporting of a measure leads to negative
unintended consequences other than patient harm'' such that it aligns
with measure removal Factor 7 in the ASCQR Program.
(4) Proposed New Measure Removal Factor 8
We are proposing to adopt an additional factor to consider when
evaluating measures for removal from the Hospital OQR Program measure
set:
Factor 8. The costs associated with a measure outweigh the
benefit of its continued use in the program.
As we discuss in section I.A.2. of this proposed rule with respect
to our new Meaningful Measures Initiative, we are engaging in efforts
to ensure that the Hospital OQR Program measure set continues to
promote improved health outcomes for beneficiaries while minimizing the
overall costs associated with the program. We believe these costs are
multifaceted and include not only the burden associated with reporting,
but also the costs associated with implementing and maintaining the
program. We have identified several different types of costs,
including, but not limited to: (1) Facility information collection
burden and related costs and burden associated with the submission/
reporting of quality measures to CMS; (2) the facility cost associated
with complying with other programmatic requirements; (3) the facility
cost associated with participating in multiple quality programs and
tracking multiple similar or duplicative measures within or across
those programs; (4) the CMS cost associated with the program oversight
of the measure including measure maintenance and public display; and
(5) the facility cost associated with compliance with other Federal and
State regulations (if applicable). For example, it may be needlessly
costly and/or of limited benefit to retain or maintain a measure which
our analyses show no longer meaningfully supports program objectives
(for example, informing beneficiary choice or payment scoring). It may
also be costly for health care providers to track confidential
feedback, preview reports, and publicly reported information on a
measure where we use the measure in more than one program. CMS may also
have to expend unnecessary resources to maintain the specifications for
the measure, as well as the tools needed to collect, validate, analyze,
and publicly report the measure data. Furthermore, beneficiaries may
find it confusing to see public reporting on the same measure in
different programs.
In weighing the costs against the benefits, we evaluate the
benefits of the measure, but, we assess the benefits through the
framework of our Meaningful Measures Initiative, as we discussed in
section I.A.2. of this proposed rule. One key aspect of patient
benefits is assessing the improved beneficiary health outcomes if a
measure is retained in our measure set. We believe that these benefits
are multifaceted, and are illustrated through the Meaningful Measures
framework's 6 domains and 19 areas. For example, we assessed the
Healthcare Worker Influenza Vaccination and patient Influenza
Vaccination measures categorized in the Quality Priority ``Promote
Effective Prevention and Treatment of Chronic Disease'' in the
meaningful measure area of ``Preventive Care'' across multiple CMS
programs, and considered: patient outcomes, such as mortality and
hospitalizations associated with influenza; CMS measure performance in
a program; and other available and reported influenza process measures,
such as population influenza vaccination coverage.
When these costs outweigh the evidence supporting the benefits to
patients with the continued use of a measure in the Hospital OQR
Program, we believe it may be appropriate to remove the measure from
the program. Although we recognize that one of the main goals of the
Hospital OQR Program is to improve beneficiary outcomes by
incentivizing health care facilities to focus on specific care issues
and making public data related to those issues, we also recognize that
those goals can have limited utility where, for example, the publicly
reported data (including percentage payment adjustment data) is of
limited use because it cannot be easily interpreted by beneficiaries,
and used to inform their choice of facility. In these cases, removing
the measure from the Hospital OQR Program may better accommodate the
costs of program administration and compliance without sacrificing
improved health outcomes and beneficiary choice.
We are proposing that we would remove measures based on this factor
on a case-by-case basis. We might, for example, decide to retain a
measure that is burdensome for health care facilities to report if we
conclude that the benefit to beneficiaries justifies the reporting
burden. Our goal is to move the program forward in the least burdensome
manner possible, while maintaining a parsimonious set of meaningful
quality measures and continuing to incentivize improvement in the
quality of care provided to patients. We are inviting public comment on
our proposal to adopt an additional measure removal Factor 8, the costs
associated with a measure outweigh the benefit of its continued use in
the program, beginning with the effective date of the CY 2019 OPPS/ASC
final rule with comment period and for subsequent years.
We refer readers to section XIII.B.4.b. of this proposed rule,
where we are proposing to remove two measures based on this proposed
measure removal factor. We note that we have also proposed this same
removal factor for the ASCQR Program in section XIV.B.3.b. of this
proposed rule, as well as for other quality reporting and value-based
purchasing programs for FY 2019 including: the Hospital Value-Based
Purchasing (VBP) Program (83 FR 20409), the Hospital IQR Program (83 FR
20472); the PPS-exempt Cancer Hospital Quality Reporting (PCHQR)
Program (83 FR 20501 through 20502); the Long-Term Care Hospital
Quality
[[Page 37179]]
Reporting Program (LTCH QRP) (83 FR 20512); the Hospice Quality
Reporting Program (HQRP) (83 FR 20956); the Inpatient Rehabilitation
Facility Quality Reporting Program (IRF QRP) (83 FR 21000); the Skilled
Nursing Facility Quality Reporting Program (SNF QRP) (83 FR 21082); and
the Inpatient Psychiatric Facilities Quality Reporting (IPFQR) Program
(83 FR 21118).
If our proposals to update one and add one new removal factor are
finalized as proposed, the new removal factors list would be:
Factor 1. Measure performance among hospitals is so high
and unvarying that meaningful distinctions and improvements in
performance can no longer be made (``topped out'' measures).
Factor 2. Performance or improvement on a measure does not
result in better patient outcomes.
Factor 3. A measure does not align with current clinical
guidelines or practice.
Factor 4. The availability of a more broadly applicable
(across settings, populations, or conditions) measure for the topic.
Factor 5. The availability of a measure that is more
proximal in time to desired patient outcomes for the particular topic.
Factor 6. The availability of a measure that is more
strongly associated with desired patient outcomes for the particular
topic.
Factor 7. Collection or public reporting of a measure
leads to negative unintended consequences other than patient harm.
Factor 8. The costs associated with a measure outweigh the
benefit of its continued use in the program.
(5) Proposed Codification at 42 CFR 419.46(h)(2) and (3)
We are proposing to codify our measure removal policies, including
proposals made in this rule, in proposed 42 CFR 419.46(h)(2) and (3).
(6) Clarification of Removal Factor 1: ``Topped-Out'' Measures
As noted above, we refer readers to the CY 2015 OPPS/ASC final rule
with comment period where we finalized the criteria for determining
when a measure is ``topped-out'' (79 FR 66769). In that final rule with
comment period, we finalized two criteria for determining when a
measure is ``topped out'' under the Hospital OQR Program: (1) When
there is statistically indistinguishable performance at the 75th and
90th percentiles of national facility performance; and (2) when the
measure's truncated coefficient of variation (TCOV) is less than or
equal to 0.10 (79 FR 66942).
In this proposed rule, we are clarifying our process for
calculating the truncated coefficient of variation (TCOV), particularly
for two of the measures (OP-11 and OP-14) proposed for removal from the
Hospital OQR Program. In accordance with our finalized methodology (79
FR 66942), we determine the truncated coefficient of variation (TCOV)
by calculating the truncated standard deviation (SD) divided by the
truncated mean. As discussed above, our finalized removal criteria
state that to be considered ``topped-out,'' a measure must have a
truncated TCOV of less than 0.10. We utilize the TCOV because it is
generally a good measure of variability and provides a relative
methodology for comparing different types of measures.
Unlike the majority of the measures, for which a higher rate
(indicating a higher proportion of a desired event) is the preferred
outcome, some measures--in particular, OP-11 and OP-14--assess the rate
of rare, undesired events for which a lower rate is preferred. For
example, OP-11 assesses the use of both a contrast and non-contrast CT
Thorax study at the same time, which is not recommended, as no clinical
guidelines or peer-reviewed literature supports such CT Thorax
``combined studies.'' However, when determining the TCOV for a measure
assessing rare, undesired events, the mean-or average rate of event
occurrence-is very low, and the result is a TCOV that increases rapidly
and approaches infinity as the proportion of rare events declines.\69\
We note that the SD, the variability statistic, is the same in
magnitude for measures assessing rare and nonrare events.
---------------------------------------------------------------------------
\69\ Rose-Hulman Institute of Technology. Denominator
approaching zero. Available at: https://www.rose-hulman.edu/media/89584/lclimitsguide.pdf.
---------------------------------------------------------------------------
In this proposed rule, we are proposing to remove two measures that
assess the rate of rare, undesired events for which a lower rate is
preferred--OP-11 and OP-14--and refer readers to section XIII.B.4.b. of
this proposed rule, where these proposals are discussed in detail.
Because by design these measures have maintained very low rates of
rare, undesired events (indicating the preferred outcomes), we utilized
the mean of non-adverse events in our calculation of the TCOV. For
example, for OP-11, to calculate the TCOV, we divide the SD by the
average rate of patients not receiving both contrast and non-contrast
abdominal CT (1.0 minus the rate of patients receiving both), rather
than the rate of those receiving both types of CT. Utilizing this
methodology results in a TCOV that is comparable to that calculated for
other measures and allows us to assess rare-event measures by still
generally using our previously finalized topped-out criteria.
b. Proposed Removal of Quality Measures from the Hospital OQR Program
Measure Set
In this proposed rule, we are proposing to remove a total of 10
measures from the Hospital OQR Program measure set across the CY 2020
and CY 2021 payment determinations. Specifically, beginning with the CY
2020 payment determination, we are proposing to remove (1) OP-27:
Influenza Vaccination Coverage Among Healthcare Personnel (NQF #0431);
and beginning with the CY 2021 payment determination, we are proposing
to remove--(2) OP-5: Median Time to ECG (NQF #0289); (3) OP 31:
Cataracts--Improvement in Patient's Visual Function within 90 Days
Following Cataract Surgery (NQF #1536); (4) OP-29: Endoscopy/Polyp
Surveillance: Appropriate Follow-up Interval for Normal Colonoscopy in
Average Risk Patients (NQF #0658); (5) OP-30: Endoscopy/Polyp
Surveillance: Colonoscopy Interval for Patients with a History of
Adenomatous Polyps--Avoidance of Inappropriate Use (NQF #0659); (6) OP-
9: Mammography Follow-up Rates (no NQF number); (7) OP-11: Thorax
Computed Tomography (CT)--Use of Contrast Material (NQF #0513); (8) OP-
12: The Ability for Providers with HIT (Health Information Technology)
to Receive Laboratory Data Electronically Directly into Their
Qualified/Certified EHR System as Discrete Searchable Data (NQF
endorsement removed); (9) OP-14: Simultaneous Use of Brain Computed
Tomography (CT) and Sinus CT (no NQF number); and (10) OP-17: Tracking
Clinical Results between Visits (NQF endorsement removed). We are
proposing to remove these measures under the following removal factors:
proposed measure removal Factor 8--the costs associated with a measure
outweigh the benefit of its continued use in the program; measure
removal Factor 3--a measure does not align with current clinical
guidelines or practice; measure removal Factor 1--measure performance
among hospitals is so high and unvarying that meaningful distinctions
and improvements in performance can no longer be made (``topped-out''
measures); and measure removal Factor 2--performance or improvement on
a measure does not result in better patient outcomes. These
[[Page 37180]]
proposed measure removals are discussed in detail below.
(1) Proposed Measure Removal for the CY 2020 Payment Determination and
Subsequent Years--Proposed Removal of OP-27: Influenza Vaccination
Coverage Among Healthcare Personnel (NQF #0431)
For the CY 2020 payment determination and subsequent years, we are
proposing to remove one NHSN measure under proposed measure removal
Factor 8, the costs associated with this measure outweigh the benefit
of its continued use in the program.
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75099), where we adopted OP-27: Influenza Vaccination
Coverage Among Healthcare Personnel (NQF #0431), beginning with the CY
2016 payment determination and for subsequent years. This process-of-
care measure, also a National Healthcare Safety Network (NHSN) measure,
assesses the percentage of healthcare personnel who have been immunized
for influenza during the flu season. We initially adopted this measure
based on our recognition that influenza immunization is an important
public health issue and vital component to preventing healthcare
associated infections. We believe that the measure addresses this
public health concern by assessing influenza vaccination in the HOPD
among health care personnel (HCP), who can serve as vectors for
influenza transmission.
In this proposed rule, we are proposing to remove OP-27, beginning
with the CY 2020 payment determination under our proposed measure
removal Factor 8 because we have concluded that the costs associated
with this measure outweigh the benefit of its continued use in the
program.
The information collection burden for the Influenza Vaccination
Coverage Among Healthcare Personnel measure is less than for measures
that require chart-abstraction of patient data because influenza
vaccination among healthcare personnel can be calculated through review
of records maintained in administrative systems and because facilities
have fewer healthcare personnel than patients. As such, OP-27 does not
require review of as many records. However, this measure does still
pose information collection burden on facilities due to the requirement
to identify personnel who have been vaccinated against influenza and
for those not vaccinated, the reason why.
Furthermore, as we stated in section XIII.B.4.a. of this proposed
rule, costs are multi-faceted and include not only the burden
associated with reporting, but also the costs associated with
implementing and maintaining the program. For example, it may be costly
for health care providers to maintain general administrative knowledge
to report these measures. In addition, CMS must expend resources in
maintaining information collection systems, analyzing reported data,
and providing public reporting of the collected information.
In our analysis of the Hospital OQR Program measure set, we
recognized that some facilities face challenges with respect to the
administrative requirements of the NHSN in their reporting of the
Influenza Vaccination Coverage Among Healthcare Personnel measure.
These administrative requirements (which are unique to NHSN) include
annually completing NHSN system user authentication. Enrolling in NHSN
is a five-step process that the Centers for Disease Control and
Prevention (CDC) estimates takes an average of 263 minutes per
facility.\70\
---------------------------------------------------------------------------
\70\ CDC, National Healthcare Safety Network (NHSN). Five-Step
Enrollment for Acute Care Hospitals/Facilities. Available at:
https://www.cdc.gov/nhsn/acute-care-hospital/enroll.html (the
estimates for time to complete are 2 hours 45 minutes for step 1, 10
minutes for step 2, 16 minutes for step 3a, 35 minutes for step 3b,
32 minutes for step 4, and 5 minutes for step 5; totaling 263
minutes).
---------------------------------------------------------------------------
Furthermore, submission via NHSN requires the system security
administrator of participating facilities to re-consent electronically,
ensure that contact information is kept current, ensure that the
hospital has an active facility administrator account, keep Secure
Access Management Service (SAMS) credentials active by logging in
approximately every 2 months and changing their password, create a
monthly reporting plan, and ensure the facility's CCN information is
up-to-date. Unlike acute care hospital which participate in other
quality programs, such as the Hospital IQR and HAC Reduction Programs,
HOPDs are only required to participate in NHSN to submit data for this
one measure. In our assessment, we also considered that the vast
majority (99.7 percent) of Hospital OQR Program eligible hospitals
already report this measure in the Hospital IQR Program for workers
providing any services to inpatient care. The Hospital IQR Program
measure includes the vast majority of all hospital personnel, since
many workers in outpatient departments provide services to both
inpatient and outpatient departments (adopted at 76 FR 51631 through
51633). These workers include most emergency department clinicians,
specialists such as pharmacists and imaging professionals, and
custodians and other support staff working across the hospital.
We continue to believe that the OP-27: Influenza Vaccination
Coverage Among Healthcare Personnel (NQF #0431) measure provides the
benefit of protecting patients against influenza. However, we believe
that these benefits are offset by other efforts to reduce influenza
infection among patients, such as numerous healthcare employer
requirements for health care personnel to be vaccinated against
influenza.\71\ We also expect that a portion of MIPS-eligible
clinicians nationwide will report on the Preventive Care and Screening:
Influenza Immunization measure through the Quality Payment Program
(QPP).\72\ Although MIPS-eligible clinicians may voluntarily select
measures from a list of options, HOPD providers that are MIPS-eligible
will have the opportunity to continue collecting information for the
measure. We remain responsive to the public health concern of influenza
infection within the Medicare FFS population by collecting data on
rates of influenza immunization among patients.\73\ Thus, the public
health concern of influenza immunization is addressed via these other
efforts to track influenza vaccination. The availability of this
measure in another CMS program demonstrates CMS' continued commitment
to this measure area. In addition, as we discuss in section XIII.B.4.a
of this proposed rule, where we are proposing to adopt measure removal
Factor 8, beneficiaries may find it confusing to see public reporting
on the same measure in different programs.
---------------------------------------------------------------------------
\71\ CDC, Influenza Vaccination Information for Health Care
Workers. Available at: https://www.cdc.gov/flu/healthcareworkers.htm.
\72\ QPP 2017 Measures Selection: Influenza. Retrieved from:
https://qpp.cms.gov/mips/quality-measures.
\73\ Ibid.
---------------------------------------------------------------------------
We wish to minimize the level of cost of our programs for
participating facilities, as discussed under the Meaningful Measures
Initiative, described in section I.A.2. of this proposed rule. In our
assessment of the Hospital OQR Program measure set, we prioritized
measures that align with this Initiative's framework as the most
important to the Hospital OQR Program's population. Our assessment
concluded that while the OP-27 measure continues to provide benefits,
these benefits are diminished by other factors and are outweighed by
the costs and burdens of reporting this chart-abstracted measure.
[[Page 37181]]
For these reasons, we are proposing to remove OP-27: NHSN Influenza
Vaccination Coverage among Healthcare Personnel (NQF #0431) from the
Hospital OQR Program beginning with the CY 2020 payment determination
and for subsequent years. We note that if proposed measure removal
Factor 8 is not finalized, removal of this measure would also not be
finalized. We note that this measure is also proposed for removal from
the ASCQR Program in section XIV.B.3.c. of this proposed rule and the
IPFQR Program in the FY 2019 IPF PPS proposed rule (83 FR 21104).
(2) Proposed Measure Removals for the CY 2021 Payment Determination and
Subsequent Years
For the CY 2021 payment determination and subsequent years, we are
proposing to remove: Four measures under proposed measure removal
Factor 8; one measure under measure removal Factor 3; two measures
under removal Factor 1; and two measures under measure removal Factor
2.
(a) Proposed Measure Removals Under Proposed Removal Factor 8: OP-5,
OP-29, OP-30, and OP-31
In this proposed rule, we are proposing to remove four measures
under our proposed measure removal Factor 8 for the CY 2021 payment
determination and subsequent years: OP-5, OP-29, OP-30, and OP-31. We
note that if proposed measure removal Factor 8 is not finalized,
removal of these measures would also not be finalized. The proposals
are discussed in more detail below. We note that in crafting our
proposals, we considered removing these measures beginning with the CY
2020 payment determination, but we decided on proposing to delay
removal until the CY 2021 payment determination to be sensitive to
facilities' planning and operational procedures given that data
collection for this measure begins during CY 2018 for the CY 2020
payment determination.
Proposed Removal of OP-5: Median Time to ECG (NQF #0289)
We refer readers to the CY 2008 OPPS/ASC final rule with comment
period (72 FR 66865) where we adopted OP-5: Median Time to ECG (NQF
#0289) beginning with the CY 2009 payment determination.\74\ This
chart-abstracted measure assesses the median number of minutes before
outpatients with heart attack (or chest pain that suggests a possible
heart attack) received an electrocardiograph (ECG) test to help
diagnose heart attack.
---------------------------------------------------------------------------
\74\ This measure was formerly called ``ED-AMI-4--Median Time to
Electrocardiogram (ECG)'' in the cited Federal Register.
---------------------------------------------------------------------------
We are proposing to remove the OP-5 measure beginning with the CY
2021 payment determination under our proposed measure removal Factor 8,
the costs associated with the measure outweigh the benefit of its
continued use in the program. As noted above, OP-5 is a chart-
abstracted measure, which can be potentially more challenging for
facilities to report than claims-based or structural measures. Chart-
abstraction requires facilities to select a sample population, access
historical records from several clinical data quarters past, and
interpret that patient data. This process is typically more time and
resource-consuming than for other measure types. As described in
section I.A.2. of this proposed rule, our Meaningful Measures
Initiative is intended to reduce costs and minimize burden, and we
believe that removing this chart-abstracted measure from the Hospital
OQR Program would reduce program complexity.
However, we do not believe the use of chart-abstracted measure data
alone is sufficient justification for removal of a measure under
proposed measure removal Factor 8. The costs of collection and
submission of chart-abstracted measure data is burdensome for
facilities, especially when taking into consideration that, although
this measure is not topped-out, we have come to the conclusion that the
benefit of this measure is limited. Based on our analysis of data
submitted by 1,995 hospitals from Quarter 3 in 2016 through Quarter 2
in 2017 the variation in average measure performance between hospitals
is minimal, with a difference in median time to ECG of less than 2
minutes between the 75th and 90th percentile hospitals. Furthermore,
the difference between the 25th and 75th percentile, distinguishing
between high and low performers, is only 5.5 minutes, further
indicating that variations are not sufficiently large to inform
beneficiary decision-making to justify the costs of collecting the
data. These data are demonstrated in the table below.
Differences in Performance for OP-5: Median Wait Time to ECG
----------------------------------------------------------------------------------------------------------------
Number of 25th 75th 90th
Period hospitals Percentile Percentile Percentile
----------------------------------------------------------------------------------------------------------------
2016 Q3--2017 Q2................................ 1,995 11.0 minutes 5.5 minutes 3.8 minutes.
----------------------------------------------------------------------------------------------------------------
We believe that the minimal variation in hospital performance does
not help beneficiaries to make informed care decisions, since
distinguishing meaningful differences in hospital performance on this
measure is difficult. As such, the measure benefit is limited, and no
longer meaningfully supports program objectives of informing
beneficiary choice.
Thus, we believe that costs and burdens to both facilities and CMS
such as program oversight, measure maintenance, and public display,
associated with keeping this measure in the program outweigh the
limited benefit associated with the measure's continued use. Therefore,
we are proposing to remove OP-5: Median Time to ECG from the Hospital
OQR Program beginning with the CY 2021 payment determination and for
subsequent years.
Proposed Removal of OP-29: Endoscopy/Polyp Surveillance:
Appropriate Follow-Up Interval for Normal Colonoscopy in Average Risk
Patients
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75099 through 75100) where we adopted OP-29: Endoscopy/
Polyp Surveillance: Appropriate Follow-up Interval for Normal
Colonoscopy in Average Risk Patients (NQF #0659) beginning with the CY
2016 payment determination. This chart-abstracted process measure
assesses the ``[p]ercentage of patients aged 18 years and older
receiving a surveillance colonoscopy, with a history of a prior colonic
polyp in previous colonoscopy findings, who had a follow-up interval of
3 or more years since their last colonoscopy documented in the
colonoscopy report'' (78 FR 75099). This measure aims to assess whether
average risk patients
[[Page 37182]]
with normal colonoscopies receive a recommendation to receive a repeat
colonoscopy in an interval that is less than the recommended amount of
10 years.
In this proposed rule, we are proposing to remove OP-29: Endoscopy/
Polyp Surveillance Follow-up Interval for Normal Colonoscopy in Average
Risk Patients beginning with the CY 2021 payment determination and for
subsequent years under our proposed measure removal Factor 8, the costs
associated with a measure outweigh the benefit of its continued use in
the program. We adopted OP-29: Endoscopy/Polyp Surveillance Follow-up
Interval for Normal Colonoscopy in Average Risk Patients in the CY 2014
OPPS/ASC final rule with comment period (78 FR 75099 through 75100)
noting that performing colonoscopy too frequently increases patients'
exposure to procedural harm. However, we now believe that the costs of
this measure outweigh the benefit of its continued use in the program.
Chart-abstraction requires facilities to select a sample
population, access historical records from several current and historic
clinical data quarters, and interpret that patient data. This process
is typically more time and resource-consuming than for other measure
types. In addition to submission of manually chart-abstracted data, we
take all burden and costs into account when evaluating a measure.
Removing OP-29 would reduce the burden and cost to facilities
associated with collection of information and reporting on their
performance associated with the measure.
However, we do not believe the use of chart-abstracted measure data
alone is sufficient justification for removal of a measure under
proposed measure removal Factor 8. The costs of collection and
submission of chart-abstracted measure data is burdensome for
facilities especially when taking into consideration the availability
of other CMS quality measures that are relevant in the clinical
condition and highly correlated in performance across measures. Another
colonoscopy-related measure required in the Hospital OQR Program, OP-
32: Facility 7-Day Risk-Standardized Hospital Visit Rate after
Outpatient Colonoscopy (NQF# 2539), measures all-cause, unplanned
hospital visits (admissions, observation stays, and emergency
department visits) within 7 days of an outpatient colonoscopy procedure
(79 FR 66949). This claims-based outcomes measure does not require
chart-abstraction, and similarly contributes data on quality of care
related to colonoscopy procedures, although the measure does not
specifically track processes such as follow-up intervals. When we
adopted OP-32, we believed this measure would reduce adverse patient
outcomes associated with preparation for colonoscopy, the procedure
itself, and follow-up care by capturing and making more visible to
facilities and patients all unplanned hospital visits following the
procedure (79 FR 66949). Furthermore, the potential benefits of keeping
OP-29 in the program are mitigated by the existence of the same measure
(Appropriate Follow-up Interval for Normal Colonoscopy in Average Risk
Patients) \75\ for gastroenterologists in the Merit-Based Incentive
Payment System (MIPS) for the 2019 performance period in the QPP (82 FR
30292). Thus, we believe the issue of preventing harm to patients from
colonoscopy procedures that are performed too frequently is adequately
addressed through MIPS in the QPP, because we expect a portion of MIPS-
eligible clinicians reporting on the measure nationwide to provide
meaningful data to CMS. We note that although MIPS-eligible clinicians
may voluntarily select measures from a list of options, HOPD providers
that are MIPS-eligible will have the opportunity to continue collecting
information for the measure without being penalized if they determine
there is value for various quality improvement efforts.\76\ The
availability of this measure in another CMS program demonstrates CMS'
continued commitment to this measure area.
---------------------------------------------------------------------------
\75\ QPP Measure Selection: Appropriate Follow-up Interval for
Normal Colonoscopy in Average Risk Patients. Available at: https://qpp.cms.gov/mips/quality-measures.
\76\ CMS finalized that services furnished by an eligible
clinician that are payable under the ASC, HHA, Hospice, or HOPD
methodology will not be subject to the MIPS payments adjustments,
but eligible clinicians payable under those methodologies may have
the option to still voluntarily report on applicable measures and
the data reported will not be used to determine future eligibility
(82 FR 53586).
---------------------------------------------------------------------------
Furthermore, we seek to align our quality reporting work with the
Patients Over Paperwork and the Meaningful Measures Initiatives
described in section I.A.2. of this proposed rule. The purpose of this
effort is to hold providers accountable for only the measures that are
most important to patients and clinicians and those that are focused on
patient outcomes in particular, because outcome measures evaluate the
actual results of care. As described in section I.A.2. of this proposed
rule, our Meaningful Measures Initiative is intended to reduce costs
and minimize burden, and we believe that removing this chart-abstracted
measure from the Hospital OQR Program would reduce program complexity.
In addition, as we discuss in section XIV.B.3.b. of this proposed rule,
where we are proposing to adopt measure removal Factor 8, beneficiaries
may find it confusing to see public reporting on the same measure in
different programs.
Therefore, due to the combination of factors of the costs of
collecting data for this chart-abstracted measure, the preference for
an outcomes measure in the Hospital OQR Program that provides valuable
data for the same procedure, and the existence of the same measure in
another CMS program, we believe that the burdens and costs associated
with this measure outweigh the limited benefit to beneficiaries. As a
result, we are proposing to remove OP-29: Endoscopy/Polyp Surveillance
Follow-up Interval for Normal Colonoscopy in Average Risk Patients
beginning with the CY 2021 payment determination and for subsequent
years. We note that we are also proposing to remove a similar measure
in the ASCQR Program in section XIV.B.3.c. of this proposed rule.
Proposed Removal of OP-30: Endoscopy/Polyp Surveillance:
Colonoscopy Interval for Patients with a History of Adenomatous
Polyps--Avoidance of Inappropriate Use
We refer readers to CY 2014 OPPS/ASC final rule with comment period
(78 FR 75102) where we adopted OP-30: Endoscopy/Polyp Surveillance:
Colonoscopy Interval for Patients with a History of Adenomatous
Polyps--Avoidance of Inappropriate Use (NQF #0659) beginning with the
CY 2016 payment determination. This chart-abstracted process measure
assesses the percentage of patients aged 18 years and older receiving a
surveillance colonoscopy, with a history of a prior colonic polyp in
previous colonoscopy findings, who had a follow-up interval of 3 or
more years since their last colonoscopy documented in the colonoscopy
report.
In this proposed rule, we are proposing to remove OP-30: Endoscopy/
Polyp Surveillance: Colonoscopy Interval for Patients with a History of
Adenomatous Polyps--Avoidance of Inappropriate Use beginning with the
CY 2021 payment determination and for subsequent years under our
proposed measure removal Factor 8, the costs associated with a measure
outweigh the benefit of its continued use in the program.
We adopted OP-30: Endoscopy/Polyp Surveillance: Colonoscopy
Interval for Patients with a History of Adenomatous Polyps--Avoidance
of Inappropriate Use in the CY 2014 OPPS/ASC final rule
[[Page 37183]]
with comment period (78 FR 75102) noting that colonoscopy screening for
high risk patients is recommended based on risk factors and one such
factor is a history of adenomatous polyps. The frequency of colonoscopy
screening varies depending on the size and amount of polyps found, with
the general recommendation of a 3-year follow-up. We stated that this
measure is appropriate for the measurement of quality of care furnished
by hospital outpatient departments because colonoscopy screening is
commonly performed in these settings (78 FR 75102). However, we now
believe that the costs of this measure outweigh the benefit of its
continued use in the program.
Chart-abstraction requires facilities to select a sample
population, access historical records from several clinical data
quarters past, and interpret that patient data. This process is
typically more time and resource-consuming than for other measure
types. In addition to submission of manually chart-abstracted data, we
take all burden and costs into account when evaluating a measure.
Removing OP-30 would reduce the burden and cost to facilities
associated with collection of information and reviewing their data and
performance associated with the measure.
However, we do not believe the use of chart-abstracted measure data
alone is sufficient justification for removal of a measure under
proposed measure removal Factor 8. The costs of collection and
submission of chart-abstracted measure data is burdensome for
facilities especially when taking into consideration the availability
of other CMS quality measures. Another colonoscopy-related measure
required in the Hospital OQR Program, OP-32: Facility 7-Day Risk-
Standardized Hospital Visit Rate after Outpatient Colonoscopy (NQF#
2539) measures all-cause, unplanned hospital visits (admissions,
observation stays, and emergency department visits) within 7 days of an
outpatient colonoscopy procedure (79 FR 66949). This claims-based
outcome measure does not require chart-abstraction, and similarly
contributes data on quality of care related to colonoscopy procedures,
although the measure does not specifically track processes such as
follow-up intervals. When we adopted OP-32, we believed this measure
would reduce adverse patient outcomes associated with preparation for
colonoscopy, the procedure itself, and follow-up care by capturing and
making more visible to facilities and patients all unplanned hospital
visits following the procedure (79 FR 66949). Furthermore, the
potential benefits of keeping OP-30 in the program are mitigated by the
existence of the same measure for gastroenterologists in the Merit-
Based Incentive Payment System (MIPS) for the 2019 performance period
in the QPP (82 FR 30292). Thus, we believe the issue of preventing harm
to patients from colonoscopy procedures that are performed too
frequently is adequately addressed through MIPS in the QPP because we
expect a portion of MIPS-eligible clinicians reporting on the measure
nationwide to provide meaningful data to CMS. Although MIPS-eligible
clinicians may voluntarily select measures from a list of options, HOPD
providers that are MIPS-eligible will have the opportunity to continue
collecting information for the measure without being penalized if they
determine there is value for various quality improvement efforts.\77\
The availability of this measure in another CMS program demonstrates
CMS' continued commitment to this measure area.
---------------------------------------------------------------------------
\77\ CMS finalized that services furnished by an eligible
clinician that are payable under the ASC, HHA, Hospice, or HOPD
methodology will not be subject to the MIPS payments adjustments,
but eligible clinicians payable under those methodologies may have
the option to still voluntarily report on applicable measures and
the data reported will not be used to determine future eligibility
(82 FR 53586).
---------------------------------------------------------------------------
Furthermore, we seek to align our quality reporting work with the
Patients Over Paperwork and the Meaningful Measures Initiatives
described in section I.A.2. of this proposed rule. The purpose of this
effort is to hold providers accountable for only the measures that are
most important to patients and clinicians and those that are focused on
patient outcomes in particular, because outcome measures evaluate the
actual results of care. As described in section I.A.2. of this proposed
rule, our Meaningful Measures Initiative is intended to reduce costs
and minimize burden, and we believe that removing this chart-abstracted
measure from the Hospital OQR Program would reduce program complexity.
In addition, as we discuss in section XIII.B.4.a. of this proposed
rule, where we are proposing to adopt measure removal Factor 8,
beneficiaries may find it confusing to see public reporting on the same
measure in different programs.
Therefore, due to the combination of factors of the costs of
collecting data for this chart-abstracted measure, the preference for
an outcomes measure in OQR that provides valuable data for the same
procedure, and the existence of the same measure in the MIPS program,
we believe that the burdens and costs associated with manual chart
abstraction outweigh the limited benefit to beneficiaries of receiving
this information. As a result, we are proposing to remove OP-30:
Endoscopy/Polyp Surveillance: Colonoscopy Interval for Patients with a
History of Adenomatous Polyps--Avoidance of Inappropriate Use beginning
with the CY 2021 payment determination and for subsequent years. We
note that we are also proposing to remove a similar measure in the
ASCQR Program in section XIV.B.3.c. of this proposed rule.
Proposed Removal of OP-31: Cataracts--Improvement in
Patient's Visual Function within 90 Days Following Cataract Surgery
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75103) where we adopted OP-31: Cataracts: Improvement in
Patient's Visual Function within 90 Days Following Cataract Surgery
(NQF #1536) beginning with the CY 2016 payment determination and
subsequent years. This measure assesses the rate of patients 18 years
and older (with a diagnosis of uncomplicated cataract) in a sample who
had improvement in visual function achieved within 90 days following
cataract surgery based on completing both a pre-operative and post-
operative visual function survey.
Since the adoption of this measure, we came to believe that it can
be operationally difficult for facilities to collect and report the
measure (79 FR 66947). Specifically, we were concerned that the results
of the survey used to assess the pre-operative and post-operative
visual function of the patient may not be shared across clinicians and
facilities, making it difficult for facilities to have knowledge of the
visual function of the patient before and after surgery (79 FR 66947).
We were also concerned about the surveys used to assess visual
function; the measure allows for the use of any validated survey and
results may be inconsistent should clinicians use different surveys (79
FR 66947). Therefore, on December 31, 2013, we issued guidance stating
that we would delay data collection for OP-31 for 3 months (data
collection would commence with April 1, 2014 encounters) for the CY
2016 payment determination (https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier3&cid=1228772854917). We issued additional guidance on April 2, 2014, stating that we
would further delay the implementation of OP-31 for an additional 9
months, until January 1, 2015 for the CY 2016 payment
[[Page 37184]]
determination, due to continued concerns (https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier3&cid=1228773786593). As a result of these concerns, in the CY 2015 OPPS/ASC final
rule with comment period (79 FR 66948), we finalized our proposal to
allow voluntary data collection and reporting of this measure beginning
with the CY 2017 payment determination and for subsequent years.
In this proposed rule, we are proposing to remove OP-31: Cataracts:
Improvement in Patient's Visual Function within 90 Days Following
Cataract Surgery beginning with the CY 2021 and for subsequent years
under our proposed measure removal Factor 8, the costs associated with
the measure outweigh the benefit of its continued use in the program.
We originally adopted OP-31 because we believe facilities should be a
partner in care with physicians and other clinicians using their
facility and that this measure would provide an opportunity to do so
(79 FR 66947). However, in light of the history of complications and
upon reviewing this measure within our Meaningful Measures framework,
we have concluded that it is overly burdensome for facilities to report
this measure due to the difficulty of tracking care that occurs outside
of the HOPD setting. In order to report on this measure to CMS, a
facility would need to obtain the visual function assessment results
from the appropriate ophthalmologist and ensure that the assessment
utilized is validated for the population for which it is being used. If
the assessment is not able to be used or is not available, the facility
would then need to administer the survey directly and ensure that the
same visual function assessment tool is utilized preoperatively and
postoperatively. There is no simple, preexisting means for information
sharing between ophthalmologists and facilities, so a facility would
need to obtain assessment results from each individual patient's
ophthalmologist both preoperatively and postoperatively. The high
administrative costs of the technical tracking of this information
presents an undue cost, and also burden associated with submission and
reporting of OP-31 to CMS, especially for small facilities with limited
staffing capacity.
Furthermore, this measure currently provides limited benefits.
Since making the measure voluntary, only 59 \78\ facilities have
reported this measure to CMS, compared to approximately 4,798 total
facilities for all other measures, resulting in only 1.2 percent of
facilities reporting. Consequently, we have been unable to uniformly
offer pertinent information to beneficiaries on how the measure
assesses facility performance. This reinforces comments made in the CY
2015 OPPS/ASC final rule with comment period in which commenters
expressed concern that the incomplete display of data associated with
voluntary reporting is confusing and not meaningful to beneficiaries
and other consumers (79 FR 66947). The data are also hard to validate.
Furthermore, commenters feared that the display of data from some
hospitals, but not others, would lead some patients to conclude that
some hospitals are more committed to improving cataract surgery. As
described in section I.A.2. of this proposed rule, we strive to ensure
that beneficiaries are empowered to make decisions about their health
care using information from data-driven insights. Because of the lack
of sufficient data, this measure may be difficult for beneficiaries to
interpret or use to aid in their choice of where to obtain care; thus,
the benefits of this measure are limited.
---------------------------------------------------------------------------
\78\ OQR Hospital Compare. Available at: https://data.medicare.gov/Hospital-Compare/Timely-and-Effective-Care-Hospital/yv7e-xc69.
---------------------------------------------------------------------------
Thus, we believe the high technical and administrative costs of
this measure, coupled with the high technical and administrative
burden, outweigh the limited benefit associated with the measure's
continued use in the Hospital OQR Program. As discussed in section
I.A.2. of this proposed rule, above, our Meaningful Measures Initiative
is intended to reduce costs and minimize burden. We believe that
removing this measure from the Hospital OQR Program will reduce program
burden, costs, and complexity. Therefore, we are proposing to remove
OP-31: Cataracts: Improvement in Patient's Visual Function within 90
Days Following Cataract Surgery beginning with the CY 2021 payment
determination and for subsequent years. We note that we are also
proposing to remove a similar measure under the ASCQR Program in
section XIV.B.3.c. of this proposed rule.
(b) Proposed Measure Removal Under Removal Factor 3: OP-9: Mammography
Follow-Up Rates
We refer readers to the CY 2009 OPPS/ASC final rule with comment
period (73 FR 68766) where we adopted OP-9: Mammography Follow-up Rates
beginning with the CY 2010 payment determination. This claims-based
measure assesses the percentage of patients with mammography screening
studies that are followed by a diagnostic mammography, ultrasound, or
MRI of the breast in an outpatient or office setting within 45 days. We
are proposing to remove this measure under measure removal Factor 3, a
measure does not align with current clinical guidelines or practice.
An examination of the measure specifications \79\ shows that recent
changes in clinical practice are not incorporated into the measure
calculation. Since development of this measure in 2008, advancements in
imaging technology and clinical practice for mammography warrant
updating the measure's specifications to align with current clinical
practice guidelines and peer-reviewed literature. Specifically,
findings from the annual Literature Reviews and Environmental Scans
conducted by the measure developer suggest that there is additional
clinical benefit in performing adjuvant DBT concomitant with full-field
digital mammography (FFDM) or conventional mammography (currently
included in the measure denominator), especially in women with dense
breast tissue.80 81 82 In addition, in 2016, the American
College of Radiology (ACR) updated its Breast Cancer Screening
Appropriateness Criteria[supreg] to include DBT.\83\ The ACR notes that
DBT can better detect potential false-positive findings without the
need for recall. Furthermore, the cancer detection rate is increased
with use of DBT compared with traditional mammography alone.\84\ A 2014
study published in the Journal of the American College of Radiology
assessed the utilization of DBT among physician members of the Society
of
[[Page 37185]]
Breast Imaging and found that 30 percent of respondents reported using
DBT concurrent with traditional mammography.\85\ With the update of the
ACR clinical practice guidelines (that is, the Breast Cancer Screening
Appropriateness Criteria[supreg]) to include DBT, use of this
technology is expected to increase.
---------------------------------------------------------------------------
\79\ Hospital Outpatient Quality Reporting Specifications
Manual. Version 11.0a. Available at: http://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FSpecsManualTemplate&cid=1228776146046.
\80\ Bernardi, D., Macaskill, P., Pellegrini, M., Valentini, M.,
Fanto, C., Ostillio, L., Houssami, N. (2016). Breast cancer
screening with tomosynthesis (3D mammography) with acquired or
synthetic 2D mammography compared with 2D mammography alone (STORM-
2): A population-based prospective study. Lancet Oncol, 17(8), 1105-
1113. doi: 10.1016/s1470-2045(16)30101-2.
\81\ Bian, T., Lin, Q., Cui, C., Li, L., Qi, C., Fei, J., & Su,
X. (2016). Digital Breast Tomosynthesis: A New Diagnostic Method for
Mass-Like Lesions in Dense Breasts. Breast J, 22(5), 535-540. doi:
10.1111/tbj.12622.
\82\ Pozz, A., Corte, A.D., Lakis, M. A., & Jeong, H. (2016).
Digital Breast Tomosynthesis in Addition to Conventional
2DMammography Reduces Recall Rates and is Cost Effective. Asian Pac
J Cancer Prev, 17(7), 3521-3526.
\83\ Mainiero MB, Bailey L, D'Orsi C, Green ED, Holbrook AI, Lee
SJ, Lourenco AP, Moy L, Sepulveda KA, Slanetz PJ, Trikha S, Yepes
MM, Newell MS, Expert Panel on Breast Imaging. ACR Appropriateness
Criteria[supreg] breast cancer screening. Reston (VA): American
College of Radiology (ACR); 2016. 7 p.
\84\ Ibid.
\85\ Hardesty LA, Kreidler SM, Glueck DH. Digital breast
tomosynthesis utilization in the United States: A survey of
physician members of the Society of Breast Imaging. Journal of the
American College of Radiology. 2014. 11(6): 594-599.
---------------------------------------------------------------------------
As currently specified, the measure does not adequately capture
this shift in clinical practice. Thus, we believe this measure as
specified does not align with current clinical guidelines or practice,
and we are proposing to remove OP-9: Mammography Follow-up Rates from
the program for the CY 2021 payment determination and subsequent years.
We intend to investigate respecification of this measure and consider
it for adoption to the program through future rulemaking. Specifically,
we will consider ways to capture a broader, more comprehensive spectrum
of mammography services including adding diagnostic digital breast
tomosynthesis (DBT). We note that, in crafting our proposal, we
considered removing this measure beginning with the CY 2020 payment
determination, but decided on proposing to delay removal until the CY
2021 payment determination and subsequent years to be sensitive to
facilities' planning and operational procedures given that data
collection for this measure begins during CY 2018 for the CY 2020
payment determination.
(c) Proposed Measure Removals Under Removal Factor 1: OP-11 and OP-14
In this proposed rule, for the CY 2021 payment determination and
subsequent years, we are proposing to remove OP-11 and OP-14 under
removal Factor 1, measure performance among providers is so high and
unvarying that meaningful distinctions and improvements in performance
can no longer be made. The Hospital OQR Program previously finalized
two criteria for determining when a measure is ``topped-out'': (1) When
there is statistically indistinguishable performance at the 75th and
90th percentiles of national facility performance; and (2) when the
measure's truncated coefficient of variation is less than or equal to
0.10 (79 FR 66968 through 66969). We refer readers to section
XIII.B.4.a.(6) of this proposed rule, above, where we clarify and
discuss how we calculate the TCOV for measures that assess the rate of
rare, undesired events for which a lower rate is preferred such as OP-
11 and OP-14.
For each of these measures, we believe that removal from the
Hospital OQR Program measure set is appropriate as there is little room
for improvement. In addition, as discussed in section I.A.2. of this
proposed rule above, our Meaningful Measures Initiative is intended to
reduce costs and minimize burden. We believe that removing these
measures from the Hospital OQR Program will reduce program burden,
costs, and complexity. As such, we believe the burden associated with
reporting these measures outweighs the benefits of keeping them in the
Hospital OQR Program.
Each measure is discussed in more detail below. We also note that
in crafting our proposals, we considered removing these measures
beginning with the CY 2020 payment determination, but decided on
proposing to delay removal until the CY 2021 payment determination and
subsequent years to be sensitive to providers' planning and operational
procedures given that data collection for the measures begins during CY
2018 for the CY 2020 payment determination.
Proposed Removal of OP-11: Thorax CT Use of Contrast
Material
We refer readers to the CY 2009 OPPS/ASC final rule with comment
period (73 FR 68766) where we adopted OP-11: Thorax CT Use of Contrast
Material (NQF #0513) beginning with the CY 2010 payment determination.
This claims-based measure assesses the percentage of thorax studies
that are performed with and without contrast out of all thorax studies
performed.
Based on our analysis of Hospital OQR Program measure data, we have
determined that this measure meets our measure removal Factor 1. These
analyses are captured in the table below.
OP-11--Thorax CT Use of Contrast Material Topped-Out Analysis
----------------------------------------------------------------------------------------------------------------
Number of 75th 90th
Encounters hospitals Percentile Percentile Truncated COV
----------------------------------------------------------------------------------------------------------------
CY 2012......................................... 867 96.9 98.4 0.081
CY 2013......................................... 869 97.1 98.5 0.074
CY 2014......................................... 796 97.2 98.4 0.065
CY 2015......................................... 711 97.4 98.5 0.054
----------------------------------------------------------------------------------------------------------------
As displayed in the table above, there is a statistically
indistinguishable difference in hospital performance between the 75th
and 90th percentiles, and the truncated coefficient of variation has
been below 0.10 since 2012.
Proposed Removal of OP-14: Simultaneous Use of Brain
Computed Tomography (CT) and Sinus CT
We refer readers to the CY 2010 OPPS/ASC final rule with comment
period (75 FR 72082) where we adopted OP-14: Simultaneous Use of Brain
Computed Tomography (CT) and Sinus CT beginning with the CY 2012
payment determination and for subsequent years. This claims-based
measure assesses the extent to which patients with a headache who have
a brain CT also have a sinus CT performed on the same date at the same
facility.
Based on our analysis of Hospital OQR Program measure data, we have
determined that this measure meets our measure removal Factor 1. These
analyses are captured in the table below.
OP-14: Simultaneous Use of Brain Computed Tomography (CT) And Sinus CT Topped-Out Analysis
----------------------------------------------------------------------------------------------------------------
Number of 75th 90th
Encounters hospitals percentile percentile Truncated COV
----------------------------------------------------------------------------------------------------------------
CY 2012......................................... 1,478 97.8 98.3 0.012
[[Page 37186]]
CY 2013......................................... 1,939 97.7 98.2 0.010
CY 2014......................................... 2,023 97.6 98.2 0.011
CY 2015......................................... 1,101 98.5 98.8 0.007
----------------------------------------------------------------------------------------------------------------
As displayed in the table above, there is a statistically
indistinguishable difference in hospital performance between the 75th
and 90th percentiles, and the truncated coefficient of variation has
been below 0.10 since 2012.
Therefore, we are inviting public comment on our proposals to
remove: (1) OP-11: Thorax CT Use of Contrast Material, and (2) OP-14:
Simultaneous Use of Brain Computed Tomography (CT) and Sinus CT measure
for the CY 2021 payment determination and subsequent years as discussed
above.
(d) Proposed Removals Under Measure Removal Factor 2: OP-12 and OP-17
In this proposed rule, for the CY 2021 payment determination and
subsequent years, we are proposing to remove two measures under our
measure removal Factor 2, performance or improvement on a measure does
not result in better patient outcomes: OP-12 and OP-17. The proposals
are discussed in more detail below. As discussed in section I.A.2. of
this proposed rule above, our Meaningful Measures Initiative is
intended to reduce costs and minimize burden. We believe that removing
these measures from the Hospital OQR Program will reduce program
burden, costs, and complexity. In addition, we note that in crafting
our proposals, we considered removing these measures beginning with the
CY 2020 payment determination, but decided on proposing to delay
removal until the CY 2021 payment determination to be sensitive to
facilities' planning and operational procedures given that data
collection for this measure begins during CY 2018 for the CY 2020
payment determination.
Proposed Removal of OP-12: The Ability for Providers with
HIT to Receive Laboratory Data Electronically Directly into Their
Qualified/Certified EHR System as Discrete Searchable Data
We refer readers to CY 2011 OPPS/ASC final rule with comment period
(75 FR 72076) where we adopted OP-12: The Ability for Providers with
HIT to Receive Laboratory Data Electronically Directly into Their
Qualified/Certified EHR System as Discrete Searchable Data beginning
with the CY 2012 payment determination. This web-based measure assesses
the extent to which a provider uses an Office of the National
Coordinator for Health Information Technology (ONC) certified
electronic health record (EHR) system that incorporates an electronic
data interchange with one or more laboratories allowing for direct
electronic transmission of laboratory data in the EHR as discrete
searchable data elements. In this proposed rule, we are proposing to
remove OP-12 beginning with the CY 2021 payment determination and for
subsequent years under our measure removal Factor 2, performance or
improvement on a measure does not result in better patient outcomes.
OP-12 is a process measure that tracks the transmittal of data, but
does not directly assess quality or patient outcomes. In the CY 2011
OPPS/ASC final rule with comment period (75 FR 72075), commenters
expressed concern that the measure only assesses HIT functionality and
does not assess the quality of care provided. As discussed in section
I.A.2. of this proposed rule, one of the goals of our Meaningful
Measures Initiative is to reduce burden associated with payment policy,
quality measures, documentation requirements, conditions of
participation, and health information technology. As also discussed in
section I.A.2. of this proposed rule, one of the goals of our
Meaningful Measures Initiative is to utilize measures that are
``outcome-based where possible.'' We do not believe OP-12 adds to these
goals. In fact, we believe that provider performance in the measure is
not an indicator for patient outcomes and continued collection provides
little benefit.
Therefore, we are proposing to remove OP-12 from the Hospital OQR
Program beginning with the CY 2021 payment determination and for
subsequent years.
Proposed Removal of OP-17: Tracking Clinical Results
Between Visits
We refer readers to CY 2011 OPPS/ASC final rule with comment period
(75 FR 72085) where we adopted OP-17: Tracking Clinical Results between
Visits beginning with the CY 2013 payment determination. This web-based
measure assesses the extent to which a provider uses a certified/
qualified EHR system to track pending laboratory tests, diagnostic
studies (including common preventive screenings), or patient referrals.
In this proposed rule, we are proposing to remove OP-17 beginning with
the CY 2021 payment determination and for subsequent years under our
measure removal Factor 2, performance or improvement on a measure does
not result in better patient outcomes.
OP-17 is a process measure that tabulates only the ability for
transmittal of data, but does not directly assess quality or patient
outcomes. In the CY 2011 OPPS/ASC final rule with comment period (75 FR
72075), commenters expressed concern that the measure only assesses HIT
functionality and does not assess the quality of care provided. As
discussed in section I.A.2. of this proposed rule, one of the goals of
our Meaningful Measures Initiative is to reduce burden associated with
payment policy, quality measures, documentation requirements,
conditions of participation, and health information technology. As also
discussed in section I.A.2. of this proposed rule, one of the goals of
our Meaningful Measures Initiative is to utilize measures that
``outcome-based where possible.'' We do not believe OP-17 supports this
goal. In fact, we believe that provider performance in the measure does
not improve patient outcomes and continued collection provides little
benefit. Therefore, we are proposing to remove OP-17 from the Hospital
OQR Program beginning with the CY 2021 payment determination and for
subsequent years.
5. Summary of Proposed Hospital OQR Program Measure Sets for the CY
2020 and CY 2021 Payment Determinations
In this proposed rule, we are not proposing any new measures for
the Hospital OQR Program. We refer readers to the CY 2018 OPPS/ASC
final rule with comment period (82 FR 59434 through 59435) for the
previously finalized measure set for the CY 2020 payment determination
and subsequent years. The tables below summarize the
[[Page 37187]]
proposed Hospital OQR Program measure sets for the CY 2020 and 2021
payment determinations and subsequent years (including previously
adopted measures and excluding measures proposed for removal in this
proposed rule).
Proposed Hospital OQR Program Measure Set for the CY 2020 Payment
Determination
------------------------------------------------------------------------
NQF No. Measure name
------------------------------------------------------------------------
0288......................... OP-2: Fibrinolytic Therapy Received
Within 30 Minutes of ED Arrival
0290......................... OP-3: Median Time to Transfer to Another
Facility for Acute Coronary Intervention
0289......................... OP-5: Median Time to ECG [dagger]
0514......................... OP-8: MRI Lumbar Spine for Low Back Pain
None......................... OP-9: Mammography Follow-up Rates
None......................... OP-10: Abdomen CT--Use of Contrast
Material
0513......................... OP-11: Thorax CT--Use of Contrast
Material
None......................... OP-12: The Ability for Providers with HIT
to Receive Laboratory Data
Electronically Directly into their ONC-
Certified EHR System as Discrete
Searchable Data
0669......................... OP-13: Cardiac Imaging for Preoperative
Risk Assessment for Non-Cardiac, Low-
Risk Surgery
None......................... OP-14: Simultaneous Use of Brain Computed
Tomography (CT) and Sinus Computed
Tomography (CT)
0491......................... OP-17: Tracking Clinical Results between
Visits [dagger]
0496......................... OP-18: Median Time from ED Arrival to ED
Departure for Discharged ED Patients
0499......................... OP-22: Left Without Being Seen [dagger]
0661......................... OP-23: Head CT or MRI Scan Results for
Acute Ischemic Stroke or Hemorrhagic
Stroke who Received Head CT or MRI Scan
Interpretation Within 45 minutes of ED
Arrival
0658......................... OP-29: Appropriate Follow-Up Interval for
Normal Colonoscopy in Average Risk
Patients *
0659......................... OP-30: Colonoscopy Interval for Patients
with a History of Adenomatous Polyps--
Avoidance of Inappropriate Use *
1536......................... OP-31: Cataracts: Improvement in
Patient's Visual Function within 90 Days
Following Cataract Surgery **
2539......................... OP-32: Facility 7-Day Risk-Standardized
Hospital Visit Rate after Outpatient
Colonoscopy
1822......................... OP-33: External Beam Radiotherapy for
Bone Metastases
None......................... OP-35: Admissions and Emergency
Department (ED) Visits for Patients
Receiving Outpatient Chemotherapy
2687......................... OP-36: Hospital Visits after Hospital
Outpatient Surgery
None......................... OP-37a: OAS CAHPS--About Facilities and
Staff ***
None......................... OP-37b: OAS CAHPS--Communication About
Procedure ***
None......................... OP-37c: OAS CAHPS--Preparation for
Discharge and Recovery ***
None......................... OP-37d: OAS CAHPS--Overall Rating of
Facility ***
None......................... OP-37e: OAS CAHPS--Recommendation of
Facility ***
------------------------------------------------------------------------
[dagger] We note that NQF endorsement for this measure was removed.
* OP-26: Procedure categories and corresponding HCPCS codes are located
at: https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier3&cid=1196289981244 9981244.
** We note that measure name was revised to reflect NQF title.
*** Measure voluntarily collected as set forth in section XIII.D.3.b. of
the CY 2015 OPPS/ASC final rule with comment period (79 FR 66946
through 66947).
**** Measure reporting delayed beginning with CY 2018 reporting and for
subsequent years as discussed in section XIII.B.5. of the CY 2018 OPPS/
ASC final rule with comment period (82 FR 59432 through 59433).
Proposed Hospital OQR Program Measure Set for the CY 2021 Payment
Determination and Subsequent Years
------------------------------------------------------------------------
NQF No. Measure name
------------------------------------------------------------------------
0288......................... OP-2: Fibrinolytic Therapy Received
Within 30 Minutes of ED Arrival.
0290......................... OP-3: Median Time to Transfer to Another
Facility for Acute Coronary
Intervention.
0514......................... OP-8: MRI Lumbar Spine for Low Back Pain.
None......................... OP-10: Abdomen CT--Use of Contrast
Material.
0669......................... OP-13: Cardiac Imaging for Preoperative
Risk Assessment for Non-Cardiac, Low-
Risk Surgery.
0496......................... OP-18: Median Time from ED Arrival to ED
Departure for Discharged ED Patients.
0499......................... OP-22: Left Without Being Seen. [dagger]
0661......................... OP-23: Head CT or MRI Scan Results for
Acute Ischemic Stroke or Hemorrhagic
Stroke who Received Head CT or MRI Scan
Interpretation Within 45 minutes of ED
Arrival.
2539......................... OP-32: Facility 7-Day Risk-Standardized
Hospital Visit Rate after Outpatient
Colonoscopy.
1822......................... OP-33: External Beam Radiotherapy for
Bone Metastases.
None......................... OP-35: Admissions and Emergency
Department (ED) Visits for Patients
Receiving Outpatient Chemotherapy.
2687......................... OP-36: Hospital Visits after Hospital
Outpatient Surgery.
None......................... OP-37a: OAS CAHPS--About Facilities and
Staff.***
None......................... OP-37b: OAS CAHPS--Communication About
Procedure.***
None......................... OP-37c: OAS CAHPS--Preparation for
Discharge and Recovery.***
None......................... OP-37d: OAS CAHPS--Overall Rating of
Facility.***
None......................... OP-37e: OAS CAHPS--Recommendation of
Facility.***
------------------------------------------------------------------------
[dagger] We note that NQF endorsement for this measure was removed.
[ordm] OP-26: Procedure categories and corresponding HCPCS codes are
located at: https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier3&cid=1196289981244 9981244.
* We note that measure name was revised to reflect NQF title.
** Measure voluntarily collected as set forth in section XIII.D.3.b. of
the CY 2015 OPPS/ASC final rule with comment period (79 FR 66946
through 66947).
*** Measure reporting delayed beginning with CY 2018 reporting and for
subsequent years as discussed in section XIII.B.5. of the CY 2018 OPPS/
ASC final rule with comment period (82 FR 59432 through 59433).
[[Page 37188]]
6. Hospital OQR Program Measures and Topics for Future Consideration
In this proposed rule, we are requesting public comment on future
measure topics for the Hospital OQR Program. We seek to develop a
comprehensive set of quality measures to be available for widespread
use for informed decision-making and quality improvement in the
hospital outpatient setting. The current measure set for the Hospital
OQR Program includes measures that assess process of care, imaging
efficiency patterns, care transitions, ED throughput efficiency, Health
Information Technology (health IT) use, care coordination, and patient
safety. Measures are of various types, including those of process,
structure, outcome, and efficiency. Through future rulemaking, we
intend to propose new measures that help us further our goal of
achieving better health care and improved health for Medicare
beneficiaries who receive health care in hospital outpatient settings,
while aligning quality measures across the Medicare program to the
extent possible.
We are moving towards greater use of outcome measures and away from
use of clinical process measures across our Medicare quality reporting
and value-based purchasing programs. We are inviting public comments on
possible measure topics for future consideration in the Hospital OQR
Program. We are specifically requesting comment on any outcome measures
that would be useful to add to as well as any process measures that
should be eliminated from the Hospital OQR Program.
7. Maintenance of Technical Specifications for Quality Measures
CMS maintains technical specifications for previously adopted
Hospital OQR Program measures. These specifications are updated as we
modify the Hospital OQR Program measure set. The manuals that contain
specifications for the previously adopted measures can be found on the
QualityNet website at: https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier2&cid=1196289981244. In this proposed rule, we are proposing to change the frequency
of the Hospital OQR Program Specifications Manual release beginning
with CY 2019 and for subsequent years and we refer readers to section
XIII.D.2. of this proposed rule for more details.
8. Public Display of Quality Measures
We refer readers to the CY 2014 and CY 2017 OPPS/ASC final rules
with comment period (78 FR 75092 and 81 FR 79791 respectively) for our
previously finalized policies regarding public display of quality
measures. In this proposed rule, we are not proposing any changes to
our previously finalized public display policies.
C. Administrative Requirements
1. QualityNet Account and Security Administrator
The previously finalized QualityNet security administrator
requirements, including setting up a QualityNet account and the
associated timelines, are described in the CY 2014 OPPS/ASC final rule
with comment period (78 FR 75108 through 75109). In that final rule
with comment period, we codified these procedural requirements at 42
CFR 419.46(a). In this proposed rule, we are not proposing any changes
to our requirements for the QualityNet account and security
administrator.
2. Requirements Regarding Participation Status
In this proposed rule, we are proposing to update our requirements
related to the Notice of Participation (NOP) form.
a. Background
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75108 through 75109) and the CY 2016 OPPS/ASC final rule
with comment period (80 FR 70519) for requirements for participation
and withdrawal from the Hospital OQR Program. We also codified these
procedural requirements at 42 CFR 419.46(a) and 42 CFR 419.46(b).
b. Proposal to Remove the Notice of Participation (NOP) Form
Requirement
We finalized in the CY 2014 OPPS/ASC final rule with comment period
(78 FR 75108 through 75109) that participation in the Hospital OQR
Program requires that hospitals must: (1) Register on the QualityNet
website before beginning to report data; (2) identify and register a
QualityNet security administrator; and (3) complete and submit an
online participation form, the Notice of Participation (NOP) form,
available at the QualityNet website if this form has not been
previously completed, if a hospital has previously withdrawn, or if the
hospital acquires a new CMS Certification Number (CCN). In addition, in
the CY 2014 OPPS/ASC final rule with comment period (78 FR 75108
through 75109), we finalized the requirement that that hospitals must
submit the NOP according to the below deadlines. These requirements are
also codified at 42 CFR 419.46(a).
If a hospital has a Medicare acceptance date before
January 1 of the year prior to the affected annual payment update, the
hospital must complete and submit to CMS a completed Hospital OQR
Notice of Participation Form by July 31 of the calendar year prior to
the affected annual payment update.
If a hospital has a Medicare acceptance date on or after
January 1 of the year prior to the affected annual payment update, the
hospital must submit a completed participation form no later than 180
days from the date identified as its Medicare acceptance date. In this
proposed rule, beginning with the CY 2018 reporting period/CY 2020
payment determination, we are proposing to remove submission of the NOP
form as a requirement for the Hospital OQR Program. After reevaluating
program requirements, we have concluded that this form does not provide
CMS with any unique information, and as such, we believe it is
unnecessarily burdensome for hospitals to complete and submit. In place
of the NOP form, we are proposing that submission of any Hospital OQR
Program data would indicate a hospital's status as a participant in the
program. This includes submitting just one data element. That is,
hospitals would no longer be required to submit the NOP form as was
previously required. Instead, hospitals would need to do the following
to be a participant in the Hospital OQR Program: (1) Register on the
QualityNet website before beginning to report data; (2) identify and
register a QualityNet security administrator; and (3) submit data. We
are also proposing to update 42 CFR 419.46(a) to reflect these changes.
D. Form, Manner, and Timing of Data Submitted for the Hospital OQR
Program
1. Hospital OQR Program Annual Payment Determinations
In the CY 2014 OPPS/ASC final rule with comment period (78 FR 75110
through 75111) and the CY 2016 OPPS/ASC final rule with comment period
(80 FR 70519 through 70520), we specified our data submission
deadlines. We also codified our submission requirements at 42 CFR
419.46(c).
We refer readers to the CY 2016 OPPS/ASC final rule with comment
period (80 FR 70519 through 70520), where we finalized our proposal to
shift the quarters upon which the Hospital OQR Program payment
determinations are based, beginning with the CY 2018 payment
determination. The finalized deadlines for the CY 2020 payment
[[Page 37189]]
determination and subsequent years are illustrated in the table below.
CY 2020 Payment Determination and Subsequent Years
------------------------------------------------------------------------
Clinical
data
Patient encounter quarter submission
deadline
------------------------------------------------------------------------
Q2 2018 (April 1-June 30).................................. 11/1/2018
Q3 2018 (July 1-September 30).............................. 2/1/2019
Q4 2018 (October 1-December 31)............................ 5/1/2019
Q1 2019 (January 1-March 31)............................... 8/1/2019
------------------------------------------------------------------------
In the CY 2018 OPPS/ASC final rule with comment period, we
finalized a policy to align the initial data submission timeline for
all hospitals that did not participate in the previous year's Hospital
OQR Program and made conforming revisions at 42 CFR 419.46(c)(3). In
this proposed rule, we are not proposing any changes to these policies.
2. Proposal To Change Frequency of Hospital Outpatient Quality
Reporting Specifications Manual Release Beginning With CY 2019 and for
Subsequent Years
In this proposed rule, we are proposing to change the frequency of
the Hospital Outpatient Quality Reporting Specifications Manual release
beginning with CY 2019 and for subsequent years. In the CY 2009 OPPS/
ASC final rule with comment period (73 FR 68766 through 68767), we
established a subregulatory process for making updates to the measures
we have adopted for the Hospital OQR Program. As stated in CY 2014
OPPS/ASC final rule with comment period (78 FR 75091), we believe that
a measure can be updated through this subregulatory process provided it
is a nonsubstantive change. We expect to continue to make the
determination of what constitutes a substantive versus a nonsubstantive
change on a case-by-case basis. Examples of nonsubstantive changes to
measures might include updated diagnosis or procedure codes, medication
updates for categories of medications, broadening of age ranges, and
exclusions for a measure (such as the addition of a hospice exclusion
to the 30-day mortality measures). We believe that nonsubstantive
changes may include updates to measures based upon changes to
guidelines upon which the measures are based.
For a history of our policies regarding maintenance of technical
specifications for quality measures, we refer readers to the CY 2010
OPPS/ASC final rule with comment period (74 FR 60631), the CY 2011
OPPS/ASC final rule with comment period (75 FR 72069), and the CY 2013
OPPS/ASC final rule with comment period (77 FR 68469 through 68470). We
note that we will continue to use rulemaking to adopt substantive
updates to measures we have adopted for the Hospital OQR Program. We
believe that this policy adequately balances our need to incorporate
nonsubstantive updates to Hospital OQR Program measures in the most
expeditious manner possible, while preserving the public's ability to
comment on updates that so fundamentally change an endorsed measure
that it is no longer the same measure that we originally adopted. We
also note that the NQF process incorporates an opportunity for public
comment and engagement in the measure maintenance process.
As stated in CY 2014 OPPS/ASC final rule with comment period (78 FR
75091), under current policy, technical specifications for the Hospital
OQR Program measures are listed in the Hospital Outpatient Quality
Reporting Specifications Manual, which is posted on the CMS QualityNet
website at: http://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FSpecsManualTemplate&cid=1228772438492. We maintain the technical specifications for the
measures by updating this Hospital Outpatient Quality Reporting
Specifications Manual and including detailed instructions and
calculation algorithms. In some cases where the specifications are
available elsewhere, we may include links to websites hosting technical
specifications. These resources are for hospitals to use when
collecting and submitting data on required measures. We revise the
Hospital Outpatient Quality Reporting Specifications Manual so that it
clearly identifies the updates and provide links to where additional
information on the updates can be found. We provide sufficient lead
time for facilities to implement the changes where changes to the data
collection systems would be necessary. We generally release the
Hospital Outpatient Quality Reporting Specifications Manual every 6
months and release addenda as necessary. This release schedule provides
at least 3 months of advance notice for nonsubstantive changes such as
changes to ICD-10, CPT, NUBC, and HCPCS codes, and at least 6 months of
advance notice for changes to data elements that would require
significant systems changes (78 FR 75091).
However, we believe that unnecessarily releasing two manuals a year
has the potential to cause confusion for Hospital OQR Program
participants. Therefore, in this proposed rule, we are proposing to
update the frequency with which we release Hospital Outpatient Quality
Reporting Specifications Manuals, such that instead of every 6 months,
we would release Specifications Manuals every 6 to 12 months beginning
with CY 2019 and for subsequent years. Under this proposal, we would
release a Hospital Outpatient Quality Reporting Specifications Manual
one to two times per calendar year, depending on the need for an
updated release and consideration of our policy to provide at least 6
months' notice for substantive changes.
3. Requirements for Chart-Abstracted Measures Where Patient-Level Data
Are Submitted Directly to CMS for the CY 2020 Payment Determination and
Subsequent Years
We refer readers to the CY 2013 OPPS/ASC final rule with comment
period (77 FR 68481 through 68484) for a discussion of the form,
manner, and timing for data submission requirements of chart-abstracted
measures for the CY 2014 payment determination and subsequent years. We
are not proposing any changes to our policies regarding the submission
of chart-abstracted measure data where patient-level data are submitted
directly to CMS.
We note that, in section XIII.B.4.b. of this proposed rule, we are
proposing to remove OP-5: Median Time to ECG for the CY 2021 payment
determination and subsequent years. If that proposal is finalized as
proposed, only the following previously finalized Hospital OQR Program
chart-abstracted measures will require patient-level data to be
submitted for the CY 2021 payment determination and subsequent years:
OP-2: Fibrinolytic Therapy Received Within 30 Minutes of
ED Arrival (NQF #0288);
OP-3: Median Time to Transfer to Another Facility for
Acute Coronary Intervention (NQF #0290);
OP-18: Median Time from ED Arrival to ED Departure for
Discharged ED Patients (NQF #0496); and
OP-23: Head CT Scan Results for Acute Ischemic Stroke or
Hemorrhagic Stroke Patients who Received Head CT Scan Interpretation
Within 45 Minutes of ED Arrival (NQF #0661).
4. Claims-Based Measure Data Requirements for the CY 2020 Payment
Determination and Subsequent Years
In this proposed rule, we are proposing to extend the reporting
[[Page 37190]]
period \86\ for OP-32: Facility 7-Day Risk-Standardized Hospital Visit
Rate after Outpatient Colonoscopy.
---------------------------------------------------------------------------
\86\ We note that we previously referred to these reporting
periods as ``collection periods'' (for example, 82 FR 59440); we now
use the term ``reporting period'' in order to align the ASCQR
Program terminology with the terminology we use in other CMS quality
reporting and pay for performance (value-based purchasing) programs.
---------------------------------------------------------------------------
a. General
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75111 through 75112) for a discussion of the general
claims-based measure data submission requirements for the CY 2015
payment determination and subsequent years.
We are not proposing changes to our general requirements for
claims-based measure data, but refer readers to the section below for
our proposal specific to OP-32.
We note that, in section XIII.B.4.b. of this proposed rule, we are
proposing to remove OP-9: Mammography Follow-up Rates, OP-11: Thorax CT
Use of Contrast Material, and OP-14: Simultaneous Use of Brain Computed
Tomography (CT) and Sinus CT for the CY 2021 payment determination and
subsequent years. If these removals are finalized as proposed, only the
following previously finalized Hospital OQR Program claims-based
measures will be required for the CY 2021 payment determination and
subsequent years:
OP-8: MRI Lumbar Spine for Low Back Pain (NQF #0514);
OP-10: Abdomen CT--Use of Contrast Material;
OP-13: Cardiac Imaging for Preoperative Risk Assessment
for Non-Cardiac, Low Risk Surgery (NQF #0669);
OP-32: Facility 7-Day Risk-Standardized Hospital Visit
Rate after Outpatient Colonoscopy (NQF #2539);
OP-35: Admissions and Emergency Department Visits for
Patients Receiving Outpatient Chemotherapy; and
OP-36: Hospital Visits after Hospital Outpatient Surgery
(NQF #2687).
b. Proposed Extension of the Reporting Period for OP-32: Facility 7-Day
Risk-Standardized Hospital Visit Rate After Outpatient Colonoscopy
In the CY 2015 OPPS/ASC final rule with comment period (79 FR
66949), we finalized the adoption of OP-32: Facility 7-Day Risk-
Standardized Hospital Visit Rate after Outpatient Colonoscopy into the
Hospital OQR Program for the CY 2018 payment determination and
subsequent years, with public display to begin on or after December 1,
2017. This measure is calculated with data obtained from paid Medicare
FFS claims (79 FR 66950). For this reason, facilities are not required
to submit any additional information. In that final rule with comment
period, we also finalized the reporting period for measure calculation
as claims data from 2 calendar years prior to the payment determination
year. Specifically, for the CY 2018 payment determination, we stated we
would use paid Medicare FFS claims from January 1, 2016 to December 31,
2016 to calculate measure results (79 FR 66955). We finalized a 1-year
reporting period, as it adequately balanced competing interests of
measure reliability and timeliness for payment determination purposes,
and explained that we would continue to assess this during the dry run
(79 FR 66955).
We noted we would complete a dry run of the measure in 2015 using 3
or 4 years of data, and, from the results of this dry run, we would
review the appropriate volume cutoff for facilities to ensure
statistical reliability in reporting the measure score (79 FR 66953).
Our analyses of the 2015 dry run using data from July 2011 through June
2014 showed that a reporting period of one year had moderate to high
reliability for measure calculation. Specifically, using data from July
2013 through June 2014, we calculated facility-level reliability
estimates as the ratio of true variance to observed variance.\87\
Consistent with the original measure specifications as described in the
2014 technical report,\88\ this calculation was performed combining the
measure results for HOPDs and ASCs. We found that for a facility with
median case size, the reliability estimate was high (over 0.90), but
the minimum reliability estimate for facilities with 30 cases (the
minimum case size chosen for public reporting) was only moderate (that
is, between 0.40 and 0.60).\89\
---------------------------------------------------------------------------
\87\ Snijders TA, Bosker RJ. Multilevel Analysis: An
introduction to basic and advanced multilevel modeling. SAGE
Publications. 2000. London.
\88\ Additional methodology details and information obtained
from public comments for measure development are available at:
https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/HospitalQualityInits/Measure-Methodology.html under
``Hospital Outpatient Colonoscopy.''
\89\ Landis JR, Koch GG. The Measurement of Observer Agreement
for Categorical Data. Biometrics. 1977;33(1):159-174.
---------------------------------------------------------------------------
However, after the 2015 dry run, CMS calculated the HOPD and ASC
scores separately to compare similar types of providers to each other.
During subsequent analysis of the 1-year period July 2013 through June
2014, we confirmed that a 1-year reporting period with separate
calculations for HOPDs and ASCs was sufficient, but did result in lower
reliability and decreased precision compared to these measures
calculated from longer reporting periods (2 or 3 years). Based on
analyses conducted using data from July 2013 through June 2014 (1-year
reporting period) and 2017 measure specifications,\90\ we found that
the median facility-level reliability was 0.74 for ASCs and 0.51 for
HOPDs. Using a 2-year reporting period (data from July 2012--June
2014), we found that median facility-level reliability was 0.81 for
ASCs and 0.67 for HOPDs. When the reporting period was extended to 3
years (using data from July 2011 through June 2014), we found that
median facility-level reliability was higher for both ASCs and HOPDs:
0.87 for ASCs and 0.75 for HOPDs. These results indicate that a larger
portion of the included facilities have scores measured with higher
reliability when 3 years of data are used rather than 1 year of data.
---------------------------------------------------------------------------
\90\ Current and past measure specifications are available at:
https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier3&cid=1228775214597.
---------------------------------------------------------------------------
Using 3 years of data, compared to just 1 year, is estimated to
increase the number of HOPDs with eligible cases for OP-32 by 5
percent, adding approximately 235 additional facilities to the measure
calculation. Facilities reporting the measure would increase their
sample sizes and, in turn, increase the precision and reliability of
their measure scores. Thus, we believe extending the reporting period
to 3 years from 1 year for purposes of increasing reliability would be
beneficial for providing better information to beneficiaries regarding
the quality of care associated with low-risk outpatient colonoscopy
procedures. In crafting our proposal, we considered extending the
reporting period to 2 years beginning with the CY 2020 payment
determinations and subsequent years, but decided on proposing 3 years
instead, because a higher level of reliability is achieved with a 3-
year reporting period compared to 2 years.
Therefore, we are proposing to change the reporting period for OP-
32: Facility 7-Day Risk-Standardized Hospital Visit Rate after
Outpatient Colonoscopy from 1 year to 3 years beginning with the CY
2020 payment determination (which would use claims data from January 1,
2016 through December 31, 2018) and for subsequent years. Under this
proposal, the annual reporting requirements for facilities would not
change, because this is a claims-based measure. However, with a 3-year
reporting period, the most current year
[[Page 37191]]
of data would be supplemented by the addition of 2 prior years. For
example, for the CY 2020 payment determination, we would use a
reporting period of CY 2018 data plus 2 prior years of data (CYs 2016
and 2017). We note that since implementation of this measure began with
the CY 2018 payment determination, we have already used paid Medicare
fee-for-service claims from January 1, 2016 to December 31, 2016 to
calculate measure scores, which have been previously previewed by
facilities and publicly displayed. In crafting our proposal, we also
considered timeliness related to payment determinations and public
display. Because we would utilize data already collected to supplement
current data, our proposal to use 3 years of data would not disrupt
payment determinations or public display. We refer readers to the table
below for example reporting periods and public display dates
corresponding to the CY 2020, CY 2021, and CY 2022 payment
determinations:
----------------------------------------------------------------------------------------------------------------
CY 2020 payment CY 2021 payment CY 2022 payment
determination determination determination
----------------------------------------------------------------------------------------------------------------
Public display....................... January 2020........... January 2021........... January 2022.
Reporting period..................... January 1, 2016- January 1, 2017- January 1, 2018-
December 31, 2018. December 31, 2019. December 31, 2020.
----------------------------------------------------------------------------------------------------------------
5. Data Submission Requirements for the OP-37a-e: Outpatient and
Ambulatory Surgery Consumer Assessment of Healthcare Providers and
Systems (OAS CAHPS) Survey-Based Measures for the CY 2020 Payment
Determination and Subsequent Years
We refer readers to the CY 2017 OPPS/ASC final rule with comment
period (81 FR 79792 through 79794) for a discussion of the previously
finalized requirements related to survey administration and vendors for
the OAS CAHPS Survey-based measures. In addition, we refer readers to
the CY 2018 OPPS/ASC final rule with comment period (82 FR 59432
through 59433), where we finalized a policy to delay implementation of
the OP-37a-e OAS CAHPS Survey-based measures beginning with the CY 2020
payment determination (2018 reporting period) until further action in
future rulemaking. We are not proposing any changes to the previously
finalized requirements related to survey administration and vendors for
the OAS CAHPS Survey-based measures.
6. Data Submission Requirements for Previously Finalized Measures for
Data Submitted via a Web-Based Tool for the CY 2020 Payment
Determination and Subsequent Years
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75112 through 75115) and the CY 2016 OPPS/ASC final rule
with comment period (80 FR 70521) and the CMS QualityNet website
(https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier2&cid=1205442125082) for a discussion of the requirements for measure data submitted
via the CMS QualityNet website for the CY 2017 payment determination
and subsequent years. In addition, we refer readers to the CY 2014
OPPS/ASC final rule with comment period (78 FR 75097 through 75100) for
a discussion of the requirements for measure data submitted via the CDC
NHSN website. We are not proposing any changes to our policies
regarding the submission of measure data submitted via a web-based
tool.
We note that, in section XIII.B.4.b. of this proposed rule, we are
proposing to remove of OP-27: Influenza Vaccination Coverage Among
Healthcare Personnel beginning with the CY 2020 payment determination
and for subsequent years. If this removal is finalized as proposed, for
the CY 2020 payment determination, the following web-based quality
measures would be required:
OP-12: The Ability for Providers with HIT to Receive
Laboratory Data Electronically Directly into their ONC-Certified EHR
System as Discrete Searchable Data (via CMS' QualityNet website);
OP-17: Tracking Clinical Results between Visits (NQF
#0491) (via CMS' QualityNet website);
OP-22: Left Without Being Seen (NQF #0499) (via CMS'
QualityNet website);
OP-29: Appropriate Follow-up Interval for Normal
Colonoscopy in Average Risk Patients (NQF #0658) (via CMS' QualityNet
website);
OP-30: Colonoscopy Interval for Patients with a History of
Adenomatous Polyps--Avoidance of Inappropriate Use (NQF #0659) (via
CMS' QualityNet website);
OP-31: Cataracts: Improvement in Patient's Visual Function
within 90 Days Following Cataract Surgery (NQF #1536) (via CMS'
QualityNet website); and
OP-33: External Beam Radiotherapy (EBRT) for Bone
Metastases (NQF #1822) (via CMS' QualityNet website).
Furthermore, we note that in section XIII.B.4.b. of this proposed
rule, for the CY 2021 payment determination and subsequent years, we
are proposing to remove: OP-12: The Ability for Providers with HIT to
Receive Laboratory Data Electronically Directly into Their Qualified/
Certified EHR System as Discrete Searchable Data; OP-17: Tracking
Clinical Results between Visits; OP-29: Endoscopy/Polyp Surveillance:
Appropriate Follow-up Interval for Normal Colonoscopy in Average Risk
Patients; OP-30: Endoscopy/Polyp Surveillance: Colonoscopy Interval for
Patients with a History of Adenomatous Polyps-Avoidance of
Inappropriate Use; and OP-31: Cataracts: Improvement in Patient's
Visual Function within 90 Days Following Cataract Surgery beginning
with the CY 2021 payment determination and for subsequent years. If
these removals are finalized as proposed, only the following web-based
quality measures would require data to be submitted via a web-based
tool for the CY 2021 payment determination and subsequent years:
OP-22: Left Without Being Seen (NQF #0499) (via CMS'
QualityNet website); and
OP-33: External Beam Radiotherapy (EBRT) for Bone
Metastases (NQF #1822) (via CMS' QualityNet website).
7. Population and Sampling Data Requirements for the CY 2020 Payment
Determination and Subsequent Years
We refer readers to the CY 2011 OPPS/ASC final rule with comment
period (75 FR 72100 through 72103) and the CY 2012 OPPS/ASC final rule
with comment period (76 FR 74482 through 74483) for discussions of our
population and sampling requirements. In this proposed rule, we are not
proposing any changes to our population and sampling requirements for
chart-abstracted measures.
8. Hospital OQR Program Validation Requirements
We refer readers to the CY 2013 OPPS/ASC final rule with comment
period (77 FR 68484 through 68487), the
[[Page 37192]]
CY 2015 OPPS/ASC final rule with comment period (79 FR 66964 through
66965), the CY 2016 OPPS/ASC final rule with comment period (80 FR
70524), and the CY 2018 OPPS/ASC final rule with comment period (82 FR
59441 through 59443), and 42 CFR 419.46(e) for our policies regarding
validation. We are not proposing any changes to these policies in this
proposed rule.
9. Extraordinary Circumstances Exception (ECE) Process for the CY 2020
Payment Determination and Subsequent Years
We refer readers to the CY 2013 OPPS/ASC final rule with comment
period (77 FR 68489), the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75119 through 75120), the CY 2015 OPPS/ASC final rule
with comment period (79 FR 66966), the CY 2016 OPPS/ASC final rule with
comment period (80 FR 70524), the CY 2017 OPPS/ASC final rule with
comment period (81 FR 79795), the CY 2018 OPPS/ASC final rule with
comment period (82 FR 59444), and 42 CFR 419.46(d) for a complete
discussion of our extraordinary circumstances exception (ECE) process
under the Hospital OQR Program. We are not proposing any changes to our
ECE policy in this proposed rule.
10. Hospital OQR Program Reconsideration and Appeals Procedures for the
CY 2020 Payment Determination and Subsequent Years
We refer readers to the CY 2013 OPPS/ASC final rule with comment
period (77 FR 68487 through 68489), the CY 2014 OPPS/ASC final rule
with comment period (78 FR 75118 through 75119), the CY 2016 OPPS/ASC
final rule with comment period (80 FR 70524), the CY 2017 OPPS/ASC
final rule with comment period (81 FR 79795), and 42 CFR 419.46(f) for
our reconsideration and appeals procedures. We are not proposing any
changes to our reconsideration and appeals procedures in this proposed
rule.
E. Proposed Payment Reduction for Hospitals That Fail To Meet the
Hospital OQR Program Requirements for the CY 2019 Payment Determination
1. Background
Section 1833(t)(17) of the Act, which applies to subsection (d)
hospitals (as defined under section 1886(d)(1)(B) of the Act), states
that hospitals that fail to report data required to be submitted on
measures selected by the Secretary, in the form and manner, and at a
time, specified by the Secretary will incur a 2.0 percentage point
reduction to their Outpatient Department (OPD) fee schedule increase
factor; that is, the annual payment update factor. Section
1833(t)(17)(A)(ii) of the Act specifies that any reduction applies only
to the payment year involved and will not be taken into account in
computing the applicable OPD fee schedule increase factor for a
subsequent year.
The application of a reduced OPD fee schedule increase factor
results in reduced national unadjusted payment rates that apply to
certain outpatient items and services provided by hospitals that are
required to report outpatient quality data in order to receive the full
payment update factor and that fail to meet the Hospital OQR Program
requirements. Hospitals that meet the reporting requirements receive
the full OPPS payment update without the reduction. For a more detailed
discussion of how this payment reduction was initially implemented, we
refer readers to the CY 2009 OPPS/ASC final rule with comment period
(73 FR 68769 through 68772).
The national unadjusted payment rates for many services paid under
the OPPS equal the product of the OPPS conversion factor and the scaled
relative payment weight for the APC to which the service is assigned.
The OPPS conversion factor, which is updated annually by the OPD fee
schedule increase factor, is used to calculate the OPPS payment rate
for services with the following status indicators (listed in Addendum B
to this proposed rule, which is available via the internet on the CMS
website): ``J1'', ``J2'', ``P'', ``Q1'', ``Q2'',:Q3'', ``R'', ``S'',
``T'', ``V'', or ``U''. In the CY 2017 OPPS/ASC final rule with comment
period (81 FR 79796), we clarified that the reporting ratio does not
apply to codes with status indicator ``Q4'' because services and
procedures coded with status indicator ``Q4'' are either packaged or
paid through the Clinical Laboratory Fee Schedule and are never paid
separately through the OPPS. Payment for all services assigned to these
status indicators will be subject to the reduction of the national
unadjusted payment rates for hospitals that fail to meet Hospital OQR
Program requirements, with the exception of services assigned to New
Technology APCs with assigned status indicator ``S'' or ``T''. We refer
readers to the CY 2009 OPPS/ASC final rule with comment period (73 FR
68770 through 68771) for a discussion of this policy.
The OPD fee schedule increase factor is an input into the OPPS
conversion factor, which is used to calculate OPPS payment rates. To
reduce the OPD fee schedule increase factor for hospitals that fail to
meet reporting requirements, we calculate two conversion factors--a
full market basket conversion factor (that is, the full conversion
factor), and a reduced market basket conversion factor (that is, the
reduced conversion factor). We then calculate a reduction ratio by
dividing the reduced conversion factor by the full conversion factor.
We refer to this reduction ratio as the ``reporting ratio'' to indicate
that it applies to payment for hospitals that fail to meet their
reporting requirements. Applying this reporting ratio to the OPPS
payment amounts results in reduced national unadjusted payment rates
that are mathematically equivalent to the reduced national unadjusted
payment rates that would result if we multiplied the scaled OPPS
relative payment weights by the reduced conversion factor. For example,
to determine the reduced national unadjusted payment rates that applied
to hospitals that failed to meet their quality reporting requirements
for the CY 2010 OPPS, we multiplied the final full national unadjusted
payment rate found in Addendum B of the CY 2010 OPPS/ASC final rule
with comment period by the CY 2010 OPPS final reporting ratio of 0.980
(74 FR 60642).
In the CY 2009 OPPS/ASC final rule with comment period (73 FR 68771
through 68772), we established a policy that the Medicare beneficiary's
minimum unadjusted copayment and national unadjusted copayment for a
service to which a reduced national unadjusted payment rate applies
would each equal the product of the reporting ratio and the national
unadjusted copayment or the minimum unadjusted copayment, as
applicable, for the service. Under this policy, we apply the reporting
ratio to both the minimum unadjusted copayment and national unadjusted
copayment for services provided by hospitals that receive the payment
reduction for failure to meet the Hospital OQR Program reporting
requirements. This application of the reporting ratio to the national
unadjusted and minimum unadjusted copayments is calculated according to
Sec. 419.41 of our regulations, prior to any adjustment for a
hospital's failure to meet the quality reporting standards according to
Sec. 419.43(h). Beneficiaries and secondary payers thereby share in
the reduction of payments to these hospitals.
In the CY 2009 OPPS/ASC final rule with comment period (73 FR
68772), we established the policy that all other applicable adjustments
to the OPPS national unadjusted payment rates apply when the OPD fee
schedule
[[Page 37193]]
increase factor is reduced for hospitals that fail to meet the
requirements of the Hospital OQR Program. For example, the following
standard adjustments apply to the reduced national unadjusted payment
rates: the wage index adjustment; the multiple procedure adjustment;
the interrupted procedure adjustment; the rural sole community hospital
adjustment; and the adjustment for devices furnished with full or
partial credit or without cost. Similarly, OPPS outlier payments made
for high cost and complex procedures will continue to be made when
outlier criteria are met. For hospitals that fail to meet the quality
data reporting requirements, the hospitals' costs are compared to the
reduced payments for purposes of outlier eligibility and payment
calculation. We established this policy in the OPPS beginning in the CY
2010 OPPS/ASC final rule with comment period (74 FR 60642). For a
complete discussion of the OPPS outlier calculation and eligibility
criteria, we refer readers to section II.G. of this proposed rule.
2. Proposed Reporting Ratio Application and Associated Adjustment
Policy for CY 2019
We are proposing to continue our established policy of applying the
reduction of the OPD fee schedule increase factor through the use of a
reporting ratio for those hospitals that fail to meet the Hospital OQR
Program requirements for the full CY 2019 annual payment update factor.
For the CY 2019 OPPS, the proposed reporting ratio is 0.980, calculated
by dividing the proposed reduced conversion factor of 77.955 by the
proposed full conversion factor of 79.546. We are proposing to continue
to apply the reporting ratio to all services calculated using the OPPS
conversion factor. For the CY 2019 OPPS, we are proposing to apply the
reporting ratio, when applicable, to all HCPCS codes to which we have
proposed status indicator assignments of ``J1'', ``J2'', ``P'', ``Q1'',
``Q2'', ``Q3'', ``R'', ``S'', ``T'', ``V'', and ``U'' (other than new
technology APCs to which we have proposed status indicator assignment
of ``S'' and ``T''). We are proposing to continue to exclude services
paid under New Technology APCs. We are proposing to continue to apply
the reporting ratio to the national unadjusted payment rates and the
minimum unadjusted and national unadjusted copayment rates of all
applicable services for those hospitals that fail to meet the Hospital
OQR Program reporting requirements. We are also proposing to continue
to apply all other applicable standard adjustments to the OPPS national
unadjusted payment rates for hospitals that fail to meet the
requirements of the Hospital OQR Program. Similarly, we are proposing
to continue to calculate OPPS outlier eligibility and outlier payment
based on the reduced payment rates for those hospitals that fail to
meet the reporting requirements.
XIV. Requirements for the Ambulatory Surgical Center Quality Reporting
(ASCQR) Program
A. Background
1. Overview
We refer readers to section XIII.A.1. of this proposed rule for a
general overview of our quality reporting programs and to section
I.A.2. of this proposed rule for a discussion of our new Meaningful
Measures Initiative.
2. Statutory History of the ASCQR Program
We refer readers to section XIV.K.1. of the CY 2012 OPPS/ASC final
rule with comment period (76 FR 74492 through 74494) for a detailed
discussion of the statutory history of the ASCQR Program.
3. Regulatory History of the ASCQR Program
We seek to promote higher quality and more efficient health care
for beneficiaries. This effort is supported by the adoption of widely-
agreed-upon quality measures. We have worked with relevant stakeholders
to define measures of quality in almost every healthcare setting and
currently measure some aspect of care for almost all Medicare
beneficiaries. These measures assess structural aspects of care,
clinical processes, patient experiences with care, and outcomes. We
have implemented quality measure reporting programs for multiple
settings of care. To measure the quality of ASC services and to make
such information publicly available, we implemented the ASCQR Program.
We refer readers to section XV.A.3. of the CY 2014 OPPS/ASC final rule
with comment period (78 FR 75122), section XIV. of the CY 2015 OPPS/ASC
final rule with comment period (79 FR 66966 through 66987), section
XIV. of the CY 2016 OPPS/ASC final rule with comment period (80 FR
70526 through 70538), section XIV. of the CY 2017 OPPS/ASC final rule
with comment period (81 FR 79797 through 79826) and section XIV. of the
CY 2018 OPPS/ASC final rule with comment period (82 FR 59445 through
59476) for an overview of the regulatory history of the ASCQR Program.
4. Meaningful Measures Initiative
In this proposed rule, we are proposing a number of new policies
for the ASCQR Program. We developed these proposals after conducting an
overall review of the Program under our new Meaningful Measures
Initiative, which is discussed in more detail in section I.A.2. of this
proposed rule. The proposals reflect our efforts to ensure that the
ASCQR Program measure set continues to promote improved health outcomes
for our beneficiaries while minimizing costs, which can consist of
several different types of costs, including, but not limited to: (1)
Facility information collection burden and related cost and burden
associated with the submitting/reporting of quality measures to CMS;
(2) the facility cost associated with complying with other quality
programmatic requirements; (3) the facility cost associated with
participating in multiple quality programs, and tracking multiple
similar or duplicative measures within or across those programs; (4)
the CMS cost associated with the program oversight of the measure,
including measure maintenance and public display; and (5) the facility
cost associated with compliance with other federal and/or State
regulations (if applicable). They also reflect our efforts to improve
the usefulness of the data that we publicly report in the ASCQR
Program. Our goal is to improve the usefulness and usability of CMS
quality program data by streamlining how facilities are reporting and
accessing data, while maintaining or improving consumer understanding
of the data publicly reported on a Compare website. We believe this
framework will allow ASCs and patients to continue to obtain meaningful
information about ASC performance and incentivize quality improvement
while also streamlining the measure sets to reduce duplicative measures
and program complexity so that the costs to ASCs associated with
participating in this program do not outweigh the benefits of improving
beneficiary care.
B. ASCQR Program Quality Measures
1. Considerations in the Selection of ASCQR Program Quality Measures
We refer readers to the CY 2013 OPPS/ASC final rule with comment
period (77 FR 68493 through 68494) for a detailed discussion of the
priorities we consider for ASCQR Program quality measure selection. We
are not proposing any changes to these policies.
[[Page 37194]]
2. Accounting for Social Risk Factors in the ASCQR Program
In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59445
through 59447), we discussed the importance of improving beneficiary
outcomes including reducing health disparities. We also discussed our
commitment to ensuring that medically complex patients, as well as
those with social risk factors, receive excellent care. We discussed
how studies show that social risk factors, such as being near or below
the poverty level as determined by HHS, belonging to a racial or ethnic
minority group, or living with a disability, can be associated with
poor health outcomes and how some of this disparity is related to the
quality of health care.\91\ Among our core objectives, we aim to
improve health outcomes, attain health equity for all beneficiaries,
and ensure that complex patients as well as those with social risk
factors receive excellent care. Within this context, reports by the
Office of the Assistant Secretary for Planning and Evaluation (ASPE)
and the National Academy of Medicine have examined the influence of
social risk factors in CMS value-based purchasing programs.\92\ As we
noted in the CY 2018 OPPS/ASC final rule with comment period (82 FR
59445 through 59447), ASPE's report to Congress found that, in the
context of value-based purchasing programs, dual eligibility was the
most powerful predictor of poor health care outcomes among those social
risk factors that they examined and tested. In addition, as we noted in
the CY 2018 OPPS/ASC final rule with comment period (82 FR 59446), the
National Quality Forum (NQF) undertook a 2-year trial period in which
certain new measures and measures undergoing maintenance review have
been assessed to determine if risk adjustment for social risk factors
is appropriate for these measures.\93\ The trial period ended in April
2017 and a final report is available at: http://www.qualityforum.org/SES_Trial_Period.aspx. The trial concluded that ``measures with a
conceptual basis for adjustment generally did not demonstrate an
empirical relationship'' between social risk factors and the outcomes
measured. This discrepancy may be explained in part by the methods used
for adjustment and the limited availability of robust data on social
risk factors. NQF is now undertaking an extension of the socioeconomic
status (SES) trial,\94\ allowing further examination of social risk
factors in outcome measures.
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\91\ See, for example, United States Department of Health and
Human Services. ``Healthy People 2020: Disparities. 2014.''
Available at: http://www.healthypeople.gov/2020/about/foundation-health-measures/Disparities; or National Academies of Sciences,
Engineering, and Medicine. Accounting for Social Risk Factors in
Medicare Payment: Identifying Social Risk Factors. Washington, DC:
National Academies of Sciences, Engineering, and Medicine 2016.
\92\ Department of Health and Human Services Office of the
Assistant Secretary for Planning and Evaluation (ASPE), ``Report to
Congress: Social Risk Factors and Performance Under Medicare's
Value-Based Purchasing Programs.'' December 2016. Available at:
https://aspe.hhs.gov/pdf-report/report-congress-social-risk-factors-and-performance-under-medicares-value-based-purchasing-programs.
\93\ National Quality Forum. Final Report-Disparities Project.
September 2017. Available at: http://www.qualityforum.org/SES_Trial_Period.aspx.
\94\ National Quality Forum. Health Equity Program: Social Risk
Initiative 2.0. 2017. Available at: http://www.qualityforum.org/WorkArea/linkit.aspx?LinkIdentifier=id&ItemID=86357.
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In the FY 2018 and CY 2018 proposed rules for our quality reporting
and value-based purchasing programs, we solicited feedback on which
social risk factors provide the most valuable information to
stakeholders and the methodology for illuminating differences in
outcomes rates among patient groups within a hospital or facility that
would also allow for a comparison of those differences, or disparities,
across facilities. Feedback we received through our quality reporting
programs included encouraging CMS to explore whether factors that could
be used to stratify or risk adjust the measures (beyond dual
eligibility); considering the full range of differences in patients'
backgrounds that might affect outcomes; exploring risk adjustment
approaches; and offering careful consideration of what type of
information display would be most useful to the public. We also sought
public comment on confidential reporting and future public reporting of
some of our measures stratified by patient dual eligibility. In
general, commenters noted that stratified measures could serve as tools
for facilities to identify gaps in outcomes for different groups of
patients, improve the quality of health care for all patients, and
empower beneficiaries and other consumers to make informed decisions
about health care. Commenters encouraged us to stratify measures by
other social risk factors such as age, income, and educational
attainment. With regard to value-based purchasing programs, commenters
also cautioned to balance fair and equitable payment while avoiding
payment penalties that mask health disparities or discourage the
provision of care to more medically complex patients. Commenters also
noted that value-based payment program measure selection, domain
weighting, performance scoring, and payment methodology must account
for social risk.
As a next step, CMS is considering options to reduce health
disparities among patient groups within and across healthcare settings
by increasing the transparency of disparities as shown by quality
measures. We also are considering how this work applies to other CMS
quality programs in the future. We refer readers to the FY 2018 IPPS/
LTCH PPS final rule (82 FR 38403 through 38409) for more details, where
we discuss the potential stratification of certain Hospital Inpatient
Quality Reporting Program outcome measures. Furthermore, we continue to
consider options to address equity and disparities in our value-based
purchasing programs.
We plan to continue working with ASPE, the public, and other key
stakeholders on this important issue to identify policy solutions that
achieve the goals of attaining health equity for all beneficiaries and
minimizing unintended consequences.
3. Policies for Retention and Removal of Quality Measures From the
ASCQR Program
a. Retention of Previously Adopted ASCQR Program Measures
We previously adopted a policy that quality measures adopted for an
ASCQR Program measure set for a previous payment determination year be
retained in the ASCQR Program for measure sets for subsequent payment
determination years, except when they are removed, suspended, or
replaced as indicated (76 FR 74494 and 74504; 77 FR 68494 through
68495; 78 FR 75122; and 79 FR 66967 through 66969). In this proposed
rule, we are not proposing any changes to this policy.
b. Removal Factors for ASCQR Program Measures
(1) Current Policy
We refer readers to the CY 2015 OPPS/ASC final rule with comment
period (79 FR 66967 through 66969) and 42 CFR 416.320 for a detailed
discussion of the process for removing adopted measures from the ASCQR
Program. In the CY 2015 OPPS/ASC final rule with comment period (79 FR
66967 through 66969), we finalized the ASCQR Program measure removal
factors \95\ for determining whether to
[[Page 37195]]
remove ASCQR Program measures as follows:
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\95\ We note that we previously referred to these factors as
``criteria'' (for example, 82 FR 59474 through 59475); we now use
the term ``factors'' in order to align the ASCQR Program terminology
with the terminology we use in other CMS quality reporting and pay
for performance (value-based purchasing) programs.
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Factor 1. Measure performance among ASCs is so high and
unvarying that meaningful distinctions and improvements in performance
can no longer be made (``topped-out'' measures).
Factor 2. Availability of alternative measures with a
stronger relationship to patient outcomes.
Factor 3. A measure does not align with current clinical
guidelines or practice.
Factor 4. The availability of a more broadly applicable
(across settings, populations, or conditions) measure for the topic.
Factor 5. The availability of a measure that is more
proximal in time to desired patient outcomes for the particular topic.
Factor 6. The availability of a measure that is more
strongly associated with desired patient outcomes for the particular
topic.
Factor 7. Collection or public reporting of a measure
leads to negative unintended consequences other than patient harm.
In that final rule with comment period, we stated that the benefits
of removing a measure from the ASCQR Program will be assessed on a
case-by-case basis (79 FR 66969). Under this case-by-case approach, a
measure will not be removed solely on the basis of meeting any specific
factor. We note that in the CY 2013 OPPS/ASC final rule with comment
period (77 FR 68472 through 68473), similar measure removal factors
were finalized for the Hospital OQR Program.
In this proposed rule, we are proposing to: (1) Remove one factor;
(2) add two new measure removal factors, and (3) update 42 CFR
416.320(c) to better reflect our measure removal policies. We are also
making one clarification to measure removal Factor 1. These items are
discussed in detail below.
(2) Proposal To Remove Factor 2
We received comments in the CY 2015 OPPS/ASC final rule with
comment period (79 FR 66967) remarking the duplicative nature of the
ASCQR Program's measure removal Factor 2, availability of alternative
measures with a stronger relationship to patient outcomes, with measure
removal Factor 6, the availability of a measure that is more strongly
associated with desired patient outcomes for the particular topic. In
that final rule with comment period, we stated that ``criterion (2)
applies when there is more than one alternative measure with a stronger
relationship to patient outcomes that is available, and criterion (6)
applies where there is only one measure that is strongly and
specifically associated with desired patient outcomes for the
particular topic that is available'' (79 FR 66967). Since reevaluating
those comments, we have now come to agree that ASCQR measure removal
Factor 2 is repetitive with Factor 6. Therefore, we are proposing to
remove Factor 2, ``availability of alternative measures with a stronger
relationship to patient outcomes,'' beginning with the effective date
of the CY 2019 OPPS/ASC final rule with comment period.
(3) Proposals To Add Two New Measure Removal Factors
(a) Proposed Measure Removal Factor 2: Performance or Improvement on a
Measure Does Not Result in Better Patient Outcomes
We would like the ASCQR Program measure removal factors to be fully
aligned with the Hospital OQR Program to provide consistency across
these two outpatient setting quality reporting programs. We believe it
is important to evaluate the appropriateness of measures across
programs using similar standards. In evaluating the two programs'
removal factors, we became aware that the Hospital OQR Program includes
one factor not currently in the ASCQR Program. The Hospital OQR
Program's second measure removal factor specifies ``performance or
improvement on a measure does not result in better patient outcomes''
(75 FR 50185).
Therefore, in this proposed rule, we are proposing to add
``performance or improvement on a measure does not result in better
patient outcomes'' as the new removal Factor 2 for the ASCQR Program
(replacing the previously adopted factor proposed for removal above).
We believe that this factor is applicable in evaluating the ASCQR
Program quality measures for removal because we have found it useful
for evaluating measures in the Hospital OQR Program, which also
evaluates the outpatient setting. We also note that this proposed
factor is already included in the Hospital IQR (80 FR 49641 through
49642), the PCHQR (82 FR 38411), the LTCH QRP (77 FR 53614 through
53615), and the IPFQR (82 FR 38463) Programs. Therefore, we are
proposing to add a new removal factor to the ASCQR Program:
``performance or improvement on a measure does not result in better
patient outcomes'' beginning with the effective date of the CY 2019
OPPS/ASC final rule with comment period.
(b) Proposed New Measure Removal Factor 8
We are proposing to adopt an additional factor to consider when
evaluating measures for removal from the ASCQR Program measure set:
Factor 8. The costs associated with a measure outweigh the
benefit of its continued use in the program.
As we discuss in section I.A.2. of this proposed rule with respect
to our new Meaningful Measures Initiative, we are engaging in efforts
to ensure that the ASCQR Program measure set continues to promote
improved health outcomes for beneficiaries while minimizing the overall
costs associated with the program. We believe these costs are
multifaceted and include not only the burden associated with reporting,
but also the costs associated with implementing and maintaining the
program. We have identified several different types of costs,
including, but not limited to: (1) Facility information collection
burden and related costs and burden associated with the submission/
reporting of quality measures to CMS; (2) the facility cost associated
with complying with other programmatic requirements; (3) the facility
cost associated with participating in multiple quality programs, and
tracking multiple similar or duplicative measures within or across
those programs; (4) the CMS cost associated with the program oversight
of the measure including measure maintenance and public display; and
(5) the facility cost associated with compliance with other federal
and/or State regulations (if applicable). For example, it may be
needlessly costly and/or of limited benefit to retain or maintain a
measure which our analyses show no longer meaningfully supports program
objectives (for example, informing beneficiary choice or payment
scoring). It may also be costly for ASCs to track confidential
feedback, preview reports, and publicly reported information on a
measure where we use the measure in more than one program. CMS may also
have to expend unnecessary resources to maintain the specifications for
the measure, as well as the tools needed to collect, validate, analyze,
and publicly report the measure data. Furthermore, beneficiaries may
find it confusing to see public reporting on the same measure in
different programs.
In weighing the costs against the benefits, we evaluate the
benefits of the
[[Page 37196]]
measure as a whole, but in particular, we assess the benefits through
the framework of our Meaningful Measures Initiative, as we discussed in
section I.A.2. of this proposed rule. One key aspect of patient
benefits is assessing the improved beneficiary health outcomes if a
measure is retained in our measure set. We believe that these benefits
are multifaceted, and are illustrated through the Meaningful Measures
framework's 6 domains and 19 areas. For example, we assessed the
Healthcare Worker Influenza Vaccination and patient Influenza
Vaccination measures categorized in the Quality Priority ``Promote
Effective Prevention and Treatment of Chronic Disease'' in the
meaningful measure area of ``Preventive Care'' across multiple CMS
programs, and considered: Patient outcomes, such as mortality and
hospitalizations associated with influenza; CMS measure performance in
a program; and other available and reported influenza process measures,
such as population influenza vaccination coverage.
When these costs outweigh the evidence supporting the benefits to
patients with the continued use of a measure in the ASCQR Program, we
believe it may be appropriate to remove the measure from the Program.
Although we recognize that one of the main goals of the ASCQR Program
is to improve beneficiary outcomes by incentivizing health care
facilities to focus on specific care issues and making public data
related to those issues, we also recognize that those goals can have
limited utility where, for example, the publicly reported data
(including percentage payment adjustment data) is of limited use
because it cannot be easily interpreted by beneficiaries and used to
inform their choice of facility. In these cases, removing the measure
from the ASCQR Program may better accommodate the costs of program
administration and compliance without sacrificing improved health
outcomes and beneficiary choice.
We are proposing that we would remove measures based on this factor
on a case-by-case basis. We might, for example, decide to retain a
measure that is burdensome for ASCs to report if we conclude that the
benefit to beneficiaries justifies the reporting burden. Our goal is to
move the program forward in the least burdensome manner possible, while
maintaining a parsimonious set of meaningful quality measures and
continuing to incentivize improvement in the quality of care provided
to patients.
We are inviting public comment on our proposal to adopt an
additional measure removal Factor 8, the costs associated with a
measure outweigh the benefit of its continued use in the program,
beginning with the effective date of the CY 2019 OPPS/ASC final rule
with comment period and for subsequent years.
We refer readers to section XIV.B.3.c. of this proposed rule, where
we are proposing to remove four measures based on this proposed measure
removal factor. We note that we have also proposed this same removal
factor for the Hospital OQR Program in section XIII.B.4.a.(4) of this
proposed rule, as well as for other quality reporting and value-based
purchasing programs for FY 2019 including: the Hospital VBP Program (83
FR 20409), the Hospital IQR Program (83 FR 20472); the PCHQR Program
(83 FR 20501 through 20502); the LTCH QRP (83 FR 20512); the HQRP (83
FR 20956); the IRF QRP (83 FR 21000); the SNF QRP (83 FR 21082); and
the IPFQR Program (83 FR 21118).
If our proposals to remove one and add two new removal factors are
finalized as proposed, the new removal factors list would be:
Factor 1. Measure performance among ASCs is so high and
unvarying that meaningful distinctions and improvements in performance
can no longer be made (``topped-out'' measures).
Factor 2. Performance or improvement on a measure does not
result in better patient outcomes.
Factor 3. A measure does not align with current clinical
guidelines or practice.
Factor 4. The availability of a more broadly applicable
(across settings, populations, or conditions) measure for the topic.
Factor 5. The availability of a measure that is more
proximal in time to desired patient outcomes for the particular topic.
Factor 6. The availability of a measure that is more
strongly associated with desired patient outcomes for the particular
topic.
Factor 7. Collection or public reporting of a measure
leads to negative unintended consequences other than patient harm.
Factor 8. The costs associated with a measure outweigh the
benefit of its continued use in the program.
(4) Proposed Revisions to 42 CFR 416.320(c)
We are proposing to revise 42 CFR 416.320(c) to better reflect our
considerations for removing measures policy in light of the above
proposals.
(5) Clarification for Removal Factor 1: ``Topped-Out'' Measures
We refer readers to the CY 2015 OPPS/ASC final rule with comment
period where we finalized the criteria for determining when a measure
is ``topped-out'' (79 FR 66968). In that final rule with comment
period, we finalized two criteria for determining when a measure is
``topped-out'' under the ASCQR Program: (1) When there is statistically
indistinguishable performance at the 75th and 90th percentiles of
national facility performance; and (2) when the measure's truncated
coefficient of variation (TCOV) is less than or equal to 0.10 (79 FR
66968 through 66969).
We are not proposing any changes to this policy; however, we are
clarifying our process for calculating the truncated coefficient of
variation (TCOV) for four of the measures (ASC-1, ASC-2, ASC-3, and
ASC-4) proposed for removal from the ASCQR Program. Utilizing our
finalized methodology (79 FR 66968), we determine the truncated
coefficient of variation (TCOV) by calculating the truncated standard
deviation (SD) divided by the truncated mean. As discussed above, our
finalized removal criteria state that to be considered ``topped-out'',
a measure must have a TCOV of less than 0.10. We utilize the TCOV
because it is generally a good measure of variability and provides a
relative methodology for comparing different types of measures.
Unlike the majority of our measures, for which a higher rate
(indicating a higher proportion of a desired event) is the preferred
outcome, some measures--in particular, ASC-1, ASC-2, ASC-3, and ASC-4--
assess the rate of rare, undesired events for which a lower rate is
preferred. For example, ASC-1 assesses the occurrence of patient burns,
a patient safety issue. However, when determining the TCOV for a
measure assessing rare, undesired events, the mean, or average rate of
event occurrence, is very low and the result is a TCOV that increases
rapidly and approaches infinity as the proportion of rare events
declines.\96\ We note that the SD, the variability statistic, is the
same in magnitude for measures assessing rare and non-rare events.
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\96\ Rose-Hulman Institute of Technology. Denominator
approaching zero. Retrieved from: https://www.rose-hulman.edu/media/89584/lclimitsguide.pdf.
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In this proposed rule, we are proposing to remove a number of
measures that assess the rate of rare, undesired events for which a
lower rate is preferred--ASC-1, ASC-2, ASC-3, and ASC-4--and refer
readers to section
[[Page 37197]]
XIV.B.3.c. of this proposed rule where these proposed measure removals
are discussed in detail. Because by design these measures have
maintained very low rates (indicating the preferred outcome), we
utilized the mean of non-adverse events in our calculation of the TCOV.
For example, for ASC-1, to calculate the TCOV we divide the SD by the
average rate of patients not receiving burns (1 minus the rate of
patients receiving burns) rather than the rate of patients receiving
burns. Utilizing this methodology results in a TCOV that is comparable
to that calculated for other measures and allows us to assess rare-
event measures by still generally using our previously finalized
topped-out criteria.
c. Proposed Removal of Quality Measures From the ASCQR Program Measure
Set
In this proposed rule, we are proposing to remove a total of 8
measures from the ASCQR Program measure set across the CY 2020 and CY
2021 payment determinations. Specifically, beginning with the CY 2020
payment determination, we are proposing to remove: (1) ASC-8: Influenza
Vaccination Coverage Among Healthcare Personnel (NQF #0431); and
beginning with the CY 2021 payment determination, we are proposing to
remove: (2) ASC-1: Patient Burn (NQF #0263); (3) ASC-2: Patient Fall
(NQF #0266); (4) ASC-3: Wrong Site, Wrong Side, Wrong Patient, Wrong
Procedure, Wrong Implant (NQF #0267); (5) ASC-4: All-Cause Hospital
Transfer/Admission (NQF #0265); (6) ASC-9: Endoscopy/Polyp Surveillance
Follow-up Interval for Normal Colonoscopy in Average Risk Patients (NQF
#0658); (7) ASC-10: Endoscopy/Polyp Surveillance: Colonoscopy Interval
for Patients with a History of Adenomatous Polyps--Avoidance of
Inappropriate Use (NQF #0659); and (8) ASC-11: Cataracts--Improvement
in Patient's Visual Function within 90 Days Following Cataract Surgery
(NQF #1536). We are proposing to remove these measures under the
following measure removal factors: Factor 1--measure performance among
ASCs is so high and unvarying that meaningful distinctions and
improvements in performance can no longer be made (``topped-out''
measures); and proposed Factor 8--the costs associated with a measure
outweigh the benefit of its continued use in the program.
These proposed measure removals are discussed in detail below.
(1) Proposed Measure Removal for the CY 2020 Payment Determination and
Subsequent Years--Proposed Removal of ASC-8: Influenza Vaccination
Coverage Among Healthcare Personnel
For the CY 2020 payment determination and subsequent years, we are
proposing to remove one NHSN measure under proposed measure removal
Factor 8, the costs associated with this measure outweigh the benefit
of its continued use in the program.
We refer readers to the CY 2012 OPPS/ASC final rule with comment
period (76 FR 74510), where we adopted ASC-8: Influenza Vaccination
Coverage Among Healthcare Personnel (NQF #0431), beginning with the CY
2016 payment determination and for subsequent years. This process of
care measure, also a National Healthcare Safety Network (NHSN) measure,
assesses the percentage of healthcare personnel who have been immunized
for influenza during the flu season. We initially adopted this measure
based on our recognition that influenza immunization is an important
public health issue and vital component to preventing healthcare
associated infections. We believe that the measure addresses this
public health concern by assessing influenza vaccination in the ASC
among healthcare personnel (HCP), who can serve as vectors for
influenza transmission.
In this proposed rule, we are proposing to remove ASC-8: Influenza
Vaccination Coverage Among Healthcare Personnel beginning with the CY
2020 payment determination under proposed measure removal Factor 8,
because we have concluded that the costs associated with this measure
outweigh the benefit of its continued use in the program.
The information collection burden for the Influenza Vaccination
Coverage Among Healthcare Personnel measure is less than for measures
that require chart abstraction of patient data because influenza
vaccination among health care personnel can be calculated through
review of records maintained in administrative systems and because
facilities have fewer health care personnel than patients. As such,
ASC-8 does not require review of as many records. However, this measure
does still pose information collection burden on facilities due to the
requirement to identify personnel who have been vaccinated against
influenza and for those not vaccinated, the reason why.
Furthermore, as we stated in section XIV.B.3.b. of this proposed
rule, costs are multifaceted and include not only the burden associated
with reporting, but also the costs associated with implementing and
maintaining the program. For example, it may be costly for health care
providers to maintain general administrative knowledge to report these
measures. In addition, CMS must expend resources in maintaining
information collection systems, analyzing reported data, and providing
public reporting of the collected information.
In our analysis of the ASCQR Program measure set, we recognized
that some ASCs face challenges with respect to the administrative
requirements of the NHSN in their reporting of the Influenza
Vaccination Coverage Among Healthcare Personnel measure. These
administrative requirements (which are unique to NHSN) include annually
completing NHSN system user authentication. Enrolling in NHSN is a
five-step process that the CDC estimates takes an average of 263
minutes per ASC.\97\ Furthermore, submission via NHSN requires the
system security administrator of participating facilities to reconsent
electronically, ensure that contact information is kept current, ensure
that the ASC has an active facility administrator account, keep Secure
Access Management Service (SAMS) credentials active by logging in
approximately every 2 months and changing their password, create a
monthly reporting plan, and ensure the ASC's CCN information is up-to-
date.
---------------------------------------------------------------------------
\97\ Available at: https://www.cdc.gov/nhsn/ambulatory-surgery/enroll.html (the estimates for time to complete are 2 hours 45
minutes for step 1, 10 minutes for step 2, 16 minutes for step 3a,
35 minutes for step 3b, 32 minutes for step 4, and 5 minutes for
step 5; totaling 263 minutes).
---------------------------------------------------------------------------
Unlike acute care hospitals which participate in other quality
programs, such as the Hospital IQR and HAC Reduction Programs, ASCs are
only required to participate in NHSN to submit data for this one
measure. This may unduly disadvantage smaller ASCs, specifically those
that are not part of larger hospital systems, because these ASCs do not
have NHSN access for other quality reporting or value-based payment
programs. It is our goal to ensure that the ASCQR Program is equitable
to all ASCs and this measure may disproportionately affect small,
independent ASCs. Especially for these small, independent ASCs, the
incremental costs of this measure, as compared to other measures in the
ASCQR Program measure set, are significant because of the requirements
imposed by NHSN participation.
We continue to believe that the Influenza Vaccination Coverage
Among Healthcare Personnel measure provides the benefit of protecting
ASC patients
[[Page 37198]]
against influenza. However, we believe that these benefits are offset
by other efforts to reduce influenza infection among ASC patients, such
as numerous healthcare employer requirements for healthcare personnel
to be vaccinated against influenza.\98\ We also expect that a portion
of MIPS-eligible clinicians nationwide will report on the Preventive
Care and Screening: Influenza Immunization measure (NQF #0041) through
the Quality Payment Program (QPP).\99\ Although MIPS-eligible
clinicians may voluntarily select measures from a list of options, ASC
providers that are MIPS-eligible will have the opportunity to continue
collecting information for the measure. CMS remains responsive to the
public health concern of influenza infection within the Medicare FFS
population by collecting data on rates of influenza immunization among
patients.\100\ Thus, the public health concern is addressed via these
other efforts to track influenza vaccination. The availability of this
measure in another CMS program demonstrates CMS' continued commitment
to this measure area. In addition, as we discuss in section XIV.B.3.b.
of this proposed rule, where we are proposing to adopt measure removal
Factor 8, beneficiaries may find it confusing to see public reporting
on the same measure in different programs.
---------------------------------------------------------------------------
\98\ CDC, Influenza Vaccination Information for Health Care
Workers. Available at: https://www.cdc.gov/flu/healthcareworkers.htm.
\99\ QPP 2017 Measures Selection: Influenza. Retrieved from:
https://qpp.cms.gov/mips/quality-measures.
\100\ Ibid.
---------------------------------------------------------------------------
We wish to minimize the level of cost of our programs for
participating facilities, as discussed under the Meaningful Measures
Initiative described in section I.A.2. of this proposed rule. In our
assessment of the ASCQR Program measure set, we prioritized measures
that align with this Framework as the most important to the ASC
population. Our assessment concluded that while the Influenza
Vaccination Coverage Among Healthcare Personnel measure continues to
provide benefits, these benefits are diminished by other factors and
are outweighed by the costs and burdens of reporting this measure.
For these reasons, we are proposing to remove ASC-8: Influenza
Vaccination Coverage among Healthcare Personnel (NQF #0431) from the
ASCQR Program beginning with the CY 2020 payment determination and for
subsequent years because the costs associated with the measure outweigh
the benefit of its continued use in the program. We note that if
proposed measure removal Factor 8 is not finalized, removal of this
measure would also not be finalized. We note that this measure is also
being proposed for removal from the Hospital OQR Program in section
XIII.B.4.b. of this proposed rule and the IPFQR Program in the FY 2019
IPF PPS proposed rule (83 FR 21119 through 21120).
(2) Proposed Measure Removals for the CY 2021 Payment Determination and
Subsequent Years
For the CY 2021 payment determination and subsequent years, we are
proposing to remove: (1) Four claims-based measures under measure
removal Factor 1, ``topped-out'' status; (2) two chart-abstracted
measures and one web-based tool measure under proposed measure removal
Factor 8.
(a) Proposed Measure Removals Under Removal Factor 1: ASC-1, ASC-2,
ASC-3, and ASC-4
In this proposed rule, beginning with the CY 2021 payment
determination and subsequent years, we are proposing to remove ASC-1,
ASC-2, ASC-3, and ASC-4 under measure removal Factor 1, measure
performance among ASCs is so high and unvarying that meaningful
distinctions and improvements in performance can no longer be made. The
ASCQR Program previously finalized two criteria for determining when a
measure is ``topped-out'': (1) When there is statistically
indistinguishable performance at the 75th and 90th percentiles of
national facility performance; and (2) when the measure's truncated
coefficient of variation is less than or equal to 0.10 (79 FR 66968
through 66969). We refer readers to section XIV.B.3.b. of this proposed
rule, above, where we clarify and discuss how we calculate the TCOV for
measures that assess the rate of rare, undesired events for which a
lower rate is preferred, such as ASC-1, ASC-2, ASC-3, and ASC-4.
For each of these measures, we believe that removal from the ASCQR
Program measure set is appropriate as there is little room for
improvement. In addition, removal would alleviate the maintenance costs
and administrative burden to ASCs associated with retaining the
measures. As such, we believe the burden associated with reporting
these measures outweighs the benefits of keeping them in the program.
Each measure is discussed in more detail below. We also note that
in crafting our proposals, we considered removing these measures
beginning with the CY 2020 payment determination, but opted to delay
removal until the CY 2021 payment determination to be sensitive to
facilities' planning and operational procedures given that data
collection for the measures begins during CY 2018 for the CY 2020
payment determination.
Proposed Removal of ASC-1: Patient Burn
We refer readers to the CY 2012 OPPS/ASC final rule with comment
period (76 FR 74497 through 74498) where we adopted ASC-1: Patient Burn
beginning with the CY 2014 payment determination (NQF #0263). This
claims-based outcome measure assesses the percentage of ASC admissions
experiencing a burn prior to discharge.
Based on our analysis of ASCQR Program measure data for CYs 2013 to
2017 encounters, the ASC-1 measure meets our measure removal Factor 1.
These analyses are captured in the table below.
ASC-1--Patient Burn Topped-Out Analysis
----------------------------------------------------------------------------------------------------------------
Encounters Number of ASCs 75th percentile 90th percentile Truncated COV
----------------------------------------------------------------------------------------------------------------
Q1-Q4 2013.......................... 4,768 100.00 100.00 0.023
Q1-Q4 2014.......................... 4,794 100.00 100.00 0.015
Q1-Q4 2015.......................... 4,783 100.00 100.00 0.011
Q1-Q4 2016.......................... 4,788 100.00 100.00 0.010
Q1-Q4 2017.......................... 4,814 100.00 100.00 0.008
----------------------------------------------------------------------------------------------------------------
[[Page 37199]]
As displayed in the analysis above, there is no distinguishable
difference in ASC performance between the 75th and 90th percentiles,
and the truncated coefficient of variation has been below 0.10 since
2013. We also note that NQF endorsement of this measure (NQF #0263) was
removed on May 24, 2016.\101\
---------------------------------------------------------------------------
\101\ National Quality Forum. Available at: http://www.qualityforum.org/QPS/0263.
---------------------------------------------------------------------------
Proposed Removal of ASC-2: Patient Fall
We refer readers to the CY 2012 OPPS/ASC final rule with comment
period (76 FR 74498) where we adopted ASC-2: Patient Fall beginning
with the CY 2014 payment determination. This NQF-endorsed (NQF #0266),
claims-based measure assesses the percentage of ASC admissions
experiencing a fall in the ASC.
Based on our analysis of ASCQR Program measure data for CYs 2013 to
2017 encounters, the ASC-2 measure meets our measure removal Factor 1.
These analyses are captured in the table below.
ASC-2--Patient Fall Topped-Out Analysis
----------------------------------------------------------------------------------------------------------------
Encounters Number of ASCs 75th percentile 90th percentile Truncated COV
----------------------------------------------------------------------------------------------------------------
Q1-Q4 2013.......................... 4,769 100.00 100.00 0.011
Q1-Q4 2014.......................... 4,793 100.00 100.00 0.007
Q1-Q4 2015.......................... 4,783 100.00 100.00 0.006
Q1-Q4 2016.......................... 4,787 100.00 100.00 0.003
Q1-Q4 2017.......................... 4,815 100.00 100.00 0.001
----------------------------------------------------------------------------------------------------------------
As displayed in the analysis above, there is no distinguishable
difference in ASC performance between the 75th and 90th percentiles and
the truncated coefficient of variation has been below 0.10 since 2013.
Proposed Removal of ASC-3: Wrong Site, Wrong Side, Wrong
Patient, Wrong Procedure, Wrong Implant
We refer readers to the CY 2012 OPPS/ASC final rule with comment
period (76 FR 74498 through 74499) where we adopted ASC-3: Wrong Site,
Wrong Side, Wrong Patient, Wrong Procedure, Wrong Implant beginning
with the CY 2014 payment determination (NQF #0267). This claims-based
outcome measure assesses the percentage of ASC admissions experiencing
a wrong site, wrong side, wrong patient, wrong procedure, or wrong
implant.
Based on our analysis of ASCQR Program measure data for CYs 2013 to
2017 encounters, the ASC-3 measure meets our measure removal Factor 1.
These analyses are captured in the table below.
ASC-3--Wrong Site, Wrong Side, Wrong Patient, Wrong Procedure, Wrong Implant Topped-Out Analysis
----------------------------------------------------------------------------------------------------------------
Encounters Number of ASCs 75th percentile 90th percentile Truncated COV
----------------------------------------------------------------------------------------------------------------
Q1-Q4 2013.......................... 4,769 100.00 100.00 0.000
Q1-Q4 2014.......................... 4,793 100.00 100.00 0.000
Q1-Q4 2015.......................... 4,781 100.00 100.00 0.000
Q1-Q4 2016.......................... 4,787 100.00 100.00 0.000
Q1-Q4 2017.......................... 4,815 100.00 100.00 0.000
----------------------------------------------------------------------------------------------------------------
As displayed in the analysis above, there is no distinguishable
difference in ASC performance between the 75th and 90th percentiles and
the truncated coefficient of variation has been below 0.10 since 2013.
We also note that NQF endorsement of this measure (NQF #0267) was
removed on May 24, 2016.\102\
---------------------------------------------------------------------------
\102\ National Quality Forum. Available at: http://www.qualityforum.org/QPS/0267.
---------------------------------------------------------------------------
Proposed Removal of ASC-4: All-Cause Hospital Transfer/
Admission
We refer readers to the CY 2012 OPPS/ASC final rule with comment
period (76 FR 74499) where we adopted ASC-4: All-Cause Hospital
Transfer/Admission beginning with the CY 2014 payment determination
(NQF #0265). This claims-based outcome measure assesses the rate of ASC
admissions requiring a hospital transfer or hospital admission upon
discharge from the ASC.
Based on our analysis of ASCQR Program measure data for CYs 2013 to
2017 encounters, the ASC-4 measure meets our measure removal Factor 1.
These analyses are captured in the table below.
ASC-4--All Cause Hospital Transfer/Admission Topped-Out Analysis
----------------------------------------------------------------------------------------------------------------
Encounters Number of ASCs 75th percentile 90th percentile Truncated COV
----------------------------------------------------------------------------------------------------------------
Q1-Q4 2013.......................... 4,768 100.00 100.00 0.059
Q1-Q4 2014.......................... 4,793 100.00 100.00 0.050
Q1-Q4 2015.......................... 4,781 100.00 100.00 0.041
Q1-Q4 2016.......................... 4,787 100.00 100.00 0.040
Q1-Q4 2017.......................... 4,814 100.00 100.00 0.037
----------------------------------------------------------------------------------------------------------------
[[Page 37200]]
As displayed in the analysis above, there is no distinguishable
difference in ASC performance between the 75th and 90th percentiles and
the truncated coefficient of variation has been below 0.10 since 2013.
We also note that NQF endorsement of this measure (NQF #0265) was
removed on February 4, 2016.\103\
---------------------------------------------------------------------------
\103\ National Quality Forum. Available at: http://www.qualityforum.org/QPS/0265.
---------------------------------------------------------------------------
Therefore, we are inviting public comment on our proposals to
remove: (1) ASC-1: Patient Burn; (2) ASC-2: Patient Fall; (3) ASC-3:
Wrong Site, Wrong Side, Wrong Patient, Wrong Procedure, Wrong Implant;
and (4) ASC-4: All-Cause Hospital Transfer/Admission beginning with the
CY 2021 payment determination and for subsequent years as discussed
above.
(b) Proposed Measure Removals Under Removal Factor 8: ASC-9, ASC-10,
and ASC-11
In this proposed rule, we are proposing to remove three measures
(ASC-9, ASC-10, and ASC-11) under proposed measure removal Factor 8,
the costs associated with a measure outweigh the benefit of its
continued use in the program, for the CY 2021 payment determination and
subsequent years. We note that if proposed measure removal Factor 8 is
not finalized, removal of these measures would also not be finalized.
The proposals are discussed in more detail below. We note that in
crafting our proposals, we considered removing these measures beginning
with the CY 2020 payment determination, but opted to delay removal
until the CY 2021 payment determination to be sensitive to facilities'
planning and operational procedures given that data collection for
these measures begins during CY 2018 for the CY 2020 payment
determination.
Proposed Removal of ASC-9: Endoscopy/Polyp Surveillance:
Appropriate Follow-Up Interval for Normal Colonoscopy in Average Risk
Patients
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75127 through 75128) where we adopted ASC-9: Endoscopy/
Polyp Surveillance: Appropriate Follow-up Interval for Normal
Colonoscopy in Average Risk Patients (NQF #0659) beginning with the CY
2016 payment determination. This chart-abstracted process measure
assesses the ``[p]ercentage of patients aged 18 years and older
receiving a surveillance colonoscopy, with a history of a prior colonic
polyp in previous colonoscopy findings, who had a follow-up interval of
3 or more years since their last colonoscopy documented in the
colonoscopy report'' (78 FR 75128). This measure aims to assess whether
average risk patients with normal colonoscopies receive a
recommendation to receive a repeat colonoscopy in an interval that is
less than the recommended amount of 10 years.
In this proposed rule, we are proposing to remove ASC-9: Endoscopy/
Polyp Surveillance Follow-up Interval for Normal Colonoscopy in Average
Risk Patients beginning with the CY 2021 payment determination and for
subsequent years under our proposed measure removal Factor 8, the costs
associated with a measure outweigh the benefit of its continued use in
the program. We adopted ASC-9: Endoscopy/Polyp Surveillance Follow-up
Interval for Normal Colonoscopy in Average Risk Patients in the CY 2014
OPPS/ASC final rule with comment period (78 FR 75127 through 75128)
noting that performing colonoscopy too frequently increases patients'
exposure to procedural harm. However, we now believe that the costs of
this measure outweigh the benefit of its continued use in the program.
Chart-abstraction requires facilities to select a sample
population, access historical records from several current and historic
clinical data quarters, and interpret that patient data. This process
is typically more time and resource-consuming than for other measure
types. In addition to submission of manually chart-abstracted data, we
take all burden and costs into account when evaluating a measure.
Removing ASC-9 would reduce the burden and cost to facilities
associated with collection of information and reviewing their data and
performance associated with the measure.
However, we do not believe the use of chart-abstracted measure data
alone is sufficient justification for removal of a measure under
proposed measure removal Factor 8. The costs of collection and
submission of chart-abstracted measure data is burdensome for
facilities, especially when taking into consideration the availability
of other CMS quality measures that are relevant in the clinical
condition and highly correlated in performance across measures. Another
colonoscopy-related measure required in the ASCQR Program, ASC-12:
Facility 7-Day Risk-Standardized Hospital Visit Rate after Outpatient
Colonoscopy (NQF #2539) measures all-cause, unplanned hospital visits
(admissions, observation stays, and emergency department visits) within
7 days of an outpatient colonoscopy procedure (79 FR 66970). This
claims-based outcome measure does not require chart-abstraction, and
similarly contributes data on quality of care related to colonoscopy
procedures, although the measure does not specifically track processes
such as follow-up intervals. When we adopted ASC-12, we believed this
measure would reduce adverse patient outcomes associated with
preparation for colonoscopy, the procedure itself, and follow-up care
by capturing and making more visible to facilities and patients all
unplanned hospital visits following the procedure (79 FR 66970).
Furthermore, the potential benefits of keeping ASC-9 in the program
are mitigated by the existence of the same measure (Appropriate Follow-
up Interval for Normal Colonoscopy in Average Risk Patients) \104\ for
gastroenterologists in the Merit-Based Incentive Payment System (MIPS)
for the 2019 performance period in the QPP (82 FR 30292). Thus, we
believe the issue of preventing harm to patients from colonoscopy
procedures that are performed too frequently is adequately addressed
through MIPS in the QPP, because we expect a portion of MIPS-eligible
clinicians reporting on the measure nationwide to provide meaningful
data to CMS. Although MIPS-eligible clinicians may voluntarily select
measures from a list of options, ASC providers that are MIPS-eligible
will have the opportunity to continue collecting information for the
measure without being penalized if they determine there is value for
various quality improvement efforts.\105\ The availability of this
measure in another CMS program demonstrates CMS' continued commitment
to this measure area.
---------------------------------------------------------------------------
\104\ QPP Measure Selection: Appropriate Follow-up Interval for
Normal Colonoscopy in Average Risk Patients. Retrieved from: https://qpp.cms.gov/mips/quality-measures.
\105\ CMS finalized that services furnished by an eligible
clinician that are payable under the ASC, HHA, Hospice, or HOPD
methodology will not be subject to the MIPS payments adjustments,
but eligible clinicians payable under those methodologies may have
the option to still voluntarily report on applicable measures and
the data reported will not be used to determine future eligibility
(82 FR 53586).
---------------------------------------------------------------------------
Furthermore, we seek to align our quality reporting work with the
Patients Over Paperwork and the Meaningful Measures Initiatives
described in section I.A.2. of this proposed rule. The purpose of this
effort is to hold providers accountable for only the measures that are
most important to patients and clinicians and those that are focused on
patient outcomes in particular, because outcome measures
[[Page 37201]]
evaluate the actual results of care. As described in section I.A.2. of
this proposed rule, our Meaningful Measures Initiative is intended to
reduce costs and minimize burden, and we believe that removing this
chart-abstracted measure from the ASCQR Program would reduce program
complexity. In addition, as we discuss in section XIV.B.3.b. of this
proposed rule, where we are proposing to adopt measure removal Factor
8, beneficiaries may find it confusing to see public reporting on the
same measure in different programs.
Therefore, due to the combination of factors of the costs of
collecting data for this chart-abstracted measure, the preference for
an outcomes measure in the ASCQR Program that provides valuable data
for the same procedure, and the existence of the same measure in
another CMS program, we believe that the burdens and costs associated
with this measure outweigh the limited benefit to beneficiaries. As a
result, we are proposing to remove ASC-9: Endoscopy/Polyp Surveillance:
Appropriate Follow-up Interval for Normal Colonoscopy in Average Risk
Patients beginning with the CY 2021 payment determination and for
subsequent years. We note that we are also proposing to remove a
similar measure in the Hospital OQR Program in section XIII.B.4.b. of
this proposed rule.
Proposed Removal of ASC-10: Endoscopy/Polyp Surveillance:
Colonoscopy Interval for Patients with a History of Adenomatous
Polyps--Avoidance of Inappropriate Use
We refer readers to CY 2014 OPPS/ASC final rule with comment period
(78 FR 75128) where we adopted ASC-10: Endoscopy/Polyp Surveillance:
Colonoscopy Interval for Patients with a History of Adenomatous
Polyps--Avoidance of Inappropriate Use (NQF #0659) beginning with the
CY 2016 payment determination. This chart-abstracted process measure
assesses the percentage of patients aged 18 years and older receiving a
surveillance colonoscopy, with a history of a prior colonic polyp in
previous colonoscopy findings, who had a follow-up interval of 3 or
more years since their last colonoscopy documented in the colonoscopy
report.
In this proposed rule, we are proposing to remove ASC-10:
Endoscopy/Polyp Surveillance: Colonoscopy Interval for Patients with a
History of Adenomatous Polyps--Avoidance of Inappropriate Use beginning
with the CY 2021 payment determination and for subsequent years under
our proposed measure removal Factor 8, the costs associated with a
measure outweigh the benefit of its continued use in the program.
We adopted ASC-10: Endoscopy/Polyp Surveillance: Colonoscopy
Interval for Patients with a History of Adenomatous Polyps--Avoidance
of Inappropriate Use in the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75128) noting that colonoscopy screening for high risk
patients is recommended based on risk factors, and one such factor is a
history of adenomatous polyps. The frequency of colonoscopy screening
varies depending on the size and amount of polyps found, with the
general recommendation of a 3-year follow-up. We stated that this
measure is appropriate for the measurement of quality of care furnished
by ASCs, because colonoscopy screening is commonly performed in these
settings (78 FR 75128). However, we now believe that the costs of this
measure outweigh the benefit of its continued use in the program.
Chart-abstraction requires facilities to select a sample
population, access historical records from several clinical data
quarters past, and interpret that patient data. This process is
typically more time and resource-consuming than for other measure
types. In addition to submission of manually chart-abstracted data, we
take all burden and costs into account when evaluating a measure.
Removing ASC-10 would reduce the burden and cost to facilities
associated with collection of information and reporting on their
performance associated with the measure.
However, we do not believe the use of chart-abstracted measure data
alone is sufficient justification for removal of a measure under
proposed measure removal Factor 8. The costs of collection and
submission of chart-abstracted measure data is burdensome for
facilities especially when taking into consideration the availability
of other CMS quality measures. Another colonoscopy-related measure
required in the ASCQR Program, ASC-12: Facility 7-Day Risk-Standardized
Hospital Visit Rate after Outpatient Colonoscopy (NQF #2539) measures
all-cause, unplanned hospital visits (admissions, observation stays,
and emergency department visits) within 7 days of an outpatient
colonoscopy procedure (79 FR 66970). This claims-based outcome measure
does not require chart-abstraction, and similarly contributes data on
quality of care related to colonoscopy procedures, although the measure
does not specifically track processes such as follow-up intervals. When
we adopted ASC-12, we believed this measure would reduce adverse
patient outcomes associated with preparation for colonoscopy, the
procedure itself, and follow-up care by capturing and making more
visible to facilities and patients all unplanned hospital visits
following the procedure (79 FR 66970). Furthermore, the potential
benefits of keeping ASC-10 in the ASCQR Program are mitigated by the
existence of the same measure (Appropriate Follow-up Interval for
Normal Colonoscopy in Average Risk Patients) \106\ for
gastroenterologists in the Merit-Based Incentive Payment System (MIPS)
for the 2019 performance period in the QPP (82 FR 30292). Thus, we
believe the issue of preventing harm to patients from colonoscopy
procedures that are performed too frequently is adequately addressed
through MIPS in the QPP, because we expect a portion of MIPS-eligible
clinicians reporting on the measure nationwide to provide meaningful
data to CMS. Although MIPS-eligible clinicians may voluntarily select
measures from a list of options, ASC providers that are MIPS-eligible
will have the opportunity to continue collecting information for the
measure without being penalized if they determine there is value for
various quality improvement efforts.\107\ The availability of this
measure in another CMS program demonstrates CMS' continued commitment
to this measure area.
---------------------------------------------------------------------------
\106\ QPP Measure Selection: Appropriate Follow-up Interval for
Normal Colonoscopy in Average Risk Patients. Retrieved from: https://qpp.cms.gov/mips/quality-measures.
\107\ CMS finalized that services furnished by an eligible
clinician that are payable under the ASC, HHA, Hospice, or HOPD
methodology will not be subject to the MIPS payments adjustments,
but eligible clinicians payable under those methodologies may have
the option to still voluntarily report on applicable measures and
the data reported will not be used to determine future eligibility
(82 FR 53586).
---------------------------------------------------------------------------
Furthermore, we seek to align our quality reporting work with the
Patients Over Paperwork and the Meaningful Measures Initiatives
described in section I.A.2. of this proposed rule. The purpose of this
effort is to hold providers accountable for only the measures that are
most important to patients and clinicians and that are focused on
patient outcomes in particular, because outcome measures evaluate the
actual results of care. As described in section I.A.2. of this proposed
rule, our Meaningful Measures Initiative is intended to reduce costs
and minimize burden, and we believe that removing this chart-abstracted
measure from the ASCQR Program would reduce program complexity. In
addition, as we discuss in section
[[Page 37202]]
XIV.B.3.b. of this proposed rule, where we are proposing to adopt
measure removal Factor 8, beneficiaries may find it confusing to see
public reporting on the same measure in different programs.
Therefore, due to the combination of factors of the costs of
collecting data for this chart-abstracted measure, the preference for
an outcomes measure in the ASCQR Program that provides valuable data
for the same procedure, and the existence of the same measure in the
MIPS program, we believe that the burdens and costs associated with
manual chart abstraction outweigh the limited benefit to beneficiaries
of receiving this information. As a result, we are proposing to remove
ASC-10: Endoscopy/Polyp Surveillance: Colonoscopy Interval for Patients
with a History of Adenomatous Polyps--Avoidance of Inappropriate Use
beginning with the CY 2021 payment determination and for subsequent
years. We note that we are also proposing to remove a similar measure
in the Hospital OQR Program in section XIII.B.4.b. of this proposed
rule.
Proposed Removal of ASC-11: Cataracts: Improvement in
Patient's Visual Function within 90 Days Following Cataract Surgery
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75129) where we adopted ASC-11: Cataracts: Improvement in
Patient's Visual Function within 90 Days Following Cataract Surgery
(NQF #1536) beginning with the CY 2016 payment determination. This
measure assesses the rate of patients 18 years and older (with a
diagnosis of uncomplicated cataract) in a sample who had improvement in
visual function achieved within 90 days following cataract surgery
based on completing both a preoperative and postoperative visual
function survey.
Since the adoption of this measure, we came to believe that it can
be operationally difficult for ASCs to collect and report the measure
(79 FR 66984). Specifically, we were concerned that the results of the
survey used to assess the preoperative and post-operative visual
function of the patient may not be shared across clinicians and
facilities, making it difficult for ASCs to have knowledge of the
visual function of the patient before and after surgery (79 FR 66984).
We were also concerned about the surveys used to assess visual
function; the measure allows for the use of any validated survey and
results may be inconsistent should clinicians use different surveys (79
FR 66984). Therefore, on December 31, 2013, we issued guidance stating
that we would delay data collection for ASC-11 for 3 months (data
collection would commence with April 1, 2014 encounters) for the CY
2016 payment determination (https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier3&cid=1228772879036). We issued additional guidance on April 2, 2014, stating that we
would further delay the implementation of ASC-11 for an additional 9
months, until January 1, 2015 for the CY 2016 payment determination,
due to continued concerns (https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier3&cid=1228773811586). As a result of these concerns, in the CY 2015 OPPS/ASC final
rule with comment period (79 FR 66984 through 66985), we finalized our
proposal to allow voluntary data collection and reporting of this
measure beginning with the CY 2017 payment determination and for
subsequent years.
In this proposed rule, we are proposing to remove ASC-11:
Cataracts: Improvement in Patient's Visual Function within 90 Days
Following Cataract Surgery from the ASCQR Program beginning with the CY
2021 payment determination under proposed measure removal Factor 8, the
costs associated with the measure outweigh the benefit of its continued
use in the program. We originally adopted ASC-11 because we believe
ASCs should be a partner in care with physicians and other clinicians
using their facility and that this measure would provide an opportunity
to do so (79 FR 66984). However, in light of the history of
complications and upon reviewing this measure within our Meaningful
Measures framework, we have concluded that it is overly burdensome for
facilities to report this measure due to the difficulty of tracking
care that occurs outside of the ASC setting.
In order to report on this measure to CMS, a facility would need to
obtain the visual function assessment results from the appropriate
ophthalmologist and ensure that the assessment utilized is validated
for the population for which it is being used. If the assessment is not
able to be used or is not available, the ASC facility would then need
to administer the survey directly and ensure that the same visual
function assessment tool is utilized preoperatively and
postoperatively. There is no simple, preexisting means for information
sharing between ophthalmologists and ASCs, so an ASC would need to
obtain assessment results from each individual patient's
ophthalmologist both preoperatively and postoperatively. The high
administrative costs of the technical tracking of this information
presents an undue cost, and also burden associated with submission and
reporting of ASC-11 to CMS, especially for small ASCs with limited
staffing capacity.
Furthermore, this measure currently provides limited benefits.
Since making the measure voluntary, only 118 facilities have reported
this measure to CMS, compared to approximately 5,121 total facilities
for all other measures, resulting in only 2.3 percent of facilities
reporting.\108\ Consequently, we have been unable to uniformly offer
pertinent information to beneficiaries on how the measure assesses ASC
performance. This reinforces comments made in the CY 2015 OPPS/ASC
final rule with comment period, in which commenters expressed concern
that the voluntary reporting of this measure would result in incomplete
data that may be confusing to beneficiaries and other consumers (79 FR
66984). As we state in section I.A.2. of this proposed rule, we strive
to ensure that beneficiaries are empowered to make decisions about
their healthcare using information from data-driven insights. Because
of the lack of sufficient data, this measure may be difficult for
beneficiaries to interpret or use to aid in their choice of where to
obtain care; thus, the benefits of this measure are limited.
---------------------------------------------------------------------------
\108\ ASCQR Compare Data. Available at: https://data.medicare.gov/Hospital-Compare/Ambulatory-Surgical-Quality-Measures-Facility/4jcv-atw7/data.
---------------------------------------------------------------------------
Therefore, we believe the high technical and administrative costs
of this measure outweigh the limited benefit associated with its
continued use in the ASCQR Program. As discussed in section I.A.2. of
this proposed rule, above, our Meaningful Measures Initiative is
intended to reduce costs and minimize burden. We believe that removing
this measure from the ASCQR Program will reduce program burden, costs,
and complexity. As a result, we are proposing to remove ASC-11
beginning with the CY 2021 payment determination and for subsequent
years. We are also proposing to remove a similar measure under the
Hospital OQR Program in section XIII.B.4.b. of this proposed rule.
4. Summary of ASCQR Program Quality Measure Sets Proposed for the CY
2020, CY 2021, and CY 2022 Payment Determinations
In this CY 2019 OPPS/ASC proposed rule, we are not proposing any
new measures for the ASCQR Program. We refer readers to the CY 2018
OPPS/ASC final rule with comment period (82 FR
[[Page 37203]]
59470) for the previously finalized ASCQR Program measure set for the
CY 2020 payment determination and subsequent years. We note that we are
proposing to change the reporting period for one previously adopted
measure, ASC-12, and refer readers to section XIV.D.4.b. of this
proposed rule for details.
The tables below summarize the proposed ASCQR Program measure sets
for the CY 2020, 2021, and 2022 payment determinations (including
previously adopted measures and measures proposed for removal in this
proposed rule).
Proposed ASCQR Program Measure Set for the CY 2020 Payment Determination and Subsequent Years
----------------------------------------------------------------------------------------------------------------
ASC No. NQF No. Measure name
----------------------------------------------------------------------------------------------------------------
ASC-1........................ 0263[dagger]................. Patient Burn.
ASC-2........................ 0266......................... Patient Fall.
ASC-3........................ 0267[dagger]................. Wrong Site, Wrong Side, Wrong Patient, Wrong
Procedure, Wrong Implant.
ASC-4........................ 0265[dagger]................. All-Cause Hospital Transfer/Admission.
ASC-9........................ 0658......................... Endoscopy/Polyp Surveillance: Appropriate Follow-
Up Interval for Normal Colonoscopy in Average
Risk Patients.
ASC-10....................... 0659......................... Endoscopy/Polyp Surveillance: Colonoscopy Interval
for Patients with a History of Adenomatous Polyps-
Avoidance of Inappropriate Use.
ASC-11....................... 1536......................... Cataracts: Improvement in Patient's Visual
Function within 90 Days Following Cataract
Surgery.*
ASC-12....................... 2539......................... Facility 7-Day Risk-Standardized Hospital Visit
Rate after Outpatient Colonoscopy.
ASC-13....................... None......................... Normothermia Outcome.
ASC-14....................... None......................... Unplanned Anterior Vitrectomy.
ASC-15a...................... None......................... OAS CAHPS--About Facilities and Staff.**
ASC-15b...................... None......................... OAS CAHPS--Communication About Procedure.**
ASC-15c...................... None......................... OAS CAHPS--Preparation for Discharge and
Recovery.**
ASC-15d...................... None......................... OAS CAHPS--Overall Rating of Facility.**
ASC-15e...................... None......................... OAS CAHPS--Recommendation of Facility.**
----------------------------------------------------------------------------------------------------------------
[dagger] NQF endorsement was removed.
* Measure voluntarily collected effective beginning with the CY 2017 payment determination as set forth in
section XIV.E.3.c. of the CY 2015 OPPS/ASC final rule with comment period (79 FR 66984 through 66985).
** Measure finalized for delay in reporting beginning with the CY 2020 payment determination (CY 2018 data
collection) until further action in future rulemaking as discussed in section XIV.B.4. of the CY 2018 OPPS/ASC
final rule with comment period (82 FR 59450 through 59451).
Proposed ASCQR Program Measure Set for the CY 2021 Payment Determination and Subsequent Years
----------------------------------------------------------------------------------------------------------------
ASC No. NQF No. Measure name
----------------------------------------------------------------------------------------------------------------
ASC-12....................... 2539......................... Facility 7-Day Risk-Standardized Hospital Visit
Rate after Outpatient Colonoscopy.
ASC-13....................... None......................... Normothermia Outcome.
ASC-14....................... None......................... Unplanned Anterior Vitrectomy.
ASC-15a...................... None......................... OAS CAHPS--About Facilities and Staff.*
ASC-15b...................... None......................... OAS CAHPS--Communication About Procedure.*
ASC-15c...................... None......................... OAS CAHPS--Preparation for Discharge and
Recovery.*
ASC-15d...................... None......................... OAS CAHPS--Overall Rating of Facility.*
ASC-15e...................... None......................... OAS CAHPS--Recommendation of Facility.*
----------------------------------------------------------------------------------------------------------------
* Measure finalized for delay in reporting beginning with the CY 2020 payment determination (CY 2018 data
collection) until further action in future rulemaking as discussed in section XIV.B.4. of the CY 2018 OPPS/ASC
final rule with comment period (82 FR 59450 through 59451).
Proposed ASCQR Program Measure Set for the CY 2022 Payment Determination and Subsequent Years
----------------------------------------------------------------------------------------------------------------
ASC No. NQF No. Measure name
----------------------------------------------------------------------------------------------------------------
ASC-12....................... 2539......................... Facility 7-Day Risk-Standardized Hospital Visit
Rate after Outpatient Colonoscopy.
ASC-13....................... None......................... Normothermia Outcome.
ASC-14....................... None......................... Unplanned Anterior Vitrectomy.
ASC-15a...................... None......................... OAS CAHPS--About Facilities and Staff.**
ASC-15b...................... None......................... OAS CAHPS--Communication About Procedure.*
ASC-15c...................... None......................... OAS CAHPS--Preparation for Discharge and
Recovery.*
ASC-15d...................... None......................... OAS CAHPS--Overall Rating of Facility.*
ASC-15e...................... None......................... OAS CAHPS--Recommendation of Facility.*
ASC-17....................... None......................... Hospital Visits after Orthopedic Ambulatory
Surgical Center Procedures.
ASC-18....................... None......................... Hospital Visits after Urology Ambulatory Surgical
Center Procedures.
----------------------------------------------------------------------------------------------------------------
* Measure finalized for delay in reporting beginning with the CY 2020 payment determination (CY 2018 data
collection) until further action in future rulemaking as discussed in section XIV.B.4. of the CY 2018 OPPS/ASC
final rule with comment period (82 FR 59450 through 59451).
[[Page 37204]]
5. ASCQR Program Measures and Topics for Future Consideration: Possible
Future Validation of ASCQR Program Measures
We are requesting public comment on the possible future validation
of ASCQR Program measures. There is currently no validation of ASCQR
measure data, and we believe ASCs may benefit from the opportunity to
better understand their data and examine potential discrepancies. We
believe the ASCQR Program may similarly benefit from the opportunity to
produce a more reliable estimate of whether an ASC's submitted data
have been abstracted correctly and provide more statistically reliable
estimates of the quality of care delivered in each selected ASC as well
as at the national level. We believe the Hospital OQR Program
validation policy could be a good model for the ASCQR Program and are
requesting comment on the validation methodology and identifying one
measure with which to start.
The Hospital OQR Program requires validation of its chart-
abstracted measures. We refer readers to the CY 2013 OPPS/ASC final
rule with comment period (77 FR 68484 through 68487) and the CY 2015
OPPS/ASC final rule with comment period (79 FR 66964 through 66965) for
a discussion of finalized policies regarding Hospital OQR Program
validation requirements, which are also codified at 42 CFR 419.46(e).
Under the Hospital OQR Program, CMS selects a random sample of 450
hospitals and an additional 50 hospitals based on the following
criteria: (1) The hospital failing of the validation requirement that
applies to the previous year's payment determination; or (2) the
hospital having an outlier value for a measure based on data that it
submits. An ``outlier value'' is defined as a measure value that is
greater than 5 standard deviations from the mean of the measure values
for other hospitals, and indicates a poor score. Then, CMS or its
contractor provides written requests to the randomly selected hospitals
by requesting supporting medical record documentation used for purposes
of data submission under the program. The hospital must submit the
supporting medical record documentation within 45 days of the date
written in the request. A hospital meets the validation requirement
with respect to a calendar year if it achieves at least a 75 percent
reliability score, as determined by CMS.
Specifically for the ASCQR Program, we are interested in the
validation of chart-abstracted measures. We believe it would be
beneficial to start with validation of just one measure, such as ASC-
13: Normothermia Outcome, prior to expanding to more measures. ASC-13:
Normothermia Outcome was finalized in the 2017 OPPS/ASC final rule with
comment period (81 FR 79798 through 79801) and assesses the percentage
of patients having surgical procedures under general or neuraxial
anesthesia of 60 minutes or more in duration who are normothermic
within 15 minutes of arrival in the post-anesthesia care unit. We also
considered starting with ASC-14: Unplanned Anterior Vitrectomy instead,
which was finalized in the 2017 OPPS/ASC final rule with comment period
(81 FR 79801 through 79803) and assesses the percentage of cataract
surgery patients who have an unplanned anterior vitrectomy. However, we
believe ASC-13 would be the most feasible measure for validation
because it assesses surgical cases and would have a larger population
of cases from which to sample. ASC-14, which assesses rare, unplanned
events that are less common, would have a smaller population of cases
from which to sample.
Therefore, we are inviting public comment on the possible future
validation of ASCQR Program measures. We specifically request comment
on whether Hospital OQR Program's validation policies could be an
appropriate model for the ASCQR Program, the possible ASC sample size,
sampling methodology, number of cases to sample, validation score
methodology, and reduced annual payment updates for facilities that do
not pass validation requirements. We also are requesting comment on
possibly starting with only one measure, specifically ASC-13, before
expanding to more measures.
6. Maintenance of Technical Specifications for Quality Measures
We refer readers to the CY 2012 OPPS/ASC final rule with comment
period (76 FR 74513 through 74514), where we finalized our proposal to
follow the same process for updating the ASCQR Program measures that we
adopted for the Hospital OQR Program measures, including the
subregulatory process for updating adopted measures. In the CY 2013
OPPS/ASC final rule with comment period (77 FR 68496 through 68497),
the CY 2014 OPPS/ASC final rule (78 FR 75131), and the CY 2015 OPPS/ASC
final rule with comment period (79 FR 66981), we provided additional
clarification regarding the ASCQR Program policy in the context of the
previously finalized Hospital OQR Program policy, including the
processes for addressing nonsubstantive and substantive changes to
adopted measures. In the CY 2016 OPPS/ASC final rule with comment
period (80 FR 70531), we provided clarification regarding our decision
to not display the technical specifications for the ASCQR Program on
the CMS website, but stated that we will continue to display the
technical specifications for the ASCQR Program on the QualityNet
website. In addition, our policies regarding the maintenance of
technical specifications for the ASCQR Program are codified at 42 CFR
416.325. In this proposed rule, we are not proposing any changes to our
policies regarding the maintenance of technical specifications for the
ASCQR Program.
7. Public Reporting of ASCQR Program Data
In the CY 2012 OPPS/ASC final rule with comment period (76 FR 74514
through 74515), we finalized a policy to make data that an ASC
submitted for the ASCQR Program publicly available on a CMS website
after providing an ASC an opportunity to review the data to be made
public. In the CY 2016 OPPS/ASC final rule with comment period (80 FR
70531 through 70533), we finalized our policy to publicly display data
by the National Provider Identifier (NPI) when the data are submitted
by the NPI and to publicly display data by the CCN when the data are
submitted by the CCN. In addition, we codified our policies regarding
the public reporting of ASCQR Program data at 42 CFR 416.315 (80 FR
70533). In the CY 2017 OPPS/ASC final rule with comment period (81 FR
79819 through 79820), we formalized our current public display
practices regarding timing of public display and the preview period by
finalizing our proposals to: Publicly display data on the Hospital
Compare website, or other CMS website as soon as practicable after
measure data have been submitted to CMS; to generally provide ASCs with
approximately 30 days to review their data before publicly reporting
the data; and to announce the timeframes for each preview period
starting with the CY 2018 payment determination on a CMS website and/or
on our applicable listservs. In the CY 2018 OPPS/ASC final rule with
comment period (82 FR 59455 through 59470), we discussed specific
public reporting policies associated with two measures beginning with
the CY 2022 payment determination: ASC-17: Hospital Visits after
Orthopedic Ambulatory Surgical Center Procedures, and ASC-18: Hospital
Visits after Urology Ambulatory Surgical Center Procedures.
[[Page 37205]]
In this proposed rule, we are not proposing any changes to our
public reporting policies.
C. Administrative Requirements
1. Requirements Regarding QualityNet Account and Security Administrator
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75132 through 75133) for a detailed discussion of the
QualityNet security administrator requirements, including setting up a
QualityNet account, and the associated timelines, for the CY 2014
payment determination and subsequent years. In the CY 2016 OPPS/ASC
final rule with comment period (80 FR 70533), we codified the
administrative requirements regarding maintenance of a QualityNet
account and security administrator for the ASCQR Program at 42 CFR
416.310(c)(1)(i). In the CY 2018 OPPS/ASC final rule (82 FR 59473), we
finalized expanded submission via the CMS online tool to also allow for
batch data submission and made corresponding changes to the 42 CFR
416.310(c)(1)(i). In this proposed rule, we are not proposing any
changes to these policies.
2. Requirements Regarding Participation Status
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75133 through 75135) for a complete discussion of the
participation status requirements for the CY 2014 payment determination
and subsequent years. In the CY 2016 OPPS/ASC final rule with comment
period (80 FR 70533 and 70534), we codified these requirements
regarding participation status for the ASCQR Program at 42 CFR 416.305.
In this proposed rule, we are not proposing any changes to these
policies.
D. Form, Manner, and Timing of Data Submitted for the ASCQR Program
1. Requirements Regarding Data Processing and Collection Periods for
Claims-Based Measures Using Quality Data Codes (QDCs)
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75135) for a complete summary of the data processing and
collection periods for the claims-based measures using QDCs for the CY
2014 payment determination and subsequent years. In the CY 2016 OPPS/
ASC final rule with comment period (80 FR 70534), we codified the
requirements regarding data processing and collection periods for
claims-based measures using QDCs for the ASCQR Program at 42 CFR
416.310(a)(1) and (2).
In this proposed rule, we are not proposing any changes to these
requirements. However, we note that in section XIV.B.3.c. of this
proposed rule, beginning with the CY 2021 payment determination and for
subsequent years, we are proposing to remove all four claims-based
measures currently using QDCs:
ASC-1: Patient Burn;
ASC-2: Patient Fall;
ASC-3: Wrong Site, Wrong Side, Wrong Patient, Wrong
Procedure, Wrong Implant; and
ASC-4: Hospital Transfer/Admission.
If the removal of these measures is finalized as proposed, no
claims-based measures using QDCs would remain in the ASCQR Program.
However, we are not proposing any changes to our requirements regarding
data processing and collection periods for these types of measures.
These requirements would apply to any future claims-based measures
using QDCs adopted in the program.
2. Minimum Threshold, Minimum Case Volume, and Data Completeness for
Claims-Based Measures Using QDCs
We refer readers to the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59472) (and the previous rulemakings cited therein), as
well as 42 CFR 416.310(a)(3) and 42 CFR 416.305(c) for our policies
about minimum threshold, minimum case volume, and data completeness for
claims-based measures using QDCs. In this proposed rule, we are not
proposing any changes to these policies.
3. Requirements for Data Submitted via an Online Data Submission Tool
We refer readers to the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59472) (and the previous rulemakings cited therein) and
42 CFR 416.310(c) for our previously finalized policies for data
submitted via an online data submission tool. For more information on
data submission using QualityNet, we refer readers to: https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier2&cid=1228773314768.
a. Requirements for Data Submitted via a Non-CMS Online Data Submission
Tool
We refer readers to the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75139 through 75140) and the CY 2015 OPPS/ASC final rule
with comment period (79 FR 66985 through 66986) for our requirements
regarding data submitted via a non-CMS online data submission tool
(that is, the CDC NHSN website). We codified our existing policies
regarding the data collection time periods for measures involving
online data submission and the deadline for data submission via a non-
CMS online data submission tool at 42 CFR 416.310(c)(2).
Currently, we only have one measure (ASC-8: Influenza Vaccination
Coverage among Healthcare Personnel) that is submitted via a non-CMS
online data submission tool. We note that we are proposing this measure
for removal for the CY 2020 payment determination and subsequent years
in section XIV.B.3.c. of this proposed rule. If the removal of ASC-8 is
finalized as proposed, no measures submitted via a non-CMS online data
submission tool would remain in the ASCQR Program. However, we are not
proposing any changes to our non-CMS online data submission tool
reporting requirements; these requirements would apply to any future
non-CMS online data submission tool measures adopted in the program.
b. Requirements for Data Submitted via a CMS Online Data Submission
Tool
We refer readers to the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59473) (and the previous rulemakings cited therein) and
42 CFR 416.310(c)(1) for our requirements regarding data submitted via
a CMS online data submission tool. We are currently using the
QualityNet website as our CMS online data submission tool: https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetHomepage&cid=1120143435383. We note that in the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59473), we finalized expanded submission via the CMS
online tool to also allow for batch data submission and made
corresponding changes to the 42 CFR 416.310(c)(1)(i).
In this proposed rule, we are not proposing any changes to this
policy. However, we note that in sections XIV.B.3.c. of this proposed
rule, we are proposing to remove three measures collected via a CMS
online data submission tool-ASC-9: Endoscopy/Polyp Surveillance:
Appropriate Follow-Up Interval for Normal Colonoscopy in Average Risk
Patients, ASC-10: Endoscopy/Polyp Surveillance: Colonoscopy Interval
for Patients with a History of Adenomatous Polyps--Avoidance of
Inappropriate Use, and ASC-11: Cataracts: Improvement in Patients'
Visual Function within 90 Days Following
[[Page 37206]]
Cataract Surgery \109\ beginning with the CY 2021 payment
determination. If those measures are finalized for removal as proposed,
only the following previously finalized measures will require data to
be submitted via a CMS online data submission tool for the CY 2021
payment determination and subsequent years:
\109\ We note that the ASC-11 measure is voluntarily collected
effective beginning with the CY 2017 payment determination, as set
forth in section XIV.E.3.c. of the CY 2015 OPPS/ASC final rule with
comment period (79 FR 66984 through 66985).
---------------------------------------------------------------------------
ASC-13: Normothermia Outcome
ASC-14: Unplanned Anterior Vitrectomy
4. Requirements for Non-QDC Based, Claims-Based Measure Data
In this proposed rule, we are not proposing any changes to our
requirements for non-QDC based, claims-based measures. However, we are
proposing to change the reporting period for the previously adopted
measure, ASC-12: Facility 7-Day Risk-Standardized Hospital Visit Rate
after Outpatient Colonoscopy. This proposal is discussed in more detail
further below.
a. General
We refer readers to the CY 2015 OPPS/ASC final rule with comment
period (79 FR 66985) and the CY 2016 OPPS/ASC final rule with comment
period (80 FR 70536) for our previously adopted policies regarding data
processing and reporting periods for claims-based measures for the CY
2018 payment determination and subsequent years. In addition, in the CY
2016 OPPS/ASC final rule with comment period (80 FR 70536), we codified
these policies at 42 CFR 416.310(b). We are not proposing any changes
to these policies. We note that the non-QDC, claims-based measures in
the program are as follows:
CY 2020 payment determination and subsequent years: ASC 12:
Facility 7-Day Risk Standardized Hospital Visit Rate after Outpatient
Colonoscopy (79 FR 66970 through 66978)
CY 2022 payment determination and subsequent years:
ASC-17: Hospital Visits after Orthopedic
Ambulatory Surgical Center Procedures (82 FR 59455 through 59470)
ASC-18: Hospital Visits after Urology Ambulatory
Surgical Center Procedures (82 FR 59455 through 59470)
b. Proposed Extension of the Reporting Period for ASC-12: Facility
Seven-Day Risk-Standardized Hospital Visit Rate After Outpatient
Colonoscopy
In the CY 2015 OPPS/ASC final rule with comment period (79 FR 66970
through 66978), we finalized the adoption of ASC-12: Facility 7-Day
Risk-Standardized Hospital Visit Rate after Outpatient Colonoscopy into
the ASCQR Program for the CY 2018 payment determination and subsequent
years, with public display to begin on or after December 1, 2017. This
measure is calculated with data obtained from paid Medicare FFS claims
(79 FR 66978). For this reason, facilities are not required to submit
any additional information. In that final rule with comment period, we
also finalized the reporting period for measure calculation as claims
data from two calendar years prior to the payment determination year.
Specifically, for the CY 2018 payment determination, we stated we would
use paid Medicare FFS claims from January 1, 2016 to December 31, 2016
to calculate measure results (79 FR 66985). We finalized a 1-year
reporting period as it adequately balanced competing interests of
measure reliability and timeliness for payment determination purposes,
and explained that we would continue to assess this during the dry run
(79 FR 66973).
We noted we would complete a dry run of the measure in 2015 using 3
or 4 years of data, and, from the results of this dry run, we would
review the appropriate volume cutoff for facilities to ensure
statistical reliability in reporting the measure score (79 FR 66974).
Our analyses of the 2015 dry run using data from July 2011 through June
2014 showed that a reporting period of 1 year had moderate to high
reliability for measure calculation. Specifically, using data from July
2013 through June 2014, we calculated facility-level reliability
estimates as the ratio of true variance to observed variance.\110\
Consistent with the original measure specifications as described in the
2014 technical report,\111\ this calculation was performed combining
the measure results for HOPDs and ASCs. We found that for a facility
with median case size, the reliability estimate was high (over 0.90),
but the minimum reliability estimate for facilities with 30 cases (the
minimum case size chosen for public reporting) was only moderate (that
is, between 0.40 and 0.60).\112\
---------------------------------------------------------------------------
\110\ Snijders TA, Bosker RJ. Multilevel Analysis: An
introduction to basic and advanced multilevel modeling. SAGE
Publications. 2000. London.
\111\ Additional methodology details and information obtained
from public comments for measure development are available at:
https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/HospitalQualityInits/Measure-Methodology.html under
``Hospital Outpatient Colonoscopy.''
\112\ Landis JR, Koch GG. The Measurement of Observer Agreement
for Categorical Data. Biometrics. 1977;33(1):159-174.
---------------------------------------------------------------------------
However, after the 2015 dry run, CMS calculated the HOPD and ASC
scores separately to compare similar types of facilities to each other.
During subsequent analysis of the 1-year period of July 2013 through
June 2014, we confirmed that a 1-year reporting period with separate
calculations for HOPDs and ASCs was sufficient, but did result in lower
reliability and decreased precision, compared to results calculated
with longer reporting periods (2 or 3 years). Based on analyses
conducted using data from July 2013 through June 2014 (1-year reporting
period) and 2017 measure specifications,\113\ we found that the median
facility-level reliability was 0.74 for ASCs and 0.51 for HOPDs. Using
a 2-year reporting period (data from July 2012--June 2014), we found
that median facility-level reliability was 0.81 for ASCs and 0.67 for
HOPDs. When the reporting period was extended to 3 years (using data
from July 2011 through June 2014), we found that median facility-level
reliability was higher for both ASCs and HOPDs: 0.87 for ASCs and 0.75
for HOPDs. These results indicate that a larger portion of the included
facilities have scores measured with higher reliability when 3 years of
data are used rather than 1 year of data.
---------------------------------------------------------------------------
\113\ Current and past measure specifications are available at:
https://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier3&cid=1228775214597.
---------------------------------------------------------------------------
Using 3 years of data, compared to just 1 year, is estimated to
increase the number of ASCs with eligible cases for ASC-12 by 10
percent, adding approximately 235 additional ASCs to the measure
calculation. ASCs reporting the measure would increase their sample
sizes and, in turn, increase the precision and reliability of their
measure scores. Thus, we believe extending the reporting period to 3
years from 1 year for purposes of increasing reliability would be
beneficial for providing better information to beneficiaries regarding
the quality of care associated with low-risk outpatient colonoscopy
procedures. In crafting our proposal, we considered extending the
reporting period to 2 years beginning with the CY 2020 payment
determinations and subsequent years, but decided on proposing 3 years
instead, because a higher level of reliability is achieved with a 3-
year reporting period compared to 2 years.
[[Page 37207]]
Therefore, we are proposing to change the reporting period for ASC-
12: Facility 7-Day Risk-Standardized Hospital Visit Rate after
Outpatient Colonoscopy from 1 year to 3 years beginning with the CY
2020 payment determination (which would use claims data from January 1,
2016 through December 31, 2018) and for subsequent years. Under this
proposal, the annual reporting requirements for ASCs would not change
because this is a claims-based measure. However, with a 3-year
reporting period, the most current year of data would be supplemented
by the addition of 2 prior years. For example, for the CY 2020 payment
determination, we would use a reporting period of CY 2018 data plus 2
prior years of data (CYs 2016 and 2017). We note that since
implementation of this measure began with the CY 2018 payment
determination, we have already used paid Medicare FFS claims from
January 1, 2016 to December 31, 2016 to calculate the measure scores,
which have been previously previewed by ASCs and publicly displayed. In
crafting our proposal, we also considered timeliness related to payment
determinations and public display. Because we would utilize data
already collected to supplement current data, our proposal to use 3
years of data would not disrupt payment determinations or public
display. We refer readers to the table below for example reporting
periods and public display dates corresponding to the CY 2020, CY 2021,
and CY 2022 payment determinations:
----------------------------------------------------------------------------------------------------------------
CY 2020 Payment CY 2021 Payment CY 2022 Payment
determination determination determination
----------------------------------------------------------------------------------------------------------------
Public display....................... January 2020........... January 2021........... January 2022.
Reporting period..................... January 1, 2016- January 1, 2017- January 1, 2018-
December 31, 2018. December 31, 2019. December 31, 2020.
----------------------------------------------------------------------------------------------------------------
5. Requirements for Data Submission for ASC-15a-e: Outpatient and
Ambulatory Surgery Consumer Assessment of Healthcare Providers and
Systems (OAS CAHPS) Survey-Based Measures
We refer readers to the CY 2017 OPPS/ASC final rule with comment
period (81 FR 79822 through 79824) for our previously finalized
policies regarding survey administration and vendor requirements for
the CY 2020 payment determination and subsequent years. In addition, we
codified these policies at 42 CFR 416.310(e). However, in the CY 2018
OPPS/ASC final rule with comment period (82 FR 59450 through 59451), we
delayed implementation of the ASC-15a-e: OAS CAHPS Survey-based
measures beginning with the CY 2020 payment determination (CY 2018 data
submission) until further action in future rulemaking, and we refer
readers to that discussion for more details. In this proposed rule, we
are not proposing any changes to this policy.
6. Extraordinary Circumstances Exception (ECE) Process for the CY 2020
Payment Determination and Subsequent Years
We refer readers to the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59474 through 59475) (and the previous rulemakings cited
therein) and 42 CFR 416.310(d) for the ASCQR Program's policies for
extraordinary circumstance exceptions (ECE) requests.
In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59474
through 59475), we: (1) Changed the name of this policy from
``extraordinary circumstances extensions or exemption'' to
``extraordinary circumstances exceptions'' for the ASCQR Program,
beginning January 1, 2018; and (2) revised 42 CFR 416.310(d) of our
regulations to reflect this change. We also clarified that we will
strive to complete our review of each request within 90 days of
receipt. In this proposed rule, we are not proposing any changes to
these policies.
7. ASCQR Program Reconsideration Procedures
We refer readers to the CY 2016 OPPS/ASC final rule with comment
period (82 FR 59475) (and the previous rulemakings cited therein) and
42 CFR 416.330 for the ASCQR Program's reconsideration policy. In this
proposed rule, we are not proposing any changes to this policy.
E. Payment Reduction for ASCs That Fail To Meet the ASCQR Program
Requirements
1. Statutory Background
We refer readers to section XVI.D.1. of the CY 2013 OPPS/ASC final
rule with comment period (77 FR 68499) for a detailed discussion of the
statutory background regarding payment reductions for ASCs that fail to
meet the ASCQR Program requirements.
2. Proposed Policy Regarding Reduction to the ASC Payment Rates for
ASCs That Fail To Meet the ASCQR Program Requirements for a Payment
Determination Year
The national unadjusted payment rates for many services paid under
the ASC payment system equal the product of the ASC conversion factor
and the scaled relative payment weight for the APC to which the service
is assigned. For CY 2019, the proposed ASC conversion factor is equal
to the conversion factor calculated for the previous year updated by
the multifactor productivity (MFP)-adjusted hospital market basket
update factor. The MFP adjustment is set forth in section
1833(i)(2)(D)(v) of the Act. The MFP-adjusted hospital market basket
update is the proposed annual update for the ASC payment system for an
interim 5-year period (CY 2019 through CY 2023). As discussed in the CY
2011 OPPS/ASC final rule with comment period (75 FR 72062), if the CPI-
U update factor is a negative number, the CPI-U update factor would be
held to zero. Consistent with past practice, in the event the
percentage change in the hospital market basket for a year is negative,
we are proposing to hold the hospital market basket update factor for
the ASC payment system to zero. Under the ASCQR Program in accordance
with section 1833(i)(7)(A) of the Act and as discussed in the CY 2013
OPPS/ASC final rule with comment period (77 FR 68499), any annual
increase shall be reduced by 2.0 percentage points for ASCs that fail
to meet the reporting requirements of the ASCQR Program. This reduction
applied beginning with the CY 2014 payment rates (77 FR 68500). For a
complete discussion of the calculation of the ASC conversion factor and
our proposal to update the ASC payment rates using the inpatient
hospital market basket update for CYs 2019 through 2023, we refer
readers to section XII.G. of this proposed rule.
In the CY 2013 OPPS/ASC final rule with comment period (77 FR 68499
through 68500), in order to implement the requirement to reduce the
annual update for ASCs that fail to meet the ASCQR Program
requirements, we finalized our proposal that we would calculate two
conversion factors: A full update conversion factor and an ASCQR
Program reduced update conversion factor. We finalized our proposal to
[[Page 37208]]
calculate the reduced national unadjusted payment rates using the ASCQR
Program reduced update conversion factor that would apply to ASCs that
fail to meet their quality reporting requirements for that calendar
year payment determination. We finalized our proposal that application
of the 2.0 percentage point reduction to the annual update may result
in the update to the ASC payment system being less than zero prior to
the application of the MFP adjustment.
The ASC conversion factor is used to calculate the ASC payment rate
for services with the following payment indicators (listed in Addenda
AA and BB to the proposed rule, which are available via the internet on
the CMS website): ``A2'', ``G2'', ``P2'', ``R2'' and ``Z2'', as well as
the service portion of device-intensive procedures identified by ``J8''
(77 FR 68500). We finalized our proposal that payment for all services
assigned the payment indicators listed above would be subject to the
reduction of the national unadjusted payment rates for applicable ASCs
using the ASCQR Program reduced update conversion factor (77 FR 68500).
The conversion factor is not used to calculate the ASC payment
rates for separately payable services that are assigned status
indicators other than payment indicators ``A2'', ``G2'', ``J8'',
``P2'', ``R2'' and ``Z2.'' These services include separately payable
drugs and biologicals, pass-through devices that are contractor-priced,
brachytherapy sources that are paid based on the OPPS payment rates,
and certain office-based procedures, certain radiology services and
diagnostic tests where payment is based on the PFS nonfacility PE RVU-
based amount, and a few other specific services that receive cost-based
payment (77 FR 68500). As a result, we also finalized our proposal that
the ASC payment rates for these services would not be reduced for
failure to meet the ASCQR Program requirements because the payment
rates for these services are not calculated using the ASC conversion
factor and, therefore, not affected by reductions to the annual update
(77 FR 68500).
Office-based surgical procedures (performed more than 50 percent of
the time in physicians' offices) and separately paid radiology services
(excluding covered ancillary radiology services involving certain
nuclear medicine procedures or involving the use of contrast agents)
are paid at the lesser of the PFS nonfacility PE RVU-based amounts or
the amount calculated under the standard ASC ratesetting methodology.
Similarly, in section XII.D.2.b. of the CY 2015 OPPS/ASC final rule
with comment period (79 FR 66933 through 66934), we finalized our
proposal that payment for the new category of covered ancillary
services (that is, certain diagnostic test codes within the medical
range of CPT codes for which separate payment is allowed under the OPPS
and when they are integral to covered ASC surgical procedures) will be
at the lower of the PFS nonfacility PE RVU-based (or technical
component) amount or the rate calculated according to the standard ASC
ratesetting methodology. In the CY 2013 OPPS/ASC final rule with
comment period (77 FR 68500), we finalized our proposal that the
standard ASC ratesetting methodology for this type of comparison would
use the ASC conversion factor that has been calculated using the full
ASC update adjusted for productivity. This is necessary so that the
resulting ASC payment indicator, based on the comparison, assigned to
these procedures or services is consistent for each HCPCS code,
regardless of whether payment is based on the full update conversion
factor or the reduced update conversion factor.
For ASCs that receive the reduced ASC payment for failure to meet
the ASCQR Program requirements, we believe that it is both equitable
and appropriate that a reduction in the payment for a service should
result in proportionately reduced coinsurance liability for
beneficiaries (77 FR 68500). Therefore, in the CY 2013 OPPS/ASC final
rule with comment period (77 FR 68500), we finalized our proposal that
the Medicare beneficiary's national unadjusted coinsurance for a
service to which a reduced national unadjusted payment rate applies
will be based on the reduced national unadjusted payment rate.
In that final rule with comment period, we finalized our proposal
that all other applicable adjustments to the ASC national unadjusted
payment rates would apply in those cases when the annual update is
reduced for ASCs that fail to meet the requirements of the ASCQR
Program (77 FR 68500). For example, the following standard adjustments
would apply to the reduced national unadjusted payment rates: The wage
index adjustment; the multiple procedure adjustment; the interrupted
procedure adjustment; and the adjustment for devices furnished with
full or partial credit or without cost (77 FR 68500). We believe that
these adjustments continue to be equally applicable to payment for ASCs
that do not meet the ASCQR Program requirements (77 FR 68500).
In the CY 2015, CY 2016, CY 2017, and CY 2018 OPPS/ASC final rules
with comment period (79 FR 66981 through 66982; 80 FR 70537 through
70538; 81 FR 79825 through 79826; and 82 FR 59475 through 59476,
respectively), we did not make any other changes to these policies.
XV. Requests for Information (RFIs)
This section addresses three requests for information (RFIs). Upon
reviewing the RFIs, respondents are encouraged to provide complete but
concise responses. These RFIs are issued solely for information and
planning purposes; neither RFI constitutes a Request for Proposal
(RFP), application, proposal abstract, or quotation. The RFIs do not
commit the U.S. Government to contract for any supplies or services or
make a grant award. Further, CMS is not seeking proposals through these
RFIs and will not accept unsolicited proposals. Responders are advised
that the U.S. Government will not pay for any information or
administrative costs incurred in response to these RFIs; all costs
associated with responding to these RFIs will be solely at the
interested party's expense.
Failing to respond to either RFI will not preclude participation in
any future procurement, if conducted. It is the responsibility of the
potential responders to monitor each RFI announcement for additional
information pertaining to the request. Please note that CMS will not
respond to questions about the policy issues raised in these RFIs. CMS
may or may not choose to contact individual responders. Such
communications would only serve to further clarify written responses.
Contractor support personnel may be used to review RFI responses.
Responses to these RFIs are not offers and cannot be accepted by the
U.S. Government to form a binding contract or issue a grant.
Information obtained as a result of these RFIs may be used by the U.S.
Government for program planning on a non-attribution basis. Respondents
should not include any information that might be considered proprietary
or confidential. These RFIs should not be construed as a commitment or
authorization to incur cost for which reimbursement would be required
or sought. All submissions become U.S. Government property and will not
be returned. CMS may publically post the comments received, or a
summary thereof.
[[Page 37209]]
A. Request for Information on Promoting Interoperability and Electronic
Healthcare Information Exchange Through Possible Revisions to the CMS
Patient Health and Safety Requirements for Hospitals and Other
Medicare- and Medicaid-Participating Providers and Suppliers
Currently, Medicare- and Medicaid-participating providers and
suppliers are at varying stages of adoption of health information
technology (health IT). Many hospitals have adopted electronic health
records (EHRs), and CMS has provided incentive payments to eligible
hospitals, critical access hospitals (CAHs), and eligible professionals
who have demonstrated meaningful use of certified EHR technology
(CEHRT) under the Medicare EHR Incentive Program. As of 2015, 96
percent of Medicare- and Medicaid-participating non-Federal acute care
hospitals had adopted certified EHRs with the capability to
electronically export a summary of clinical care.\114\ While both
adoption of EHRs and electronic exchange of information have grown
substantially among hospitals, significant obstacles to exchanging
electronic health information across the continuum of care persist.
Routine electronic transfer of information post-discharge has not been
achieved by providers and suppliers in many localities and regions
throughout the Nation.
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\114\ These statistics can be accessed at: https://dashboard.healthit.gov/quickstats/pages/FIG-Hospital-EHR-Adoption.php.
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CMS is firmly committed to the use of certified health IT and
interoperable EHR systems for electronic healthcare information
exchange to effectively help hospitals and other Medicare- and
Medicaid-participating providers and suppliers improve internal care
delivery practices, support the exchange of important information
across care team members during transitions of care, and enable
reporting of electronically specified clinical quality measures
(eCQMs). The Office of the National Coordinator for Health Information
Technology (ONC) acts as the principal Federal entity charged with
coordination of nationwide efforts to implement and use health
information technology and the electronic exchange of health
information on behalf of the Department of Health and Human Services.
In 2015, ONC finalized the 2015 Edition health IT certification
criteria (2015 Edition), the most recent criteria for health IT to be
certified to under the ONC Health IT Certification Program. The 2015
Edition facilitates greater interoperability for several clinical
health information purposes and enables health information exchange
through new and enhanced certification criteria, standards, and
implementation specifications. CMS requires eligible hospitals and CAHs
in the Medicare and Medicaid EHR Incentive Programs and eligible
clinicians in the Quality Payment Program (QPP) to use EHR technology
certified to the 2015 Edition beginning in CY 2019.
In addition, several important initiatives will be implemented over
the next several years to provide hospitals and other participating
providers and suppliers with access to robust infrastructure that will
enable routine electronic exchange of health information. Section 4003
of the 21st Century Cures Act (Pub. L. 114-255), enacted in 2016, and
amending section 3000 of the Public Health Service Act (42 U.S.C.
300jj), requires HHS to take steps to advance the electronic exchange
of health information and interoperability for participating providers
and suppliers in various settings across the care continuum.
Specifically, Congress directed that ONC ``. . . for the purpose of
ensuring full network-to-network exchange of health information,
convene public-private and public-public partnerships to build
consensus and develop or support a trusted exchange framework,
including a common agreement among health information networks
nationally.'' In January 2018, ONC released a draft version of its
proposal for the Trusted Exchange Framework and Common Agreement,\115\
which outlines principles and minimum terms and conditions for trusted
exchange to enable interoperability across disparate health information
networks (HINs). The Trusted Exchange Framework (TEF) is focused on
achieving the following four important outcomes in the long-term:
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\115\ The draft version of the trusted Exchange Framework may be
accessed at: https://beta.healthit.gov/topic/interoperability/trusted-exchange-framework-and-common-agreement.
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Professional care providers, who deliver care across the
continuum, can access health information about their patients,
regardless of where the patient received care.
Patients can find all of their health information from
across the care continuum, even if they do not remember the name of the
professional care provider they saw.
Professional care providers and health systems, as well as
public and private health care organizations and public and private
payer organizations accountable for managing benefits and the health of
populations, can receive necessary and appropriate information on
groups of individuals without having to access one record at a time,
allowing them to analyze population health trends, outcomes, and costs;
identify at-risk populations; and track progress on quality improvement
initiatives.
The health IT community has open and accessible
application programming interfaces (APIs) to encourage entrepreneurial,
user-focused innovation that will make health information more
accessible and improve EHR usability.
ONC will revise the draft TEF based on public comment and
ultimately release a final version of the TEF that will subsequently be
available for adoption by HINs and their participants seeking to
participate in nationwide health information exchange. The goal for
stakeholders that participate in, or serve as, a HIN is to ensure that
participants will have the ability to seamlessly share and receive a
core set of data from other network participants in accordance with a
set of permitted purposes and applicable privacy and security
requirements. Broad adoption of this framework and its associated
exchange standards is intended to both achieve the outcomes described
above while creating an environment more conducive to innovation.
In light of the widespread adoption of EHRs along with the
increasing availability of health information exchange infrastructure
predominantly among hospitals, we are interested in hearing from
stakeholders on how we could use the CMS health and safety standards
that are required for providers and suppliers participating in the
Medicare and Medicaid programs (that is, the Conditions of
Participation (CoPs), Conditions for Coverage (CfCs), and Requirements
for Participation (RfPs) for Long-Term Care (LTC) Facilities) to
further advance electronic exchange of information that supports safe,
effective transitions of care between hospitals and community
providers. Specifically, CMS might consider revisions to the current
CMS CoPs for hospitals, such as: Requiring that hospitals transferring
medically necessary information to another facility upon a patient
transfer or discharge do so electronically; requiring that hospitals
electronically send required discharge information to a community
provider via electronic means if possible and if a community provider
can be identified; and requiring that hospitals make certain
information available to patients or a specified third-party
application (for example, required
[[Page 37210]]
discharge instructions) via electronic means if requested.
On November 3, 2015, we published a proposed rule (80 FR 68126) to
implement the provisions of the Improving Medicare Post-Acute Care
Transformation Act of 2014 (the IMPACT Act) (Pub. L. 113-185) and to
revise the discharge planning CoP requirements that hospitals
(including short-term acute care hospitals, long-term care hospitals
(LTCHs), rehabilitation hospitals, psychiatric hospitals, children's
hospitals, and cancer hospitals), critical access hospitals (CAHs), and
home health agencies (HHAs) would need to meet in order to participate
in the Medicare and Medicaid programs. This proposed rule has not been
finalized yet. However, several of the proposed requirements directly
address the issue of communication between providers and between
providers and patients, as well as the issue of interoperability:
Hospitals and CAHs would be required to transfer certain
necessary medical information and a copy of the discharge instructions
and discharge summary to the patient's practitioner, if the
practitioner is known and has been clearly identified;
Hospitals and CAHs would be required to send certain
necessary medical information to the receiving facility/post-acute care
providers, at the time of discharge; and
Hospitals, CAHs, and HHAs would need to comply with the
IMPACT Act requirements that would require hospitals, CAHs, and certain
post-acute care providers to use data on quality measures and data on
resource use measures to assist patients during the discharge planning
process, while taking into account the patient's goals of care and
treatment preferences.
We published another proposed rule (81 FR 39448) on June 16, 2016,
that updated a number of CoP requirements that hospitals and CAHs would
need to meet in order to participate in the Medicare and Medicaid
programs. This proposed rule has not been finalized yet. One of the
proposed hospital CoP revisions in that rule directly addresses the
issues of communication between providers and patients, patient access
to their medical records, and interoperability. We proposed that
patients have the right to access their medical records, upon an oral
or written request, in the form and format requested by such patients,
if it is readily producible in such form and format (including in an
electronic form or format when such medical records are maintained
electronically); or, if not, in a readable hard copy form or such other
form and format as agreed to by the facility and the individual,
including current medical records, within a reasonable timeframe. The
hospital must not frustrate the legitimate efforts of individuals to
gain access to their own medical records and must actively seek to meet
these requests as quickly as its recordkeeping system permits.
We also published a final rule (81 FR 68688) on October 4, 2016,
that revised the requirements that LTC facilities must meet to
participate in the Medicare and Medicaid programs. In this rule, we
made a number of revisions based on the importance of effective
communication between providers during transitions of care, such as
transfers and discharges of residents to other facilities or providers,
or to home. Among these revisions was a requirement that the
transferring LTC facility must provide all necessary information to the
resident's receiving provider, whether it is an acute care hospital, an
LTCH, a psychiatric facility, another LTC facility, a hospice, a home
health agency, or another community-based provider or practitioner (42
CFR 483.15(c)(2)(iii)). We specified that necessary information must
include the following:
Contact information of the practitioner responsible for
the care of the resident;
Resident representative information including contact
information;
Advance directive information;
Special instructions or precautions for ongoing care;
The resident's comprehensive care plan goals; and
All other necessary information, including a copy of the
resident's discharge or transfer summary and any other documentation to
ensure a safe and effective transition of care.
We note that the discharge summary mentioned above must include
reconciliation of the resident's medications, as well as a
recapitulation of the resident's stay, a final summary of the
resident's status, and the post-discharge plan of care. In addition, in
the preamble to the rule, we encouraged LTC facilities to
electronically exchange this information if possible and to identify
opportunities to streamline the collection and exchange of resident
information by using information that the facility is already capturing
electronically.
Additionally, we specifically invite stakeholder feedback on the
following questions regarding possible new or revised CoPs/CfCs/RfPs
for interoperability and electronic exchange of health information:
If CMS were to propose a new CoP/CfC/RfP standard to
require electronic exchange of medically necessary information, would
this help to reduce information blocking as defined in section 4004 of
the 21st Century Cures Act?
Should CMS propose new CoPs/CfCs/RfPs for hospitals and
other participating providers and suppliers to ensure a patient's or
resident's (or his or her caregiver's or representative's) right and
ability to electronically access his or her health information without
undue burden? Would existing portals or other electronic means
currently in use by many hospitals satisfy such a requirement regarding
patient/resident access as well as interoperability?
Are new or revised CMS CoPs/CfCs/RfPs for interoperability
and electronic exchange of health information necessary to ensure
patients/residents and their treating providers routinely receive
relevant electronic health information from hospitals on a timely basis
or will this be achieved in the next few years through existing
Medicare and Medicaid policies, the implementing regulations related to
the privacy and security standards of the Health Insurance Portability
and Accountability Act of 1996 (HIPAA) (Pub. L. 104-91), and
implementation of relevant policies in the 21st Century Cures Act?
What would be a reasonable implementation timeframe for
compliance with new or revised CMS CoPs/CfCs/RfPs for interoperability
and electronic exchange of health information if CMS were to propose
and finalize such requirements? Should these requirements have delayed
implementation dates for specific participating providers and
suppliers, or types of participating providers and suppliers (for
example, participating providers and suppliers that are not eligible
for the Medicare and Medicaid EHR Incentive Programs)?
Do stakeholders believe that new or revised CMS CoPs/CfCs/
RfPs for interoperability and electronic exchange of health information
would help improve routine electronic transfer of health information as
well as overall patient/resident care and safety?
Under new or revised CoPs/CfCs/RfPs, should non-electronic
forms of sharing medically necessary information (for example, printed
copies of patient/resident discharge/transfer summaries shared directly
with the patient/resident or with the receiving provider or supplier,
either directly transferred with the patient/resident or by mail or fax
to the receiving provider or supplier) be permitted to continue if the
receiving
[[Page 37211]]
provider, supplier, or patient/resident cannot receive the information
electronically?
Are there any other operational or legal considerations
(for example, implementing regulations related to the HIPAA privacy and
security standards), obstacles, or barriers that hospitals and other
providers and suppliers would face in implementing changes to meet new
or revised interoperability and health information exchange
requirements under new or revised CMS CoPs/CfCs/RfPs if they are
proposed and finalized in the future?
What types of exceptions, if any, to meeting new or
revised interoperability and health information exchange requirements
should be allowed under new or revised CMS CoPs/CfCs/RfPs if they are
proposed and finalized in the future? Should exceptions under the QPP,
including CEHRT hardship or small practices, be extended to new
requirements? Would extending such exceptions impact the effectiveness
of these requirements?
We would also like to directly address the issue of communication
between hospitals (as well as the other providers and suppliers across
the continuum of patient care) and their patients and caregivers.
MyHealthEData is a government-wide initiative aimed at breaking down
barriers that contribute to preventing patients from being able to
access and control their medical records. Privacy and security of
patient data will be at the center of all CMS efforts in this area. CMS
must protect the confidentiality of patient data, and CMS is completely
aligned with the Department of Veterans Affairs (VA), the National
Institutes of Health (NIH), ONC, and the rest of the Federal
Government, on this objective.
While some Medicare beneficiaries have had, for quite some time,
the ability to download their Medicare claims information, in pdf or
Excel formats, through the CMS Blue Button platform, the information
was provided without any context or other information that would help
beneficiaries understand what the data were really telling them. For
beneficiaries, their claims information is useless if it is either too
hard to obtain or, as was the case with the information provided
through previous versions of Blue Button, hard to understand. In an
effort to fully contribute to the Federal Government's MyHealthEData
initiative, CMS developed and launched the new Blue Button 2.0, which
represents a major step toward giving patients meaningful control of
their health information in an easy-to-access and understandable way.
Blue Button 2.0 is a developer-friendly, standards-based application
programming interface (API) that enables Medicare beneficiaries to
connect their claims data to secure applications, services, and
research programs they trust. The possibilities for better care through
Blue Button 2.0 data are exciting, and might include enabling the
creation of health dashboards for Medicare beneficiaries to view their
health information in a single portal, or allowing beneficiaries to
share complete medication lists with their doctors to prevent dangerous
drug interactions.
To fully understand all of these health IT interoperability issues,
initiatives, and innovations through the lens of its regulatory
authority, CMS invites members of the public to submit their ideas on
how best to accomplish the goal of fully interoperable health IT and
EHR systems for Medicare- and Medicaid-participating providers and
suppliers, as well as how best to further contribute to and advance the
MyHealthEData initiative for patients. We are particularly interested
in identifying fundamental barriers to interoperability and health
information exchange, including those specific barriers that prevent
patients from being able to access and control their medical records.
We also welcome the public's ideas and innovative thoughts on
addressing these barriers and ultimately removing or reducing them in
an effective way, specifically through revisions to the current CMS
CoPs, CfCs, and RfPs for hospitals and other participating providers
and suppliers. We have received stakeholder input through recent CMS
Listening Sessions on the need to address health IT adoption and
interoperability among providers that were not eligible for the
Medicare and Medicaid EHR Incentives program, including long-term and
post-acute care providers, behavioral health providers, clinical
laboratories and social service providers, and we would also welcome
specific input on how to encourage adoption of certified health IT and
interoperability among these types of providers and suppliers as well.
B. Request for Information on Price Transparency: Improving Beneficiary
Access to Provider and Supplier Charge Information
In the FY 2019 IPPS/LTCH PPS proposed rule (83 FR 20548 and 20549)
and the FY 2015 IPPS/LTCH PPS proposed and final rules (79 FR 28169 and
79 FR 50146, respectively), we stated that we intend to continue to
review and post relevant charge data in a consumer-friendly way, as we
previously have done by posting hospital and physician charge
information on the CMS website.\116\ In the FY 2019 IPPS/LTCH PPS
proposed rule, we also continued our discussion of the implementation
of section 2718(e) of the Public Health Service Act, which aims to
improve the transparency of hospital charges. This discussion in the FY
2019 IPPS/LTCH PPS proposed rule continued a discussion we began in the
FY 2015 IPPS/LTCH PPS proposed rule and final rule (79 FR 28169 and 79
FR 50146, respectively). In all of these rules, we noted that section
2718(e) of the Public Health Service Act requires that each hospital
operating within the United States, for each year, establish (and
update) and make public (in accordance with guidelines developed by the
Secretary) a list of the hospital's standard charges for items and
services provided by the hospital, including for diagnosis-related
groups (DRGs) established under section 1886(d)(4) of the Social
Security Act. In the FY 2015 IPPS/LTCH PPS proposed and final rules, we
reminded hospitals of their obligation to comply with the provisions of
section 2718(e) of the Public Health Service Act and provided
guidelines for its implementation. We stated that hospitals are
required to either make public a list of their standard charges
(whether that be the chargemaster itself or in another form of their
choice) or their policies for allowing the public to view a list of
those charges in response to an inquiry. In the FY 2019 IPPS/LTCH PPS
proposed rule, we took one step to further improve the public
accessibility of charge information. Specifically, effective January 1,
2019, we are updating our guidelines to require hospitals to make
available a list of their current standard charges via the internet in
a machine readable format and to update this information at least
annually, or more often as appropriate.
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\116\ For example, Medicare Provider Utilization and Payment
Data, available at: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/Medicare-Provider-Charge-Data/index.html.
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In general, we encourage all providers and suppliers of health care
services to undertake efforts to engage in consumer-friendly
communication of their charges to help patients understand what their
potential financial liability might be for services they obtain, and to
enable patients to compare charges for similar services. We encourage
providers and suppliers to update this information at least annually,
or more often as appropriate, to reflect current charges.
We are concerned that challenges continue to exist for patients due
to insufficient price transparency. Such challenges include patients
being
[[Page 37212]]
surprised by out-of-network bills for physicians, such as
anesthesiologists and radiologists, who provide services at in-network
hospitals and other settings, and patients being surprised by facility
fees, physician fees for emergency department visits, or by fees for
provider and supplier services that the beneficiary might consider to
be a part of an episode of care involving a hospitalization but that
are not services furnished by the hospital. We also are concerned that,
for providers and suppliers that maintain a list of standard charges,
the charge data are not helpful to patients for determining what they
are likely to pay for a particular service or facility encounter. In
order to promote greater price transparency for patients, we are
considering ways to improve the accessibility and usability of current
charge information.
We also are considering potential actions that would be appropriate
to further our objective of having providers and suppliers undertake
efforts to engage in consumer-friendly communication of their charges
to help patients understand what their potential financial liability
might be for services they obtain from the provider or supplier, and to
enable patients to compare charges for similar services across
providers and suppliers, including when services could be offered in
more than one setting, such as a freestanding physician office or a
hospital outpatient department or an ambulatory surgical center.
Therefore, we are seeking public comment from all providers and
suppliers, including providers receiving payment under the OPPS, on the
following:
How should we define ``standard charges'' in provider and
supplier settings? Is there one definition for those settings that
maintain chargemasters, and potentially a different definition for
those settings that do not maintain chargemasters? Should ``standard
charges'' be defined to mean: Average or median rates for the items on
a chargemaster or other price list or charge list; average or median
rates for groups of items and/or services commonly billed together, as
determined by the provider or supplier based on its billing patterns;
or the average discount off the chargemaster, price list, or charge
list amount across all payers, either for each separately enumerated
item or for groups of services commonly billed together? Should
``standard charges'' be defined and reported for both some measure of
the average contracted rate and the chargemaster, price list, or charge
list? Or is the best measure of a provider's or supplier's standard
charges its chargemaster, price list, or charge list?
What types of information would be most beneficial to
patients, how can health care providers and suppliers best enable
patients to use charge and cost information in their decision-making,
and how can CMS and providers and suppliers help third parties create
patient-friendly interfaces with these data?
Should providers and suppliers be required to inform
patients how much their out-of- pocket costs for a service will be
before those patients are furnished that service? How can information
on out-of-pocket costs be provided to better support patient choice and
decision-making? What changes would be needed to support greater
transparency around patient obligations for their out-of-pocket costs?
How can CMS help beneficiaries to better understand how copayment and
coinsurance are applied to each service covered by Medicare? What can
be done to better inform patients of their financial obligations?
Should providers and suppliers play any role in helping to inform
patients of what their out-of-pocket obligations will be?
Can we require providers and suppliers to provide patients
with information on what Medicare pays for a particular services
performed by that provider or supplier. If so, what changes would need
to be made by providers and suppliers. What burden would be added as a
result of such a requirement?
In addition, we are seeking public comment on improving a Medigap
patient's understanding of his or her out-of-pocket costs prior to
receiving services, especially with respect to the following particular
questions: