Key decisions from Medicare’s FY2105 HOPPS-Final rule

Key decisions from Medicare’s FY2015 Hospital Outpatient Prospective Payment System (HOPPS)-Final rule published on on November 1, 2014 and in the Federal Register on November 10, 2014.  These changes become effective January 1, 2015.

General impact:

  • For CY 2015, we are increasing the payment rates under the OPPS by an Outpatient Department (OPD) fee schedule increase factor of 2.2 percent.
  • For CY 2015, we are using a conversion factor of $74.144 in the calculation of the national unadjusted payment rates.
  • Approximate 4,000 facilities are paid under the OPPS approximately $56.1 billion, an increase of approximately $5.1 billion compared to CY 2014.
  • Continuing to implement the statutory 2.0% point reduction in payments for hospitals failing to meet the hospital outpatient quality reporting requirements.
  • For CY 2015, we are implementing, with several modifications, the policy for comprehensive APCs (C-APCs). We are establishing a total of 25 C-APCs for CY 2015, including all of the formerly device-dependent APCs.
  • For CY 2015, we are increasing payment rates under the ASC payment system by 1.4 percent.

Specific HOPPS Decisions related to medical devices:

  • Finalizing our proposal to no longer implement specific procedure-to-device and device-to-procedure edits for any APC. The term “device-dependent APC” will no longer be employed beginning in CY 2015.
  • Comprehensive APCs (C-APCs) = comprehensive payment policy that packages payment for adjunctive and secondary items, services, and procedures into the most costly primary procedure (primarily medical device implantation procedures) under the OPPS at the claim level, effective January 1, 2015.  We define 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.  Twenty-five C-APCs within 12 clinical families for CY 2015 are described in Table 7.
  • In the CY 2015 the composite APC payment for cardiac electrophysiologic evaluation and ablation services (APC 8000) will be deleted and paid as comprehensive APC 0086 (Level III Electrophysiologic Procedures).
  • We proposed to rename the arthroplasty family of APCs to “Orthopedic Surgery.”  We also proposed to reassign several codes from APC 0052 to C-APC 0425, which we proposed to rename “Level V Musculoskeletal Procedures Except Hand and Foot.”
  • For Skin Substitute assignments to “High Cost” and “Low Cost” groups, please see Table 34.  CMS also finalized a medical device pass-through evaluation process for pass-through payment for skin substitute and similar wound healing products, effective April 1, 2015.

Rationale for Packaging in the OPPS:

  • 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.
  • 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.
  • Our overarching goal is to make OPPS payments for all services paid 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.

Procedures That Will Be Paid Only as Inpatient Procedures (page 558):

  • In the proposed rule, CMS did not identify any procedures that potentially could be removed from the inpatient list for CY 2015.
  • As a result of comments, CMS did decide to add CPT code 22222 (Osteotomy of spine, including discectomy, anterior approach, single vertebral segment; thoracic) to the CY 2015 inpatient list.
  • In response to public comments, CMS has decided to remove CPT code 63043 (Laminotomy(hemilaminectomy, with decompression of nerve root(s), including partial facetectomy, foraminotomy and/or excision of herniated intervertebral disc, reexploration, single interspace; each additional cervical interspace) and CPT code 63044 (Laminotomy (hemilaminectomy, with decompression of nerve root(s), including partial facetectomy, foraminotomy and/or excision of herniated intervertebral disc, reexploration, single interspace; each additional lumbar interspace) from the inpatient-only list.
  • For specific procedures on Medicare’s CY 2015 inpatient only list, please see Addendum E.

Updates to the Ambulatory Surgical Center (ASC) Payment System (page 583):

  • In the CY 2015 OPPS/ASC proposed rule, CMS proposed to update the list of ASC covered surgical procedures by adding 10 spine procedures to the ASC list, effective 1-1-15.
  • 74 potential procedures were submitted to CMS through public comments, as shown on Table 44.
  • Effective January 1, 2015, 11 surgical procedures will be added to Medicare’s ASC Covered Surgical Procedures list, as shown on Table 45. Of note, they are all spine procedures (arthrodesis, laminotomy, transpendicular decompression).

For additional information and personal consideration, please call Kathryn @ 203-271-3366. 

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