Outpatient Payment Cut for Certain Clinic Visits to Remain in Effect for 2020

Despite the recently announced intention of the Centers for Medicare & Medicaid Services (CMS) to reprocess and pay claims for certain 2019 outpatient clinic visits at the full outpatient prospective payment system rate, those payments will be cut in 2020.

A federal judge stated in a Memorandum Opinion filed Dec. 16 that hospitals must file claims in 2020 to demonstrate the effects of the Centers for Medicare & Medicaid Services’ (CMS) calendar year 2020 final rule. The rule cuts Medicare fee-for-service outpatient prospective payment system (OPPS) payments for 2020 clinic visits provided in off-campus hospital outpatient departments (HOPDs) that were grandfathered under the Bipartisan Budget Act of 2015. The 2020 OPPS final rule reduced payment for these visits from 70% of the OPPS rate to 40%.

United States District Judge Rosemary Collyer stated that her September ruling declaring the payment cuts unlawful was limited only to the 2019 final rule. Although the judge’s opinion states the court believes the CMS appears to have acted “above the law” by implementing the 2020 cuts, it is requiring hospitals to file claims to meet Medicare procedural requirements.

The American Hospital Association and other plaintiffs in a recent lawsuit to reverse the cuts are confident that the courts will find the 2020 cuts to be illegal, as they did with the 2019 cuts. In October, the judge reaffirmed her previous order to the CMS to vacate the payment cut. The CMS will automatically reprocess calendar year 2019 claims starting in January to pay hospitals at 100% of the OPPS rate for clinic visits provided at grandfathered off-campus HOPDs that were previously paid at 70% of the OPPS rate. The Department of Health and Human Services also announced that it intends to appeal the district court’s ruling in the case. Members with questions should contact Vickie Kunz at the MHA.