Medicare Outpatient Prospective Payment System Rule Finalized for 2021, Webinar Offered

This article was revised Dec.10 to include Jan. 5 webinar information.

The Centers for Medicare & Medicaid Services (CMS) recently released a final rule to update the Medicare fee-for-service outpatient prospective payment system (PPS) effective Jan. 1, 2021, unless otherwise noted. The final rule will:

  • Require all hospitals, including critical access hospitals, to report information about COVID-19 therapeutic inventory and usage and to report acute respiratory illness during the public health emergency (PHE) for COVID-19.
     
  • Increase the outpatient payment rate by a net 2.5%, from $80.79 to $82.80, for hospitals that comply with requirements of the outpatient quality reporting program.
     
  • Maintain the current payment policy for 340B drugs at average sales price (ASP) minus 22.5% as implemented in 2018, rather than reducing payments to ASP minus 28.7% as proposed. Rural sole-community hospitals, children’s hospitals and PPS-exempt cancer hospitals continue to be paid ASP plus 6%.
     
  • Require prior authorization for two additional service categories — cervical fusion with disc removal and implanted spinal neurostimulators — for dates of service July 1, 2021, and after.
     
  • Eliminate the inpatient-only list over three calendar years, beginning with the removal of 266 musculoskeletal-related services (including total hip arthroplasty) and 32 additional HCPCS codes in 2021.
     
  • Create two new comprehensive ambulatory payment classifications (C-APCs) for Level 8 Urology and Related Services (C-APC 5378) and Level 5 Neurostimulator and Related Procedures (C-APC 5465), increasing the number of C-APCs to 69.
     
  • Reduce the level of supervision of outpatient therapeutic services for nonsurgical extended duration therapeutic services, such as certain infusion services. The CMS stipulates general supervision for the entire service, including the initiation portion of the service, which currently requires direct supervision. The CMS also finalized its proposal to permit direct supervision for pulmonary and cardiac rehabilitation services using virtual presence of the physician through audio/video real-time communications technology, subject to clinical judgment of the supervising physician, until the latter of the end of the calendar year in which the PHE ends or Dec. 31, 2021.
     
  • Establish and update the methodology used to calculate the Overall Hospital Star Ratings, beginning with 2021, by adopting a simple average of measure scores and reducing the total number of measure groups from seven to five. The CMS is also increasing the comparability of star ratings by peer grouping hospitals by the number of measure groups. The CMS did not finalize its proposals related to stratification of the readmissions group by dual eligible patients.
     
  • Add 11 procedures to the ambulatory surgical center covered-procedures list (CPL), including total hip arthroplasty, under the standard review process. Additionally, the CMS revised the criteria used to add procedures to the CPL, which resulted in adding 267 surgical procedures to the CPL beginning in 2021.
     
  • Remove certain restrictions on the expansion of physician-owned hospitals that qualify as “high Medicaid facilities.”

The MHA anticipates distributing hospital-specific impact analyses in early January.  A national webinar to review the final rule and impact analysis will be available from 3 to 4 p.m. Jan. 5. The webinar is hosted by DataGen and is offered free of charge, but registration is required. Members with questions should contact Vickie Kunz at the MHA.

Combating the Novel Coronavirus (COVID-19): Week of June 8

MHA Covid-19 update

COVID-19 UpdateThe MHA continues to keep members apprised of developments during the COVID-19 pandemic through regular email updates and the MHA Coronavirus webpage. Important updates on how the pandemic is affecting Michigan hospitals are outlined below.

Data Due June 15 to Potentially Qualify for Further COVID-19 Funding from HHS

The U.S. Department of Health and Human Services (HHS) has requested information from hospitals to determine the distribution of $10 billion to hospitals that have been particularly burdened with COVID-19 cases. Each healthcare facility with a Medicare Tax Identification Number is asked to submit the number of COVID-19-positive inpatients admitted from Jan. 1 through June 10.

Submission of this data by 9 p.m. ET June 15 is required to be eligible to receive the funding, but it is not a guarantee of eligibility. The HHS has posted a frequently asked questions document about funding through the Coronavirus Aid, Relief, and Economic Security (CARES) Act; information on this round of funding begins on page 26. The data must be submitted through the HHS’s TeleTracking system. More information on setting up an account and entering data is available on TeleTracking’s help webpage or by calling TeleTracking Technical Support at (877) 570-6903. Members with questions about federal funding may contact Laura Appel at the MHA.

Policy Updated on Decontaminating N95 Masks

The Food and Drug Administration (FDA) reissued emergency use authorizations related to respirator decontamination, noting that some respirators should not be decontaminated for reuse. The agency will no longer recommend decontamination for the reuse of respirators manufactured in China or those that have exhalation valves. Decontamination will be authorized only on non-cellulose-compatible N95 respirators. Healthcare personnel should use the decontamination process only when new, FDA-cleared N95 respirators, NIOSH-approved N95 respirators or other FDA-authorized respirators are unavailable.

State Issues Guidance on Testing Frequency and Available Capacity

To ensure available COVID-19 testing resources are being effectively used in high-risk populations and/or settings across the state, the Michigan Department of Health and Human Resources (MDHHS) issued recommendations June 10 on the ideal frequency of COVID-19 testing. The guidance assumes a scenario where sufficient testing supplies and capacity are available. To help meet the level of testing envisioned in these recommendations, the MDHHS has also published information regarding test sites that provide services at no cost to the patient and laboratories with available testing supplies and capacity to allow for new providers and congregate care facilities to send specimens. The June 10 recommendations and additional information on testing priorities and frequency by population is available in the June 10 update emailed to members.

Resources and Guidance Available for Lab Supplies and Reporting Results

The FDA’s web-based resource Testing Supply Substitution Strategies contains detailed information to support labs performing authorized COVID-19 tests, including validated supply alternatives for use when there is a supply issue with some components of a test. This PowerPoint presentation, which can be downloaded from the FDA website, does not alter emergency use authorizations that have already been issued nor specific FDA regulatory requirements. It is provided solely to address concerns about the availability of certain critical components of DOVID-19 diagnostic tests.

The U.S. Department of Health and Human Services (HHS) has provided guidance that specifies additional data that laboratories must report with their COVID-19 test results. The new data should be reported as soon as possible, but no later than Aug. 1. More information is available in the department’s news release.

Workplace Requirements for Outpatient Facilities

Executive Order 2020-114 stipulates accommodations for all workers required to return to the workplace during the pandemic. Section 9 of EO 2020-114 pertains specifically to outpatient healthcare facilities, including clinics and physician offices, and outlines requirements that do not apply to inpatient hospitals.

The requirement for checking patient temperatures for these facilities is different from the evaluation required for employees at inpatient or outpatient facilities. This section of EO 2020-114 does not change the requirements for employee health evaluations prior to entering healthcare facilities when reporting to work. Questions on the requirements should be directed to Amy Barkholz at the MHA.

The Joint Commission Offers Webinar as On-site Surveys Resume

The Joint Commission will host a webinar titled The Joint Commission – Plan for Resuming Surveys from 11 a.m. to noon June 18. Registration is required, and more information is available in the related article.

Blue Cross Cost Sharing Waiver Extended Through End of Year

Blue Cross Blue Shield of Michigan (BCBSM) announced it is extending cost sharing (copays, deductibles and coinsurance) waivers for COVID-19 testing and treatment through Dec. 31. These measures originally were set to expire June 30. The announcement says the cost share waivers “apply to members in fully insured commercial PPO and HMO plans, as well as individuals in fully insured Medicare Advantage plans. BCBSM will work with employer group customers that are self-insured to make decisions regarding their own benefits.” Members with questions on COVID-19 payer issues may contact Jason Jorkasky at the MHA.

“Don’t Delay Care” Campaign Update

The MHA “Hospitals are Safe – Don’t Delay Care” campaign began on social media and statewide television in mid-May and will end during the week of June 15. The campaign has focused on video views, building awareness for those who may be making decisions about seeking medical care during COVID-19. As of June 12, the video had been viewed on Facebook more than 577,000 times. Although the campaign is ending, the association will continue to share this message through its normal social media content. For more information on this or other public relations campaigns, contact Ruthanne Sudderth at the MHA.

Additional information on the COVID-19 pandemic is available to members on the MHA Community Site and the MHA COVID-19 webpage. Questions on COVID-19 and infectious disease response strategies may be directed to the MDHHS Community Health Emergency Coordination Center (CHECC). Members with MHA-specific questions should contact the following MHA staff members:

Final Medicaid Policies Affect Outpatient, Neonatal Intensive Care Services

The Medical Services Administration (MSA) recently released two final policies that impact hospital Medicaid payments. One relates to the rural access pool and the other updates payment to hospitals with approved neonatal intensive care units (NICUs).

MSA Policy 20-39 restores the rural access pool for fiscal year (FY) 2020 and provides a Medicaid outpatient rate increase for critical access hospitals (CAHs) effective Jan. 1, 2020, while removing CAHs from rural access pool eligibility for FY 2021.

The MSA received approval of the state plan amendment (SPA) submitted to the Centers for Medicare & Medicaid Services to increase Medicaid outpatient rates by 42.5% for services provided at CAHs effective Jan. 1, 2020. The SPA approval gives the MSA flexibility to implement the 7% outpatient rate increase for all hospitals effective April 1, 2020, as included in the FY 2020 Medicaid budget.

The MSA recently released the outpatient rate changes for CAHs and all other hospitals and is making system changes to implement the increases, which apply to both Medicaid fee-for-service and managed care organization claims. Affected claims will be reprocessed and paid at the higher rate following completion of the system changes.

MSA Policy 20-45 updates payment policy for hospitals that have approved NICUs effective for discharges on and after July 1, 2020. The final policy aligns with updated guidance from the National Uniform Billing Committee, which recognizes revenue codes 0173 and 0174 as NICU services that are eligible for payment at the alternate all-patient refined diagnosis-related group (APR-DRG) weight. This is a change from the current policy that recognizes only revenue code 0174 as NICU services.

Members with questions on these final policies should contact Vickie Kunz at the MHA.