January 2014 Matthew H. Lawney MSPT, MBA, CHC, mlawney@epochhealth.com Jean C. Russell, MS, RHIT jrussell@epochhealth.com Richard Cooley, BA, CCS rcooley@epochhealth.com 518-430-1144 2 Agenda • • • • • • APC Reimbursement Impact Comprehensive APCs Packaging Changes • 1. Drugs/biologicals/radiopharm dx tests • 2. Drugs/biologicals/radiopharm surgical procedures • 3. Clinical dx lab tests • 4. Add-on procedures • 5. Ancillary services (APC status X) • 6. Dx tests on bypass list • 7. Device removal procedures Physician Supervision Other Changes – I/P Only Procedures Quality Reporting 3 Abbreviations APC – Ambulatory Patient Classification ASP – Average Sales Price CAH – Critical Access Hospital EACH – Essential Access Community Hospital MPFS – Medicare Physician Fee Schedule NPP – Non-Physician Practitioners OPPS – Outpatient Prospective Payment System PHP – Partial Hospitalization Program RCC – Ratio of Costs to Charges SCH – Sole Community Hospital SI – APC Status Indicator WAC – Wholesale Acquisition Cost 4 APC Reimbursement 5 Payment Impact Hospitals that met the quality indicator reporting requirements will get the full 1.7% (1.8% in 2013) payment rate increase factor 2.0% reduction in payment update factor if hospital did not meet the quality indicator reporting requirements Conversion factor increased from $71.313 in 2012 to $72.672 for hospitals that meet quality reporting standards 2% reduction conversion factor would be $71.219 6 Cancer Centers The 11 cancer centers continue to receive a payment adjustment Ensuring they do not receive a lower payment under OPPS than what they received prior to 2000 Rural adjustment will be continued at 7.1% for rural Sole Community Hospitals (SCHs), including Essential Access Community Hospitals (EACHs) 7 Outlier Calculations Calculation methodology unchanged 1st Threshold: Line-item cost exceeds 1.75 times APC payment 2nd Threshold: Line-item cost exceeds APC payment plus $2,900 The threshold is higher compared to $2,025 last year When both thresholds met Outlier payment = 50% * Cost – 1.75 * APC payment 50% of the cost that exceeds 1.75 times APC payment [cost = charges * RCC] 8 Deductible Changes Inpatient deductible has increased from: $1,132 (2011) to $1,156 (2012) to $1,184 (2013) to $1,216 (2014) Inpatient hospital coinsurance increased from: $296 (2013) to $304 (2014) Part B deductible has changed from: $166 (2011) to $140 (2012) to $147 (2013) with no change in 2014 ($147) 9 Comprehensive APCs 10 Proposed Rule Create 29 Comprehensive APCs with one payment made for the primary service plus all adjunctive services performed to support that service These were developed from the 29 highest cost device dependent APCs There will be a new status indicator (J1) to identify the 136 HCPCS codes which map to the 29 comprehensive APCs 11 Proposed Rule A single payment will be made that includes the following when performed as part of the service: All DME items Rehab codes, including PT/OT/ST All drugs, except pass-through drugs, including self- administered drugs Recovery and extended recovery and observation services Two or more comprehensive APC procedures will result in payment for the higher paid procedure Add-on procedures 12 Final Rule Comprehensive APCs have been FINALIZED But delayed until 1/1/2015 Extra time to allow hospitals to perform a thorough analysis of the impact of this change so that they can implement changes CMS will apply a “degree of complexity” to each J1 procedure Table 10 identifies which comprehensive codes will be reassigned to a higher (more complex) comprehensive APC 13 Table 10 – Complexity Reassignments 14 Comprehensive APCs This proposal has been finalized, but delayed There are still outstanding questions Watch for further clarification and transmittals during the year Analyze the impact for your hospital and make changes (if possible) 15 16 17 Packaging 18 Packaging No major changes to any Status Indicators Significant changes to packaging Status Indicator N - Unconditionally packaged services Always considered integral to the primary service 19 Packaging Conditionally packaged services - Composites Review of the Composite Status Indicators: “Q1” - “STVX-packaged codes” “Q2” - “T-packaged codes” “Q3” – Procedure codes that may be paid through a composite APC based on composite-specific criteria or separately through single code APCs when composite criteria is not met 20 Original Composite APCs 1. Mental Health Services – Partial Hospitalization 2. Low dose prostate brachytherapy 3. Cardiac EP (electrophysiologic) evaluation and ablation services 4. Extended ED observation and monitoring 5. Extended Clinic observation and monitoring 21 Multiple Imaging Services Added in 2009 - five imaging composite APCs Single APC payment for two or more imaging procedures provided using same imaging modality The imaging composite APCs are: 1. 2. 3. 4. 5. Ultrasound CT and CTA w/o contrast CT and CTA with contrast MRI and MRA w/o contrast MRI and MRA w/contrast 22 Partial Hospitalization The most intensive outpatient psychiatric service Consists of 4 or more services per day If the payment amount for multiple mental health services provided during a single day exceeds this payment, the payment will be capped at the partial hospitalization composite rate (APC 0034) Payment for APC 0034 – 2013 - $228.26 Payment for APC 0034 – 2014 - $213.64 23 Cardiac Resynchronization Therapy (APC 108) Created in 2012 – Combination of 33225, insertion of a pacing electrode, reported with 33249, insertion of an ICD Unusual “composite” in that the payment is the same w/ and w/o the additional reporting of 33225 That is, 33225 is essentially unconditionally packaged APC 108 will be part of the 29 comprehensive APCs delayed until 2015 24 Composite Rate Changes 25 The Proposed/Finalized Packaging Changes Addendum P in Final Rule 26 1. Drugs/Biologicals/Radiopharm Dx Tests In 2013, the following drugs are APC status N (unconditionally packaged) unless status G (passthru): Drugs with a per day cost less than threshold Diagnostic radiopharmaceuticals Contrast agents Anesthesia drugs Drugs used as a supply Implanted biologicals 27 1. Drugs/Biologicals/Radiopharm Dx Tests For 2014, CMS is adding two more categories of diagnostic drugs unconditionally packaged Stress Agents HCPCS Code C9275, Injection, hexaminolevulinate hydrochloride, 100 mg, per study dose 28 2. Drugs/Biologicals/Radiopharm Dx Surgical Procedures These changes were implemented, more information to follow in the wound care session 29 3. Clinical Diagnostic Lab Tests CMS finalized the changes as proposed to packaged all diagnostic lab tests in OPPS billed with a bill type 131 whether they are integral, ancillary, supportive, dependent or adjunctive to a primary service! The only time they are not packaged is if they are billed on a bill type 141, they must be billed on a bill type 141 if they are: The only service (i.e., referred lab), may be billed with a 36415, venipuncture Or, if they are ordered for a different purpose by a different practitioner 30 3. Clinical Diagnostic Lab Tests This application of bill type 141 conflicts with the definition According to the NUBC, a bill type 141 should be reported only for a referred, outside lab Bill type 141 is not usually reported for cases where the patient came to the hospital for the blood draw or other services 31 4. Add-on Procedures CMS proposed to package unconditionally (i.e., APC SI “N”) all add-on procedures Commenters were concerned that this would not adequately cover the cost of doing these services CMS finalized to unconditionally package all add-ons with two exceptions: Drug administration payable add-on codes (e.g., 96375, 96366) 2. Add-on codes currently assigned to device dependent APCs (see Table 15) – These will be packaged with the inception of comprehensive APCs 1. 32 5. Ancillary Services (APC SI X) CMS proposed to package all services currently assigned to APC SI X, with a few exceptions, such as: Preventative services Effectively removing this status indicator X and changing the definition of Q1 from STVX to STV packaged Commenters were again concerned that this type of service is not always “ancillary” to the services CMS agreed and did not implement this proposal 33 5. Ancillary Services (APC SI X) One exception to this is 93017, stress test This code has been changed from APC SI X to a conditionally packaged code, APC SI Q1 It will not be paid when another APC SI S, T, V or X procedure is performed 34 6. Dx Tests on Bypass List There are certain procedures that have limited associated packaged costs when calculating APC rates as described in the OPPS final rule These are on the “bypass list” CMS proposed to have these procedures conditionally packaged Commenters were not thrilled about this CMS did not implement this change 35 7. Device Removal Procedures CMS finalized the proposal to conditionally package separately coded device removal procedures when they are performed with a repair or replacement of a device These have been assigned to APC SI Q2 (T packaged) Appendix P includes a list of these conditionally packaged procedures 36 Physician Supervision 37 Types of Outpatient Services Diagnostic Therapeutic When a service is not diagnostic it is assumed to be therapeutic 38 Physician Supervision Three levels of supervision in the hospital outpatient setting have been defined as: General – Overall direction of physician, but presence is not required during the performance Direct – Physician is present on-site and “immediately” available if needed Personal – Physician is present in the room 39 Physician Supervision – of Diagnostic Services Each procedure code has a level of supervision defined in the Medicare Physician Fee Schedule Relative Value File, for example: 01 = Procedure must be performed under the general supervision of a physician 02 = Procedure must be performed under the direct supervision of a physician 03 = Procedure must be performed under the personal supervision of physician [https://www.cms.gov/PhysicianFeeSched/PFSRVF/list.asp#TopOfPage] 40 CAH Exception Up to this year there was a moratorium that delayed enforcement of the direct supervision requirement for CAHs and small rural hospitals (100 beds or less) Final rule removed this moratorium As a result, all outpatient therapeutic services performed in CAHs and small rural hospitals will require direct supervision 41 Coding, Reporting, and/or Significant Payment Changes 42 Nerve Conduction Tests New codes in 2013, changed APCs in 2014 with significant increase in reimbursement See Table 26 43 Stereotactic Radiosurgery (SRS) No longer necessary to distinguish robotic versus non- robotic SRS with the G codes Replaced the current G codes with CPT codes G0173 (moved to an SI B) replaced with 77372, SRS linear based (moved from an SI B to SI S) G0251, G0339 and G0340 replaced with 77373, SBRT delivery Retains the reporting of 77371, SRS multisource, still a status S See Table 29 44 Other Changes 45 Inpatient-Only Procedures APC Status C CMS requires admission for reimbursement of these procedures Paid as outpatient only if performed on an emergency case where the patient expired prior to being admitted (Modifier - CA) 46 Criteria for Change Criteria for removing from IP-only list Procedure related to codes that have already been removed from the inpatient list Determination is made that the procedure is being performed in numerous hospitals on an outpatient basis Determination is made that the procedure can be appropriately and safely performed in an ASC Addendum E in the Final Rule 47 2014 IP-Only Codes New Codes that are SI C Status T Changed to SI C 48 Codes removed from the IP Only list No codes were removed from the IP-only list for 2014 49 Therapy Cap Changes Therapy cap set at $1,920 for 2014 These caps now apply to outpatient therapy services furnished by CAHs as of January 1, 2014 The therapy cap automatic exceptions process and the manual medical review process, applicable to outpatient therapy expenditures exceeding $3,700 per beneficiary, will expire on December 31, 2013, unless Congress acts to extend them 50 Hospital Outpatient Quality Data Reporting Program HOQR 51 Background Allows financial incentive based on quality control measures HOQR implemented in 2008, affected the payment rate update for 2009 Affects CY OPPS payment update—2.0 % point reduction in market basket rate increase 52 Affordable Care Act (ACA) of 2010 Increase coverage of the underinsured Reduce spending President announced three goals for cutting improper payments Reduce payment errors Cut the Medicare fee-for-service error rate in half Recover $2 billion in improper payments Improve Value- Accountable Care Quality Data Reporting Program Value Based Purchasing 53 New Quality Measures Four of the five newly proposed qualify measures were adopted for 2016 payment determinations: 1. 2. 3. 4. Influenza Vaccination Coverage Among Healthcare Personnel (National Quality Forum [NQF] #431) Endoscopy/Polyp Surveillance: Appropriate Follow-up Interval for Normal Colonoscopy in Average-risk Patients (NQF #0658) Endoscopy/Polyp Surveillance: Colonoscopy Interval for Patients with a History of Adenomatous Polyps—Avoidance of Inappropriate Use (NQF #0659) Cataracts—Improvement in Patient's Visual Function within 90 Days Following Cataract Surgery (NQF #1536) 54 Measure Not Adopted CMS did not adopt: Complications within 30 Days Following Cataract Surgery Requiring Additional Surgical Procedures (NQF #0564) 55 Eliminated Measures CMS adopted its proposal to eliminate two measures for CY 2015 payment determinations: 1. Transition Record with Specified Elements Received by Discharged ED Patients (OP-19) 2. Cardiac Rehabilitation Measure: Patient Referral from an Outpatient Setting (OP24) 56 Extensions/Waivers Beginning with CY 2014 payment determinations, CMS will grant extensions or waivers to the reporting of required quality data when there are extraordinary circumstances beyond the control of the hospital, such as: An act of nature (i.e., hurricane) affects an entire region or A systemic problem with one of CMS' data collection systems directly or indirectly affects data submission 57 Hospital Value-Based Purchasing Program CMS adopted the performance and baseline periods for the for the CY 2016 VBP Program for the following: Catheter-associated urinary tract infection Central line-associated bloodstream infection Surgical site infection measures In addition to the normal Hospital VBP appeal process, CMS will implement an independent CMS review process for hospitals that complete the appeal process and are dissatisfied with the result 58 Questions and Discussion 59 Contact Us Richard Cooley Phone: Email: 518-430-1144 RCooley@EpochHealth.Com Matthew Lawney Phone: Email: 845-642-6462 mlawney@EpochHealth.Com Jean Russell Phone: Email: 518-369-4986 JRussell@EpochHealth.Com 60 http://www.EpochHealth.com/ 61 CPT® Current Procedural Terminology (CPT®) Copyright 2013 American Medical Association All Rights Reserved Registered trademark of the AMA 62 Disclaimer Information and opinions included in this presentation are provided based on our interpretation of current available regulatory resources. 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