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  • Washington Highlights

    CMS Releases CY 2016 OPPS Final Rule

    Susan Xu, Lead Research Analyst
    Ivy Baer, Senior Director and Regulatory Counsel

    The Centers for Medicare and Medicaid Services (CMS) Oct. 30 released the calendar year (CY) 2016 Outpatient Prospective Payment System (OPPS) final rule updating payment policies and rates for services furnished to Medicare beneficiaries in hospital outpatient departments (HOPD) and ambulatory surgical centers (ASCs) beginning Jan. 1, 2016.

    Among the most notable changes is a final CY OPPS payment update of minus 0.3 percent. CMS finalized a two percentage point reduction in the update, which the agency states is needed to redress excess packaged OPPS laboratory test payments that had continued to be paid separately in CY 2014.

    CMS also finalized several proposals that aimed to make the OPPS more like a prospective payment system, such as adding nine comprehensive ambulatory payment classification (C-APCs) and conditionally packaging lab tests on the same claim with a major procedure regardless of the date of service.

    Other finalized changes include revisions to the two-midnights policy, recovery audit contractor (RAC) reforms, a new C-APC for comprehensive observation stays, reduction of payment for the technical component for computed tomography (CT) services using equipment that does not meet requirements of National Electrical Manufacturers Association (NEMA) standard XR-29-2013, changes to the Chronic Care Management (CCM) payments, and updates to the outpatient quality reporting (OQR) program.

    Starting in 2016, on a case-by-case basis, inpatient stays of less than two midnights will be payable under Medicare Part A based on the judgment of the admitting physician and supporting documentation in the medical record. As of Oct. 1, 2015, Quality Improvement Organizations (QIOs) will conduct the initial medical review of short stay inpatient admissions.

    In response to public comments, CMS adopted two modifications to the new C-APC for observation stays. CMS excluded all claims with major procedures from qualifying for the observation APC; however, CMS also expanded eligible services that could trigger qualification and payment to include all emergency department (ED) visits, instead of only high-level ED visits as originally proposed.

    In consideration of overwhelming opposition, CMS did not finalize the proposal that would require hospitals to identify and report all adjunctive services to a comprehensive service billed in different claims, except for a defined list of services related to stereotactic radiosurgery (SRS).

    Regarding the hospital OQR program, CMS finalized the inclusion of one new measure: External Beam Radiotherapy for Bone Metastases (OP-33). This measure is intended to standardize dosing schedules to address variation in treatment plans and will be used for payment purposes starting CY 2018.

    CMS chose not to finalize the Emergency Department Transfer Communication measure, which would have required documentation and communication of 27 different medical record elements when a patient is transferred from the emergency department to another healthcare facility. CMS ultimately concluded that this measure would overlap with requirements under the Electronic Health Record (EHR) incentive program and was too burdensome for hospitals, among other reasons. The agency also finalized the removal of Use of Brain Computed Tomography in the Emergency Department for Atraumatic Headache from the OQR program, since the measure does not align with the most updates clinical guidelines.