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CMS Finalizes E/M Code Collapse and Packaging Proposals in OPPS Final Rule

December 6, 2013—The Centers for Medicare and Medicaid Services (CMS) Nov. 27 released the calendar year (CY) 2014 outpatient prospective payment system (OPPS) final rule with comment period updating payment policies and payment rates for services furnished to Medicare beneficiaries in hospital outpatient departments and ambulatory surgical centers (ASCs) beginning Jan. 1, 2014.

The final rule also updates and refines the requirements for the hospital outpatient quality reporting (OQR) program, the ASC quality reporting (ASCQR) program, and the hospital value-based purchasing (VBP) program.  CMS will accept comments until Feb. 8, 2014 on the payment classifications assigned to certain health care common procedure coding system (HCPCS) codes identified in the final rule and other areas specified in the rule.

In the rule, CMS finalized the proposal to collapse the current five levels of codes for hospital outpatient evaluation and management (E/M) clinic visits into a single code.  This single code will be assigned to a new ambulatory payment classification (APC) with the payment rate for all outpatient clinic visits based on the total mean costs of Levels 1 through 5 clinic visit codes for new and established patients using CY 2012 outpatient PPS claims data.  However, CMS did not finalize the proposal to collapse Type A and Type B emergency department (ED) visit codes in the same manner.  Therefore, CMS will maintain the five levels of codes for each of these types of visits.

The final rule updates the OPPS market basket by 1.7 percent for CY 2014.  This is based on a market basket update of 2.5 percent, minus a 0.5 percentage point productivity adjustment, and minus an additional negative 0.3 percent adjustment required by the Affordable Care Act (ACA, P.L. 111-148and P.L. 111-152).  For hospitals that do not publicly report data on 24 quality measures, the net update will be 0.3 percent.

Under the final rule, CMS will package the payment for five of seven proposed supporting items and services: certain clinical diagnostic laboratory tests; drugs, biologicals, and radiopharmaceuticals that function as supplies when used in a diagnostic test or procedure; drugs and biologicals that function as supplies or devices in a surgical procedure; procedures described by add-on codes; and device removal procedures.  CMS did not finalize the proposal to package certain ancillary services and diagnostic tests on the bypass list.

The final rule also will replace 29 existing device-dependent APCs with 29 newly created “comprehensive APCs.”  CMS modified the proposal in that the final rule will apply a complexity adjustment for the most complex multiple device claims.  The agency also will delay the implementation of the new comprehensive APCs until CY 2015 to provide time to develop and test appropriate claims processing systems protocols for the comprehensive APCs.  CMS is accepting comments on the modified methodology for calculating payments for the comprehensive APCs.

Additionally, the rule finalizes the proposal to continue paying at a rate of average sales price (ASP) plus 6 percent for non-pass-through drugs and biologicals that are payable separately under the OPPS.

CMS did not finalize the proposal to collect data on the frequency, type, and payment for services furnished in off-campus provider-based departments.  Instead, CMS deferred until a later point so the agency can “continue to consider approaches to collecting data on services furnished in off-campus provider-based departments.”

Regarding the OQR program, CMS finalized four quality measures for CY 2016 payment determination and removed two measures starting CY 2015. One of the newly finalized measures will assess influenza vaccination coverage among health care personnel in the outpatient department. CMS plans to release additional information on the reporting requirements for this measure in the upcoming weeks. The full list of measures in the OQR is available in the final rule.

CMS also finalized two changes to the VBP program in the OPPS final rule. CMS will create an independent review process for hospitals that wish to appeal the calculation of their performance score. The agency also finalized the inclusion of the baseline and performance periods for central-line-associated blood stream infection (CLABSI), catheter-associated urinary tract infection (CAUTI), and surgical site infection (SSI) measures for fiscal year (FY) 2016.

Scott Wetzel, M.P.P.
Lead, Quality Reporting
Telephone: 202-828-0495
Email: swetzel@aamc.org

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Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806
Email: jkleinman@aamc.org