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AAMC Urges CMS Not to Finalize OPPS Proposal to Package Ancillary Services Due to Disproportionate Impact on Major Teaching Hospitals

September 5, 2014—The AAMC Sept. 2 submitted comments  to the Centers for Medicare and Medicaid Services (CMS) on the calendar year (CY) 2015 hospital outpatient prospective payment system (OPPS) proposed rule. CMS will implement final changes to the OPPS on Jan. 1, 2015.

The comment letter expresses concern that CMS’ proposal to conditionally package ancillary service Ambulatory Payment Classifications (APCs) that have a proposed geometric mean cost of less than or equal to $100 would disproportionately affect teaching hospitals because of the unique and complex patients they serve.

Based on data analysis, major teaching hospitals would lose an average of approximately negative 0.4 percent and hospitals with a Level I trauma center would lose an average of nearly negative 0.6 percent of their OPPS payments as a result of CMS’ packaging proposal.  Because hospitals with trauma centers tend to treat a higher proportion of emergency department patients with higher acuity, whose care requires more packaged services, CMS’ proposed policy change would harm teaching hospitals for providing exactly the type of care they are best equipped to provide.  The AAMC letter urges CMS not to implement this proposal until further analysis is conducted regarding the impact on teaching hospitals.

The letter also expresses concern about the administrative burden and extremely short timeline associated with CMS’ proposal to require hospitals to report a new Healthcare Common Procedure Coding System (HCPCS) modifier with every code for physician services and outpatient hospital services furnished in off-campus, provider-based departments starting Jan. 1, 2015.  Accordingly, the AAMC urges CMS to:

  • Postpone the effective date by at least one year;

  • Convene a group of CMS staff and hospital stakeholders to identify the most accurate and least burdensome way of meaningfully collecting this data and address granular issues associated with implementation; and

  • Engage the hospital and physician stakeholder community in putting any data collected into context.

With respect to CMS’ new proposed policy to create comprehensive APCs (C-APCs) to replace existing device-dependent APCs, the AAMC expresses concern that CMS’ proposal does not properly account for diagnoses that are unrelated to the primary condition.  In particular, hospitals providing large volumes of recurring services like chemotherapy, radiation therapy, and dialysis may be disproportionately negatively impacted.

The AAMC’s comments support CMS’ proposal to limit the physician certification requirement to stays of 20 days or longer and outlier cases.  The association agrees with CMS that the administrative burden of formal physician certification outweighs the benefits for the majority of cases.

The comments emphasize that the AAMC’s clear priority is for CMS to revise and replace the Two Midnight Rule with a new policy that appropriately defers to the critical role of medical judgment and adequately reimburses hospitals for medically necessary short hospitalizations.  At the same time, given that CMS is proposing to modify the associated physician order and certification requirements, the AAMC again urges CMS to update subregulatory guidance that excludes the majority of residents from writing inpatient orders unless they complete the added step of tracking down the attending physician for a countersignature.

The AAMC also submitted comments in response to proposed changes to the Outpatient Quality Reporting (OQR) program. CMS proposed one new measure starting CY 2017 that would assess all-cause, unplanned hospital admissions that occur up to seven days following an outpatient colonoscopy procedure.

The AAMC comments that the measure has not yet been tested or reviewed by the National Quality Forum (NQF), that visits following an outpatient colonoscopy visit are extremely rare (affecting approximately one percent of colonoscopy patients), and there is little actionable information for hospitals to show improvement on this measure.

The AAMC supports CMS’ proposal to remove three “topped out” measures, and asks the agency to consider retiring other measures that have been previously recommended for removal by the Measure Applications Partnership (MAP).

The AAMC’s letter also includes comments on CMS’ proposals related to new and revised CPT codes and interim HCPCS G-Codes; the inpatient-only list; payments to cancer hospitals; payments for proton beam radiation therapy; and payment for partial hospitalization (PHP) services.


Len Marquez
Senior Director, Government Relations
Telephone: 202-862-6281


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