OPPS Overview AHLA March 2013

Transcription

1 OPPS Overview AHLA March 2013 Carrie Bullock Deputy Director, Division of Outpatient Care Hospital & Ambulatory Policy Group Center for Medicare CMS Disclaimer This presentation was prepared by Ms. Bullock in her personal capacity. The opinions expressed in this presentation are her own and do not reflect the view of the Centers for Medicare & Medicaid Services, the Department of Health and Human Services, or the US government. 2 1

2 OPPS Defined OPPS means outpatient prospective payment system and refers to the prospective payment system by which Medicare pays most (but not all) hospital outpatient services furnished by most (but not all) hospitals 3 Entities Paid Under the OPPS OPPS pays for services provided to registered hospital outpatients in most hospitals, including general acute care hospitals, inpatient rehabilitation, psychiatric, and longterm care facilities, children s hospitals, and cancer hospitals The following categories of acute care hospitals are not paid under the OPPS: Geographic exclusion hospitals: Maryland, Guam, USVI, Northern Marianas, American Samoa Critical Access hospitals Indian Health Service hospitals, including Tribal hospitals Hospitals that do not furnish services to outpatients 4 2

3 OPPS Items and Services In general, OPPS pays hospitals for services typically furnished to hospital outpatients when they are registered in the hospital outpatient department, including but not limited to: Visits emergency department and clinic Surgery and related services (e.g. anesthesia, recovery room, observation, drugs, supplies) Diagnostic tests Drug administration (e.g. chemotherapy) Drugs and biologicals that are not usually self administered (except where integral to a procedure, such as antibiotic drops in cataract surgery, antibiotic ointment applied after suturing) Implanted medical devices 5 Excluded Items and Services Services not paid under the OPPS include: Physician/practitioner professional services Durable medical equipment, prosthetics, and orthotics furnished for home use that are not implanted Clinical laboratory tests Diagnostic tests furnished to persons not registered in the hospital outpatient department Certain preventive services (e.g., mammography) Drugs that are usually self administered (e.g. insulin) Inpatient only services 6 3

4 OPPS Payment Methodology Hospitals report outpatient services using Healthcare Common Procedure Coding System (HCPCS) codes HCPCS has two parts: Current Procedural Terminology (CPT) codes created and owned by the American Medical Association HCPCS level 2 codes created and owned by CMS Every HCPCS code is assigned a status indicator (SI) to identify: Whether the service is paid under the OPPS Whether the payment is separate or packaged Which specific OPPS payment rules apply 7 Separate Payment Separately paid items and services are assigned to Ambulatory Payment Classification (APC) groups based on clinical characteristics and resource costs Exceptions include cost based payments for certain items such as pass through devices, corneal tissue, and some vaccines Payment rates based on relative weights calculated for each APC using most recent: Claims data Cost reports Wage indices 8 4

5 Separate Payment (cont.) Two times rule: Highest cost procedure in APC may not exceed lowest cost procedure in APC by more than 200% Exceptions for low frequency HCPCS codes APC relative weights updated annually to account for changes in relative costs Conversion factor updated annually for wage index changes, hospital market basket updates, other applicable adjustments 9 Packaged Payment Packaged payment occurs when the payment for the packaged item or service is made as part of the separate payment for a related item or service (i.e., no separate payment for the packaged item or service) Packaged items or services reported by HCPCS codes assigned SI=N (always packaged), including the following: Drugs and biologicals with a per day cost less than an amount specified annually Implantable devices not on pass through payment regardless of cost Diagnostic radiopharmaceuticals and contrast agents Services that are always an integral part of another service Packaged items or services that are reported with an allowed revenue code and charges and without a HCPCS code 10 5

6 Conditional Packaging SI=Q1 means that the service is: Packaged if it is reported on the same claim with a major procedure, a visit, or an ancillary service Otherwise separately paid under an APC For example, pulse oximetry done during a visit would be packaged; pulse oximetry alone would be separately paid SI=Q2 means that the service is: Packaged if it appears on a claim with a major procedure Otherwise separately paid under an APC For example, payment for fluoroscopy done during surgery would be packaged; fluoroscopy performed without any other service would be separately paid 11 Composite APCs Composite APCs provide a single payment rate for 2 or more services that are commonly furnished together Low Dose Rate (LDR) prostate brachytherapy Cardiac electrophysiologic evaluation and ablation Extended assessment and management (observation) Multiple psych services in the same day Multiple imaging procedures Cardiac resynchronization therapy Each service is separately paid under a single service APC if not furnished together 12 6

7 Beneficiary Cost Sharing Prior to the OPPS, copayment was set at 20% of charges Currently set based on the APC payments Copayment cannot be lower than 20% of the APC payment except through explicit statutory waivers of coinsurance (e.g., some preventive services) Cannot be higher than 40% of the APC payment rate Line item copayments capped at the inpatient deductible Pass through payments and outliers are excluded from the copayment calculation Over time, copayment is intended to reach 20% of payment for all services 13 Outlier Payments Outliers are designed to protect providers from the financial risk associated with complex and/or costly cases Outlier eligibility and payment are calculated for each service based on a multiple and a fixed threshold, which compares the cost of the service to its payment Multiple threshold typically set at 1.75 Fixed dollar threshold changes from year to year Outlier payment = 0.5 (Service cost 1.75 * APC payment) Target OPPS outlier spending is typically 1% of the OPPS 14 7

8 Payment Adjustments Multiple procedure reduction (50% reduction for second and subsequent procedures) Rural adjustment that increases payment by 7.1% for rural sole community hospitals Interrupted procedure adjustment reduces payment by 50% if anesthesia not yet given Pass through offset adjustment Device recall/warranty adjustment Adjustment for dedicated cancer hospitals Hold harmless payments (cancer, children s) 15 Claims Payment IOCE is a claims processing system module that determines disposition of items and services Edits claims for OPPS rules Assigns APCs where payable Assigns messages where claim fails Applies adjustment logic and sends information needed to price the claim Pricer is a claims processing module that calculates actual OPPS payments Applies adjustments (e.g. wage adjustment) to APCs assigned by IOCE Uses the IOCE information to know what adjustments to apply other than wage adjustment 16 8

9 Annual Regulation Cycle Calendar year payment system in which payments are set effective Jan 1 Dec 31: February/March: HOP Panel meeting and mean cost calculations using 9 months data June/July: Calculate proposed rates on first set of full year data and issue proposed rule; 60 day comment period begins August/September: Summer HOP Panel meeting; comment period closes November 1: Calculate final rates on updated year of data and issue final rule and all related instructions/files; 60 day (limited) comment period begins 17 Advisory Panel on Hospital Outpatient Payment (HOP Panel) Chartered FACA committee Employees of hospitals paid under OPPS and several Critical Access Hospital members to advise on supervision issues Open public nominations Advises on APC assignment, data development, payment rates (excludes coding, charge compression, effectiveness analysis, etc.) and supervision level requirements Typically convenes biannually 18 9

10 Inpatient Part B Ruling and Proposed Rule On March 13, 2013, CMS issued a proposed rule (CMS 1455 P) that would allow Medicare to pay for additional hospital inpatient services under Medicare Part B CMS also issued an Administrator s Ruling (CMS 1455 R) to establish a standard process for handling pending appeals and billing for additional Part B inpatient services until a final rule is issued March 18, 2013 Federal Register publication May 17, 2013 proposed rule comment period ends 19 OPPS References & Resources Quarterly updates for national unadjusted payment rates and status indicators under Addendum A and Addendum B Updates CY 2013 OPPS final rule (77 FR 68210; issued November 15, 2012) under Hospital Outpatient Regulations and Notices Medicare Claims Processing Manual (Pub ), Ch. 4 Medicare Benefit Policy Manual (Pub ), Ch CFR (t) of the SSA 20 10