Comparison of CY 2021 OPPS and ASC Proposed and Final Policies
On December 2nd, the Centers for Medicare and Medicaid Services (CMS) released the Calendar Year (CY) 2021 Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems final rule, which revises the Medicare OPPS and ASC payment system for Calendar Year (CY) 2021; updates and refines the requirements for the Hospital Outpatient Quality Reporting (OQR) Program and the ASC Quality Reporting (ASCQR) Program; establishes and updates the Overall Hospital Quality Star Rating beginning with CY 2021; adds two new service categories to the Hospital Outpatient Department (OPD) Prior Authorization Process; revises the Clinical Laboratory Date of Service (DOS) policy; and establishes new requirements in the hospital and critical access hospital (CAH) Conditions of Participation (CoPs) for tracking of COVID-19 therapeutic inventory and usage and for tracking of the incidence and impact of Acute Respiratory Illness (including, but not limited to, Seasonal Influenza Virus, Influenza-like Illness, and Severe Acute Respiratory Infection) during the ongoing COVID-19 public health emergency (PHE).
Given CMS’ waiver of delay in effective date for this final rule, the finalized policies are effective beginning January 1, 2021. Comments on the payment classifications assigned to the interim APC assignments and/or status indicators of new or replacement Level II HCPCS codes are due January 4, 2021, while comments on the Reporting Requirements for Hospitals and CAHs to Report Acute Respiratory Illness During the PHE for COVID-19, instructions 21 and 23 amending §§ 482.42 and 485.640, are due February 2, 2021.
Major points of interest are found below.
Prior Authorization Under the OPPS. CMS finalized its proposal to expand the list of categories subject to prior authorization to also include (a) Cervical Fusion with Disc Removal; and (b) Implanted Spinal Neurostimulators, effective July 1, 2021.
Packaging Policy for Non-Opioid Pain Management Treatments. CMS finalized its proposal to continue to pay separately for non-opioid pain management (i.e. Exparel) in the ASC setting, but not under the OPPS where it will remain packaged. As you’ll recall, per The SUPPORT Act, last year CMS also reviewed peripheral nerve blocks and neuromodulation and “drugs that function as surgical supplies” and found no evidence to support unpacking these items. CMS doubled down on its statement that it did not conduct a similar analysis for CY 2021 because they did not think it would change their policy or that there would be any new evidence. CMS also denied requests to separately pay for several items under this policy including, Dexycu and Omidria (which are already separately payable under pass-through status), as well as drug IV acetaminophen, several pain block CPT codes, ERAS protocols, and spinal cord stimulators. CMS also declined to make separate payment for these in the ASC.
Elimination of the “Inpatient Only” List. The Inpatient Only “IPO” list, which designates procedures as payable only in the inpatient setting, has been in place since 2000. CMS finalized its proposal to eliminate the IPO list over a 3 year transitional period that will begin in CY 2021 (with the list being completely eliminated in by January 1, 2024). CMS finalized the removal of 266 musculoskeletal procedures for CY 2021, along with a number of related anesthesia codes and a number of other procedures recommended for removal by the Advisory Panel on Hospital Outpatient Payment. CMS again acknowledged stakeholder concerns that removal from the list can result in hospitals and payers stating that procedures must be performed outpatient, but CMS only responded that it would be a “misinterpretation of CMS payment policy for providers to create policies or guidelines that establish the outpatient setting as the baseline or default site of service for a procedure based on its removal from the IPO list or the elimination of the IPO list” but that commercial insurance providers “establish their own rules regarding payment for services.”
2-Midnight Rule and Medical Review of Inpatient Hospital Admissions. CMS finalized a policy that procedures removed from the IPO list on or after January 1, 2021 will be indefinitely exempted from site-of-service claim denials under Medicare Part A, eligibility for BFCC-QIO referrals to RACs for noncompliance with the 2-Midnight rule, and RAC reviews for “patient status” (that is, site-of-service), until the procedure is more commonly performed in the outpatient setting than the inpatient setting. CMS originally proposed to exempt these procedures for only two years.
OPPS Site Neutral Payment Policy for Outpatient/Clinic Visits. CMS finalized continuation of it previously adopted “method to control” what it believed to be “unnecessary increases in the volume of covered outpatient department services” by utilizing a Medicare Physician Fee Schedule (MPFS)-equivalent payment rate for hospital outpatient clinic visits (HCPCS G0463) when furnished by excepted off-campus provider-based departments (PBDs). The “PFS-equivalent” rate for CY 2021 is 40 percent of the OPPS rate. CMS reviewed the ongoing litigation related to the policy: In September 2019, the district court vacated the volume control policy and CMS worked to ensure affected 2019 claims were paid consistent with the order, but did not revise the policy for CY 2020, as the agency was considering the ruling and possible appeal. Then, on July 17, 2020, the United States Court of Appeals for the District of Columbia Circuit ruled in favor of CMS, holding that the regulation was a reasonable interpretation of the statutory authority to adopt a “method to control for unnecessary increases in the volume” of the relevant service. CMS was proceeding as planned given its recent court victories, but CMS also stated that it will decide the appropriate course of action after the 90 day deadline for the appellees to decide whether to see U.S. Supreme Court review.
Supervision of Outpatient Therapeutic Services in Hospitals and CAHs. CMS finalized its proposal to establish general supervision as the minimum required supervision level for all non-surgical extended duration therapeutic services (NSEDTS) furnished on or after January 1, 2021.
Hospital Outpatient Quality Reporting Program. CMS generally finalized its proposals (which did not include significant changes) for this program as proposed.
Overall Hospital Quality Star Rating: The Overall Star Rating provides a summary of publicly reported data from multiple existing hospital quality programs (i.e., IQR, HRRP, HAC, VBP, and OQR). CMS generally finalized its proposals to update and simplify the methodology used to calculate these ratings starting in 2021, except that CMS did not finalize its proposal related to stratification of the Readmission measure group score. CMS also finalized its proposals to continue to include voluntary measure data from Critical Access Hospitals (CAHs) and to add Veterans Health Administration (VHA) hospital data to the Overall Star Rating.
Updating the ASC Covered Procedures List (ASC-CPL) and ASC Conditions for Coverage (CfCs). CMS added 11 procedures to the list based on its current process, along with an additional 267 procedures based on its updated process. Under the updated process, CMS will add surgical procedures to the ASC CPL as follows: (1) CMS identifies a surgical procedure that meets the requirements at paragraph (b)(2) of this section. (2) CMS is notified of a surgical procedure that could meet the requirements at paragraph (b)(2) of this section and CMS confirms that such surgical procedure meets those requirements. CMS also shifted the responsibility to physicians for determining when a service is not expected to pose a significant safety risk for a specific beneficiary and one for which standard medical practice for the specific beneficiary dictates the beneficiary would not typically be expected to require active medical monitoring and care at midnight following the procedure. The full regulatory text changes can be found on p. 1295 for the revised language for § 416.166 – Covered Surgical Procedures. CMS declined to make any changes to the ASC Conditions for Coverage (CfCs) at this time.
ASC Quality Reporting Program. CMS finalized its proposals (which did not include significant changes) for this program as proposed.