ASC payment rates will increase by 0.3% and hospital outpatient departments (HOPDs) will receive a -0.3% change in 2016 under the final payment rule from the Centers for Medicare and Medicaid Services (CMS), the Ambulatory Surgery Center Association (ASCA) reported.
The ASC increase is based on a projected rate of inflation of 0.8% minus a 0.5 percentage point productivity adjustment required by the Affordable Care Act, ASCA reported. This payment update is significantly lower than the 1.1% update in the proposed rule, which was based on an inflation rate of 1.7% minus a 0.6 percentage point productivity adjustment.
The payment rate for HOPDs is based on a 2.4% market basket minus a 0.5% adjustment for economy-wide productivity, a 0.2 percentage point adjustment required by statute, and a 2.0% reduction to the conversion factor. The reduction to the conversion factor was to redress the inflation in HOPD payment rates that resulted from excess packaged payment under the OPPS for laboratory tests that are excepted from the final CY 2014 laboratory packaging policy. The 2.0% reduction was implemented to correct previous overpayments. Without the one-time reduction, HOPDs would have received a 1.7% update, ASCA reported.
As in previous years, ASCA requested that CMS align the two update factors to prevent a continuing divergence in payment rates by using the hospital market basket to determine the update factor for ASCs, the association reported.
“We are extremely disappointed that the CPI-U [Consumer Price Index for All Urban Consumers] has once again left us with a meager inflationary update,” remarked ASCA CEO Bill Prentice. “It is important to note that the hospital outpatient update, which was determined by the hospital market basket that we maintain should also be used as our inflation factor, would have dwarfed the ASC update except for a one-time deduction to correct a previous overpayment.”
Under the rule, there is a net decrease in OPPS payments of 0.4%, the American Hospital Association (AHA) reported.
The primary reason for this net decrease is from the cut to the outpatient prospective payment system (OPPS) conversion factor that was intended to account for CMS’s overestimation of the amount of packaged laboratory payments under the OPPS for laboratory tests that were previously paid under the Clinical Laboratory Fee Schedule, the AHA said. AHA Executive Vice President Tom Nickels said, “It is unfortunate that hospitals and the patients they serve are now left to deal with the consequences of CMS’ faulty math. We continue to be troubled by CMS’ actuaries’ lack of transparency, which is untenable.”
CMS also finalized its proposal to alter its “two-midnight” policy so that certain hospital inpatient services that do not cross two midnights might be considered appropriate for payment under Medicare Part A if a physician determines and documents in the patient’s medical record that the patient required reasonable and necessary admission to the hospital. CMS makes no changes for stays that last at least two midnights.
“Hospitals appreciate the certainty that stays of at least two midnights are inpatient, with stays of less than two midnights also considered inpatient based on physician judgment,” Nickels said.
As expected, CMS did not reverse the 0.2% payment cut associated with the two-midnight policy, the AHA said.
To access the final rule, go to http://bit.ly/1OhFUMV. (See stories on final physician payment rule and new procedures added to the ASC list in this issue.)
