One-month reprieve: Hospitals have more time to prepare for HCFA’s outpatient PPS
One-month reprieve: Hospitals have more time to prepare for HCFA’s outpatient PPS
AHA pushes for new contingency plan
Hospitals and health care organizations are waiting to find out if Aug. 1 is the final effective date for the outpatient prospective payment system (PPS). The Health Care Financing Administration (HCFA) insists it’s correct, but HCFA once insisted July 1 would be the date.
HCFA postponed the July 1 date, saying it would be virtually impossible to implement the change by then. One problem was the nine-week delay from the original target date of April 1 to release Claims Expansion and Line Item Processing (CELIP), the expanded claim form necessary for the new system. Informal surveys of the hospital community also had indicated that a significant number of hospitals would not be prepared to implement outpatient PPS on July 1, says HCFA Administrator Nancy-Ann DeParle.
Rick Pollack, executive vice president for advocacy and public policy at the American Hospital Association (AHA), says his organization is pleased HCFA took the "responsible approach" in delaying the implementation. He says AHA would like HCFA to continue taking its time in implementing the new system to reduce the number of disruptions hospitals could face in providing access to services at a local level.
HCFA said it will begin working with hospitals to inform beneficiaries that changes in Medicare payments for hospital outpatient department services also could mean changes in the amount of coinsurance beneficiaries would need to pay. "We will provide all hospitals with a plain English’ flyer to distribute to beneficiaries," DeParle said. Beneficiaries will also have a toll-free number to call for more information about outpatient PPS.
DeParle said she is urging hospitals to not collect deductibles or coinsurance from Medicare beneficiaries until HCFA notifies them of the correct amount. "In this way, we can ensure that most beneficiaries will be charged the correct, generally lower, coinsurance amounts when hospitals’ claims are processed in August."
HCFA also is intensifying its efforts to provide clear and accurate training to fiscal intermediaries, hospitals, and community mental health centers. Those efforts include:
• a national satellite broadcast to assist hospitals in preparing for implementation;
• a "Frequently Asked Questions and Answers," booklet available on the Internet and in printed form;
• a reconfiguration of the HCFA Web site to facilitate access to relevant program instructions, training documents, and other materials;
• weekly conference calls with fiscal intermediaries;
• continued regularly scheduled teleconferences with hospitals and other provider associations to keep them abreast of HCFA’s implementation schedule and to answer any questions.
Developing a contingency plan
HCFA also says it has developed contingency plans in case hospitals are unable to submit claims in the new format or that HCFA is unable to process claims under the PPS in a timely manner. When the implementation date was July 1, HCFA indicated that if computer glitches prevented accurate claims processing, it would make accelerated payments to hospitals that requested them, following the Provider Reimbursement Manual Section 2412.
These payments, equal to 70% of the estimated Medicare payment, would be paid every two weeks. Once the outpatient PPS system became fully operational, payments would be adjusted to actual claims. Once actual claims payments were determined, other payers would be informed of the Medicare payment amount so they could pay any additional amounts due.
The AHA and other health care organizations labeled this plan as unacceptable. One complaint was that the plan to pay hospitals only 70% of current Medicare program payments would be a "dangerous sacrifice for hospitals," according to a letter sent to HCFA.
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