OPPS proposed rule would eliminate inpatient-only list of procedures
Medicare has proposed to eliminate the list of procedures that providers are required to perform in inpatient hospital settings and instead allow those services to be performed on an outpatient basis.
Eliminating the inpatient-only (IPO) list over three years, as outlined in the outpatient prospective payment system (OPPS) proposed rule for CY21, would give clinicians the option to perform 1,700 more types of procedures in the hospital outpatient setting.
The phased-in elimination would start in 2021, allowing outpatient procedures for about 300 musculoskeletal services, such as certain joint replacement procedures.
CMS would boost OPPS payment rates by 2.6% for 2021, representing a $7.5 billion increase.
The proposed rule also would allow ambulatory surgical centers (ASCs) to perform 11 more procedures, including total hip arthroplasty, that previously were limited to hospital settings but weren’t on the IPO list. Those would add to 28 procedures that Medicare has made ASC-eligible since 2018.
Senate’s COVID-19 bill disappoints hospitals
Hospital finances would remain imperiled if a new Senate COVID-19 relief package is enacted, hospital advocates said.
A package of bills, collectively known as the HEALS Act, was introduced in July by Senate Republicans. The bills follow House Democrats’ passage in May along party lines of a very different COVID-19 relief package and portend extended negotiations to reach a compromise.
Hospital advocates, having called for as much as $100 billion in additional funding for the provider fund, responded that the financing provisions were insufficient.
Major finance provisions of the healthcare bills that constitute the HEALS Act:
- Adding $25 billion to the Provider Relief Fund, bringing the total allocation to $200 billion
- Easing some requirements of the Medicare Accelerated and Advance Payment Program
- Extending Medicare telehealth waivers until Dec. 31, 2021
- Extending telehealth flexibilities for rural health clinics and federally qualified health centers for five years after termination of the public health emergency
- Allocating $225 million for rural health clinics
- Allocating $7.6 billion for community health centers
Hospitals decry court decision upholding 340B cuts
After an appeals court recently upheld Trump administration payment cuts to the 340B discount drug program, hospitals worried about the effects of the lost revenue.
On July 31, the U.S. Court of Appeals for the District of Columbia reversed a lower-court decision in The American Hospital Association, et al v. Azar by a 2-1 ruling, allowing nearly 30% cuts to the 340B drug discount program to continue.
The decision revolves around a 2017 policy change to the program, which requires drugmakers to provide discounted drugs to safety net hospitals in exchange for participating in Medicaid. Qualifying 340B hospitals generally pay between 20% and 50% less than the average sales price for the covered drugs but are then paid the full price by health plans.
The U.S. Department of Health and Human Services (HHS) amended the program by cutting Medicare outpatient drug payments to 340B hospitals by 28.5%, seeking to close a gap between those prices and Medicare Part B payments.
The majority’s ruling that the changes were legal because they were not “unambiguously barred” by the statute sets a new standard that will allow further HHS payment changes to fit unrelated policy goals, as CMS has done thus far, said Andrew Ruskin, JD, a partner at K&L Gates.
Ruskin said site-neutrality policy changes, which were upheld recently in court, were driven by CMS’s general concerns about physician practice acquisitions. Likewise, the 340B policy changes were driven, in part, by a desire to reduce the cost of drugs. Although such a goal is politically popular, there is little reason to believe the payment change has that effect. Regardless, policy decisions shouldn’t drive payment decisions, he said.
The appeals court decision “is essentially delivering a body blow against the payment system that Congress thought through very carefully and which CMS participated in,” Ruskin says.
Trump administration extends public health emergency to October
Following weeks of requests from hospitals and other healthcare providers, the Trump administration in July extended the federal public health emergency to Oct. 23.
The 90-day extension of the emergency, first implemented Jan. 31, stemmed from “the continued consequences of [the] Coronavirus Disease 2019 (COVID-19) pandemic,” Alex Azar, secretary of the U.S. Department of Health and Human Services, wrote in the declaration announcement.