CMS released its CY 2011 proposed rules for hospital outpatient departments and ambulatory surgery centers on July 2, 2010. The proposed rules update payment policies and rates for hospital outpatient departments and ambulatory surgery centers. Some of the proposed provisions implement portions of the health reform legislation signed into law in March. As described by CMS, notable provisions of the proposed rule include:
Hospital Outpatient Departments
- Waiver of the deductible and copayment for certain preventive services.
- Additional quality measures to report in CY 2011 (six additional measures, including a health information technology measure), CY 2012 (seven additional measures) and CY 2013 (six additional measures).
- Validation of quality reporting, including review of randomly selected cases from each hospital.
- Changes to the supervision requirements for certain non-surgical extended duration services to require direct supervision for the initiation period of such services, followed by general supervision.
- Payment for the acquisition and pharmacy overhead costs of separately payable drugs and biologicals at an amount equal to the average sales price plus six percent.
- Removal of CPT codes 21193, 21395 and 25909 from the inpatient-only list.
Ambulatory Surgical Centers
- Waiver of the deductible and coinsurance for certain preventive services.
- The addition of five surgical procedures to the list of Medicare-covered ASC procedures.
Other Proposed Rules
- Reduced availability of the physician self-referral exceptions for ownership or investment interests in a “whole hospital” or “rural provider” for new physician-owned hospitals and those looking to expand capacity.
- Changes relating to graduate medical education payment.
You can review a summary of most of these provisions on CMS’s website here. A display copy of the proposed rule is available here. CMS will accept comment until August 31, 2010.
CMS recently released its CY 2011 Medicare Physician Fee Schedule Proposed Rule. Among updated payment policies and rates for services paid under the Medicare Physician Fee Schedule, the proposed rule includes provisions to implement portions of the health reform legislation signed into law in March. As described by CMS, the proposed rule includes provisions, among others, relating to the following:
- Elimination of the deductible and coinsurance that would otherwise apply for most preventive services.
- Coverage of annual wellness visits in which the beneficiary receives personalized prevention plan services.
- Quarterly incentive payments for primary care services furnished by primary care practitioners.
- Quarterly incentive payments for major surgical procedures provided by general surgeons in health professional shortage areas.
- Permission for physician assistants to order post-hospital extended care services.
- An increase in the Medicare payment for certified nurse-midwife services so that it equals 100% of the MPFS.
- Extension of Medicare reasonable cost payments for certain clinical diagnostic laboratory tests performed by hospitals with fewer than 50 beds that are located in certain rural areas as part of their outpatient services.
- An amendment to the in-office ancillary services exception for self-referrals.
- Adjustments to the DMEPOS competitive bidding program (to add 21 metropolitan statistical areas to round 2).
- Modification to the equipment utilization rate assumption for expensive diagnostic imaging equipment used in diagnostic computed tomography and magnetic resonance imaging services.
- Payment revisions for power-driven wheelchairs.
- Reduction of the maximum period for submission of Medicare fee-for-service claims to not more than 12 months.
You can review a summary of each of these provisions on CMS’s website here. A display copy of the proposed rule is available here. CMS will accept comments until August 24, 2010.
The Federal Trade Commission announced on May 28, 2010 that it will further delay enforcement of the identity theft “Red Flags” Rule through December 31, 2010. The Rule requires creditors and financial institutions that have certain accounts to develop and implement written identity theft prevention programs. The delay gives Congress time to consider legislation that would affect the scope of entities covered by the Rule. The FTC will begin enforcing the Rule at an earlier date if Congress enacts legislation to limit the scope of the Rule and provides an effective date earlier than December 31, 2010.
You may access the FTC’s announcement here and a von Briesen & Roper Health Law Bulletin on the Rule here.
CMS released a supplemental proposed rule on May 21, 2010 to implement changes in payments for inpatient services in general acute care hospitals and long term care hospitals (“LTCHS”). The changes are required by the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 (collectively, “PPACA”). The proposed rule supplements the 2011 IPPS Proposed Rule described in a blog on April 22. CMS did not have time to address provisions relating to PPACA in the earlier proposed rule. The provisions in the supplemental proposed rule generally take effect for discharges occuring on or after October 1, 2010. As described by CMS, the supplemental proposed rule includes provisions relating to:
- Protection for hospitals in frontier states;
- Additional payments for hospitals with low per enrollee Medicare spending;
- Temporary improvements to the low-volume hospital adjustment;
- Revisions of certain market basket updates;
- Wage index improvement related to geographic reclassification;
- National budget neutrality in the calculation of the rural floor for the hospital wage index;
- Extension of Medicare-dependent hospitals;
- Technical correction related to critical access hospital services;
- Extension of certain payment rules for long term care services and of a moratorium on the establishment of certain hospitals and facilities; and
- Extension of the rural community hospital demonstration program.
You can review a summary of each of these provisions on CMS’S website here. A display copy of the supplemental proposed rule is available here. CMS will accept comments until June 21, 2010.
Wisconsin Governor Jim Doyle signed a bill on April 19, 2010 to establish an assessment on the gross patient revenues of critical access hospitals (“CAHs”). A portion of the revenue collected under the assessment will be used to increase payments to CAHs under the Medical Assistance Programs, including Medicaid, largely by producing additional federal matching funds. Consequently, the assessment will help offset a 10% cut in Medicaid payments implemented earlier this year, with payment increases beginning July 1, 2010. The assessment will also help fund a rural physician residency assistance program and a loan assistance program for physicians who agree to practice in a rural area. The specific amount of the assessment (a percentage of the gross patient revenues) is not set forth in the bill. A similar assessment was implemented in Wisconsin last year for non-CAHs. You can review the act establishing the assessment here.
CMS has issued a display copy of its 2011 Inpatient Prospective Payment System Proposed Rule. CMS proposes to update payment rates to general acute care hospital by 2.4% to adjust for inflation, but apply a -2.9% Documentation and Coding Adjustment (DCA). The DCA would continue CMS’s efforts to adjust payments to account for changes in documentation and coding practices after the adoption of the MS-DRG system. Such changes in coding practices resulted in higher aggregate payments that did not reflect an actual increase in patient severity of illness. CMS is phasing in the DCA adjustments over time. Overall, CMS estimates that after these proposed changes to the payment rates and other factors, the Proposed Rule would cause a 0.1% drop in total payments made to general acute care hospitals for operating expenses. A few other highlights from the Proposed Rule include:
- Proposed additional quality measures for hospitals to report under the Reporting Hospital Quality Data for Annual Payment Update program.
- Proposed changes to Medicare’s hospital conditions of participation regarding the types of practitioners who may provide rehabilitation services and respiratory care services.
- Proposed changes concerning effective dates for provider agreements and supplier approvals.
- Proposed clarifications concerning whether certain taxes are considered allowable costs.
CMS also proposes to update long-term care hospital (LTCH) rates by 2.4% for inflation, but apply a -2.5% DCA. Overall, CMS expects that after these proposed changes and others, total payments to LTCHs to increase by 0.8%.
CMS notes that it did not have time to address provisions in the Patient Protection and Affordable Care Act enacted on March 23, 2010. CMS, however, will issue separate proposed rules relating to provisions of the Act. Comments to the Proposed Rule are due by June 18, 2010. You can review CMS’s display copy here and summaries from CMS here and here.
On April 15, 2010, the President signed the Continuing Extension Act of 2010 (H.R. 4851). The Act, among other actions, delays the 21% cut in Medicare physician reimbursement through May 31, 2010. The cut was originally set to take effect on January 1, 2010, but Congress already delayed the cut several times this year. The latest delay expired April 1, 2010, but CMS instructed contractors to withhold processing claims for ten business days in April in anticipation that Congress would take further action to prevent the cut. The delay once again buys Congress time to fix the sustainable growth rate formula that is responsible for the reimbursement cut. You may access the Act here.
The Department of Health Services’ Division of Quality Assurance released guidance today for health care providers. Specifically, the DQA issued a Quarterly Information Update which, among other things, noted that the Division is not considered a business associate of any health care provider licensed, surveyed or otherwise regulated by DQA. Click here to access this update. The DQA also released frequently asked questions for health care providers. These FAQ’s include helpful interpretation of rules and regulations governing orders, H&Ps, mid-level supervision, etc. These FAQ’s can be found here.
Although Congress has not yet delayed the 21% reimbursement cut set to take effect April 1, 2010 for services paid under the Medicare Physician Fee Schedule, CMS believes Congress will take action. Accordingly, CMS has instructed its contractors to hold claims for services paid under the MPFS for the first ten business days of April. The hold will apply to claims with April 1 or later dates of service. The hold will give Congress some time to act on the payment cut after it returns April 12 from a recess. You may view an email from CMS announcing the ten business day hold here.
As part of the Patient Protection and Affordable Care Act signed into law on March 23, 2010, insurance companies will now be barred from imposing pre-authorization requirements on EMTALA care. The Act also requires insurers to pay hospitals not under contract with them for EMTALA services on the same basis as they pay their own in-network hospitals.
Under the new law, insurance plans cannot (1) require a prior authorization for screening and stabilization services as defined under EMTALA; (2) impose any requirement or condition on a non-contracted hospital that is more restrictive than those it imposes on hospitals with contracts; (3) impose different coinsurance or copayment requirements on non-network hospitals than they impose on in-network hospitals; or (4) apply any other coverage restriction (other than otherwise permissible cost-sharing and pre-existing condition exclusions).
The new provision does not apply to services provided in an emergency department if those services are not required to determine whether an “emergency medical condition” exists and to stabilize such a condition.
The new requirements for insurance payment for EMTALA services become effective on or after September 23, 2010.
