Fasten your seat belts: On July 6, the U.S. Centers for Medicare and Medicaid Services (CMS) issued a proposed rule for the 2017 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System -- and if it's finalized, radiology may experience further payment cuts.
The proposed rule's highlights for radiology include "site-neutral" payments, further restructuring of imaging's ambulatory payment classifications (APCs), expanded use of comprehensive APCs (C-APCs), and a new modifier that will reduce payments for film-based x-ray services.
Of particular concern is the site-neutral payments proposal, according to Pamela Kassing, senior economics and health policy advisor at the American College of Radiology (ACR).
"This could have significant financial implications for hospitals and does not take into account the actual costs incurred in operating these facilities," she told AuntMinnie.com.
Understanding the updates
Overall, CMS is proposing a 1.6% increase to the OPPS conversion factor, which brings it up to $74.91, according to the ACR. This increase will bring estimated total payments to $63 billion, up $5.1 billion from the amount in 2016, CMS wrote.
Payments under the ASC system will increase by 1.2% for those ASCs that meet quality reporting requirements under the Ambulatory Surgical Center Quality Reporting (ASCQR) program, which translates to an estimated total payment amount of $4.4 billion, up $214 million compared to 2016.
But what about these "site-neutral" payments? CMS is proposing this framework for new off-campus sites that provide items and services to outpatients based on the Medicare Physician Fee Schedule (MPFS) technical component rate, and the new policy would deny off-campus providers eligibility for payment under the Hospital OPPS.
The new policy is transitional and would only be applicable for one year beginning January 1, 2017. It comes from part of the Bipartisan Budget Act of 2015, which requires that some services furnished by off-campus sites not be considered covered outpatient department services for purposes of OPPS payment, according to the ACR.
Finally, CMS is proposing that OPPS payment for film x-rays will be reduced by 20% starting in 2017, implementing legislation passed in the Consolidated Appropriations Act of 2016. The agency plans to develop a new modifier that hospitals will use for film x-ray claims. And don't be surprised to see payment reductions for x-rays taken with computed radiography (CR) in future rule-making, CMS said.
Restructuring APCs
In the proposed OPPS rule, CMS continues its effort to restructure ambulatory payment classifications by consolidating the existing 17 that apply to imaging to eight. This restructuring is intended to keep radiology together within the diagnostic imaging family, but to recategorize it to be more clinically similar with respect to resource use, according to the ACR. In addition, CMS is proposing to remove interventional radiology imaging studies and nuclear medicine from the diagnostic APC structure.
CMS is not proposing extensive changes in the methodology used to calculate comprehensive ambulatory payment classifications, but it is proposing to create 25 new C-APCs that meet the established criteria, bringing the total number of C-APCs to 62 as of January 1, 2017. Many of these new C-APCs are major surgery APCs within the various existing C-APC clinical families, but CMS is also proposing three new clinical families to accommodate new C-APCs: nerve procedures; excision, biopsy, incision, and drainage procedures; and airway endoscopy procedures, the ACR said.
The quest for quality
The proposed rule updates and refines requirements for the Hospital Outpatient Quality Reporting (OQR) Program, which is a pay-for-quality data reporting initiative that requires hospitals to meet administrative, data collection, submission, validation, and reporting requirements, or receive a reduction of two percentage points in their annual payment update. This proposed rule also states that in 2018, CMS will publicly display measure data on the Hospital Compare website as soon as possible after the information has been submitted to CMS. Hospitals will have about 30 days to preview their data, CMS said.
CMS is proposing to eliminate the objectives and measures for clinical decision support (CDS) and computerized provider order entry (CPOE) for eligible hospitals and critical access hospitals under the Medicare electronic health record (EHR) incentive program, as well as to reduce the thresholds for some of the remaining objectives and measures in modified stage 2 for 2017 and stage 3 for 2017 and 2018.
"The proposal to reduce measure thresholds is intended to respond to input we have received from hospitals, hospital associations, health systems, and vendors," CMS wrote. "The proposed [changes] focus on reducing hospital administrative burden."
CMS is also suggesting a one-time "significant hardship" exception from the 2018 payment adjustment for new 2017 electronic health record incentive program participants who are transitioning to the Merit-Based Incentive Payment System (MIPS).
"Eligible professionals who have not successfully demonstrated meaningful use in a prior year, intend to attest to meaningful use for an EHR reporting period in 2017, and intend to transition to MIPS ... in 2017, can apply for a significant hardship exception from the 2018 payment adjustment," the agency said.
The ACR said it plans to conduct a detailed analysis of the proposed rule in the coming days. In the meantime, the document will be published in the Federal Register on July 14. CMS is accepting comments on it until September 6.
