Health Information Management

CMS releases 2010 OPPS proposed rule

HCPRO Website, July 6, 2009

Outpatient facilities and pharmacies hoping to see an increase in reimbursement for separately payable drugs in CMS’ 2010 OPPS proposed rule didn’t get their wish, but they did see additional proposed guidance on physician supervision rules.
CMS also proposes to allow hospitals to bill Medicare for pulmonary and intensive cardiac rehabilitation services.
“My sense when I first looked at the proposed rule this year was that it seemed much shorter,” says Jugna Shah, MPH, president of Nimitt Consulting in Washington, DC. One reason for that, Shah says, might be because CMS chose not to add any additional composite APCs or additional outpatient quality indicators.
That doesn’t mean CMS is abandoning its commitment to “value-based” purchasing principles, Shah says, but it does seem like CMS is taking some time to assess the impact of its current composite APCs before adding additional ones.
Reimbursement for separately payable drugs
Providers and various stakeholders have repeatedly weighed in to CMS over the past four years that charge compression has a huge negative impact on how it computes payment rates for separately payable drugs. CMS acknowledges this as an issue, and in its discussion on how it calculated payment rates for 2010, CMS referred to the pharmacy stakeholders’ proposal.
Although CMS analyzed the pharmacy stakeholders’ proposal, the agency elected not to use that methodology nor did it follow the APC Advisory Panel’s recommendations. Instead, CMS introduced a new calculation method: the result is that CMS’ proposed payment for 2010 for all separately payable drugs of average sales price (ASP) plus 4% came as a total surprise, says Shah. 
 “The fact that the 2010 proposed payment rates for separately payable drugs remains the same as what we have today, despite the CMS’ new calculation methodology is truly disheartening,” says Shah.
CMS’ new methodology does shift some packaged drug costs to separately payable drugs, but falls quite short of covering what providers would consider their drug acquisition costs and pharmacy overhead/handling costs, says Shah.
Shah cautions that an in-depth reading of the information is required to analyze how CMS arrived at the payment rate.
 “To the end user –hospitals paid under OPPS- if the proposed payment rate of ASPplus4% is made final for 2010, then nothing will look different,” Shah says. She is hopeful that hospitals will weigh in on this and other CMS proposed changes.
“CMS’ proposal is far from what providers have been telling CMS they need for separately payable drug reimbursement to cover both acquisition and pharmacy overhead/handling costs,” Shah says.
Some estimates provided to CMS indicate that adequate coverage of drug acquisition costs and pharmacy overhead would result CMS paying closer to ASP plus 13% for separately payable drugs, Shah says. Alternatively, CMS could reimburse hospitals at ASP plus 6% and provide a separate add-on payment for pharmacy handling/overhead costs similar to what the pharmacy stakeholders group proposed and APC Advisory Panel supported.
“Unfortunately, CMS’ proposal for 2010 is far from what providers have been telling CMS they need for separately payable drug reimbursement to cover both acquisition and pharmacy overhead/handling costs,” Shah says.
Physician supervision and incident to
CMS proposes to allow physician assistants, nurse practitioners, clinical nurse specialists, certified nurse midwives, and clinical psychologists to provide supervision of hospital outpatient therapeutic services when their license allows them to do so.
“The fact that they are going to be able to do the supervision is a huge benefit to hospitals,” says Kimberly Anderwood Hoy, Esq., CPC, director of Medicare and compliance at HCPro, Inc., in Marblehead, MA. Under last year’s clarification, hospitals were not be able to bill for services supervised by a nurse practitioner unless a physician was present.
“This really expands the number of people who can provide supervision, and that is really important in rural areas,” Hoy says.
However, Hoy cautions that the change, if finalized, would not go into effect until 2010, so hospitals must still follow the current rules for 2009.
“The fact that we see so much discussion in the 2010 OPPS proposed rule on this topic is a testament to providers and other industry organizations for a raising tough questions with CMS on its physician supervision and incident-to language over the past 12-16 months”, says Shah.
CMS added a discussion of its expectation that the supervising physician or nonphysician practitioner to be able step in and assume providing the service. In addition, the supervising practitioner can’t be occupied with any other procedure he or she can’t leave.
“That begs the question about whether the emergency physician is always appropriate to use to provide supervision,” Hoy says.
CMS did clarify its definition of what “in the hospital” means, which will be very helpful, Hoy says. Under the proposed change, “in the hospital" would mean areas in the main building(s) of the hospital that are under the ownership, financial, and administrative control of the hospital; are operated as part of the hospital; and for which the hospital bills the services furnished under the hospital’s CMS Certification Number.
“There are some very provider-friendly things . . . but those don’t go into effect until 2010,” Hoy says.
Hoy also recommended facilities carefully read the physician supervision requirements for cardiac and pulmonary rehabilitation services.
“There’s a nice opportunity for hospitals to expand those programs because it’s going to be a little easier to operate,” Hoy says.
Additional proposed changes
CMS proposes to evaluate surgically implantable biologicals that are not receiving pass-through payment before January 1, 2010, for pass-through status using the device category pass-through process. CMS has also proposed to increase the separately payable drug packaging threshold to $65 (it is currently $60) and to package 5HT3 antiemetics. 
CMS is also considering paying rural providers for kidney disease education services furnished on or after January 1, 2010, to Medicare beneficiaries diagnosed with Stage IV chronic kidney disease.
CMS will accept comments on the proposed rule until August 31, and will respond to comments in a final rule to be issued by November 1.
Editor’s note: Click here to view proposed rule.

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