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CMS announces physician supervision changes as part of 2011 OPPS final rule

HCPRO Website, November 3, 2010

CMS finalized four changes to its physician supervision requirements as part of the 2011 OPPS final rule, released November 2.

In the final rule, CMS:

  • Changed the definition of “immediately available”
  • Delayed enforcement of supervision requirements for rural and critical access hospitals (CAHs)
  • Announced its plan to convene a panel beginning in 2012 to determine the level of supervision required for different services
  • Finalized a new category of “nonsurgical extended duration therapeutic services” that require direct supervision during an initiation period, followed by a minimum standard of general supervision

These changes are a welcome relief and clearly show that CMS is listening to provider comments, says Jugna Shah, MPH, president of Nimitt Consulting in Washington, DC.

“The delay for CAHs and rural hospitals, the convening of a board to review supervision levels, and the change in the definition of immediately available, are all very positive,” Shah says. “Unfortunately, CMS also finalized its proposal for defining a new category of nonsurgical extended duration therapeutic services, which requires further consideration since it seems somewhat premature given that it is convening a panel to review such things and also since its delay in enforcing these rules for CAHs and rural hospitals.”

Redefining immediately available

Beginning in 2011, CMS will no longer require physicians to be present in every off-campus provider-based department (PBD). Instead it will change the definition of immediately available to mean “physically present, interruptible, and able to furnish assistance and direction throughout the performance of the procedure but without reference to any particular physical boundary.”

“So the walls have come down that were easy to identify when direct supervision was required in the department for off-campus PBCs,” says Debbie Mackaman RHIA, CHCO, regulatory specialist for HCPro, Inc., in Marblehead, MA. “They have gone 180 degrees in the other direction from what they had ‘clarified’ in the CY2009 OPPS Final Rule and upheld in 2010.”

Shah was pleasantly surprised by CMS’ decision to back away from the boundary requirement, as this change seems to recognize that hospitals need more flexibility in how they deliver services.

However, Shah says that the onus is still very much on hospitals. She suggests that they proceed cautiously because if audited, they will need to be able to prove who was designated to be the supervisory physician, how the physician was immediately available, and that he or she could in fact be interrupted.

Delaying enforcement of supervision for CAHs

CMS will not evaluate or enforce the “direct supervision” requirement for therapeutic services furnished in 2010 and 2011 to outpatients in CAHs and rural hospitals. CMS initially suspended the requirement in March.

The CAHs made compelling enough arguments that CMS needed to look at this area more carefully. However, CMS continues to make the point that CAHs cannot operate just under their Conditions of Participation (CoP).

In addition to suspending the requirements for CAHs, CMS added small and rural hospitals to the mix because they have similar staffing problems, a decision that surprised Mackaman.

“Instead of including CAHs in the same policies for safety and quality as other hospitals, they have gone the other way and continued to suspend enforcement for CAHs in 2011 and added specific small and rural hospitals to this list,” Mackaman says. “This is interesting because CMS was adamant that staffing requirements through the CoPs is for licensure and not for payment policies and that all Medicare beneficiaries should be able to expect a similar level of quality and safety in any hospital, regardless of size or payment methodology. It is good news for those hospitals but sends a mixed message.”

CMS’ suspension of requirements for now for CAHs and rural hospitals clearly shows, it has an understanding that there are nuanced concerns specific to CAHs and rural hospitals that must be carefully addressed, says Shah.

“We should not see this as CMS backing away from wanting the same quality and safety requirements across all hospitals,” Shah says. “Instead, we should view this as CMS taking an even-handed approach by listening to the operational and staffing challenges that CAHs and rural hospitals would face if forced to live under the current physician supervision requirements. I think this thoughtfulness on CMS’ part is a really good sign that the agency is listening and moving forward cautiously.

Adding a new category of services

CMS selected 16 services to include in the new category of nonsurgical extended duration therapeutic services, including observation, intravenous infusion, subcutaneous infusion, and therapeutic, prophylactic, or diagnostic injections. When selecting the services for the new category, CMS stated the services must:

  • Be of extended duration, frequently extending beyond normal business hours
  • Largely consist of a significant monitoring component typically conducted by nursing or other auxiliary staff
  • Be of sufficiently low risk, such that the service typically would not require direct supervision often during the service
  • Not be a surgical service that includes recovery time

CMS excluded all surgical services—including recovery time—from potential inclusion because, although monitoring of any patient in recovery is a component of surgery, it is not the focus or a substantial component of the service. In addition, CMS states it believes the surgeon should personally evaluate the patient’s medical status during the recovery period.

CMS defines “initiation of the service” as the beginning portion of a service. It ends when the patient is stable and the supervising physician or appropriate non-physician practitioner believes the remainder of the service can be delivered safely under his or her general direction and control without the physician’s physical presence on the hospital campus or in the PBD of the hospital.

This new category of services does not currently apply to CAHs or rural hospitals because CMS has temporarily suspended enforcing physician supervision requirements for them-- which makes its decision to finalize this change a little difficult to understand, Shah says. “Why did CMS really need to move forward with this now given that it is convening a group to look at supervision requirements across services beginning in 2012?”

Convening a panel to determine supervision requirements

In the rule CMS discusses that commenters asked about other services, such as wound debridement and pain management. In addition, commenters suggested that CMS not make the decision about supervision levels in a vacuum. CMS agreed and as a result will form a panel to review the supervision requirements for all outpatient services.

“This adds another layer to the process and may be another case of be careful what you ask for – providers should seek clarification from CMS what the panel’s charge will be when recommending supervision requirements. Is it possible that the advisory panel could also recommend reducing the payment for those services that move to general supervision since they would be considered to be low risk and may use less resources?” Mackaman says.

CMS is seeking comments on who should make up the advisory group and the criteria that they should use when determining supervision levels for outpatient services. “I don’t know how many people are going to weigh in, but I think it’s critical that we provide feedback on who should be on such a panel and what sort of criteria they should use,” Shah says.

Reporting ancillary services with critical care

Another significant change comes as a result of a change by the CPT Editorial Panel, which is revising its guidance for critical care codes 99291 and 99292 to specifically state that, for hospital reporting purposes, critical care codes do not include the specified ancillary services.

This means beginning in CY 2011, hospitals can and should report in accordance with the CPT guidelines that will allow the separate reporting of ancillary services and associated charges when provided in conjunction with critical care. These ancillary services include, but are not limited, to electrocardiograms, chest X-rays, and pulse oximetry.

The immediate good news, Shah says, is that beginning in 2011 hospitals are going to be able to report the ancillary services they provide in conjunction with critical care. The bad news is that hospitals will not receive APC payment for those services because CMS said it has already factored those costs into the development of the critical care APC payment rate from historical claims data where the cost of these services was included in the critical care charge.

“This is another win for the hospital community because they have been trying individually through comment letters and through the American Hospital Association to get CMS and/or the AMA through the CPT Editorial Panel to realize that hospitals should be allowed to report and obtain payment for these ancillary services in addition to the reporting and payment for critical care,” Shah says.

CMS is requesting comments on this issue so hospitals should provide feedback on how CMS should treat the revision of the CY 2011 critical care codes for the future, especially with respect to generating separate payment. The rule of course covers other changes, including:

  • An increase to the drug packaging threshold from $65 to $70
  • A slight increase in separately payable drug reimbursement from ASP + 4% today to ASP+5% in the future
  • Removal of three codes from the inpatient-only list
  • Co-insurance and deductibles for preventive services
  • Wound care coding and payment
  • The outpatient hospital quality intitiave

Briefings on APCs will cover these changes in detail in future issues.

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