Health Information Management

Device/procedure edits may disappear

APCs Insider, August 2, 2013

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By Michelle A. Leppert, CPC

At first glance, CMS’ proposal to eliminate the device-to-procedure and procedure-to-device edits may not seem like a big deal. CMS would replace the current device-dependent APCs with 29 new comprehensive APCs. Facilities would receive one payment for all of the services when the primary procedure is reported on the claim. CMS would package everything else into that one payment.

CMS proposed new status indicator “J1” to identify HCPCS codes that would be paid under this comprehensive APC.

So it sounds relatively benign. It’s just more packaging, like we’ve seen for the past several years, especially in the 2014 OPPS Proposed Rule.

Take a trip through the way-back machine to 2005 when CMS created these device edits in the first place. Back then, CMS did not separately pay for devices, and as a result, hospitals weren’t reporting the device. In some cases, those devices can cost a significant amount of money. Pins and screws are probably low-cost devices, but pacemakers and defibrillators are not. Neither are joint replacements.

Because hospitals were not reporting the devices, CMS did not have data showing the true cost of the procedures. Hence it created the device-dependent procedure edits. The edits basically forced hospitals to report the device along with the procedure. Otherwise, CMS rejected the claim and the hospital had to fix and refile it.

As a result, facilities reported the devices with the appropriate HCPCS code and CMS collected all kinds of data to use in rate setting.

CMS has tweaked the list of device-dependent procedures, adding some, removing some, and adding some devices that qualify to bypass the edit. That’s fairly standard procedure for CMS, and it released the changes as part of the quarterly I/OCE edits.

Fast forward to July 2013 and the release of the 2014 OPPS Proposed Rule. CMS is now saying to get rid of these device edits and package payment again. CMS is going to lose all of that lovely data about which devices physicians are implanting. Realistically, many hospitals will probably go back to not reporting the device. Consequently, CMS could reduce payment rates because it doesn’t have data to support a higher payment.

What can hospitals do? Comment to CMS. The 2014 OPPS Proposed Rule is just that—a proposed rule. CMS has backed off of plans before because of negative provider comments. If you don’t like this proposal, or anything else in the proposed rule, tell CMS. Do it in a constructive way with data to back you up. Don’t just say it’s a bad idea. Explain why.

Have a better plan? Send that in, too. You can comment on the rule until September 6.

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