Health Information Management

Q&A: Are more surgical procedures being packaged in 2014?

APCs Insider, March 28, 2014

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Q: Did CMS increase packaging for surgical procedures in 2014? Our surgery director is upset because her revenue is down for January, but the number of cases appears consistent with the last couple of years.
A: Yes, 2014 is a year of packaging like we've never seen before under the OPPS. CMS has noted over the years that the OPPS is a prospective payment system, and as such the payment of each line item would be phased out. 
For 2014, all add-on and device removal procedures codes are packaged into the primary procedure. This could be the cause of the change in the net revenue that your surgery director is seeing. CMS noted in the final rule:
The OPPS packages payment for multiple interrelated items and services into a single payment to create incentives for hospitals to furnish services most efficiently and to manage their resources with maximum flexibility. Our packaging policies support our strategic goal of using larger payment bundles to maximize hospitals’ incentives to provide care in the most efficient manner.
Over the last 15 years, we have refined our understanding and implementation of the OPPS and have packaged numerous services that we originally paid as primary services. As we continue to consider the development of larger payment groups that more broadly reflect services provided in an encounter or episode of care, we may propose to expand these packaging policies as they apply to services that we currently separately pay as primary services.
Providers should review the remittance advices to ensure that the calculations are correct under the packaging scenarios and that the appropriate reimbursement is being received. The national payment rates are noted in Addendum B, and information concerning the status indicators for the additional packaged services for 2014 are noted in Addendum P, a new addendum for 2014.
Editor’s note: Andrea Clark, RHIA, CCS, CPCH, chairman, CEO, and founder of Health Revenue Assurance Associates, Inc., in Plantation, Fla., answered this question.

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