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Medicare Proposes 2020 Outpatient Payment Policies

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August 1, 2019

Medicare Proposes 2020 Outpatient Payment Policies

Medicare is continuing its drive to equalize payment levels among different sites of care, particularly for identical services performed in physician offices and off-campus provider-based facilities run by hospital outpatient departments. The Centers for Medicare & Medicaid Services (CMS) outlined its efforts in its recent proposal to update rates and payment policies for hospital outpatient departments and ambulatory surgical centers (ASC) for calendar year 2020. It also proposed policy changes on price transparency, breakthrough technologies, and procedures that can be performed in ambulatory surgical centers. CMS says public comments are due by September 27, 2019, with a final rule expected in November.

Highlights:

Site-Neutral Payments: CMS intends to complete its two-year phase-in of site-neutral policies that will pay for clinic visits at off-campus provider-based facilities run by hospital outpatient departments at 40% of the level such visits would be paid if performed in the actual hospital outpatient department. This policy removes the previous exemption from such cuts for some off-campus facilities.

Payment Rates: CMS proposes to increase the hospital outpatient department payment rate by 2.7% in 2020 and the ASC payment rate also by 2.7%. Reflecting the CMS effort to equalize rates among different types of settings, CMS is now using the same hospital market basket inflation rate in calculating ASC payment as it uses for hospital payment. The agency says this change will help promote site neutrality between hospitals and ASCs.

Price Transparency: CMS proposes that all U.S. hospitals must make prices publicly available annually, including prices negotiated with payers for at least 300 “shoppable” services that consumers can schedule in advance. Failure to comply could cost hospitals $300 per day.

Procedures Performed in ASCs: CMS says it will expand the number of procedures that it will pay for when provided at ASCs, including total knee replacement, percutaneous transluminal coronary angioplasty, and percutaneous transcatheter placement of stents. CMS is also asking for public comment on whether a range of other coronary procedures are appropriate for ASCs.

Innovative Technologies: For breakthrough medical technologies, CMS proposes to allow pass-through payment without insisting that they demonstrate “substantial clinical improvement.” This change is consistent with proposed changes in pass-through payment for such devices in the inpatient hospital setting.