The Medicare Outpatient Prospective Payment System (OPPS) proposed rule for calendar year (CY) 2022 would continue cuts to hospitals in the 340B Drug Pricing Program, continue cuts to off-campus provider-based departments (PBDs), pause the elimination of the inpatient-only (IPO) list, and increase penalties for failing to report standard charges.
In a statement, America’s Essential Hospitals strongly objected to the Centers for Medicare & Medicaid Services (CMS) proposals on outpatient payments and price transparency while applauding the administration for its proposal to halt the elimination of the IPO list. The policies in the rule, if finalized, would start Jan. 1, 2022.
CMS will increase base payment rates under the OPPS by 2.3 percent for CY 2022, representing a market basket increase of 2.5 percent, less a productivity adjustment of 0.2 percentage points. The agency will reduce payment rates by an additional 2 percentage points for hospitals that fail to meet Hospital Outpatient Quality Reporting Program requirements. To avoid payment rates being skewed by data collected during the COVID-19 public health emergency, CMS proposes to use CY 2019 claims data and cost reports, instead of CY 2020 data, in setting outpatient payment rates for CY 2022.
340B Reimbursement Cuts
For a fifth year, CMS proposes Medicare Part B reimbursement cuts for separately payable drugs purchased through the 340B program. Since 2018, CMS has reimbursed 340B hospitals at 77.5 percent for most separately payable Part B drugs instead of the statutory default payment rate of 106 percent of ASP. CMS proposes to continue reimbursing 340B hospitals at 77.5 percent for these separately payable Part B drugs in 2022. America’s Essential Hospitals continues to challenge the lawfulness of CMS’ payment cuts, a policy that the U.S. Supreme Court will review later this year.
Site-Neutral Payment Cuts
Under Section 603 of the Bipartisan Budget Act of 2015 (BBA), Congress instructed CMS to pay certain non-excepted, off-campus PBDs under a payment system other than the OPPS. CMS determined these facilities should be paid under the Medicare Physician Fee Schedule (PFS) at a percentage of the OPPS payment rate (set at 40 percent since 2019). CMS does not address the payment rate or other policies for non-excepted, off-campus PBDs in the CY 2022 OPPS or PFS proposed rules, indicating the agency likely will continue to pay these PBDs at 40 percent of the OPPS payment rate.
In CY 2019, CMS began a policy of paying for outpatient office visits (health care common procedure coding system code G0463) at excepted, off-campus PBDs at 40 percent of the OPPS payment rate. CMS proposes to continue these cuts for CY 2022 and beyond.
CMS proposes to amend several previously finalized hospital price transparency policies, including increasing the amount of the penalties for noncompliance through use of a sliding scale based on hospital bed count. The agency also proposes actions to prohibit conduct that the agency believes serves as barriers to accessing standard charge information. Additionally, CMS clarifies the information it expects from hospital online price estimator tools.
Procedures Paid Only as Inpatient Services
CMS maintains a list of procedures usually performed only in the inpatient setting, reimbursed at inpatient rates, and not paid for under the OPPS. Each year, CMS reviews this inpatient-only (IPO) list for procedures that should be removed because they can be provided in the outpatient setting. CMS previously finalized a proposal to eliminate the remaining 1,740 services on the IPO list over a three-year period. In response to stakeholder concerns, CMS proposes to halt the elimination of the IPO list and to add the 298 services removed from the list in CY 2021 back to the IPO list in CY 2022.
Rural Emergency Hospitals
Through a request for information, CMS seeks comment on policies governing rural emergency hospitals (REHs), a new provider type established by the Consolidated Appropriations Act of 2021. REHs are hospitals that used to be a critical access hospital or a rural hospital with fewer than 50 beds and do not provide acute inpatient services, except for skilled nursing facility services provided in a separate unit. REHs will exclusively provide emergency department services and observation care, as well as other outpatient services as designated by CMS. Beginning in CY 2023, this new provider type will receive a payment rate that is higher than the OPPS payment rate. In the rule, CMS seeks comments on payment policies, quality measures, and health and safety standards for REHs.
RFI on Health Equity
CMS seeks comment on the possible expansion of its confidential reports to hospitals to include reporting of measures stratified by race and ethnicity. CMS also is interested in learning about current data collection practices by facilities to capture demographic data elements, such as race, ethnicity, sex, sexual orientation and gender identity, primary language, and disability status.
America’s Essential Hospitals is analyzing the proposed rule for comment and will send members a detailed Action Update in the coming days. CMS is accepting comments on the proposed rule until Sept. 17.
Contact Senior Director of Policy Erin O’Malley at firstname.lastname@example.org or 202.585.0127 with questions.