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Should Medicare be reimbursing outpatient facilities owned by hospitals at higher rates than it does independent providers' facilities? The US Centers for Medicare and Medicaid (CMS) doesn't think so.

In its 2019 outpatient prospective payment system (OPPS) rule, CMS proposes to expand its use of a "site-neutral" payment model in its reimbursements, meaning that it will do away with the current system that pays so-called "off-campus" hospital-owned facilities an estimated $75 to $85 more than it does independent counterparts. The proposal is expected to meet with opposition from hospital groups.

If adopted, CMS estimates the change will save Medicare around $760 million in 2019, according to a CMS fact sheet on the proposed rule. Those savings would help to offset an overall payment increase of 1.25%, or about $4.9 billion.

"This proposal indicates that CMS is aware of, and taking action against, the potential for rising costs due to the consolidation of health care systems," said Kate Gilliard, APTA's senior regulatory affairs specialist. "By implementing site-neutral payments, major health systems will be less incentivized to buy up smaller practices, because they won't be receiving a higher reimbursement rate for the mere fact that they are owned by a hospital system."

Also included in the proposed OPPS:

  • Ambulatory surgical center (ASC) payment would increase by 2% and would be updated based on the hospital market basket update instead of the "consumer price index-urban all item" (CPI-U) system through at least 2023.
  • Nonopioid pain-management drugs that function as a supply when used in an ASC surgical procedure would be paid for separately.
  • CMS is soliciting comments on regulatory changes that might help prevent opioid use disorders and improve access to treatment in the Medicare program, as well as identify any barriers that may inhibit access to non-opioid alternatives for pain treatment and management.

APTA is analyzing the proposed rule and will provide comments to CMS by the September 24 deadline.


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