Highlights of the 2011 Hospital Outpatient Prospective Payment System Proposed Rule and Proposed Physician Fee Schedule
- ACCC members can view a detailed summary of the proposed 2011 HOPPS rule. After you log on to the Members-Only section, select MEMBER CONTENT from the menu at left.
- ACCC members can view a detailed summary of the proposed 2011 Physician Fee Schedule. After you log on to the Members-Only section, select MEMBER CONTENT from the menu at left.
Hospital Outpatient Prospective Payment System Proposed Rule for 2011. On July 2, 2010, the Centers for Medicare & Medicaid Services (CMS) released the hospital outpatient prospective payment system (OPPS) proposed rule for 2011. The proposed rule will be published in the Federal Register on August 3, 2010, and CMS will accept comments until August 31, 2010.
5 key points:
- The proposed payment rates for 2011 reflect a 2.15 percent increase in the hospital operating market basket. This update includes a 0.25 percentage point reduction required by the Patient Protection and Affordable Care Act (PPACA). Hospitals that fail to meet the quality data reporting requirements will receive an update that is reduced by 2.0 percentage points. CMS expects that total Medicare payments to hospital outpatient departments (HOPDs) will be approximately $40 billion and total payments to ambulatory surgical centers (ASCs) will be $4 billion in 2011.
- In general, CMS proposes to continue to use the same methodology and policies to establish payment for drugs, biologicals, and radiopharmaceuticals in 2011 as it used in 2011. In the Proposed Rule, this approach produced a payment rate of average sales price (ASP)+6 percent for separately payable drugs, biologicals, and radiopharmaceuticals with or without pass-through status. The proposed packaging threshold is $70. CMS cautions stakeholders that the final payment rate for nonpass-through drugs, biologicals, and radiopharmaceuticals could be lower than ASP+6 percent after CMS finalizes its calculations with updated data later this year.
- CMS proposes to continue pass-through status in CY 2011 for 31 drugs and biologicals. These products would be reimbursed at ASP+6 percent, equivalent to the rate these drugs and biologicals would receive in the physician’s office setting in CY 2011.
- CMS discusses its implementation of section 3138 of PPACA that requires the Secretary of Health and Human Services to study whether the 11 PPS-exempt cancer hospitals incur greater outpatient costs than other hospitals. CMS proposes to make hospital-specific adjustments for the 11 cancer hospitals. The hospital-specific adjustment would be applied to the wage adjusted payments for all items, except for items and services paid at charges adjusted to cost or devices receiving pass-through status.
- Physician supervision. In the final rule for CY 2010, CMS issued new regulations on supervision of outpatient therapeutic services. In the Proposed Rule for 2011, CMS proposes “modest changes” to the supervision policy for therapeutic services. The agency identifies a set of services with a significant monitoring component that can extend for a sizable period of time, that are not surgical, and that typically have a low risk of complication after assessment at the beginning of the service, as “nonsurgical extended duration therapeutic services.”
Physician Fee Schedule Proposed Rule for 2011. CMS released the Medicare Physician Fee Schedule (PFS) proposed rule for 2011 on June 25, 2010, and published it in the Federal Register on July 13, 2010. The proposed rule discusses several changes that will have a significant effect on payment for cancer care.
The proposed rule would:
- Reduce physician payment rates in 2011 by an additional projected 6.1 percent under the sustainable growth rate (SGR) formula. This reduction does not take into account the independent 2.2 percent payment increase for physician services furnished between June 1, 2010 through November 30, 2010 pursuant to the newly passed Preservation of Access to Care for Medicare Beneficiaries and Pension Relief Act of 2010.4 The 6.1 percent payment cut to the conversion factor for 2011 would be in addition to the impending 21.2 percent cut that has been thus far delayed by Congress, for a net cut of nearly 28 percent, unless Congress enacts further changes to physician payment rates.
- Continue the second year of a four-year transition to practice expense (PE) relative value units (RVUs) calculated using Physician Practice Information Survey (PPIS) survey data.
- Change the utilization rate for determining PE RVUs for diagnostic imaging equipment priced over $1 million and expand the list of services to which the higher equipment utilization rate assumption applies.
- Identify and revise potentially misvalued services under the PFS.
- Expand the imaging multiple procedure payment reduction (MPPR) policy.
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