Centers for Medicare and Medicaid Services Issues a Proposed Rule for the 2020 Outpatient Prospective Payment System

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On July 29, CMS published the proposed Physician Fee Schedule Rule for the 2020 Outpatient Prospective Payment System.

The proposed changes encourage site-neutral payment between certain Medicare sites of services as well as proposing updates and policy changes under the Medicare Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System.

According to CMS, the proposed polices in the CY 2020 OPPS/ASC Payment System proposed rule would further advance the agency’s commitment to increasing price transparency—including proposals for requirements that would apply to each hospital operating in the United States)—rethinking rural health, unleashing innovation, reducing provider burden, and strengthening program integrity so that hospitals and ambulatory surgical centers can operate with better flexibility, and patients have what they need to become active health care consumers.

In the proposed rule, CMS is proposing to update OPPS payment rates by 2.7 percent. This update is based on the projected hospital market basket increase of 3.2 percent minus a 0.5 percentage point adjustment for Multi-Factor Productivity (MFP).

In the proposed rule, CMS is not proposing any changes to its policy to use the hospital market basket update for ASC payment rates for CY 2020-2023. Using the hospital market basket, CMS proposes to update ASC rates for CY 2020 by 2.7 percent for ASCs meeting relevant quality reporting requirements. This change is based on the projected hospital market basket increase of 3.2 percent minus a 0.5 percentage point adjustment for MFP. This change would also help to increase site neutrality between hospitals and ASCs and encourage the migration of services from the hospital setting to the lower cost ASC setting.

The proposed rule also includes:

  • Proposed definition of ‘hospital,’ ‘standard charges,’ and ‘items and services’
  • Proposed requirements for making public all standard charges for all items and services
  • Proposed requirements for making public consumer-friendly standard charges for a limited set of ‘shoppable services’
  • Proposals for monitoring and enforcement
  • Method to control for unnecessary increases in utilization of outpatient services
  • Changes to the Inpatient Only list
  • ASC covered procedures list
  • High-cost/low-cost threshold for packaged skin substitutes
  • Device pass-through applications

ISASS is currently review the proposed rule and will provide input and comments to CMS.

Read the CMS Fact Sheet here.

Read the proposed rule here.