3.7% HOPD increase also could affect ASCs
Hospital outpatient surgery departments (HOPDs) have been given good news: They will receive a 3.7% increase in Medicare payment rates in 2006 under a final Outpatient Prospective Payment System (OPPS) rule from the Centers for Medicare & Medicaid Services (CMS). CMS originally had proposed a 3.2% increase.
The update could be significant for surgery centers, because under a proposed bill, they would be paid at 75% of the hospital outpatient department rate. Special rules exist in that legislation so that those procedures being paid higher than 75% of the HOPD rates, such as some gastrointestinal and pain management procedures, will not suffer significant cuts. In 2008, transition to the new ambulatory surgery center (ASC) system would begin with ASCs being paid a blended rate of 80% of the ASC rate and 20% of the HOPD rate. Each year the percentage based upon the HOPD rate would increase by 20% until the rate is entirely based upon the HOPD rate.
While describing the final rule as a "mixed bag," Roslyne Schulman, senior associate director for policy development at the American Hospital Association, says the association was happy to see the final numbers. "On the plus side, we were happy to see that CMS did adopt the same update on the outpatient side [3.7%] as the inpatient side," she reports.
On the negative side, CMS continues to pay 87 cents on the dollar for outpatient care provided to Medicare beneficiaries, Schulman says. "That’s an overarching concern," she adds.
In good news for hospitals, sole community hospitals in rural areas will receive an additional 7.1% increase for outpatient payments. This increase, originally proposed to be 6.6%, will benefit about 400 sole community hospitals. The increase is the result of a study of rural hospital costs authorized by the Medicare Modernization Act of 2003 (MMA).
In another change from the proposed rule, CMS plans to seek comments from device manufacturers, hospitals, and others to determine how to pay for new technologies. CMS had proposed a requirement that a copy of the application submitted to the American Medical Association’s CPT Editorial Panel for a new technology service be provided to CMS for its review of a New Technology APC request. The final rule does not adopt that proposal.
"CMS is committed to providing more rapid access to effective new technologies," CMS administrator Mark B. McClellan, MD, PhD, said in a released statement. "At the same time, the hospitals that use these technologies need a consistent way of billing and being paid for them. We will be working with the device and hospital industries to remove any unreasonable barriers to the fast introduction of effective technologies into the outpatient setting."
In other changes, CMS continues the decline in coinsurance rates that Medicare beneficiaries will pay for many hospital outpatient services. Coinsurance rates for outpatient services at hospitals are being reduced gradually until the beneficiary’s share for any outpatient service will be 20% of the hospital’s total payment. Under the final rule, the coinsurance rate for 31 more medical and surgical ambulatory payment classifications (APCs) will decline to 20%. The final rule also reduces the maximum coinsurance rate for any service to 40% of the total payment to the hospital for the APCs in 2006, which is a reduction from 45% this year.
The final rule will be effective Jan. 1, 2006. (Editor’s note: To see the final rule, go to www.cms.hhs.gov/providers/hopps/2006fc/CMS-1501-FC.pdf. To view the final rule and the supporting data files, go to www.cms.hhs.gov/providers/hopps/2006fc/default.asp
Hospital outpatient surgery departments (HOPDs) have been given good news: They will receive a 3.7% increase in Medicare payment rates in 2006 under a final Outpatient Prospective Payment System (OPPS) rule from the Centers for Medicare & Medicaid Services (CMS). CMS originally had proposed a 3.2% increase.You have reached your article limit for the month. Subscribe now to access this article plus other member-only content.
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