CMS finalized the Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) rule on November 1, 2012, updating Medicare payment policies and rates for hospital outpatient and ASC services beginning January 1, 2013.


The final OPPS/ASC rule with comment period affects hospital outpatient departments in more than 4,000 hospitals, including general acute care hospitals, inpatient rehabilitation facilities, inpatient psychiatric facilities, long-term acute care hospitals, children’s hospitals, and cancer hospitals, and approximately 5,000 Medicare-participating ASCs.

Rates and policies set in the calendar year (CY) 2013 final rule with comment period will increase payment rates for hospital outpatient departments by 1.8 percent. The increase is based on the projected hospital market basket—an inflation rate for goods and services used by hospitals—of 2.6 percent, minus 0.8 percent in statutory reductions, including a 0.7 percent adjustment for economy-wide productivity and a 0.1 percentage point adjustment required by statute.


The OPPS rule also contains a significant change from prior policy: as proposed, it bases relative payment weights on geometric mean costs rather than median costs.   Basing the OPPS payments on mean costs better reflects average costs of services and aligns the metric used in rate-setting for the OPPS with the IPPS.


For CY 2013, ASC payment rates will increase by 0.6 percent—the projected rate of inflation of 1.4 percent minus a 0.8 percent productivity adjustment required by law.  Medicare uses changes in the consumer price index for urban consumers (CPI-U) as the measure of inflation for ASCs.


Total payments to hospitals under the OPPS in CY 2013 will be approximately $48.1 billion and total payments to ASCs under the ASC payment system will be approximately $4.07 billion.


The rule made several changes to the quality-reporting program for outpatient departments. While CMS did not add any new measures to the 22 measures finalized for the CY 2014 payment determination, CMS did confirm the removal of one measure; deferred data collection for another measure, and confirmed the suspension of data collection for a third measure.  In addition, CMS finalized proposed revisions to several procedural requirements that apply to the reporting of quality data and finalized the automatic retention of Hospital OQR Program measures adopted in previous payment determinations for subsequent year payment determinations, until the measures are actively removed, suspended, or replaced.


CMS also finalized proposed revisions to the ASC Quality Reporting (ASCQR) program, including requirements for claims-based measures regarding the dates for submission, payment of claims and data completeness, and a methodology for reducing payment to ASCs that do not meet the program’s reporting requirements.  CMS also adopted principles to be applied in future measure selection and development.  CMS previously finalized the measure sets that apply to the CYs 2014 through 2016 payment determinations.


The rule also streamlines the operations of the Quality Improvement Organizations (QIOs), increases their transparency, and makes them more responsive to beneficiary complaints about quality of care. QIOs are organizations composed of health professionals under contract to CMS who are charged with monitoring and improving Medicare beneficiaries’ care.


For example, the rule requires QIOs to provide beneficiaries with more information about their review processes.  It establishes a new alternative dispute resolution option called “Immediate Advocacy” to resolve beneficiary complaints. It allows QIOs to send and receive secure electronic health information.  Finally, the rule gives beneficiaries the right to authorize the QIOs’ use and disclosure of confidential information and removes outdated regulations so that QIOs will have to provide beneficiaries with more information about specific reviews.


Lastly, CMS finalized Inpatient Rehabilitation Facility (IRF) quality-reporting proposals, including:   (1) as proposed, an application of the National Quality Forum (NQF)-endorsed catheter-associated urinary tract infection (CAUTI) measure for the IRF quality-reporting program for the FY 2014 annual payment update determination, and (2) the actual NQF-updated CAUTI measure for the FY 2015 payment determination and all subsequent fiscal year payment determinations.   CMS also adopted a non-risk adjusted version of a NQF-endorsed pressure ulcer measure.  The final OPPS rule stipulates that any measure selected for use in the IRF QRP will remain in effect until actively removed, suspended, or replaced.


This rule will be printed in the Federal Register November 15, 2012 and go into effect January 1, 2013.

View the CMS Fact Sheet regarding this rule.

View the Federal Register regarding this rule.

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