Archive for: Billing and reimbursement
CMS releases 2010 OPPS proposed rule
Changes for separately payable drugs, physician supervision
Outpatient facilities and pharmacies hoping to see an increase in reimbursement for separately payable drugs in CMS’ 2010 OPPS proposed rule didn’t get their wish, but they did see additional proposed guidance on physician supervision rules.
CMS also proposes to allow hospitals to bill Medicare for pulmonary and intensive cardiac rehabilitation services.
“My sense when I first looked at the proposed rule this year was that it seemed much shorter,” says Jugna Shah, MPH, president of Nimitt Consulting in Washington, DC. One reason for that, Shah says, might be because CMS chose not to add any additional composite APCs or additional outpatient quality indicators.
That doesn’t mean CMS is abandoning its commitment to “value-based” purchasing principles, Shah says, but it does seem like CMS is taking some time to assess the impact of its current composite APCs before adding additional ones.
Reimbursement for separately payable drugs Providers and various stakeholders have repeatedly weighed in to CMS over the past four years that charge compression has a huge negative impact on how it computes payment rates for separately payable drugs. CMS acknowledges this as an issue, and in its discussion on how it calculated payment rates for 2010, CMS referred to the pharmacy stakeholders’ proposal.
Although CMS analyzed the pharmacy stakeholders’ proposal, the agency elected not to use that methodology nor did it follow the APC Advisory Panel’s recommendations. Instead, CMS introduced a new calculation method: the result is that CMS’ proposed payment for 2010 for all separately payable drugs of average sales price (ASP) plus 4% came as a total surprise, says Shah.
“The fact that the 2010 proposed payment rates for separately payable drugs remains the same as what we have today, despite the CMS’ new calculation methodology is truly disheartening,” says Shah.
CMS’ new methodology does shift some packaged drug costs to separately payable drugs, but falls quite short of covering what providers would consider their drug acquisition costs and pharmacy overhead/handling costs, says Shah.
Shah cautions that an in-depth reading of the information is required to analyze how CMS arrived at the payment rate.
“To the end user – hospitals paid under OPPS - if the proposed payment rate of ASP plus 4% is made final for 2010, then nothing will look different,” Shah says. She is hopeful that hospitals will weigh in on this and other CMS proposed changes.
“CMS’ proposal is far from what providers have been telling CMS they need for separately payable drug reimbursement to cover both acquisition and pharmacy overhead/handling costs,” Shah says.
Some estimates provided to CMS indicate that adequate coverage of drug acquisition costs and pharmacy overhead would result CMS paying closer to ASP plus 13% for separately payable drugs, Shah says. Alternatively, CMS could reimburse hospitals at ASP plus 6% and provide a separate add-on payment for pharmacy handling/overhead costs similar to what the pharmacy stakeholders group proposed and APC Advisory Panel supported.
“Unfortunately, CMS’ proposal for 2010 is far from what providers have been telling CMS they need for separately payable drug reimbursement to cover both acquisition and pharmacy overhead/handling costs,” Shah says.
Physician supervision and incident to
CMS proposes to allow physician assistants, nurse practitioners, clinical nurse specialists, certified nurse midwives, and clinical psychologists to provide supervision of hospital outpatient therapeutic services when their license allows them to do so.
“The fact that they are going to be able to do the supervision is a huge benefit to hospitals,” says Kimberly Anderwood Hoy, Esq., CPC, director of Medicare and compliance at HCPro, Inc., in Marblehead, MA. Under last year’s clarification, hospitals were not be able to bill for services supervised by a nurse practitioner unless a physician was present.
“This really expands the number of people who can provide supervision, and that is really important in rural areas,” Hoy says.
However, Hoy cautions that the change, if finalized, would not go into effect until 2010, so hospitals must still follow the current rules for 2009.
“The fact that we see so much discussion in the 2010 OPPS proposed rule on this topic is a testament to providers and other industry organizations for a raising tough questions with CMS on its physician supervision and incident-to language over the past 12-16 months”, says Shah.
CMS added a discussion of its expectation that the supervising physician or nonphysician practitioner to be able step in and assume providing the service. In addition, the supervising practitioner can’t be occupied with any other procedure he or she can’t leave.
“That begs the question about whether the emergency physician is always appropriate to use to provide supervision,” Hoy says.
CMS did clarify its definition of what “in the hospital” means, which will be very helpful, Hoy says. Under the proposed change, “in the hospital” would mean areas in the main building(s) of the hospital that are under the ownership, financial, and administrative control of the hospital; are operated as part of the hospital; and for which the hospital bills the services furnished under the hospital’s CMS Certification Number.
“There are some very provider-friendly things . . . but those don’t go into effect until 2010,” Hoy says.
Hoy also recommended facilities carefully read the physician supervision requirements for cardiac and pulmonary rehabilitation services.
“There’s a nice opportunity for hospitals to expand those programs because it’s going to be a little easier to operate,” Hoy says.
Additional proposed changes
CMS proposes to evaluate surgically implantable biologicals that are not receiving pass-through payment before January 1, 2010, for pass-through status using the device category pass-through process. CMS has also proposed to increase the separately payable drug packaging threshold to $65 (it is currently $60) and to package 5HT3 antiemetics.
CMS is also considering paying rural providers for kidney disease education services furnished on or after January 1, 2010, to Medicare beneficiaries diagnosed with Stage IV chronic kidney disease.
CMS will accept comments on the proposed rule until August 31, and will respond to comments in a final rule to be issued by November 1.
Hospital’s ’what if’ scenario becomes reality
The patient access team at Skagit Valley Hospital has many goals as it works through this economic recession: Sustain morale, maintain trust, minimize criticism, and acknowledge success.
Michele Hill, CHAM, patient access manager at the Mount Vernon, WA, facility, knows it's not easy considering what the hospital faces:
- Federal and state budget cuts
- Change in payer mix
- Increased charity care requests
- RAC audits
"Our facility, like many others, is facing significant challenges during this time of economic downturn," Hill says.
Read the full story.
Drug industry agrees to fund portion of Medicare doughnut hole
The Pharmaceutical Research and Manufacturers of America, following negotiations with lawmakers, announced an agreement that calls for the industry to spend $80 billion over the next decade to assist Medicare beneficiaries and defray medication costs. The agreement calls for pharmaceutical companies to pay as much as half the cost of brand name drugs for lower- and middle-income senior citizens in the so called Medicare “doughnut hole.”
The doughnut hole occurs when patients’ total drug spending has exceeded $2,400. They must pay full cost for their medications until they have spent more than $3,850. And in 2007, about 15% of the 3.4 million Medicare beneficiaries who hit the doughnut hole quit taking their medications.
The agreement with the pharmaceutical industry marked a small victory for Sen. Max Baucus (D-MT), chairman of the Senate Finance Committee, who has been negotiating with health industry groups as he was working on drafting health reform legislation with his committee.
Source: HealthLeaders Media
June 22-29 Transmittals and MLN Matters articles: CMS re-issues OPPS update, released MLN Matters article for never events NCDs, and more
CMS issues contractor instructions for 835 adoption
On June 26, CMS instructed contractors to make system changes required for implementation of the next version of Health Insurance Portability and Accountability Act (HIPAA) standard for transaction 835.
Effective date: October 1, 2009
Implementation date: April 6, 2009 for VMS; July 6, 2009 for MCS, FISS
CMS re-issues OPPS update
On June 23, CMS rescinded and replaced its previous OPPS update to the Claims Processing Manual due to some incorrect information regarding HCPCS code Q4115. All other information remains the same.
Effective date: July 1, 2009
Implementation date: July 6, 2009
View a related MLN Matters article.
MLN Matters articles
CMS released two MLN Matters articles related to transmittals previously outlined in Medicare Weekly Update.
- Wrong Surgical or Other Invasive Procedure Performed on a Patient; Surgical or Other Invasive Procedure Performed on the Wrong Body Part; Surgical or Other Invasive Procedure Performed on the Wrong Patient
- Implementation of the Redesigned Provider Statistical and Reimbursement (PS&R) System
Inpatient Part B benefit - limited services payable under Part B to hospital inpatients
By Judith Kares, JD, CPC, regulatory specialist for HCPro, Inc.
Although there were several transmittals and other CMS issuances published during the past week, they were primarily technical in nature rather than of general interest. Having just completed an MBC-H course in Chicago, I was reminded of a topic that I have wanted to discuss for some time. Although not new--that is, there have been no recent changes—there are several things that participants seem surprised about when we discuss them in class. Under the limited inpatient Part B benefit, hospitals can bill Medicare for certain nonphysician services furnished by a hospital (directly or under arrangements) to an inpatient of the hospital when these services are not covered under Part A.
Go to the MedicareMentor Blog to read the rest of this week's note.
Use a change-of-status form to ensure compliance when reporting condition code 44
A change-of-status form will help ensure that a hospital meets all of the criteria for reporting condition code 44, says Judith Kares, JD, CPC, regulatory specialist at HCPro, Inc., in Marblehead, MA. The form should include the following:
- A statement about the hospital’s decision to change the patient’s status from inpatient to outpatient, including appropriate rationale
- Information about how this decision will affect the patient medically and financially
- Documentation that the hospital informed the patient’s physician of the status change and asked him or her to offer input
- A place for two required signatures, one from a utilization review (UR) committee member and the other from the patient’s attending physician or an additional UR committee member
Keep the original form in the patient’s medical record and provide copies to the patient and his or her physician, Kares says. Keep a third copy in the UR committee records.
Editor’s note: This article was adapted from the June issue of Briefings on Coding Compliance Strategies.
CMS releases RAC audit phase-in strategy: Complex reviews to arrive as soon as August
CMS released further information June 24 on its RAC Web site letting healthcare providers know when they can expect RACs to begin auditing. The new “CMS RAC Review Phase-in Strategy,” details different types of reviews and dates CMS anticipates the reviews will begin in various areas of the country.
The new information is consistent with CMS’ previous indications that some providers may begin to undergo automated review this month.
According to the CMS, the earliest possible dates for RAC reviews in yellow and green states are:
- June 2009-Automated reviews of black and white issues
- August or September 2009-Complex reviews for DRG validation
- August or September 2009-Complex review for coding errors
- Fiscal year 2010, which begins October 1, 2009-Complex reviews for durable medical equipment (DME) medical necessity
- Calendar year 2010-Complex reviews for medical necessity
The earliest possible dates for reviews in blue states generally fall a bit later:
- August 2009-Automated reviews of black and white issues
- October or November 2009-Complex reviews for DRG validation
- October or November 2009-Complex review for coding errors
- Fiscal year 2010-Complex reviews for DME medical necessity
- Calendar year 2010-Complex reviews for medical necessity
CMS also reaffirmed that before RACs actively begin auditing in a particular state, outreach educational sessions must occur in that area.
Although the schedule calls for automated reviews as early as this month, any issue a RAC reviews must be vetted through the CMS’ “Issue Review Board.” In addition, RACs must post the approved issues to their Web sites before the reviews can begin.
“Providers should check their RAC’s Web site often for any newly approved issues for review to anticipate their vulnerability to reviews and take backs,” says Kimberly Anderwood Hoy, JD, CPC, director of Medicare and compliance for HCPro, Inc.
Even though CMS has delayed the rollout of certain types of complex reviews, providers shouldn’t ease off on their RAC preparation activities.
“Use the time wisely to continue performing your own internal vulnerability audits and ensure that all of your policies and procedures are up-to-date. Consider this a little extra time to get your facility ready for those appeals,” says Tanja Twist, MBA/HCM, director of patient financial services at Methodist Hospital of Southern California.
Editor’s note: Twist and Hoy will be speaking at the upcoming conference, “Medicare Compliance Forum: A Strategic Approach to RACs, Observation Status and the Role of Physician Advisors,” which will be held in Atlanta this October. Twist will also be featured in the July 21 HCPro audio conference, “Medicare Appeals: Practical and Compliant Procedures for Overturning Denials.”
Obama administration calls for more hospital payment cuts
In an effort to reform healthcare and reduce costs, President Obama has called for $313 billion in healthcare spending cuts.
The proposed cuts include a $220 billion reduction in hospital payments over the next 10 years. The American Hospital Association (AHA) expressed deep disappointment and noted that hospitals already face a previously announced potential $38 billion cut and $41 billion in cuts under the proposed Medicare Inpatient Prospective Payment System rule.
AHA President and CEO, Rich Umbdenstock said, “Reform must improve care for patients without crippling hospitals’ ability to care for patients and communities.”
Source: AHA News Now
