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Tag Archives: Final

Making a checklist to prepare for the OPPS final rule

Making a checklist to prepare for the OPPS final rule

Editor’s note: Jugna Shah, MPH, president and founder of Nimitt Consulting, writes a bimonthly column for Briefings on APCs, commenting on the latest policies and regulations and analyzing their impact on providers.

 

The 2017 OPPS final rule will not be out for a couple of weeks, but that doesn’t mean providers can’t be thinking about what their action plan will be once the rule is released.

With only 60 days between the final rule’s release and the January 1 implementation date, providers will be ahead of the curve by spending time now and thinking about the processes they may need to review, change, or implement based on what CMS finalizes and the sort of financial impact the final rule is likely to have.

While I don’t know with 100% certainty what CMS will finalize, revise, delay, or back away from, I offer providers this list of what they should look at immediately upon the rule’s release.

 

Section 603

With Congress mandating payment changes for all non-grandfathered (those not billing under OPPS prior to November 2, 2015) off-campus, provider-based departments (PBD) starting January 2017, it was no surprise that CMS discussed this issue in the proposed rule. But it was a huge surprise to read CMS’ proposals, which, if finalized, would greatly impact otherwise protected grandfathered locations under Congress’ Section 603.

For example, CMS proposed that if an off-campus PBD moves, changes ownership, or expands its services beyond what it was providing as of November 2, 2015, as defined by APC-based clinical families, then its grandfathered status would be impacted. While this may sound relatively simple, the payment and operational impact would be a nightmare.

There is another aspect of Section 603 and CMS’ proposal to use the Medicare Physician Fee ­Schedule (MPFS) as the "applicable payment system" for ­Medicare Part B services provided at non-grandfathered locations or deemed "non-excepted." Specifically, there are many services for which the MPFS has no facility component for the facility costs associated with performing the procedure because they are only provided in hospital outpatient departments or ambulatory surgery centers. For these services, the industry has to wonder what CMS was thinking, as the agency cannot possibly expect to pay nothing for services that would continue to be rendered in off-campus PBDs.

CMS’ unexpected and hastily configured proposals create such large operational and financial problems that the industry is hoping the agency will simply retreat and delays the implementation of Section 603, or at a minimum revert to paying grandfathered facilities under the OPPS for all of their services, regardless of clinical service expansion, site relocation, or ownership changes. There is precedent for CMS to postpone implementation beyond statutory deadlines. If there were ever a situation where delay is advised, this is one.

Hopefully, providers sent in a surfeit of comments regarding these and other issues and outstanding questions related to the agency’s Section 603 implementation proposals. I hope CMS will acknowledge its proposals have administrative, operational, and financial gaps that are so large, it will be impossible to move forward by January. But even if CMS does choose to put off its proposals until proper payment mechanisms are developed, Congress was clear in its language requiring changes by January 1, 2017, so something is likely going to have to occur.

CMS’ proposals, if finalized, would have drastic long-term implications for all providers, including those who believe that their grandfathered status would protect them; the sad reality is that under CMS’ proposals, there will be massive operational and financial impact, so this is the first topic in the final rule that everyone should review.

 

Packaging proposals

Providers have gotten used to CMS expanding packaging in each OPPS rule, as the agency calls packaging an essential part of a prospective payment system. With CMS’ expansion of lab packaging from date of service to claim level this year, we should not be surprised if the agency finalizes its proposal of expanding the conditional packaging logic of CPT codes assigned to status indicators Q1 and Q2 to the claim level.

Claim-level packaging of these types of ancillary services will have a huge financial impact on providers submitting multiday claims, such as those for chemotherapy and radiation therapy services, despite the fact that multiday claims for these types of services are not required.

Currently, status indicators Q1 and Q2 are packaged into other OPPS services when provided on the same date of service, even when submitted on a claim that spans more than one day. If CMS finalizes its proposal, providers that continue submitting multiday claims when monthly or series claims are not required should not be surprised when they find themselves no longer receiving separate payment for many services.

This is the time for providers to assess whether they submit multiday claims for any services beyond the required repetitive services listed in the Medicare Claims Processing Manual, Chapter 1, section 50.2.2. While it is true the manual states that is is an option to bill nonrepetitive services on multiday claims, it did not have financial implications. At least, until this year, with the claim-based packaging of labs and proposal for claim-based packaging of Q1 and Q2 services. Providers should determine why they are billing multiday claims and what it would take to change their billing processes. If they elect not to move away from multiday claims, then assessing the financial impact that will occur is an important exercise to go through prior to January 1.

The other packaging proposal providers should look for in the final rule involves the use of modifier -L1 for reporting unrelated laboratory tests when they occur on a claim with other OPPS services. CMS proposes to delete the modifier for CY 2017 as it believes that the vast majority of labs should be packaged regardless of whether they are unrelated to other OPPS payable services.

This would have a big impact on providers who provide reference laboratory or nonpatient services, which the agency requires to be reported on the same claim as other OPPS services performed on the same date. Today, the use of the -L1 modifier allows providers to identify these services as separate and unrelated to the other OPPS services so that payment is received from the Clinical Laboratory Fee Schedule.

If CMS finalizes its proposal to eliminate modifier -L1, we can hope the agency will also update its instructions for reporting reference laboratory services so they can be separately paid even when provided on the same date of service or claim as other OPPS services. If CMS does not make a change, then providers can again expect to see a large financial impact. Both of these packaging proposals should be looked at immediately in the final rule.

 

Device-intensive procedures

The final set of proposals providers will want to review relates to the changes proposed for device-intensive procedures. This is a place where we hope to see CMS finalizing changes as proposed.

For example, CMS proposes to use the implantable device cost-to-charge ratio (CCR) to calculate pass-through device payments for hospitals that file cost reports designating that cost center, as this is a more accurate CCR for determining separate pass-through payment. Currently, only about two-thirds of hospitals use the implantable device CCR, which means the remaining one-third need to examine their cost reporting process.

Providers should determine whether they are in the group that reports the implantable cost center; if a provider is not reporting, it should find out why and begin making changes. This will have an impact on facilities’ ability to generate much better pass-through payment going forward, when applicable. It will also ensure future payment rates for device-intensive procedures reflect more accurate payment of the device.

Finally, it will be interesting to see whether CMS finalizes the addition of another 25 comprehensive APCs (C-APC) encompassing 1,844 additional status indicator T services; if it does, a financial impact analysis of these services will also be important, as this will be a large increase in C-APCs for a one-year span.

I plan to discuss these and other final rule changes in my next column, as well as in HCPro’s annual OPPS final rule webcast December 1 (see www.hcmarketplace.com for details), but in the meantime I hope the above checklist will be useful to providers now and in the first weeks of the rule’s release.

HCPro.com – Briefings on APCs

MOON requirement delayed in IPPS final rule: What next?

MOON requirement delayed in IPPS final rule: What next?

Hospitals got a last-minute reprieve from the Medicare Outpatient Observation Notice (MOON) notification requirement, which was set to go into effect August 6. Citing the need for additional time to revise the standardized notification form that hospitals will need to use to notify patients about the financial implications of being assigned to observation services, CMS moved back the start date for the requirement in the 2017 IPPS final rule to ‘no later than 90 days,’ after the final version of the form is approved (www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/FY2017-IPPS-Final-Rule-Home-Page.html).

CMS released the new draft of the form (www.cms.gov/Regulations-and-Guidance/Legislation/PaperworkReductionActof1995/PRA-Listing-Items/CMS-10611.html?DLPage=1&DLEntries=10&DLFilter=10611&DLSort=1&DLSortDir=descending) August 1 and accepted public comments for 30 days. The MOON notification form is intended to be used to help hospitals comply with the Notice of Observation Treatment and Implication for Care Eligibility (NOTICE) Act. The Act requires hospitals to provide a verbal and written notice of outpatient status to any patient in observation who has been in the hospital for more than 24 hours, stipulating that hospitals must inform patients within 36 hours from the start of the service about their status. However, without a final version of the form ready for use, it would appear that hospitals cannot comply with the NOTICE Act at this time.

‘Hospitals should review the IPPS final rule that contains significant clarification on things like when and how the notice is delivered and finalize their own policies for delivering the notice pending the final version of the MOON being available,’ says Kimberly Anderwood Hoy Baker, JD, CPC, director of Medicare and compliance for HCPro in Middleton, Massachusetts.

CMS stated in the 2017 IPPS final rule:

We expect the final [Paperwork Reduction Act] PRA approval of the MOON around the time the implementing regulations are effective. Therefore, the implementation period for hospitals and CAHs will begin sometime after the effective date of this final rule and will be announced on the CMS Beneficiary Notices Initiative Website at: www.cms.gov/Medicare/Medicare-General-information/Bni/index.html and in an HPMS memorandum to MA plans. During this implementation period, hospitals and CAHs will have time to prepare for implementation, consistent with past implementation practices for beneficiary notices. Hospitals and CAHs will be required to deliver the MOON to applicable patients who begin receiving observation services as outpatients on or after the notice implementation date.

 

‘Hospitals should watch the Beneficiary Notice Initiative page, where CMS said they would announce implementation information, for more information on the finalization of the MOON and implementation time frames,’ says Baker.

Hospitals will likely not be required to provide the MOON notification form to patients until 90 days after PRA approval, which could mean compliance with the MOON and NOTICE Act is at least 120 days out from the final rule release date given that there is also a 30-day comment period on the revised form, according to Baker.

‘When the final version of the notice form is ready for use, hospitals should use the 90-day implementation period to develop a mechanism for the form to be in their EHR with a trigger to print the notice when the patient is registered as or has a status change to observation. This will allow for the form to be delivered by the designated individual to the patient immediately rather than attempting to do it at discharge,’ says Rose T. Dunn, MBA, RHIA, CPA, FACHE, chief operating officer for First Class Solutions, Inc.

The message should be delivered by hospital staff who are well versed in the purpose of the notice and how patient status may financially impact the patient. Dunn recommends that hospitals choose patient access staff, financial counselors, or utilization review/case management staff to deliver the MOON rather than patient care staff.

The role of HIM in MOON compliance

While many facilities plan to task departments outside of HIM with delivering the verbal and written notice to observation patients, that does not mean there isn’t a seat at the table for HIM when it comes to operationalizing this regulation.

At Via Christi Health in Wichita, Kansas, Sam Antonios, MD, FACP, FHM, CCDS, medical director of medical information and ICD-10 physician advisor, and his colleagues are working to ensure they understand the nuances of the MOON.

Antonios’ facility is currently building a daily report to help track patients who have been in observation 24 hours.

The report will help the facility ensure compliance with the NOTICE Act and MOON, but this may be a challenge for facilities that do not have the capability to create such a document in their electronic systems. But even with the right systems and alerts in place, relying on just one report may present challenges. ‘For example, you may have patients who don’t have the right trigger from the initiation of observation services,’ Antonios says. Remember, the MOON must be delivered 24?36 hours after the initiation of observation services, which is not always the time when the patient entered the hospital, especially for those in the emergency department, he says.

In general, HIM should aid in the creation of reports listing any admission for Medicare beneficiaries in observation. Records for patients who have been in observation for more than 24 hours should be flagged when the report is run, which should ideally be done twice daily and be sent to the team tasked with delivering the MOON, Antonios says.

HIM must play a role in deciding what to do with the MOON when it is completed and how to track verbal notification of observation status, Antonios says. Should HIM scan the MOON forms immediately for inclusion in the patient’s medical record, or should scanning be completed at the end of the patient’s hospital stay? Deciding which option is best may depend on the needs of your facility and staffing patterns.

‘HIM professionals should ensure that the form is properly signed and scanned into the appropriate section of the medical record where it can be consistently found during an audit,’ says Edward Hu, MD, CHCQM-PHYADV, system executive director of physician advisor services at UNC Health Care system in Chapel Hill, North Carolina, and president of the American College of Physician Advisors. In addition, HIM will also play a role in ensuring the CMS-approved MOON is given to observation patients, Hu says.

In an era when hospitals are increasingly using electronic methods of documentation and communication, it may be tempting to create an electronic version of the MOON for patients to read and sign. However, Hu notes that if this practice is implemented the patient must still receive a paper copy of the form. ‘Hospitals must provide a signed paper copy of the MOON to the beneficiary, even if he or she reviews and signs on an electronic pad,’ he says. ‘The hospital must provide the MOON on paper for the beneficiary’s review if the beneficiary asks to review a paper version.’

Tracking and delivering the MOON is one hurdle to overcome, but so too is ensuring that patients understand the information presented to them. Language barriers can present a challenge when delivering the MOON. While it may be relatively easy to obtain a copy of the notice for patients who speak more common languages like Spanish, it is a bit more difficult at Antonios’ facility where patients speak a variety of languages that the form is not available in. In turn, staff may have a difficult time verbally notifying patients of observation status during off hours when a translator is unavailable, he says.

Hu notes that HIM can play a role in ensuring the Spanish-language version of the MOON is made available to patients and staff when it is approved by CMS. ‘Hospitals also have an obligation to provide the information on the MOON in a language and manner that the patient understands. Although this does not mean the MOON must be translated into every language, it does mean that the hospital has an obligation to ensure understanding by beneficiaries with limited English proficiency,’ he says.

 

The ups and downs of MOON

Complying with the NOTICE Act and operationalizing MOON has presented a significant challenge for healthcare organizations. Some are unsure of how to deliver the form and little is known about the impact it will have on patient relations and hospital staffing.

The verbal and written notice to observation patients should be given between 24 and 36 hours of the patient being placed in this status, which has many wondering whether they should actually wait 24 hours to deliver the notice since it can be challenging to ensure the notice is given before the 36-hour mark, says Antonios. ‘It leaves you with an open window of only 12 hours of actually being able to deliver before missing the deadline,’ Antonios says. Failure to deliver the notice within the given time frame can result in noncompliance.

While Antonios points out that CMS stated in the 2017 IPPS final rule that facilities can deliver the MOON prior to 24 hours of observation care, this may not always be the best option?especially since CMS noted that it discourages this practice. Delivering it before the 24-hour ma=rk as a proactive measure to ensure observation patients in need of the notice are not overlooked?or even delivering it on time?can present challenges since an observation stay can often become an inpatient stay based on a physician’s finding during the early hours of patient care, Antonios says.

Whether you decide to wait 24 hours or deliver the MOON as soon as observation status is initiated, there will be pros and cons.

Not waiting for the 24-hour mark may mean the verbal and written notice were given but not needed and could result in patients who are confused about their status and the financial implications of it. ‘It’s so early in the process that you may have people switched to inpatient before 24 hours and then you would have wasted the little bit of energy and resources to do a task that you didn’t need to do, because if you switch someone before 24 hours you don’t have to give them anything,’ Antonios says.

Delivering the MOON to all patients when they are first assigned to observation makes it easier to capture these Medicare beneficiaries before the 24?36-hour window passes, he says. It lends a fair amount of standardization and automation to the process of complying with the NOTICE Act and MOON, Antonios says.

However, ensuring that staff who are educated on completing the written notice and verbally explaining observation to patients are available at all times is not an easy task. While emergency departments (ED) are often well staffed during nights and weekends, other areas of hospitals may not have the same coverage, which could result in noncompliance if the MOON delivery window is missed. The ED?be it registration or other staff?may be the ideal setting for delivering the MOON if it is done routinely prior to the 24-hour mark. ‘Staffing on the floor goes down significantly after hours. It goes down significantly during the weekend, but the ED typically still has staff,’ Antonios says. ‘People receive paperwork in the ED anyway. It’s part of the process.’

HCPro.com – HIM Briefings

[Announcement] Hospice Benefit: Final FY 2017 Payment and Policy Change

Hospice

Originally Published in MLN Connects

On July 29, CMS issued a final rule (CMS-1652-F) outlining FY 2017 Medicare payment rates and wage index and the Hospice Quality Reporting Program (QRP) for hospices serving Medicare beneficiaries. As finalized, hospices would see a 2.1 percent ($ 350 million) increase in their payments for FY 2017 (reflecting an estimated 2.7 percent inpatient hospital market basket update, reduced by a 0.3 percentage point productivity adjustment and a 0.3 percentage point adjustment required by law).

Changes to the Hospice QRP:

• Provides a description of the Hospice CAHPS® Survey and outlines participation requirements for the FY 2019 and FY 2020 annual payment updates
• Finalizes two new quality measures for FY 2017
• CMS expects to begin public reporting hospice quality measures via a Compare site in CY 2017

Enhanced Data Collection:

• CMS is considering enhancing the current Hospice Item Set (HIS) data collection instrument to be more in line with other post-acute care settings
• This revised data collection instrument would be a comprehensive patient assessment instrument, rather than the current chart abstraction tool

For More Information:

• Final Rule will become effective on October 1, 2016
• Hospice Center website

 

See the full text of this excerpted CMS fact sheet (issued July 29).

The Medical Management Institute – MMI – Medical Coding News & MMI Updates

[Announcement] SNFs: Final FY 2017 Payment and Policy Changes

On July 29, CMS issued a final rule (CMS-1645-F) outlining FY 2017 Medicare payment policies and rates for the Skilled Nursing Facility (SNF) Prospective Payment System (PPS), the SNF Quality Reporting Program (QRP), and the SNF Value-Based Purchasing (VBP) Program. CMS projects that aggregate payments to SNFs will increase in FY 2017 by $ 920 million, or 2.4 percent, from payments in FY 2016. This estimated increase is attributable to a 2.7 percent market basket increase reduced by 0.3 percentage points, in accordance with the multifactor productivity adjustment required by law.

Changes to the SNF QRP:

• Adopts three measures to meet the resource use and other measure domains and one measure to satisfy the domain of medication reconciliation
• SNFs that fail to submit the required quality data to CMS will be subject to a 2 percentage point reduction to the annual market basket percentage update factor for fiscal years beginning with FY 2018
• Policies and procedures associated with public reporting are being finalized, including the reporting timelines, preview period, review and correction of assessment-based and claims-based quality measure data, and the provision of confidential feedback reports to SNFs

SNF VBP Program:

• Specifies the SNF 30-Day Potentially Preventable Readmission Measure, (SNFPPR), as the all-cause, all-condition risk-adjusted potentially preventable hospital readmission measure as required by law

• Finalized additional policies, including establishing performance standards, establishing baseline and performance periods, adopting a performance scoring methodology, and providing confidential feedback reports to SNFs

For More Information:

• Final Rule will become effective on October 1, 2016
• SNF PPS website
• SNF QRP webpage
• SNF VBP webpage

 

See the full text of this excerpted CMS fact sheet (issued July 29).

The Medical Management Institute – MMI – Medical Coding News & MMI Updates

[Announcement] IRFs: Final FY 2017 Payment and Policy Change

On July 29, CMS issued a final rule (CMS-1647-F) outlining FY 2017 Medicare payment policies and rates for the Inpatient Rehabilitation Facility (IRF) Prospective Payment System (PPS) and the IRF Quality Reporting Program (QRP). CMS is updating the IRF PPS payments for FY 2017 to reflect an estimated 1.65 percent increase factor (reflecting an IRF-specific market basket estimate of 2.7 percent, reduced by a 0.3 percentage point multi-factor productivity adjustment and a 0.75 percentage point reduction required by law). An additional approximate 0.3 percent increase to aggregate payments due to updating the outlier threshold results in an overall estimated update of approximately 1.9 percent (or $ 145 million), relative to payments in FY 2016.

• No changes to the facility-level adjustment
• Rural adjustment transition: Continue year two of the phase-out of the 14.9 percent rural adjustment for IRF providers in areas that were designated as rural and changed to urban under the new Office of Management and Budget delineations

    Changes to the IRF QRP:

    • Adopts three measures to meet the resource use and other measure domains and one measure to satisfy the domain of medication reconciliation
    • IRFs that fail to submit the required quality data to CMS will be subject to a 2 percentage point reduction to their applicable FY annual increase factor
    • Begin publically reporting IRF quality data in fall 2016
    • Adopted an extension of the time frame for submission of exception and extension requests for extraordinary circumstances from 30 days to 90 days from the date of the qualifying event

      For More Information:

      • Final Rule will become effective on October 1, 2016
      • IRF PPS website
      • IRF QRP website

        See the full text of this excerpted CMS fact sheet (issued July 29).

        The Medical Management Institute – MMI – Medical Coding News & MMI Updates

        [Announcement] Hospital IPPS and LTCH PPS Final Rule Policy and Payment Changes for FY 2017

        Hospital Discharges

        Originally Published in MLN Connects

        On August 2, CMS issued a final rule to update FY 2017 Medicare payment policies and rates under the Inpatient Prospective Payment System (IPPS) and the Long-Term Care Hospital (LTCH) Prospective Payment System (PPS). The final rule, which would apply to approximately 3,330 acute care hospitals and approximately 430 LTCHs, would affect discharges occurring on or after October 1, 2016.

        The final increase in operating payment rates for general acute care hospitals paid under the IPPS that successfully participate in the Hospital Inpatient Quality Reporting (IQR) Program and are meaningful Electronic Health Record (EHR) users is approximately 0.95 percent. This reflects the projected hospital market basket update of 2.7 percent adjusted by -0.3 percentage point for multi-factor productivity and an additional adjustment of -0.75 percentage point in accordance with the Affordable Care Act. This also reflects a 1.5 percentage point reduction for documentation and coding required by the American Taxpayer Relief Act of 2012 and an increase of approximately 0.8 percentage points to remove the adjustment to offset the estimated costs of the Two Midnight policy and address its effects in FYs 2014, 2015, and 2016.

        • In sum, CMS projects that total Medicare spending on inpatient hospital services, including capital, will increase by about $ 746 million in FY 2017
        • This projected increase in spending includes an estimated $ 350,000 increase in FY 2017 payments to hospitals located in Puerto Rico under the final policy to make IPPS payments for capital-related costs based solely on the national capital Federal rate

        The final rule also includes:

        • IPPS rate adjustments for documentation and coding and Two-Midnight Policy Medicare uncompensated care payments
        • CMS-1632-F & IFC: Finalization of the extension of the Medicare-Dependent Hospital Program and low-volume hospital adjustment provided by MACRA
        • Notification procedures for outpatients receiving observation services
        • Hospital-Acquired Condition Reduction Program
        • Hospital Readmissions Reduction Program
        • Medicare and Medicaid EHR Incentive Programs 
        • Hospital IQR Program
        • Hospital Value-Based Purchasing Program
        • PPS-Exempt Cancer Hospital Quality Reporting Program
        • Inpatient Psychiatric Facility Quality Reporting Quality Reporting Program
        • LTCH PPS changes
        • LTCH Quality Reporting Program


        See the full text of this excerpted CMS fact sheet (issued August 2).

        The Medical Management Institute – MMI – Medical Coding News & MMI Updates