AACU News & Notes

AACU Comments on Proposed 2017 Outpatient Facility and ASC Payment Rates

posted: September 2, 2016

The AACU submitted comments September 1, 2016, on a proposed rule regulating hospital-based outpatient and ambulatory surgical center (ASC) Medicare payment rates for calendar year 2017.

Overall, the Centers for Medicare and Medicaid Services (CMS) proposal would increase hospital-based rates by 1.55% and ASC rates by 1.2%. The positive ’update’ is notable in contrast to last year’s adjustment, which cut payment rates for the first time in several years.

Site-Neutral Payments

For the past several years, policymakers have discussed site-neutral payments as a mechanism for savings in the outpatient space. A ’site-neutral’ payment policy would eliminate the difference between hospital-based and non-hospital based outpatient facility payment rates, thus reducing rates for some hospital-based services to non-hospital based rates and ultimately decreasing Medicare’s outpatient costs.

Many stakeholders were disappointed by exceptions CMS proposes in the site-neutral payment changes, including:

  • All items and services furnished in a dedicated emergency department
  • Items and services furnished and billed by an off-campus, provider-based department before November 2, 2015
  • Items and services furnished in a hospital department within 250 yards of a remote location of the hospital

AACU Comments

The AACU’s comments on the proposed rule touched on the following points:

  • We support the proposed change from APC 1565 to APC 5376 (Level 6 Urology and Related Services).
  • We agree with the proposed move from a Status Indicator (SI) T to J1, Comprehensive APC status.
  • We agree with the proposed shift from status indicator (SI) G2 (non office-based surgical procedure) to J8 (device intensive procedure). This change is essential to allow for appropriate ASC payment and will allow more Medicare patients access to this treatment option.
  • We support the proposal to revise the device-intensive calculation methodology and calculate at the HCPCS code level rather than at the APC level to ensure that device-intensive status is properly assigned to all device-intensive procedures. This change will result in ASC payments that have less fluctuation, thereby allowing more Medicare procedures in this efficient site of service.

Additional Resources

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