Final Rule with Comment Period on Medicare OPPS - Ropes & Gray

Federal Register / Vol. 76, No. 230 / Wednesday, November 30, 2011 / <strong>Rule</strong>s and Regulations74187jlentini on DSK4TPTVN1PROD <strong>with</strong> RULES2some level of risk to the patient and thebeneficiary would be spared the riskassociated <strong>with</strong> the additional service ordifferent technology. Moreover, webelieve that hospitals strive to providethe best care they can to the patientsthey serve so that when newtechnologies are proven to improve thequality of care, their utilization willincrease appropriately, whether thepayment for them is packaged or not.While we believe hospitals arecommitted to provide optimal care totheir patients, we are aware that thereare financial pressures on hospitals thatmight motivate some providers to splitservices among different hospitalencounters in such a way as tomaximize payments. While we do notexpect that hospitals would routinelychange the way they furnish services orthe way they bill for services in orderto maximize payment, we recognize thatit would be possible and we considerthat possibility as we annually reviewhospital claims data. We will continueto examine claims data for patterns offragmented care, and if we find a patternin which a hospital appears to bedividing care across multiple days, wewill refer it for investigation to the QIOor to the Program Safeguard Contractor,as appropriate to the circumstances wefind.<strong>Comment</strong>: <strong>Comment</strong>ers asked thatCMS make underlying payment rates forpackaged services, including utilizationrates, estimated median costs, andnumbers of hospitals furnishing variousservices, available to the public. Inaddition, commenters asked that CMSstudy and report annually to the APCPanel and to the public on the impactof packaged payment on beneficiaryaccess to care. One commenter believedthat the APC Panel recommended thatCMS report annually on the impact ofpackaging on net payments for patientcare.Response: Each year, CMS makesavailable an extensive amount of OPPSdata that can be used for any dataanalysis an interested party would careto perform. Specifically, we makeavailable a considerable amount of datafor public analysis each year throughthe supporting data files that are postedon the CMS Web site in association <strong>with</strong>the display of the proposed and finalrules. In addition, as we discuss indetail in section II.A.2. of this final rule<strong>with</strong> comment period, we makeavailable the public use files of claims,including, for CY 2008 and later,supplemental line item cost data forevery HCPCS code under the OPPS, anda detailed narrative description of ourdata process for the annual OPPS/ASCproposed and final rules that the publiccan use to perform any desired analyses.Therefore, commenters are able toexamine and analyze these data todevelop specific information to assessthe impact and effect of packaging forthe services of interest to them. Thisinformation is available to supportpublic requests for changes to paymentsunder the OPPS, whether <strong>with</strong> regard toseparate payment for a packaged serviceor other issues. We understand that theOPPS is a complex payment system andthat it may be difficult to determine thequantitative amount of packaged costincluded in the median cost for everyindependent service. However,commenters routinely provide us <strong>with</strong>meaningful analyses at a very detailedand service-specific level based on theclaims data we make available. Weroutinely receive complex and detailedpublic comments, including extensivecode-specific data analysis on packagedand separately paid codes, using thedata from current and prior proposedand final rules. The APC Panel did notrecommend at either the February 2011or August 2011 meetings that CMSshould report annually on the impact ofpackaging on net payments for patientcare.<strong>Comment</strong>: <strong>Comment</strong>ers stated thatCMS assumes that its packaging policieswill allow it to continue to collect thedata it needs to set appropriate, stablepayment rates in the future, but that thisassumption is flawed. <strong>Comment</strong>ersstated that CMS’ past experience <strong>with</strong>packaging payment for ancillary itemsindicates that hospitals do not submitcodes for services that do not directlyaffect their payment and see no reasonto believe that this will change. Thecommenters asked that CMS requirecomplete and correct coding forpackaged services so that all items andservices that are not individually paidmust be included on the claim toprovide CMS <strong>with</strong> essential data forfuture OPPS updates. <strong>Comment</strong>ersexpressed concern about what theybelieved to be decreases in the numberof hospitals reporting services as a resultof packaging and bundling. Theybelieved that the decline could be dueto one or both of two reasons: Hospitalsmay no longer be providing theseservices; or hospitals could be providingthese services but not reporting codesand charges for them, denying CMSaccurate data for use in rate setting. Thecommenters were concerned thatdecreased reporting of services willresult in the costs of packaged servicesnot being included in the payment forthe independent service <strong>with</strong> whichthey are furnished.Response: We do not believe thatthere has been or will be a significantVerDate Mar2010 17:08 Nov 29, 2011 Jkt 226001 PO 00000 Frm 00067 Fmt 4701 Sfmt 4700 E:\FR\FM\30NOR2.SGM 30NOR2change in what hospitals report andcharge for the outpatient services theyfurnish to Medicare beneficiaries andother patients as a result of our currentpackaging methodology. Medicare costreporting standards specify thathospitals must impose the same chargesfor Medicare patients as for otherpatients. We are often told by hospitalsthat many private payers pay based ona percentage of charges and that, inaccordance <strong>with</strong> Medicare costreporting rules and generally acceptedaccounting principles, hospitalchargemasters do not differentiatebetween the charges to Medicarepatients and other patients. Therefore,we have no reason to believe thathospitals will stop reporting HCPCScodes and charges for packaged servicesthey provide to Medicare beneficiaries.As we stated in the CY 2009 OPPS/ASCfinal rule <strong>with</strong> comment period (74 FR68575), we strongly encourage hospitalsto report a charge for each packagedservice they furnish, either by billingthe packaged HCPCS code and a chargefor that service if separate reporting isconsistent <strong>with</strong> CPT and CMSinstructions, by increasing the chargefor the separately paid associatedservice to include the charge for thepackaged service, or by reporting thecharge for the packaged service <strong>with</strong> anappropriate revenue code but <strong>with</strong>out aHCPCS code. Any of these means ofcharging for the packaged service willresult in the cost of the packaged servicebeing incorporated into the cost weestimate for the separately paid service.If a HCPCS code is not reported whena packaged service is provided, weacknowledge that it can be challengingto specifically track the utilizationpatterns and resource cost of thepackaged service itself. However, wehave no reason to believe that hospitalshave not considered the cost of thepackaged service in reporting chargesfor the independent, separately paidservice. We expect that hospitals, asother prudent businesses, have a qualityreview process that ensures that theyaccurately and completely report theservices they furnish, <strong>with</strong> appropriatecharges for those services to Medicareand all other payers. We encouragehospitals to report on their claim forpayment all HCPCS codes that describepackaged services that were furnished,unless the CPT Editorial Panel or CMSprovides other guidance. To the extentthat hospitals include separate chargesfor packaged services on their claims,the estimated costs of those packagedservices are then added to the costs ofseparately paid procedures on the sameclaims and used in establishing