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The Centers for Medicare & Medicaid Services is boosting payment for hospital outpatient services and home health and reducing reimbursement for physicians next year, according to a trio of final rules published Tuesday.
Hospital-owned outpatient and ambulatory surgery center payment rates will each increase by 2%. Medicare home health reimbursement rates will increase by 2.6%, which the CMS expects to increase payments by $465 million.
The agency will reduce the physician fee schedule conversation factor by $1.30 to $33.59 as the temporary reimbursement boost provided by the Consolidated Appropriations Act expires.
But the CMS is expanding reimbursement for telehealth services that treat mental health issues.
“The COVID-19 pandemic has highlighted the gaps in our current healthcare system and the need for new solutions to bring treatments to patients, wherever they are,” CMS Administrator Chiquita Brooks-LaSure said in a news release. “This is especially true for people who need behavioral health services, and the improvements we are enacting will give people greater access to telehealth and other care delivery options.”
Outpatient rule
Hospitals will face stricter penalties next year if they don’t publish their negotiated rates with insurers and meet other requirements in the transparency rule, as the Outpatient Prospective Payment System rule outlined.
Large hospitals will pay a maximum annual fine of more than $2 million if they don’t post machine-readable files of the rates they negotiate with payers, gross charges and discounted cash prices. Small hospitals will pay up to $109,500 if they don’t follow the rule.
Less than 6% of hospitals were fully compliant, according to a Patient Rights Advocate analysis conducted from May to July. Some large hospitals will opt to pay the fine rather than publish the data, lawyers who represent hospitals said.
“The CMS is committed to promoting and driving price transparency, and we take seriously concerns we have heard from consumers that hospitals are not making clear, accessible pricing information available online, as they have been required to do since January 1, 2021,” Brooks-LaSure said in a news release.
Federal regulators paused plans to phase out the inpatient-only list, which includes services that can only be performed in hospitals. The CMS aimed to cut costs by allowing more services in outpatient settings, as technology safely allowed.
But the agency halted the elimination of the IPO list through next year and added nearly all of the 298 services it removed from the list last year after hospitals claimed that safety would suffer if treatment moved to outpatient facilities.
“We are pleased that CMS recognized the unique role that hospital outpatient departments play in caring for patients,” the American Hospital Association said in a written statement.
The final rule also continued reductions for 340B drug discount payments, except for rural sole community hospitals, certain cancer hospitals and children’s hospitals. The U.S. Supreme Court is weighing whether the CMS had the authority to make the cuts that began in 2018.
“Four years’ worth of Medicare cuts have taken their toll on 340B hospitals, some of which have been forced to cut crucial services or postpone expanding care that would have benefited their communities. We remain concerned that more of these cutbacks will become necessary as the reductions persist,” 340B Health President and CEO Maureen Testoni said in prepared remarks.
Home health rule
The home health final rule will expand quality-based reimbursement for home health agencies.
The CMS formalized the nationwide expansion of the Home Health Value-Based Purchasing Model, starting in 2023. The initial pilot program showed an average 4.6% improvement in participating agencies’ quality scores over a three-year period and an average annual savings of $141 million, regulators said. Starting in 2025, the agency will adjust fee-for-service payments to Medicare-certified home health agencies based on the quality of care provided to beneficiaries during the 2023 calendar year.
The home health final rule will boost data collection efforts to address health disparities and access issues for the underserved, the CMS said.
Physician rule
In the physician fee schedule final rule, CMS will eliminate geographic restrictions that limit behavioral health patients’ access to mental healthcare.
Medicare will pay for audio-only counseling and therapy visits provided by rural health clinics and federally qualified health centers, which should mitigate access issues for those with poor internet access, regulators said.
“The (AHA) applauds today’s 2022 Physician Fee Schedule final rule for delaying the enforcement of the Appropriate Use Criteria program as well as expanding access to telehealth services, especially for behavioral health services,” the association said in a statement.
The CMS also plans to expand coverage of outpatient pulmonary rehabilitation services, grow its Medicare Diabetes Prevention Program, boost payment rates for several vaccines and increase access to nutrition therapy.
Meanwhile, regulators are reducing Medicare payments to physicians by nearly 9% next year, after taking into account the expiring 3.75% boost they received in 2021 via the Consolidation Appropriations Act.
“Amid the ongoing pandemic, it’s critical now more than ever, to protect patients by stopping these cuts and working toward a long-term solution to stabilize the health care system,” Dr. John Ratliff, American Association of Neurological Surgeon/Congress of Neurological Surgeons Washington Committee chair, said on behalf of the Surgical Care Coalition.
The CMS is delaying its mandate for accountable care organizations to report quality metrics electronically, which was welcomed by the National Association of ACOs.
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