Medicare's 2020 Final Payment Rule Released; ASCA Advocacy Produces Successes

November 1, 2019

The Centers for Medicare & Medicaid Services (CMS) released the 2020 final payment rule for ASCs and hospital outpatient departments (HOPDs) today. Of note, CMS has finalized the addition of eight codes to the ASC-payable list, including total knee arthroplasty (TKA), which were previously not payable in the ASC setting. CMS also finalized its decision to continue to align the ASC update factor with that used to update HOPD payments. According to the final rule, CMS plans to continue using the hospital market basket to update ASC payments for calendar year (CY) 2020 through CY 2023 as the agency assesses this policy’s impact on volume migration.

“We are grateful that this final rule continues the sound policy of updating ASC Medicare payments for inflation on par with hospital outpatient departments," says ASCA CEO Bill Prentice. “In addition, adding total knee arthroplasty to our procedures list so soon after moving it from the inpatient-only list, as well as a number of cardiac codes, speaks well to the confidence that CMS has in the ability of physicians to use well-established patient selection criteria to move appropriate patients to the lower-cost ASC setting."

Some other initial observations about the 1,113-page rule follow. ASCA will provide additional analysis soon, including a rate calculator that allows users to determine what ASCs will be paid locally. You can download a copy of the rule here.

2.6% Average Rate Update

ASCs’ reimbursements, on average over all covered procedures, received an effective update of 2.6 percent—a combination of a 3.0 percent inflation update based on the hospital market basket and a productivity reduction mandated by the Affordable Care Act of 0.4 percentage points. Please note that this is an average, and that updates may vary significantly by code and specialty. It is also important to note that CMS does not consider sequestration in its final rule. This statutory 2.0 percent reduction remains in effect until at least 2024 unless Congress acts.

The information below provides a comparison between the 2020 ASC and HOPD reimbursement rates:

Inflation update factor 3.0% 3.0%
Productivity reduction mandated by the ACA 0.4 percentage points 0.4 percentage points
Effective update 2.6% 2.6%
Conversion factor $47.747 $80.784

Additions to the ASC-Payable List

CMS has finalized the addition of the following eight codes to the ASC-payable list beginning January 1, 2020. These codes are:

  • 27447 (Total knee arthroplasty)
  • 29867 (Allgrft implnt knee w/scope)
  • 92920 (Prq cardiac angioplast 1 art)
  • 92921 (Prq cardiac angio addl art)
  • 92928 (Prq card stent w/angio 1 vsl)
  • 92929 (Prq card stent w/angio addl)
  • C9600 (Perc drug-el cor stent sing)
  • C9601 (Perc drug-el cor stent bran)

With regards to TKA, it is important to note that based on the public comments CMS received, the agency is not finalizing any of the additional requirements on which they sought comment, such as adding a modifier or requiring an ASC to have a certain amount of experience in performing a procedure before being eligible for payment for performing the procedure under Medicare.

Additionally, CMS notes the agency inadvertently omitted new CPT and new HCPCS codes effective January 1, 2020, from Table 32 (Proposed Additions to the List of ASC Covered Surgical Procedures for CY 2020) of CY 2020 OPPS/ASC proposed rule (84 FR 39544); however, it included these 12 procedures in Addendum AA to the proposed rule. This omission was an error, and the codes are payable in the ASC setting as of January 1, 2020.

Total Hip Arthroplasty (THA) and Six Spine Codes Removed from Inpatient Only (IPO) List

CMS also removed 27130 (total hip arthroplasty) as well as the following spine codes from the IPO list for 2020: 22633, 22634, 63265, 63266, 63267 and 63268. Effective January 1, 2020, these procedures may be performed in the hospital outpatient setting.

Changes to the ASC Quality Reporting Program for 2020

CMS adopted ASC-19: Facility-Level 7-Day Hospital Visits after General Surgery Procedures Performed at Ambulatory Surgical Centers for 2024 payment determinations and beyond.

CMS did not yet mandate implementation of the Consumer Assessment of Healthcare Providers and Systems Outpatient and Ambulatory Surgery Survey (OAS CAHPS) under the ASCQR Program.

CMS did request comments on the potential future online data submission of suspended measures: ASC-1: Patient Burn; ASC-2: Patient Fall; ASC-3: Wrong Site, Wrong Side, Wrong Patient, Wrong Procedure, Wrong Implant; and ASC-4: All-Cause Hospital Transfer/Admission. The agency will take feedback received into consideration for future rulemaking.

With regards to quality, Prentice adds, “As the ASC quality program continues to evolve, we hope to work with CMS to develop procedure-specific outcome measures that can provide more data on the care in all outpatient settings.”

ASCA is analyzing the rule in detail and will soon provide more information to help ASC operators understand the impact on their centers.