CMS Releases 2023 Proposed Medicare Payment Rule

July 15, 2022

CMS Releases 2023 Proposed Medicare Payment Rule

The Centers for Medicare & Medicaid Services (CMS) released the 2023 proposed payment rule for ASCs and hospital outpatient departments (HOPD) on July 15, 2022.

CMS proposed to continue to align the ASC update factor with the one used to update HOPD payments. Under the proposal, CMS would continue to use the hospital market basket to update ASC payments for calendar year (CY) 2023 as the agency assesses this policy’s impact on volume migration. This will be the last year of the trial period.

Although ASCA provided a list of 47 codes for procedures that are being done safely on non-Medicare populations for consideration to be added to the ASC Covered Procedures List (ASC-CPL), CMS added only one of the requested codes:

  • 38531 (Open bx/exc inguinofem nodes)

“This proposed rule misses an opportunity to lower costs and improve access to care to beneficiaries by not adding many viable procedures that ASCs are safely performing on commercial patients,” says Bill Prentice, chief executive officer of ASCA. “We have provided clinical data to CMS that should be used to add these procedures to our allowable list for 2023.”

Download the proposed rule PDF.

Other initial observations about the 886-page proposal follow. ASCA will provide additional analysis soon, including a rate calculator that allows users to determine what ASCs will be paid locally if the proposal is adopted.

2.7% Average Rate Update

If the proposed rule were to be finalized as drafted, ASCs would see, on average over all covered procedures, an effective update of 2.7 percent, which is a combination of a 3.1 percent inflation update based on the hospital market basket and a productivity reduction mandated by the Affordable Care Act of 0.4 percentage points. This is an average and the updates might vary significantly by code and specialty.

The information below provides a comparison between the 2023 ASC and HOPD reimbursement proposals:

Inflation update factor 3.1% 3.1%
Productivity reduction mandated by the ACA 0.4 percentage points 0.4 percentage points
Effective update 2.7% 2.7%
Conversion factor $51.315 $86.785

Proposed Name Change and Start Date of Nominations Process

CMS is changing the “Nominations” process to the “Pre-Proposed Rule CPL Recommendation” process. CMS believes the current name might suggest a formality or limitation that the agency did not intend, one that implies the nominations process is the preferred, primary or only means by which interested parties may submit recommendations. CMS also proposes to change the start date of this process from January 1, 2023, to January 1, 2024, so that the text at 42 CFR §416.166 - Covered Surgical Procedures (d) would specify that on or after January 1, 2024, an external party may recommend a surgical procedure by March 1 of a calendar year for the ASC-CPL for the following calendar year. CMS will continue to welcome all procedure submissions through the public comment process, as they have in previous years.

Proposed ASC Special Payment Policy for OPPS Complexity-Adjusted C-APCs

CMS is proposing a new ASC payment policy that would result in higher payment when a code combination is a more complex and costlier version of the procedure performed, “similar to the way in which the OPPS APC complexity adjustment is applied to certain paired code combinations that exhibit materially greater resource requirements than the primary service.”

Positive Change to ASC Quality Reporting Program

Regarding the ASC Quality Reporting (ASCQR) Program, CMS is proposing to suspend the mandatory adoption of ASC-11: Cataracts: Improvement in Patient’s Visual Function within 90 Days Following Cataract Surgery. ASCA has been strongly advocating for this measure to remain voluntary.

CMS also is requesting comments on the potential readoption of ASC-7: ASC Facility Volume Data on Selected ASC Surgical Procedures or another volume indicator in the ASCQR Program.

“We are pleased that CMS has made ASC-11 voluntary through 2027 as it requires data that surgery centers simply don’t possess,” noted Prentice.

Comments are due September 13, 2022.

ASCA will continue to analyze the rule in detail and will provide more information to help ASC operators understand the impact of the proposal on their centers soon.