ASCA CEO William Prentice Discusses Medicare’s Proposed 2019 ASC Payment Rule

On July 25, the Centers for Medicare & Medicaid Services (CMS) released the 2019 proposed payment rule for ASCs and hospital outpatient departments (HOPD). ASCA Chief Executive Officer William Prentice talks about the policy changes proposed and the implications of those changes for ASCs.

 

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Overall, what is ASCA’s view of CMS’ proposed 2019 rule changes for ASCs?

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The changes proposed in this year’s rule are among the most significant I have seen in my eight years with ASCA. Overall, I would say they demonstrate greater recognition of the quality and value ASCs provide than we have seen in any previous rulemaking. For example, foremost among the proposed changes is a decision to update ASC payments using the hospital market basket inflation factor, a much more realistic indicator of rising costs in the ASC space than what CMS has been using. We have fought for this change over the last decade and are appreciative to see it included.

Other changes in the rule include provisions to encourage the migration of device-intensive procedures to ASCs, allow for several new cardiac procedures in the ASC setting and make sweeping changes to the ASC Quality Reporting program.

These proposed changes are positive and beneficial for ASCs and the patients they serve, so it’s critically important that every ASCA member understand that they have an opportunity until September 24 to provide feedback to CMS (at regulations.gov/comment?D=CMS-2018-0078-0002). The final decisions on all these changes will be made when the final rule is published in November. Beginning next week, ASCA members can go to our website to learn more about submitting comments.

 

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How is CMS proposing to change the annual inflationary adjustment for ASCs?

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Under the proposal, CMS would use the hospital market basket to update ASC payments for the five-year period of calendar year (CY) 2019 through CY 2023.

Historically, ASCs have been shortchanged by a requirement that our adjustments be based on the Consumer Price Index for All Urban Consumers, or the CPI-U, (which focuses on broad consumer price changes) rather than the hospital market basket. But since ASCs use the same staff, services and supplies as HOPDs, it only makes sense to apply the same inflation rate for our yearly updates.

If the proposed rule were to be finalized as drafted, ASCs would see, on average over all covered procedures, an effective update of 2.0 percent—a combination of a 2.8 percent inflation update based on the hospital market basket and a productivity reduction mandated by the Affordable Care Act of 0.8 percentage points. It should be noted that this adjustment is an average and that updates can vary significantly by code and specialty.

 

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What is CMS proposing regarding device intensive procedures performed in ASCs?

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CMS is proposing to reduce the threshold definition of device intensive procedures in ASCs from 40 percent to 30 percent—a policy change that we have been advocating for over the past several years to encourage migration of these procedures into ASCs.

This means that if the device portion of the overall procedure equals 30 percent or more of the total cost in the HOPD, the total device cost will be included in the reimbursement rate when the procedure is performed in the ASC. If the rule is adopted as proposed, it would result in a net increase of 142 new device intensive procedures that ASCs could afford to provide for Medicare beneficiaries for the first time, effectively growing the approved list from the current 154 device-intensive procedures to 296 procedures in 2019 and beyond.

 

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What new procedures have been proposed for the ASC setting?

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CMS is proposing to revise the definition of “surgery” in the ASC payment system to account for certain “surgery-like” procedures that are assigned codes outside the Current Procedural Terminology (CPT) surgical range. This change allows them to propose adding 12 cardiac catheterization procedures to the ASC covered procedures list.

 

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Last year CMS allowed HOPDs to perform total joint replacement procedures. Did this rule make any changes regarding those procedures in ASCs?

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No, and we didn’t expect any total joint replacement codes to be added this year. We say this even though we know that many ASCs around the country are safely and effectively performing these procedures on non-Medicare patients. One issue is that the reimbursement CMS applied to the procedures it moved to the HOPD last year seems to be too low to encourage migration from the inpatient space.

 

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Speaking of procedures, CMS is proposing to review procedures that were added to the ASC list in the last three years. Do you have any insights to share on that?

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This seems to be a new approach to the statutory oversight that CMS already performs in all sites of service. Right now, they are proposing to review 38 procedures (spine, vascular and gynecologic) that were added to the ASC payment list in CYs 2015, 2016 and 2017. In the future, they will continue to use this three-year window; so, if the new cardiac codes contained in this rule are adopted, we would expect to see them reviewed in this same way in CYs 2019, 2020 and 2021. We agree that there can be clinical differences between the Medicare and non-Medicare populations, so this kind of review of newly added procedures to a site of service—whether from hospital inpatient to outpatient, HOPD to ASC or ASC to the physician office—makes sense, and we support this oversight.

 

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Could you speak to the proposed provision that addresses payment for non-opioid pain management therapy?

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As you know, President Trump has made responding to the opioid epidemic in America a priority. This provision is a result of that endeavor and an idea we brought to the Administration’s attention.

Current payment policy serves as an impediment to using non-opioids for post-surgical pain, so this provision addresses our concerns by allowing ASCs to get paid for non-opioid pain relief drugs when used in a surgical procedure. Currently, Exparel is the only drug that CMS has identified in the rule that qualifies. We will be interested to hear from the ASC community as to whether there are other alternatives being used for which CMS should apply this new policy.

 

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The proposed rule would remove eight measures from Medicare’s ASC Quality Reporting (ASCQR) Program over a two-year period:

  • ASC-1: Patient Burn;
  • ASC-2: Patient Fall;
  • ASC-3: Wrong Site, Wrong Side, Wrong Patient, Wrong Procedure, Wrong Implant;
  • ASC-4: All-Cause Hospital Transfer/Admission;
  • ASC-8: Influenza Vaccination Coverage Among Healthcare Personnel;
  • ASC-9: Endoscopy/Polyp Surveillance Follow-up Interval for Normal Colonoscopy in Average Risk Patients;
  • ASC-10: Endoscopy/Polyp Surveillance: Colonoscopy Interval for Patients with a History of Adenomatous Polyps - Avoidance of Inappropriate Use; and
  • ASC-11 (voluntary measure): Cataracts - Improvement in Patient's Visual Function within 90 Days Following Cataract Surgery.

Please discuss some of the details related to these changes.

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Importantly, the rationale that CMS is using to justify elimination of ASC-1, 2, 3 and 4 is that the results have “topped out,” which is the term used to indicate that positive performance on these measures is so consistently high that CMS sees almost no room for improvement and no reason to continue measuring them.

For the other measures, we are grateful that CMS has agreed with the concerns that ASCA and the ASC community expressed originally about them, i.e., that those measures were not really related to quality and, therefore, not appropriate for a quality reporting program.

While we are grateful for these changes, we continue to believe that patients deserve more information about the quality of care they receive in all settings and look forward to working with CMS staff to develop more meaningful measures that provide actionable data for patients, providers and regulators about outpatient procedures.

 

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Okay. Last question on the quality reporting measures: When can ASCs stop reporting the ones that are being removed?

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If this provision is adopted in the final rule, ASCs can stop reporting anything on Medicare claims beginning January 1, 2019. They can also stop reporting ASC-8 immediately and stop collecting data on ASC-9 and 10 on January 1, 2019. To qualify for their full payment update in 2020, however, facilities still need to report the data they collect this year on measures ASC-9 and 10 in 2019. Reporting on ASC-11 is already voluntary, so there are no additional reporting requirements tied to that measure.

Beginning in 2019, ASCs will also need to report information they began collecting this year on two new measures—ASC-13: Normothermia and ASC-14: Unplanned Anterior Vitrectomy. These reporting requirements were not changed in the proposed rule.

 

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A few years ago, CMS proposed instituting a lengthy patient experience of care survey in ASCs and HOPDS that it called the Consumer Assessment of Healthcare Providers and Systems Outpatient and Ambulatory Surgery Survey (OAS CAHPS). Based on comments it received on the complexity of the reporting process, CMS decided last year to delay implementation of the survey until further notice. Does this proposed rule reveal when that survey might begin?

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In this proposal, CMS indicates that the OAS CAHPS survey remains on hold but makes clear that it continues to plan to require ASCs and HOPDs to use a version of that survey in the future. ASCA continues to have strong concerns about the length of the survey and the lack of an email option, but we remain hopeful that those concerns will be addressed before CMS begins to require use of that survey.