The Centers for Medicare & Medicaid Services (CMS) has issued a final rule with comment period that updates payment policies and rates for both hospital outpatient departments (HOPDs) and ambulatory surgical centers (ASCs) for calendar year (CY) 2010. CMS projects that total payments for services furnished to people with Medicare in HOPDs during CY 2010 under the Outpatient Prospective Payment System (OPPS) will be $32.2 billion, and total projected CY 2010 payments under the ASC payment system will be approximately $3.4 billion.

The final rule has several expansions of Medicare coverage that were required in the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), including kidney disease education. This will be established payment to rural providers under the Medicare Physician Fee Schedule (MPFS) for education services furnished on or after Jan. 1, 2010 for Medicare beneficiaries diagnosed with Stage IV chronic kidney disease. There will also be OPPS payment for pulmonary and cardiac rehabilitation services furnished to beneficiaries with chronic obstructive pulmonary disease, cardiovascular disease, and related conditions, effective Jan. 1, 2010.

Next, CMS will reduce the CY 2010 annual inflation update factor by two percentage points for most services furnished by hospitals that failed to meet the CY 2009 reporting requirements of the HOP Quality Data Reporting Program (QDRP). The reduction will not apply to payments for separately payable pass-through drugs, biologicals and devices. CMS will continue to require hospitals subject to HOP QDRP requirements to provide quality data for the current seven chart-abstracted emergency department and surgical care measures and four claims-based imaging efficiency measures for CY 2011 payment determinations, and will implement a HOP QDRP validation requirement to ensure that hospitals are accurately reporting measures using chart-abstracted data. CMS is working to make HOP QDRP quality measure data publicly available as early as June 2010.

CMS will also be revising or further defining several current policies for the supervision of outpatient services. This includes allowing certain non-physician practitioners (physician assistants, nurse practitioners, clinical nurse specialists, certified nurse-midwives, and licensed clinical social workers) to provide direct supervision for all hospital outpatient therapeutic services that they are authorized to personally perform according to their state scope of practice rules and hospital-granted privileges.

In payment for drugs, biologicals and radiopharmaceuticals, CMS will pay for the acquisition and pharmacy overhead costs of separately payable drugs and biologicals without pass-through status at the average sales price (ASP) plus four percent, in CY 2010.

Beginning in CY 2010, implantable biologicals surgically implanted and not receiving pass-through payment before Jan. 1, 2010 will be evaluated for pass-through status using the device category pass-through process rather than the drug and biological pass-through process. If the implantable biologicals initially qualify for device pass-through status beginning on or after Jan. 1, 2010 they will be paid at hospitals' charges, adjusted to cost for the two to three year pass-through payment period.

Beginning Jan. 1, 2010, CMS will provide payment for separately payable therapeutic radiopharmaceuticals with ASP data at ASP plus four percent. CMS says if ASP data is not available, payment will be based upon mean unit cost from hospital claims data.

The significant changes for approximately 5,000 Medicare-participating ASCs in CY 2010 include revised payment rate updates to reflect the same relativity of resource use among procedures as under the OPPS, while considering the lower costs of surgical procedures performed in ASCs and maintaining budget neutrality in the payment system. By law, CY 2010 is the first year that CMS may provide an inflation update under the revised ASC payment system. The percentage increase in the Consumer Price Index that updates the ASC conversion factor for CY 2010 is 1.2 percent.

In addition, CMS is adding 26 surgical procedures for which Medicare will pay when performed in an ASC, and newly designating six procedures as office-based procedures (at the lesser of the national office practice expense payment to the physician, or the national ASC rate), and temporarily designating 16 procedures as office-based procedures based on coding changes for CY 2010. There are also updates on the list of device-intensive procedures and covered ancillary services and their rates.

The final rule with comment period will appear in the Nov. 20 Federal Register. Comments on designated provisions are due by 5:00 p.m. Eastern time on Dec. 29, 2009. CMS will respond to comments in the CY 2011 OPPS/ASC final rule.

The CMS Fact Sheet on the changes can be accessed at: http://www.cms.hhs.gov/apps/media/press/factsheet.asp?Counter=3542&intNumPerPage=10&checkDate=&checkKey=&srchType=1&numDays=3500&srchOpt=0&srchData=&keywordType=All&chkNewsType=6&intPage=&showAll=&pYear=&year=&desc=&cboOrder=date