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2017 Hospital Outpatient Prospective Payment System (OPPS) Final Rule Changes

2017 Hospital Outpatient Prospective Payment System (OPPS) Final Rule Changes

On October November 1, 2016, the Centers for Medicare and Medicaid Services (CMS) released the Calendar Year (CY) 2017 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment Systems and Quality Reporting Programs final rule with comment period. The final rule updates Medicare payment policies and rates for services performed in hospital outpatient departments.

Hospital-based outpatient audiology services are paid under the OPPS.  Individual services are assigned to Ambulatory Payment Classification (APC) groups.  By law, the APC groups are to be comprised of services that are similar clinically, in resource use, and cost.  Payments are then calculated for the APC with each service within a respective APC receiving the same rate of reimbursement.

OPPS Conversion Factor Update

For CY 2017, we anticipate CMS will use a conversion factor of $75.001 in the calculation of the national unadjusted payment rates for those items and services for which payment rates are calculated using geometric mean costs. CMS is increasing the payment rates under the OPPS by an Outpatient Department (OPD) fee schedule increase factor of 1.65 percent.

This year, CMS undertook a large scale consolidation and reorganization of the APC groups.  For some services this resulted in a drastic reduction in reimbursement.  Other services fared much better under the reorganization.   The Academy commented on the placement of CPT code 92540 and associated reimbursement reduction.  While CMS did not accept our comments, we will continue to monitor APC changes and respond to inappropriate code placement.

Packaging Based on Claim instead of Based on Date of Service

CMS is finalizing its proposal to package services at the claim level instead of based on the date of service. CMS has stated that this packaging policy will promote consistency and ensure that items and services that are provided during a hospital stay that may span more than one day are packaged together.

2017 APCs for Audiology Codes

Tables 1-6 below discuss the APCs for 2017 for audiology codes.  An "S" status indicator denotes a "Separate APC Payment" where regardless of services performed on the same date of service, the CPT code is paid at the APC rate. A "Q1" status indicator represents "STV-Packaged Codes" where APCs and CPT codes billed on the same date of service as those assigned a status indicator of "S", "T" or "V" are packaged and not paid for separately. If billed with without the "S," "T," or "V" service, payment is made at the APC rate.

Table 1:  APC 5721-Level I Diagnostic Tests and Related Services ($127.05)

CPT Code

Code Descriptor

Status Indicator

92540*

Basic vestibular evaluation

S

92544

Optokinetic nystagmus test, bidirectional, foveal or peripheral stim, w/recording

S

92545

Oscillating tracking test, with recording

S

92546

Sinusoidal vertical axis rotational testing

S

92584

Electrocochleography

S

92586

Auditory evoked potentials, limited

S

92601

Cochlear Implant initial programming <7  years old

S

92602

Subsequent programming <7  years old

S

92603

Cochlear implant initial programming > 7 years old

S

92604

Subsequent programming  >7  years old

S

92640

Auditory brainstem implant programming

S

92550

Tympanometry & reflex threshold

Q1

92553

Audiometry air and bone

Q1

92557

Comprehensive hearing evaluation

Q1

92562

Loudness balance test

Q1

92570

Acoustic immitance testing

Q1

92572

Staggered spondaic word test

Q1

92579

Visual audiometry (VRA)

Q1

92582

Conditioning play audiometry

Q1

92620

Auditory function test (60 min)

Q1

92625

Tinnitus assessment

Q1

92626

Evaluation of auditory rehab status

Q1

*New APC Placement for CY 2017

Table 2:  APC 5722- Level II Diagnostic Tests and Related Services ($232.21)

CPT Code

Code Descriptor

Status Indicator

92537  

Caloric vestibular test with recording, bilateral; bithermal

S

92538

Caloric vestibular test with recording, bilateral; monothermal

S

92585

Auditory evoked potentials (ABR), comprehensive

S

92587

OAEs, limited

S

92588

OAEs, comprehensive

S

Table 3: APC 5723- Level III Diagnostic Tests and Related Services ($415.69)

CPT Code

Code Descriptor

Status Indicator

92577

Stenger test, speech

Q1

Table 4: APC 5731- Level I Minor Procedures ($12.61)

CPT Code

Code Descriptor

Status Indicator

92700

Unlisted otorhinolarngological service or procedure

Q1

Table 5: APC 5732- Level II Minor Procedures ($28.37)

CPT Code

Code Descriptor

Status Indicator

92555

Speech threshold audiometry

Q1

92556

Speech threshold and discrimination

Q1

92563

Tone decay hearing test

Q1

92564

SISI hearing test

Q1

92565

Stenger  test, pure tone

Q1

92567

Tympanometry

Q1

92568

Acoustic reflex threshold

Q1

92571

Filtered speech test

Q1

92575

Sensorineural acuity test

Q1

92576

Synthetic sentence test

Q1

92583

Select picture audiometry

Q1

92596

Ear protection measurement

Q1

Table 6: APC 5734- Level IV Minor Procedures ($99.98)

CPT Code

Code Descriptor

Status Indicator

92541

Spontaneous nystagmus test

Q1

92542

Positional nystagmus test

Q1

92548

Posturography

Q1

92552

Pure tone audiometry air

Q1

92561

Bekesy audiometry diagnosis

Q1

Section 603 of the Bipartisan Budget Act of 2015

This year, the rule includes final regulations to implement section 603 of the Bipartisan Budget Act of 2015 (BBA). Implementation of this Act relates to payment for certain items and services furnished by providers in certain off-campus outpatient departments. CMS is also issuing an interim final rule with comment period to establish the Medicare Physician Fee Schedule (MPFS) payment rates for the non-excepted items and services billed by a non-excepted off-campus provider-based department of a hospital in accordance with the provisions of section 603.

In accordance with section 603, CMS is establishing interim final payment rates under the MPFS in an interim final rule. The final rule provides that certain items and services furnished by certain off-campus provider-based departments (PBDs) shall not be considered covered outpatient department services for purposes of OPPS payment and shall instead be paid "under the applicable payment system" beginning January 1, 2017. CMS is finalizing several policies relating to which off-campus PBDs and which items and services are "excepted" from application of the payment changes under this provision and will continue to be paid under the OPPS.

Excepted Items and Services : CMS is finalizing its proposals that certain off-campus PBDs would be permitted to continue to bill for excepted items and services under the OPPS. Excepted items and services are items and services furnished after January 1, 2017:

  • By a dedicated emergency department;
  • By an off-campus PBD that was billing for covered OPD services furnished prior to November 2, 2015, (i.e., the date of enactment of section 603 of the BBA of 2015) that has not impermissibly relocated or changed ownership; or
  •  In a PBD that is "on the campus," or within 250 yards, of the hospital or a remote location of the hospital.

Service Expansion in an Excepted Off-Campus PBD

CMS proposed to limit the items and services that an excepted off-campus PBD could continue to bill under the OPPS beginning January 1, 2017, to those items and services within a clinical family that were furnished and billed as of November 2, 2015. Under the proposal, additional items and services beyond those within the clinical families of services furnished and billed prior to that date would not be excepted items and services paid under the OPPS. CMS received many public comments raising concerns regarding administrative burden and complexity and potential beneficiary access issues. As a result, CMS is not finalizing the proposal at this time. CMS has decided to monitor expansion of clinical service lines by off-campus PBDs and continue to consider whether a potential limitation on service line expansion should be adopted in the future.

Relocation of Excepted Off-Campus PBDs

CMS is finalizing its proposal that items and services must continue to be furnished and billed at the same physical address of the off-campus PBD as was used as of November 2, 2015, in order for the off-campus PBD to be considered excepted from section 603 requirements. The final relocation policy includes a notable change from the proposal to allow excepted off-campus PBDs to relocate temporarily or permanently without loss of excepted status due to extraordinary circumstances outside of the hospital's control, such as natural disasters. The applicable CMS Regional Office will evaluate and determine exceptions for extraordinary circumstances, and are expected to be rare and unusual.

Changes of Ownership of Excepted Off-Campus PBDs

CMS is finalizing its proposal to allow an off-campus PBD to maintain its excepted status under the other rules outlined in this regulation if the hospital has a change of ownership and the new owners accept the existing Medicare provider agreement from the prior owner.

MPFS: Applicable Payment System for Non-Excepted Items and Services

For CY 2017, CMS is finalizing that the MPFS be the "applicable payment system" for non-excepted items and services furnished in a non-excepted off-campus PBD. In response to public comment on the proposals regarding hospital billing and payment, CMS is issuing an interim final rule with comment period to establish new interim final MPFS rates so that hospitals may be paid for these non-excepted items and services in CY 2017. The changes implemented through this process are intended to provide a billing mechanism for hospitals to report and receive payment under the MPFS for non-excepted items and services furnished by off-campus PBDs to Medicare beneficiaries in CY 2017.  Providers furnishing such services will continue to be paid on the professional claim and will be paid at the facility rate under the MPFS consistent with current payment policies for physicians practicing in an institutional setting. Under this proposal, CMS is establishing interim final site-specific rates under the MPFS for the technical component of all non-excepted items and services. Hospitals will be paid under the MPFS at these newly established MPFS rates for non-excepted items and services, which will be billed on the institutional claim and must be billed with a new claim line modifier "PN" to indicate that an item or service is a non-excepted item or service. For CY 2017, the payment rate for these services will generally be 50 percent of the OPPS rate (there are some exceptions that are spelled out in the proposal, including that payment for separately payable drugs will not be reduced). Packaging, and certain other OPPS policies, will continue to apply to such services.

Also of Interest