Hospital Outpatient and Ambulatory Surgical Center Proposed Rule Proposes Payment Policies for Rural Emergency Hospitals and Behavioral Health Services
The Centers for Medicare & Medicaid Services (CMS) is proposing actions to advance health equity and improve access to care in rural communities by establishing policies for Rural Emergency Hospitals (REH) and providing for payment for certain behavioral health services furnished via communications technology. Additionally, in line with President Biden’s Executive Order on Promoting Competition in the American Economy, the calendar year (CY) 2023 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System proposed rule includes proposed enhanced payments under the OPPS and the Inpatient Prospective Payment System (IPPS) for the additional costs of purchasing domestically made NIOSH-approved surgical N95 respirators and a comment solicitation on competition and transparency in our nation’s health care system.
“CMS is taking action to ensure that people with Medicare in rural and underserved areas have improved access to high quality health care and to prepare for the next pandemic,” said CMS Administrator Chiquita Brooks-LaSure. “The proposals in this rule, if finalized, will expand access to care options in rural communities and permanently allow behavioral health services to be provided to people in their homes. We are also proposing to adjust payments to account for the cost of domestically made surgical N95 respirators to ensure that hospitals and their health care workers are ready for the next pandemic.”
“Improving transparency of our health care system can help support people with Medicare get the high-quality, whole-person care they need,” said Dr. Meena Seshamani, Deputy Administrator and Director for CMS’ Center for Medicare. “With this proposed rule, we are taking important steps forward to ensure that CMS is doing our part to make sure we have a competitive American health care system that works for all people with Medicare.”
The proposed rule includes the following proposals:
Establishing Payment Policies for Rural Emergency Hospitals to Improve Access to Care in Rural Communities
CMS is proposing to establish payment rates for services furnished at REHs and provider enrollment procedures for REHs, a new provider designation established by the Consolidated Appropriations Act, 2021. To advance health equity and improve access to care in rural areas, CMS is broadly proposing to consider all covered outpatient department services as REH services. CMS is proposing a higher payment rate for furnished REH services; REHs will receive the standard OPPS payment rate plus 5% for each REH service provided. In order to not limit the types of services that REHs can provide, CMS is also proposing that REHs may provide certain outpatient services beyond those paid under the OPPS, and they would be paid the applicable fee schedule without the additional 5% payment.
Additionally, as required by statute, CMS is proposing that REHs would receive a monthly facility payment beginning in CY 2023 that would increase annually by the hospital market basket percentage starting in CY 2024. CMS anticipates that these predictable payments would improve access to emergency services, observation care, and additional outpatient services in rural communities whose hospitals are at risk of closing.
OPPS Payment for Remote Behavioral Health Services
In response to the COVID-19 public health emergency (PHE), CMS undertook emergency rulemaking to implement a number of flexibilities to support providers and patient care during the pandemic. Many of the flexibilities will expire at the conclusion of the PHE, including one that allows clinical staff of hospital outpatient departments to provide remote behavioral health services to patients in their homes. The proposed rule would continue payment for remote behavioral health services provided by clinical staff of hospital outpatient departments after the conclusion of the PHE, ensuring access to behavioral health services for rural and other underserved communities.
Payment Adjustments for Additional Costs of Domestic NIOSH-Approved N95 Surgical Respirators
In a future pandemic or increase in community spread of COVID-19, hospitals need to be able to access a reliable supply of NIOSH-approved surgical N95 respirators that are delivered on a timely basis in order to protect health care workers and their patients. Sustaining domestic production of these products is important for helping to maintain that assurance. CMS recognizes that hospitals may incur additional costs when purchasing domestically made NIOSH-approved surgical N95 respirators and is proposing additional hospital payments under IPPS and OPPS that would account for any such costs.
Request for Information on Competition
The proposed rule includes a Request for Information about enhancing transparency and competition in the health care system. In April 2022, CMS took action to promote competition and transparency by releasing data publicly — for the first time — on mergers, acquisitions, consolidations, and changes of ownership from 2016-2022 for hospitals and nursing homes enrolled in Medicare. These new data and analyses support President Biden’s Executive Order, Promoting Competition in the American Economy, and advance the Biden-Harris Administration’s goal of improving transparency around nursing facility ownership and enhancing nursing home safety and quality. CMS is seeking feedback on how data can be further utilized to promote competition and quality improvement, and whether CMS should consider releasing data on mergers, acquisitions, consolidations, and changes in ownership for other provider types.
Every year, CMS reviews and, as necessary, proposes changes and updates to payment rates and policies for the OPPS and the ASC payment system. CMS is proposing to update OPPS payment rates for CY 2023 for hospitals that meet applicable quality reporting requirements by 2.7%. This update is based on the projected hospital market basket percentage increase of 3.1%, reduced by 0.4 percentage point for the productivity adjustment. Using the proposed hospital market basket update, CMS is proposing to update the ASC rates for CY 2023 by 2.7% for ASCs meeting relevant quality reporting requirements. This update is based on the projected hospital market basket percentage increase of 3.1%, reduced by 0.4 percentage point for the productivity adjustment.
The OPPS/ASC Payment System proposed rule is displayed in the Federal Register with a 60-day comment period.