On July 6, 2016, the Centers for Medicare & Medicaid Services (CMS) published its Calendar Year (CY) 2017 Outpatient Prospective Payment System Proposed Rule. We will be providing an in-depth analysis of all significant proposals shortly. In the interim, we note that significant provisions of the rule would implement Bipartisan Budget Act of 2015 Section 603 and impact Medicare outpatient prospective payment system (OPPS) payments for items and services furnished in off-campus provider-based departments (PBDs). CMS explains:
- Bipartisan Budget Act of 2015 Section 603 provides that, beginning January 1, 2017, new off-campus PBDs will not be paid under the OPPS. Items and services excepted from this general payment rule are: (i) all items and services furnished in a dedicated emergency department; (ii) items and services that were furnished and billed by an off-campus PBD prior to November 2, 2015; and (iii) items and services furnished in a hospital department that is located within 250 yards of a remote location of a hospital.
- The proposed rule addresses service expansion in excepted off-campus PBDs. Items and services that were not furnished and billed in an excepted off-campus PBD prior to November 2, 2015 and that are not “within the clinical families of services furnished and billed prior to that date” would not be excepted from the Section 603 payment limitation.
- The proposed rule would require that items and services must continue to be furnished and billed at the same physical address for the off-campus PBD as of November 2, 2015 in order for the off-campus PBD to be considered excepted from the Section 603 payment limitation. An excepted off-campus PBD would lose its excepted status if it changes location.
- The proposed rule provides that if a hospital has a change of ownership and the new owner accepts the existing Medicare provider agreement from the prior owner, the off-campus PBD would maintain its excepted status.
- For CY 2017, the Medicare Physician Fee Schedule (MPFS) will be the “applicable payment system” for the majority of non-excepted items and services furnished in an off-campus PBD. Physicians furnishing services in an excepted off-campus PBD will be paid based on the professional non-facility rate under the MPFS. CMS intends this proposal to be a one-year transitional policy while it reviews possible operational changes that would enable an off-campus PBD to bill Medicare for services under a Part B payment system other than the OPPS beginning in CY 2018.
The proposed rule will be published in the July 14th Federal Register. Public comments on the proposed rule must be submitted to CMS by September 6. Comments may be submitted electronically here.