On November 2, 2021, the Centers for Medicare & Medicaid Services (“CMS”)released its Calendar Year (“CY”) 2022 Medicare Hospital Outpatient Prospective Payment System (“OPPS”) and Ambulatory Surgical Center (“ASC”) Payment System final rule. This final rule is scheduled to be published in the Federal Register on November 16, 2021.

In the final rule, CMS implements for CY 2022 an annual increase of OPPS payment rates of 2.0 percent for hospitals that meet the applicable quality reporting requirements. CMS also updates the ASC payment rates for CY 2022 by 2.0 percent for ASCs that meet applicable quality reporting requirements. CMS also continues the payment rate of Average Sale Price minus 22.5 percent for certain separately payable drugs or biologicals acquired through the 340B Drug Pricing Program. PPS-exempt cancer hospitals, rural sole community hospitals and children’s hospitals continue to not be impacted by this payment policy.

CMS modifies the hospital price transparency requirements effective January 1, 2022 by increasing the minimum civil monetary penalty to $300 per day for hospitals that less than 30 beds and $10 per bed per day for hospitals that have more than 30 beds (not to exceed $5,500 per day). For a full calendar year of non-compliance, the minimum total penalty amount would be $109,500 per hospital and the maximum would be $2,007,500 per hospital.

CMS is reversing its prior decision to eliminate the Inpatient Only (“IPO”) list. The IPO list includes services for which Medicare will only reimburse if performed in the hospital inpatient setting. Specifically, CMS is halting the elimination of the IPO list and adding back to the IPO list most of the services removed in CY 2021, except for lumbar spine fusion (CPT code 22630), reconstruct shoulder joint (CPT code 23472), and reconstruct ankle joint (CPT code 27702), along with their corresponding anesthesia codes. CMS also reinstates the criteria for adding procedures to the ASC Covered Procedures List that were effective in CY 2020.

CMS also provides that the Radiation Oncology (“RO”) Model will commence on January 1, 2022, with a five-year model performance period. The RO Model is intended to test whether making payments for radiotherapy services performed in hospital outpatient departments and physician clinics that do not vary based on care setting or how much or what type of care is delivered preserves or enhances the quality of care while reducing Medicare spending. The discounts are 4.5 percent for the technical component service and 3.5 percent for the professional component service.

For more information about the final rule, a CMS press release and fact sheet may be accessed here and here.

Norton Rose Fulbright attorneys are continuing to review the CY 2022 OPPS/ASC payments final rule and consider its implications for health care providers. Please contact members of Norton Rose Fulbright health care team if we can assist with your evaluation of this final rule and its impact on your operations.

Special thanks to law clerk Lauryn Robinson (Austin) for assisting in the creation of this content.