Knowledge Base Article

Q:

Are there any proposed rule changes from the 2019 Medicare Physician Fee Schedule (MPFS) Proposed Rule that may affect hospitals?

A:

Yes, there are several proposed revisions that could affect hospitals, although some of these will not be effective until 2020.  Here is a review of some of the issues:

Non-excepted Off-Campus Provider Based Departments

These are off-campus PBDs that did not begin billing Medicare until after November 2, 2015.  The Bipartisan Budget Act of 2015 required services in these PBDs be paid under a payment system other than the Outpatient Prospective Payment System (OPPS) in order to make payments more equitable with payments for similar services provided in a physician office setting. Medicare pays for these services under the Medicare Physician Fee Schedule at a percentage of the OPPS payment rates. For 2019, Medicare proposes to continue to pay 40% of the OPPS rate for these services. Hospitals will continue to bill these services on an institutional claim form using the PN modifier to identity non-excepted services. Packaging and other OPPS claims processing logic also apply to these services.

Clinical Laboratory Fee Schedule (CLFS)

The Protecting Access to Medicare Act of 2014 (PAMA), required significant changes to how Medicare pays for Clinical Diagnostic Laboratory Tests (CDLTs) under the CLFS. Under the CLFS final rule, applicable laboratories must report to CMS for laboratory tests the private payor rates, the volume and the specific

HCPCS code associated with the test. Beginning in 2018, Medicare CLFS rates are based on this information specifically, equal to the weighted median of the private payor rates for each test.

The 2019 MPFS Proposed Rule seeks comments on a couple of suggestions that could affect whether a hospital outreach laboratory would meet the definition of an applicable reporting lab or not. One suggestion is using Form CMS-1450 bill type 14x to determine the majority of Medicare revenues and low expenditure thresholds in deciding if a lab must report data. The other suggestion is to use the CLIA certificate rather than the NPI to identify a laboratory that would be considered an applicable laboratory.

Therapy Services

CMS is proposing to discontinue functional limitation reporting beginning January 1, 2019. If finalized, they will also delete the HCPCS codes that were created for this reporting.

The Bipartisan Budget Act of 2018 (BBA of 2018) requires reduced payment for therapy services provided in whole or in part by a therapy assistant beginning in 2022. This includes payment to providers that submit institutional claims for therapy services such as outpatient hospitals, rehabilitation agencies, skilled nursing facilities, home health agencies and comprehensive outpatient rehabilitation facilities (CORFs) but, not to critical access hospitals (CAHs). CMS will create a new modifier that must be reported on claims for outpatient PT and OT services with dates of service on and after January 1, 2020, when the service is furnished in whole or in part by a therapy assistant. These two therapy modifiers would

be added to the existing three therapy modifiers – GP, GO, and GN − that are currently used to identify all therapy services delivered under a PT, OT or SLP plan of care, respectively. Modifiers GP and GO will be redefined to be reported when physical or occupational services are provided by a therapist.

Appropriate Use Criteria for Advanced Diagnostic Imaging Services

Effective January 1, 2020, professionals must consult appropriate use criteria (AUC) before ordering applicable advanced diagnostic imaging services and furnishing professionals must report AUC consultation information on the Medicare claim. The first year (2020) is for education and operations testing and claims will not be denied for failure to include proper AUC consultation information.

Information in the proposed rule clarifies that hospital outpatient departments are required to report AUC information on claims. Specifically, the proposed MPFS rule clarifies that AUC consultation information must be reported on all claims for an applicable imaging service furnished in an applicable setting and paid for under an applicable payment system. Applicable settings include a physician’s office, a hospital outpatient department (including an emergency department), an ambulatory surgical center, and proposed this year, an independent diagnostic testing facility (IDTF). The AUC information to be reported on a claim includes which qualified clinical decision support mechanism (CDSM) was consulted; whether the service met, did not meet, or was not applicable for the AUC and the NPI of ordering physician. CMS also proposed to use established coding methods, to include G-codes and modifiers, to report the required AUC information on Medicare claims.

Although emergency departments are listed specifically in the applicable settings, the exceptions for AUC consulting and reporting are 1) a service ordered for an individual with an emergency medical condition, 2) a service ordered for an inpatient, and 3) a service ordered by an ordering professional with a significant hardship.

To find out more about the above issues, you can find the 2019 MPFS Proposed Rule here.