Summarized 2008 OPPS Proposed Rule - What is Significant?

(PYA Alert dated August 14, 2007)

The 2008 proposed OPPS rule stands to impact every organization through implementation of key changes, designed to promote more efficient care in hospital outpatient departments for greater flexibility in managing these resources. Key changes include:

• Reduced separate payment
  Instead of hospitals receiving separate payments for services, payment will be “packaged” in with the main procedure and/or visit code associated with a visit for seven categories of HCPCS codes, including but not limited to observation services, some imaging supervision and interpretation, and diagnostic pharmaceuticals.
• Proposed introduction of 10 hospital outpatient measures
  Similar to measures introduced in the inpatient setting, these include emergency department acute myocardial infarction transfer measures, surgical care improvement measures, and measures for the treatment of heart failure, community-acquired pneumonia, and diabetes.
• Creation of “composite APCs”
  This relates to reimbursement for a collection of services with low dose rate prostate brachytherapy and cardiac electrophysiologic evaluation and ablation. This care is currently provided as a single comprehensive service, requiring several HCPCS codes and with each component service paid under separate APCs. OPPS proposed changes will result in a single payment for all care provided during the encounter. CMS intends to expand use of composite APCs in the future.
• E/M principles
  In the quest for national E/M guidelines, CMS has created principles against which hospitals should compare their internal guidelines. CMS also proposed that providers separate their reported drug charges from the pharmacy overhead cost, reflecting the latter on a separate line item with only the revenue code. Pharmacy overhead should not be included when hospitals report a HCPCS drug charge.

CMS will accept public comments through September 14, 2007 with publication of the final rule in November. Providers should examine their service mix to determine potential revenue impact, providing CMS with industry feedback as proposed changes may be significant to their organization’s financial stream.

Do you need resources to evaluate the potential impact of proposed changes to your bottom line? PYA’s team of Clinical Compliance and Reimbursement professionals can assist you in evaluating the financial impact to your organization, identifying areas of potential risk, assessing your compliance and reimbursement risks, targeting process improvement opportunities, and educating your staff to keep your organization in compliance related to the 2008 OPPS Proposed Rule. Please contact Carol Eyer for additional details.

The information provided via PYA Alert, Tax Planning Alert, or Audit and Accounting Alert should not be construed as accounting, auditing, consulting, or legal advice on any specific facts or circumstances. The contents are intended for general information purposes only.  Please contact us at (800) 270-9629 to discuss your specific situation or to discuss any specific questions you may have.

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