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Proposed OPPS Rule Holds Significant Changes

Michelle A. Leppert, for HealthLeaders Media, July 10, 2012

The Centers for Medicare & Medicaid Services is proposing two major changes as part of the 2013 Outpatient Prospective Payment System proposed rule, released July 6. One has to do with how CMS proposes to calculate the relative weights of Ambulatory Payment Classifications. The other has to do with the reimbursement level for separately payable drugs and biologicals without pass-through status.

The 2013 proposed rule is approximately half the size of the 2012 proposed rule and does not contain as many changes. However, the proposed suggestions are significant because they represent a major difference in how CMS has been making payments, says Jugna Shah, MPH, president of Nimitt Consulting in Washington, DC.

Relative weight calculation
CMS proposes to change the way it calculates APC relative weights. Since the beginning of OPPS, CMS has used median cost data that it derives from provider claims to calculate relative weights that are used to pay for the vast majority of OPPS/APC services. For calendar year 2013, CMS suggests using the geometric mean cost to create APC relative weights.

In the proposed rule, CMS states that it is proposing to shift the basis for the CY 2013 APC relative weights that underpin the OPPS from median costs to geometric mean costs. CMS cites several reasons, including that the use of the geometric mean would better capture the range of costs associated with providing services, including those cases involving high-cost packaged items or services, and those cases where very efficient hospitals have provided services at much lower costs. The use of geometric mean costs also would allow CMS to detect changes in the cost of services earlier.

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