CMS Finalizes 2017 Outpatient-Service Payment Rules

HealthLeaders Media News, November 3, 2016

The pay regulations for 2017 are expected to increase Medicare payments to hospitals for outpatient services by 1.7%.

Details about the 2017 Outpatient Prospective Payment System (OPPS) final rule, which also finalizes changes to the Ambulatory Surgery Center (ASC) Payment System were announced by the Centers for Medicare & Medicaid Services Tuesday.

The final rule includes new Medicare Physician Fee Schedule (MPFS) rates for items and services rendered to Medicare beneficiaries at off-campus outpatient departments owned by hospitals.

Under the 2017 OPPS final rule, CMS is raising OPPS payment rates 1.65%, according to a fact sheet. "The change is based on the projected hospital market basket increase of 2.7 percent minus both a 0.3 percentage point adjustment for multi-factor productivity (MFP) and a 0.75 percentage point adjustment required by law."


OPPS 2017: Site-neutral Payment Policies Detailed


Once all of the outpatient payment rule changes announced Tuesday are accounted for, CMS estimates next year's Medicare payments to hospitals for outpatient services will be slightly higher than 1.65%. That is "before taking into account changes in volume and case mix" for hospitals paid under the OPPS, the fact sheet says.

New Payment Rules for Off-Campus Outpatient Departments

CMS designates hospital off-campus outpatient departments as off-campus provider-based departments (PBDs).

Under the interim final rule for PBDs, CMS is establishing "a billing mechanism for hospitals to report and receive payment under the MPFS" for items and services rendered to Medicare beneficiaries at PBDs. This new billing mechanism is set to be implemented Jan. 1.

Most items and services rendered at PBDs will receive reimbursement at 50% of the OPPS rate, according to CMS. There are PBD items and services that will be exempt from the new payment mechanism, including payment for separately payable drugs, which will not be subject to the lower payment rate.

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