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New website hopes to build support for site-neutral healthcare payments

Medicare already plans to stop paying certain hospital-owned physician practices at higher rates than those that are independently owned.

Jeff Lagasse, Associate Editor

The Alliance for Site Neutral Payment Reform's new advocacy site.The Alliance for Site Neutral Payment Reform's new advocacy site.

The Alliance for Site Neutral Payment Reform has launched a new website devoted to supporting site neutral payment reforms.

Aimed at lawmakers, healthcare officials and the general public, the site features research on the value of payment parity across sites of service, and makes a case for why Congress should protect and expand Section 603 of the Bipartisan Budget Act of 2015, which equalizes Medicare reimbursements across healthcare facilities.

The Alliance has said it believes that all outpatient off-campus facilities -- not just the hospital outpatient departments built or purchased after November 2, 2015, as is currently the case -- should be included in the payment neutralization provision.

In July, the Centers for Medicare and Medicaid Services proposed implementing the site-neutral payment provisions of the Bipartisan Budget Act, with provisions calling on Medicare to stop paying certain hospital-owned physician practices at higher rates than independently owned practices.

[Also: Budget deal cuts payments to hospital-owned practices, advances site-neutral payment]

The provisions call on Medicare to stop paying certain hospital-owned physician practices at higher rates than those that are independently owned. CMS said the difference in payments has led hospitals to acquire physician practices, and has increased costs for Medicare and its beneficiaries.

Recently, the Alliance submitted formal comments to CMS commending the interpretation of site neutral payment reforms in the Calendar Year 2017 Outpatient Prospective Payment System and Ambulatory Surgical Center proposed rule.

"The Alliance believes that the site neutral payment policy should apply to all off-campus outpatient departments and will continue to work with Congress to expand upon the progress made in the BBA," the group wrote in its letter. "We applaud CMS' proposed implementation of Section 603."

Establishing an equal playing field for Medicare reimbursements across healthcare settings reduces Medicare spending, ensures patients receive the right care in the right setting, lowers taxpayer costs and increases patient access, the organization said. Estimates from the Medicare Payments Advisory Commission suggest that equalizing payments for 66 groups of specialized services between HOPDs and freestanding offices would save Medicare beneficiaries $140-380 million in cost-sharing over the course of a single year.

[Also: CMS offers flexibility on MACRA, gives doctors ways to avoid payment adjustments]

The Alliance also contends that payment equalization would end the "flawed" system of incentives that encourages hospital practices to set up HOPDs that offer the same services as freestanding practices, but receive higher Medicare reimbursements. In 2013, the Government Accountability Office found that the total Medicare payment rate for a mid-level E/M office visit for an established patient averaged $51 higher when the service was performed in an HOPD instead of in a freestanding physician's office.

The disparity is even more significant among cancer treatment services. A 2012 Avalere study found costs for chemotherapy in HOPDs were 76 percent higher than freestanding cancer clinics.

The group said that expanding Section 603 of the BBA, so that the provision includes practices not grandfathered in by current law, will result in millions of physicians, patients and Medicare beneficiaries realizing the cost savings and improved outcomes associated with site neutral payment reform. This provision is estimated to save $9.3 billion over a 10-year period. 

Twitter: @JELagasse

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