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CMS proposes site neutral payment rule that would lower healthcare costs for patients

Rule would also expand drug pricing competition and eliminate controversial questions regarding opioids from the hospital patient experience survey.

Susan Morse, Managing Editor

Credit: <a href="">Matthew Bisanz</a>.Credit: Matthew Bisanz.

The Centers for Medicare and Medicaid Services is proposing to move toward site neutral payments for clinic visits and to close a loophole through which providers are billing patients more for visits in hospital outpatient departments when they create new service lines.

In a proposed rule for the 2019 Medicare hospital outpatient prospective payment system and ambulatory surgical center payment system, CMS has proposed site neutral payments for clinic visits, the most common service billed under the OPPS.

Currently, CMS often pays more for the same type of clinic visit in the hospital outpatient setting than in the physician office setting.

If finalized, the proposal is projected to save patients about $150 million in lower copayments for clinic visits provided at an off-campus hospital outpatient department, CMS said.

The proposed rule aims to address other payment differences between sites of service.

For 2019, CMS is proposing to expand the number of procedures payable at ambulatory surgical centers to ensure the payment for procedures involving certain high-cost devices parallels the amount provided to hospital outpatient departments.

Also, CMS is stabilizing the differential between ambulatory payment rates and hospital outpatient department payment rates.

CMS is also looking to reduce the cost of prescription drugs by issuing a request for information to solicit public comment on how best to leverage the authority provided under the Competitive Acquisition Program to get a better deal for beneficiaries as part of a CMS Innovation Center model.

"We believe a CAP-based model would allow CMS to introduce competition to Medicare Part B, the part of Medicare that pays for medicines that patients receive in a doctor's office," CMS said. "Currently, CMS pays the average sales price for these therapies plus an extra add-on payment. A CAP-based model would allow CMS to bring on vendors to negotiate payment amounts for Part B drugs, so that Medicare is no longer merely a price taker for these medicines."

CMS said it wants public comment on how the vendors that CMS brings on could help the agency structure value-based payment arrangements with manufacturers, especially for high-cost products, so that seniors and taxpayers will know that medicines are working before they have to pay.

In 2018, CMS implemented a payment policy to help beneficiaries save on coinsurance on drugs that were administered at hospital outpatient departments and that were acquired through the 340B program--a program that allows hospitals to buy certain outpatient drugs at a lower cost.

Due to CMS's policy change, Medicare beneficiaries in 2018 are saving an estimated $320 million on out-of-pocket payments for these drugs. For 2019, CMS is expanding this policy by proposing to extend the 340B payment change to non-excepted off-campus departments of hospitals that are paid under the physician fee schedule.

340B Health said it was deeply disappointed in the proposed rule that would expand payment reductions to 340B hospitals for Medicare Part B drugs.

In 2018, CMS slashed $1.6 billion from Medicare outpatient drug payments to many 340B hospitals, a reduction of nearly 30 percent, 340B Health said.

"CMS now plans to make a bad rule worse by extending the cuts to drugs provided in certain off-campus hospital clinics, including facilities providing infusion therapy for cancer patients and other high-cost drug therapies to treat chronic and life threatening conditions," 340B Health said. "Two hundred members of the U.S. House of Representatives from both political parties have supported legislation (H.R.4392) to roll back the 2018 cuts and block CMS from making such reductions in the future. We urge CMS to withdraw this latest proposal before it causes additional harm."

In response to recommendations from the President's Commission on Combating Drug Addiction and the Opioid Crisis, CMS also is proposing to pay separately for certain non-opioid pain management drugs in ambulatory surgical centers and is seeking feedback on evidence to support that other non-opioid alternative treatments for acute or chronic pain warrant separate payment.

It is proposing to eliminate questions regarding pain communication from the hospital patient experience survey.

CMS is seeking comment asking whether providers and suppliers can and should be required to inform patients about charge and payment information for healthcare services and out-of-pocket costs, what data elements would be most useful to promote price shopping, and what other changes are needed to empower healthcare consumers.

"Our healthcare system should always put patients first, and CMS today is taking important steps to empower patients and provide more affordable choices and options," said CMS Administrator Seema Verma. "In line with President Trump and Secretary Azar's priority to lower drug prices, today's proposed rule is also an important step towards expanding competition for drug payment in Medicare, in order to get the best deal for patients."

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