Knowledge Base Article

In billing Medicare, the details are important. And the details are complicated! Is the status inpatient or outpatient? Is there additional reimbursement? Are the services provided on or off campus? And with an inpatient only list, packaging of services, and provider-based vs. satellite vs. remote locations, how is a provider to figure it out? It takes lots of reading, interpreting, head-banging and gnashing of teeth. And as if the sheer complexity isn’t enough, the rules change constantly or at least once a year - as is the case with the 2015 Outpatient Prospective Payment System Final Rule (OPPS FR).

The other two articles in this week’s Wednesday@One address some of the major changes from the 2015 OPPS FR, specifically the new packaging rules including Comprehensive APCs and the changes to the physician certification requirements for inpatient admissions. In keeping with the theme, this article will address some of the other outpatient changes found in the final rule.

Inpatient Only Procedures

CMS did not make a lot of changes to the Inpatient Only list for this year but some of the changes were significant in terms of hospital operation.

They added an Osteotomy code –

• CPT code 22222 (Osteotomy of spine, including discectomy, anterior approach, single vertebral segment; thoracic)

They removed two codes for additional spinal levels of laminotomy –

• CPT code 63044 (Laminotomy … each additional lumbar interspace)
• CPT code 63043 (Laminotomy … each additional cervical interspace)

The removal of these codes seems extremely reasonable since the primary codes (CPT 63040 and 63042) representing the first and single interspace for these additional-level procedures were already not listed as inpatient only procedures. Since these are add-on codes, there will not be additional reimbursement for the additional levels, but at least these can now be performed as outpatient services.

Payment for Drugs and Biologicals

Medicare is continuing to pay for both pass-through drugs and separately payable drugs, biologicals, and therapeutic radiopharmaceuticals without pass-through status at ASP + 6%. The packaging threshold for separately payable drugs for CY2015 increased to $95. The packaging threshold (average per day cost) began at $50 in 2005 and has steadily increased from year to year; for example it was $90 for 2014. Drugs with a per day cost equal to or below this threshold (by Medicare calculations) are not separately paid, but are packaged into other services.

Off-campus Provider-Based Departments

Medicare and other governmental agencies have recently expressed concerns about the trend of hospitals acquiring physician practices. Outpatient hospital services are paid at a higher reimbursement rate than services provided in a physician’s office or free-standing clinic. In order to collect data on the amount and types of services being provided in hospital off-campus provider-based departments (PBDs), CMS will be requiring the addition of a modifier to services furnished in an off-campus provider-based department on facility claims and a new place of service (POS) code on the physician claims. This proposal was finalized in the 2015 OPPS Final Rule with the following details:

• The addition of the modifier for hospital services in an off-campus provider-based department is not required until 2016. The modifier may be voluntarily added beginning in 2015.
• The new HCPCS modifier is “PO” (Services, procedures and/or surgeries furnished at off-campus provider-based outpatient departments) and is to be appended on the hospital claim to all services furnished in the off-campus PBD.
• CMS defines “campus” as the physical area immediately adjacent to the provider’s main buildings, other areas and structures that are not strictly contiguous to the main buildings but are located within 250 yards of the main buildings, and any other areas determined on an individual case basis, by the CMS regional office, to be part of the provider’s campus.
• The modifier is not to be reported for services furnished in:
• Remote locations of a hospital as defined at 42 CFR 412.65,
• Satellite facilities of a hospital as defined at 42 CFR 412.22(h), or
• Services furnished in an emergency department.
• CMS will be deleting POS code 22 (outpatient hospital department) and replacing it with two new codes, one of which will identify services furnished in a hospital off-campus PBD for physician reporting.

CMS indicates that additional instructions and provider education will be forthcoming in sub-regulatory guidance.

These are some more of the most recent changes – until the next changes come along. Hospitals need to adjust their processes to address the above new regulations and watch for any clarifying guidance. Don’t bang your head too hard!