[Federal Register Volume 88, Number 224 (Wednesday, November 22, 2023)]
[Rules and Regulations]
[Pages 81540-82185]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-24293]
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Vol. 88
Wednesday,
No. 224
November 22, 2023
Part II
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Parts 405, 410, 416, et al.
45 CFR Part 180
Medicare Program: Hospital Outpatient Prospective Payment and
Ambulatory Surgical Center Payment Systems; Quality Reporting Programs;
Payment for Intensive Outpatient Services in Hospital Outpatient
Departments, Community Mental Health Centers, Rural Health Clinics,
Federally Qualified Health Centers, and Opioid Treatment Programs;
Hospital Price Transparency; Changes to Community Mental Health Centers
Conditions of Participation, Changes to the Inpatient Prospective
Payment System Medicare Code Editor; Rural Emergency Hospital
Conditions of Participation Technical Correction; Final Rule
Federal Register / Vol. 88 , No. 224 / Wednesday, November 22, 2023 /
Rules and Regulations
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 405, 410, 416, 419, 424, 485, 488, and 489
Office of the Secretary
45 CFR Part 180
[CMS-1786-FC]
RIN 0938-AV09
Medicare Program: Hospital Outpatient Prospective Payment and
Ambulatory Surgical Center Payment Systems; Quality Reporting Programs;
Payment for Intensive Outpatient Services in Hospital Outpatient
Departments, Community Mental Health Centers, Rural Health Clinics,
Federally Qualified Health Centers, and Opioid Treatment Programs;
Hospital Price Transparency; Changes to Community Mental Health Centers
Conditions of Participation, Changes to the Inpatient Prospective
Payment System Medicare Code Editor; Rural Emergency Hospital
Conditions of Participation Technical Correction
AGENCY: Centers for Medicare & Medicaid Services (CMS), Department of
Health and Human Services (HHS).
ACTION: Final rule with comment period.
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SUMMARY: This final rule with comment period revises the Medicare
hospital outpatient prospective payment system (OPPS) and the Medicare
ambulatory surgical center (ASC) payment system for calendar year 2024
based on our continuing experience with these systems. In this final
rule, we describe the changes to the amounts and factors used to
determine the payment rates for Medicare services paid under the OPPS
and those paid under the ASC payment system. Also, this final rule
updates and refines the requirements for the Hospital Outpatient
Quality Reporting (OQR) Program, the ASC Quality Reporting (ASCQR)
Program, and the Rural Emergency Hospital Quality Reporting (REHQR)
Program. In this final rule, we are also establishing a payment for
certain intensive outpatient services under Medicare, beginning January
1, 2024. In addition, this final rule updates and refines requirements
for hospitals to make public their standard charge information and
enforcement of hospital price transparency. We are finalizing changes
to the community mental health center (CMHC) Conditions of
Participation (CoPs) to provide requirements for furnishing intensive
outpatient (IOP) services, and we are finalizing the proposed personnel
qualifications for mental health counselors (MHCs) and marriage and
family therapists (MFTs). Additionally, we are finalizing the removal
of discussion of the inpatient prospective payment system (IPPS)
Medicare Code Editor (MCE) from the annual IPPS rulemakings, beginning
with the fiscal year (FY) 2025 rulemaking. Finally, we are finalizing a
technical correction to the Rural Emergency Hospital (REH) CoPs under
the standard for the designation and certification of REHs.
DATES:
Effective date: The provisions of this rule are effective January
1, 2024.
Comment period: To be assured consideration, comments must be
received at one of the addresses provided below, by January 1, 2024.
ADDRESSES: In commenting, please refer to file code CMS-1786-FC.
Comments, including mass comment submissions, must be submitted in
one of the following three ways (please choose only one of the ways
listed):
1. Electronically. You may submit electronic comments on this
regulation to https://www.regulations.gov. Follow the ``Submit a
comment'' instructions.
2. By regular mail. You may mail written comments to the following
address ONLY: Centers for Medicare & Medicaid Services, Department of
Health and Human Services, Attention: CMS-1786-FC, P.O. Box 8010,
Baltimore, MD 21244-8010.
Please allow sufficient time for mailed comments to be received
before the close of the comment period.
3. By express or overnight mail. You may send written comments to
the following address ONLY: Centers for Medicare & Medicaid Services,
Department of Health and Human Services, Attention: CMS-1786-FC, Mail
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
For information on viewing public comments, see the beginning of
the SUPPLEMENTARY INFORMATION section.
FOR FURTHER INFORMATION CONTACT:
Au'Sha Washington, [email protected] or 410-786-3736.
Advisory Panel on Hospital Outpatient Payment (HOP Panel), contact
the HOP Panel mailbox at [email protected].
Ambulatory Surgical Center (ASC) Payment System, contact Scott
Talaga via email at [email protected] or Mitali Dayal via email
at [email protected].
Ambulatory Surgical Center Quality Reporting (ASCQR) Program
policies, contact Anita Bhatia via email at [email protected].
Ambulatory Surgical Center Quality Reporting (ASCQR) Program
measures, contact Marsha Hertzberg via email at [email protected].
Biosimilars Packaging Exception, contact Gil Ngan via email at
[email protected].
Blood and Blood Products, contact Josh McFeeters via email at
[email protected].
Cancer Hospital Payments, contact Scott Talaga via email at
[email protected].
Cardiac Rehabilitation, Intensive Cardiac Rehabilitation and
Pulmonary Rehabilitation Services, contact Nate Vercauteren via email
at [email protected].
CMS Web Posting of the OPPS and ASC Payment Files, contact Chuck
Braver via email at [email protected].
Community Mental Health Centers (CMHC) Conditions of Participation,
contact Mary Rossi-Coajou via email at [email protected] or
Cara Meyer via email at [email protected].
Composite APCs (Multiple Imaging and Mental Health), via email at
Mitali Dayal via email at [email protected].
Comprehensive APCs (C-APCs), contact Mitali Dayal via email at
[email protected].
COVID-19 Final Rules, contact Au'Sha Washington via email at
[email protected].
Hospital Outpatient Quality Reporting (OQR) Program policies,
contact Kimberly Go via email [email protected].
Hospital Outpatient Quality Reporting (OQR) Program measures,
contact Janis Grady via email [email protected].
Hospital Outpatient Visits (Emergency Department Visits and
Critical Care Visits), contact Abby Cesnik via email at [email protected].
Hospital Price Transparency (HPT), contact Terri Postma via email
at [email protected].
Inpatient Only (IPO) Procedures List, contact Abigail Cesnik via
email at [email protected].
Inpatient Prospective Payment System (IPPS) Medicare Code Editor,
contact Mady Hue via email at [email protected].
Mental Health Services Furnished Remotely by Hospital Staff to
Beneficiaries in Their Homes, contact Emily Yoder via email at
[email protected].
Method to Control Unnecessary Increases in the Volume of Clinic
Visit
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Services Furnished in Excepted Off-Campus Provider-Based Departments
(PBDs), contact Nate Vercauteren via email at [email protected].
New Technology Intraocular Lenses (NTIOLs), contact Scott Talaga
via email at [email protected].
No Cost/Full Credit and Partial Credit Devices, contact Scott
Talaga via email at [email protected].
Opioid Treatment Program (OTP) Intensive Outpatient Services (IOP)
contact Lindsey Baldwin via email at [email protected] and
Ariana Pitcher at [email protected].
OPPS Brachytherapy, contact Cory Duke via email at [email protected] and Scott Talaga via email at [email protected].
OPPS Data (APC Weights, Conversion Factor, Copayments, Cost-to-
Charge Ratios (CCRs), Data Claims, Geometric Mean Calculation, Outlier
Payments, and Wage Index), contact Erick Chuang via email at
[email protected], or Scott Talaga via email at [email protected], or Josh McFeeters via email at [email protected].
OPPS Dental Policy, contact Nicole Marcos via email at
[email protected].
OPPS Drugs, Radiopharmaceuticals, Biologicals, and Biosimilar
Products, contact Josh McFeeters via email at [email protected], Gil Ngan via email at Gil.Ngan@ cms.hhs.gov, Cory Duke via
email at [email protected], or Au'Sha Washington via email at
[email protected].
OPPS New Technology Procedures/Services, contact the New Technology
APC mailbox at [email protected].
OPPS Packaged Items/Services, contact Mitali Dayal via email at
[email protected] or Cory Duke via email at [email protected].
OPPS Pass-Through Devices, contact the Device Pass-Through mailbox
at [email protected].
OPPS Status Indicators (SI) and Comment Indicators (CI), contact
Marina Kushnirova via email at [email protected].
Partial Hospitalization Program (PHP), Intensive Outpatient (IOP),
and Community Mental Health Center (CMHC) Issues, contact the PHP
Payment Policy Mailbox at [email protected].
Request for Public Comments on Potential Payment under the IPPS for
Establishing and Maintaining Access to Essential Medicines, contact
[email protected].
Rural Emergency Hospital Conditions of Participation, contact
Kianna Banks via email [email protected].
Rural Emergency Hospital Quality Reporting (REHQR) Program
policies, contact Anita Bhatia via email at [email protected].
Rural Emergency Hospital Quality Reporting (REHQR) Program
measures, contact Melissa Hager via email [email protected].
Rural Health Clinic (RHC) and Federally Qualified Health Center
(FQHC) Intensive Outpatient Services (IOP), contact the RHC Payment
Policy Mailbox at [email protected] or the FQHC Payment Policy Mailbox
at [email protected].
Separate Payment for High-Cost Drugs Provided by Indian Health
Service and Tribally-Owned Facilities, contact Josh McFeeters via email
at [email protected].
Skin Substitutes, contact Josh McFeeters via email at
[email protected].
All Other Issues Related to Hospital Outpatient Payments Not
Previously Identified, contact the OPPS mailbox at [email protected].
All Other Issues Related to the Ambulatory Surgical Center Payments
Not Previously Identified, contact the ASC mailbox at [email protected].
SUPPLEMENTARY INFORMATION: Inspection of Public Comments: All comments
received before the close of the comment period are available for
viewing by the public, including any personally identifiable or
confidential business information that is included in a comment. We
post all comments received before the close of the comment period on
the following website as soon as possible after they have been
received: https://www.regulations.gov. Follow the search instructions
on that website to view public comments. CMS will not post on
Regulations.gov public comments that make threats to individuals or
institutions or suggest that the individual will take actions to harm
the individual. CMS continues to encourage individuals not to submit
duplicative comments. We will post acceptable comments from multiple
unique commenters even if the content is identical or nearly identical
to other comments.
Addenda Available Only Through the Internet on the CMS Website
In the past, a majority of the Addenda referred to in our OPPS/ASC
proposed and final rules were published in the Federal Register as part
of the annual rulemakings. However, beginning with the calendar year
(CY) 2012 OPPS/ASC proposed rule, all of the Addenda no longer appear
in the Federal Register as part of the annual OPPS/ASC proposed and
final rules to decrease administrative burden and reduce costs
associated with publishing lengthy tables. Instead, these Addenda are
published and available only on the CMS website. The Addenda relating
to the OPPS are available at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices.
The Addenda relating to the ASC payment system are available at:
https://www.cms.gov/medicare/payment/prospective-payment-systems/ambulatory-surgical-center-asc/asc-regulations-and-notices.
Current Procedural Terminology (CPT) Copyright Notice
Throughout this final rule with comment period, we use CPT codes
and descriptions to refer to a variety of services. We note that CPT
codes and descriptions are copyright 2021 American Medical Association
(AMA). All Rights Reserved. CPT is a registered trademark of the AMA.
Applicable Federal Acquisition Regulations and Defense Federal
Acquisition Regulations apply.
Table of Contents
I. Summary and Background
A. Executive Summary of This Document
B. Legislative and Regulatory Authority for the Hospital OPPS
C. Excluded OPPS Services and Hospitals
D. Prior Rulemaking
E. Advisory Panel on Hospital Outpatient Payment (the HOP Panel
or the Panel)
F. Public Comments Received on the CY 2024 OPPS/ASC Proposed
Rule
G. Public Comments Received on the CY 2023 OPPS/ASC Final Rule
With Comment Period
II. Updates Affecting OPPS Payments
A. Recalibration of APC Relative Payment Weights
B. Conversion Factor Update
C. Proposed Wage Index Changes
D. Proposed Statewide Average Default Cost-to-Charge Ratios
(CCRs)
E. Proposed Adjustment for Rural Sole Community Hospitals (SCHs)
and Essential Access Community Hospitals (EACHs) Under Section
1833(t)(13)(B) of the Act for CY 2024
F. Proposed Payment Adjustment for Certain Cancer Hospitals for
CY 2024
G. Proposed Hospital Outpatient Outlier Payments
H. Proposed Calculation of an Adjusted Medicare Payment From the
National Unadjusted Medicare Payment
I. Proposed Beneficiary Copayments
B. Conversion Factor Update
C. Wage Index Changes
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D. Statewide Average Default Cost-to-Charge Ratios (CCRs)
E. Adjustment for Rural Sole Community Hospitals (SCHs) and
Essential Access Community Hospitals (EACHs) Under Section
1833(t)(13)(B) of the Act for CY 2024
F. Payment Adjustment for Certain Cancer Hospitals for CY 2024
G. Hospital Outpatient Outlier Payments
H. Calculation of an Adjusted Medicare Payment From the National
Unadjusted Medicare Payment
I. Beneficiary Copayments
III. OPPS Ambulatory Payment Classification (APC) Group Policies
A. OPPS Treatment of New and Revised HCPCS Codes
B. OPPS Changes--Variations Within APCs
C. New Technology APCs
D. Universal Low Volume APC Policy for Clinical and
Brachytherapy APCs
E. APC-Specific Policies
IV. OPPS Payment for Devices
A. Pass-Through Payment for Devices
B. Device-Intensive Procedures
V. OPPS Payment for Drugs, Biologicals, and Radiopharmaceuticals
A. OPPS Transitional Pass-Through Payment for Additional Costs
of Drugs, Biologicals, and Radiopharmaceuticals
B. OPPS Payment for Drugs, Biologicals, and Radiopharmaceuticals
Without Pass-Through Payment Status
C. Requirement in the Physician Fee Schedule CY 2024 Proposed
Rule for HOPDs and ASCs To Report Discarded Amounts of Certain
Single-Dose or Single-Use Package Drugs
VI. Estimate of OPPS Transitional Pass-Through Spending for Drugs,
Biologicals, Radiopharmaceuticals, and Devices
A. Amount of Additional Payment and Limit on Aggregate Annual
Adjustment
B. Estimate of Pass-Through Spending for CY 2024
VII. OPPS Payment for Hospital Outpatient Visits and Critical Care
Services
VIII. Payment for Partial Hospitalization and Intensive Outpatient
Services
A. Partial Hospitalization
B. Intensive Outpatient Program Services
C. Coding and Billing for PHP and IOP Services Under the OPPS
D. Payment Rate Methodology for PHP and IOP
E. Outlier Policy for CMHCs
F. Rural Health Clinics (RHCs) and Federally Qualified Health
Centers (FQHCs)
G. Modifications Related to Medicare Coverage for Opioid Use
Disorder (OUD) Treatment Services Furnished by Opioid Treatment
Programs (OTPs)
H. Payment Rates Under the Medicare Physician Fee Schedule for
Nonexcepted Items and Services Furnished by Nonexcepted Off-Campus
Provider-Based Departments of a Hospital
IX. Services That Will Be Paid Only as Inpatient Services
A. Background
B. Changes to the Inpatient Only (IPO) List
C. Solicitation of Public Comments on the Services Described by
CPT Codes 43775, 43644, 43645, and 44204
X. Nonrecurring Policy Changes
A. Supervision by Nurse Practitioners, Physician Assistants, and
Clinical Nurse Specialists of Cardiac Rehabilitation, Intensive
Cardiac Rehabilitation, and Pulmonary Rehabilitation Services
Furnished to Hospital Outpatients
B. Payment for Intensive Cardiac Rehabilitation Services (ICR)
Provided by an Off-Campus, Non-Excepted Provider Based Department
(PBD) of a Hospital
C. OPPS Payment for Specimen Collection for COVID-19 Tests
D. Remote Services
E. OPPS Payment for Dental Services
F. Use of Claims and Cost Report Data for CY 2024 OPPS and ASC
Payment System Ratesetting Due to the PHE
G. Comment Solicitation on Payment for High-Cost Drugs Provided
by Indian Health Service and Tribal Facilities
H. Technical Changes to Hospital Billing for Marriage and Family
Therapist Services and Mental Health Counselor Services
XI. CY 2024 OPPS Payment Status and Comment Indicators
A. CY 2024 OPPS Payment Status Indicator Definitions
B. CY 2024 Comment Indicator Definitions
XII. MedPAC Recommendations
A. OPPS Payment Rates Update
B. Medicare Safety Net Index
C. ASC Cost Data
XIII. Updates to the Ambulatory Surgical Center (ASC) Payment System
A. Background, Legislative History, Statutory Authority, and
Prior Rulemaking for the ASC Payment System
B. ASC Treatment of New and Revised Codes
C. Payment Policies Under the ASC Payment System
D. Additions to ASC Covered Surgical Procedures and Covered
Ancillary Services Lists
E. ASC Payment Policy for Non-Opioid Post-Surgery Pain
Management Drugs, Biologicals, and Devices
F. Comment Solicitation on Access to Non-Opioid Treatments for
Pain Relief Under the OPPS and ASC Payment System
G. New Technology Intraocular Lenses (NTIOLs)
H. Calculation of the ASC Payment Rates and the ASC Conversion
Factor
XIV. Requirements for the Hospital Outpatient Quality Reporting
(OQR) Program
A. Background
B. Hospital OQR Program Quality Measures
C. Hospital OQR Program Quality Measure Topics for Potential
Future Consideration
D. Administrative Requirements
E. Form, Manner, and Timing of Data Submitted for the Hospital
OQR Program
F. Payment Reduction for Hospitals That Fail To Meet the
Hospital OQR Program Requirements for the CY 2024 Payment
Determination
XV. Ambulatory Surgical Center Quality Reporting (ASCQR) Program
Requirements
A. Background
B. ASCQR Program Quality Measures
C. Administrative Requirements
D. Form, Manner, and Timing of Data Submitted for the ASCQR
Program
E. Payment Reduction for ASCs That Fail To Meet the ASCQR
Program Requirements
XVI. Proposed Requirements for the Rural Emergency Hospital Quality
Reporting (REHQR) Program
A. Background
B. REHQR Program Quality Measures
C. Administrative Requirements
D. Form, Manner, and Timing of Data Submitted for the REHQR
Program
XVII. Changes to Community Mental Health Center (CMHC) Conditions of
Participation (CoPs)
A. Background and Statutory Authority
B. Summary of the CMHC Proposed Provisions, Public Comments and
Responses to Comments
XVIII. Updates to Requirements for Hospitals To Make Public a List
of Their Standard Charges
A. Introduction and Overview
B. New Requirements for Making Public Hospital Standard Charges
Under 45 CFR 180.50
C. Requirements To Improve and Enhance Enforcement
D. Comments on CMS' Request for Information Related to Consumer-
Friendly Displays and Alignment With Transparency in Coverage and No
Surprises Act
XIX. Changes to the Inpatient Prospective Payment System Medicare
Code Editor
XX. Technical Edits for REH Conditions of Participation and Critical
Access Hospital (CAH) CoP Updates
XXI. Rural Emergency Hospitals (REHs): Payment for Rural Emergency
Hospitals (REHs)
A. Background on Rural Emergency Hospitals (REHs)
B. REH Payment Methodology
C. Background on the IHS Outpatient All-Inclusive Rate (AIR) for
Tribal and IHS Hospitals
D. Paying Indian Health Service (IHS) and Tribal Hospitals That
Convert to an REH Under the AIR
E. Exclusion of REHs From the OPPS
XXII. Request for Public Comments on Potential Payment Under the
IPPS and OPPS for Establishing and Maintaining Access to Essential
Medicines
A. Overview
B. Establishing and Maintaining a Buffer Stock of Essential
Medicines
C. Potential Separate Payment Under IPPS and OPPS for
Establishing and Maintaining Access to a Buffer Stock of Essential
Medicines
D. Comment Solicitation on Additional Considerations
E. Overview of Comments Received
F. Next Steps
XXIII. Files Available to the Public via the Internet
XXIV. Collection of Information Requirements
A. ICRs Related to Proposed Intensive Outpatient Physician
Certification Requirements
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B. ICRs Related to the Hospital OQR Program
C. ICRs Related to the ASCQR Program
D. ICRs Related to the REHQR Program
E. ICRs Related to Conditions of Participation (CoPs):
Admission, Initial Evaluation, Comprehensive Assessment, and
Discharge or Transfer of the Client (Sec. 485.914)
F. ICR's Related to Conditions of Participation (CoPs):
Treatment Team, Person-Centered Active Treatment Plan, and
Coordination of Services (Sec. 485.916)
G. ICR's Related to Conditions of Participation (CoPs):
Organization, Governance, Administration of Services, Partial
Hospitalization Services (Sec. 485.918)
H. ICRs Related to Hospital Price Transparency
XXV. Response to Comments
XXVI. Economic Analyses
A. Statement of Need
B. Overall Impact of Provisions of This Final Rule With Comment
Period
C. Detailed Economic Analyses
D. Regulatory Review Cost Estimation
E. Regulatory Flexibility Act (RFA) Analysis
F. Unfunded Mandates Reform Act Analysis
G. Federalism
H. Conclusion
I. Congressional Review
I. Summary and Background
A. Executive Summary of This Document
1. Purpose
In this final rule with comment period, we are updating the payment
policies and payment rates for services furnished to Medicare
beneficiaries in hospital outpatient departments (HOPDs) and ambulatory
surgical centers (ASCs), beginning January 1, 2024. Section 1833(t) of
the Social Security Act (the Act) requires us to annually review and
update the payment rates for services payable under the Hospital
Outpatient Prospective Payment System (OPPS). Specifically, section
1833(t)(9)(A) of the Act requires the Secretary of the Department of
Health and Human Services (the Secretary) to review certain components
of the OPPS not less often than annually, and to revise the groups, the
relative payment weights, and the wage and other adjustments that take
into account changes in medical practice, changes in technology, and
the addition of new services, new cost data, and other relevant
information and factors. In addition, under section 1833(i)(D)(v) of
the Act, we annually review and update the ASC payment rates. This
final rule with comment period also includes additional policy changes
made in accordance with our experience with the OPPS and the ASC
payment system and recent changes in our statutory authority. We
describe these and various other statutory authorities in the relevant
sections of this final rule with comment period. In addition, this
final rule with comment period updates and refines the requirements for
the Hospital Outpatient Quality Reporting (OQR) Program, the ASC
Quality Reporting (ASCQR) Program, and Rural Emergency Hospital Quality
Reporting (REHQR) Program. In addition, this final rule with comment
period establishes payment for intensive outpatient services under
Medicare, beginning January 1, 2024. This final rule with comment
period also updates and refines the requirements for hospitals to make
public their standard charges and CMS enforcement of hospital price
transparency regulations. In addition, we are finalizing changes to the
CMHC CoPs to provide requirements for furnishing IOP services. In
addition, we are finalizing changes to the CMHC CoPs to provide
requirements for furnishing IOP services, as well as finalizing the
proposed personnel qualifications for MHCs and MFTs. We are also
finalizing the removal of discussion of the IPPS Medicare Code Editor
(MCE) from the annual IPPS rulemakings, beginning with the FY 2025
rulemaking. Finally, we are finalizing a technical correction to the
Rural Emergency Hospital (REH) CoPs under the standard for the
designation and certification of REHs.
2. Summary of the Major Provisions
OPPS Update: For 2024, we are increasing the payment rates
under the OPPS by an Outpatient Department (OPD) fee schedule increase
factor of 3.1 percent. This increase factor is based on the final
inpatient hospital market basket percentage increase of 3.3 percent for
inpatient services paid under the hospital inpatient prospective
payment system (IPPS) reduced by a final productivity adjustment of 0.2
percentage point. Based on this update, we estimate that total payments
to OPPS providers (including beneficiary cost sharing and estimated
changes in enrollment, utilization, and case mix) for calendar year
(CY) 2024 will be approximately $88.9 billion, an increase of
approximately $6.0 billion compared to estimated CY 2023 OPPS payments.
We are continuing to implement the statutory 2.0 percentage point
reduction in payments for hospitals that fail to meet the hospital
outpatient quality reporting requirements by applying a reporting
factor of 0.9806 to the OPPS payments and copayments for all applicable
services.
Data used in CY 2024 OPPS/ASC Ratesetting: To set OPPS and
ASC payment rates, we normally use the most updated claims and cost
report data available. The best available claims data is the most
recent set of data which would be from 2 years prior to the calendar
year that is the subject of rulemaking. Cost report data usually lags
the claims data by a year and we believe that using the most updated
cost report extract available from the Healthcare Cost Report
Information System (HCRIS) is appropriate for CY 2024 OPPS ratesetting.
Therefore, we are using our typical data process of using the most
updated cost reports and claims data available for CY 2024 OPPS
ratesetting.
Partial Hospitalization Update: For CY 2024, we are
finalizing changes to our methodology used to calculate the Community
Mental Health Center (CMHC) and hospital-based PHP (HB PHP) geometric
mean per diem costs. We also are finalizing changes to expand PHP
payment from two APCs to four APCs.
Medicare Payment for Intensive Outpatient Programs:
Beginning in CY 2024, we are finalizing payment for intensive
outpatient program (IOP) services under Medicare. We are finalizing the
scope of benefits, physician certification requirements, coding and
billing, and payment rates under the IOP benefit. IOP services may be
furnished in hospital outpatient departments, community mental health
centers (CMHCs), federally qualified health centers (FQHCs), and rural
health clinics (RHCs). We also are finalizing payment for intensive
outpatient services provided by opioid treatment programs (OTPs) under
the existing OTP benefit.
Changes to the Inpatient Only (IPO) List: For 2024, we are
finalizing our proposal to not remove any services from the IPO list
for CY 2024.
340BAcquired Drugs: For CY 2024, we are continuing to
apply the default rate, generally average sales price (ASP) plus 6
percent, to 340B acquired drugs and biologicals in this final rule with
comment period. Therefore, drugs and biologicals acquired under the
340B program will be paid at the same payment rate as those drugs and
biologicals not acquired under the 340B program.
Biosimilar Packaging Exception: For CY 2024, we are
finalizing our proposal to except biosimilars from the OPPS threshold
packaging policy when their reference products are separately paid.
However, we are not finalizing that all the biosimilars related to the
reference product would be similarly
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packaged if a reference product's per-day cost falls below the
threshold packaging policy.
Finalizing to Pay IHS and Tribal Hospitals that Convert to
a Rural Emergency Hospital (REH) Under the IHS All-Inclusive Rate
(AIR): For CY 2024, we are finalizing that IHS and tribal hospitals
that convert to an REH be paid for hospital outpatient services under
the same all-inclusive rate that would otherwise apply if these
services were performed by an IHS or tribal hospital that is not an
REH. We also are finalizing that IHS and tribal hospitals that convert
to an REH would receive the REH monthly facility payment consistent
with how this payment is applied to REHs that are not tribally or IHS
operated.
Device Pass-Through Payment Applications: For CY 2024, we
received six applications for device pass-through payments. We sought
public comment on these applications and are approving four applicants
for device pass-through payment status in this final rule with comment
period.
Cancer Hospital Payment Adjustment: For CY 2024, we are
continuing to provide additional payments to cancer hospitals so that a
cancer hospital's payment-to-cost ratio (PCR) after the additional
payments is equal to the weighted average PCR for the other OPPS
hospitals using the most recently submitted or settled cost report
data. Section 16002(b) of the 21st Century Cures Act requires that this
weighted average PCR be reduced by 1.0 percentage point. In light of
the public health emergency (PHE) impact on claims and cost data used
to calculate the target PCR, we have maintained the CY 2021 target PCR
of 0.89 through CYs 2022 and 2023. In this final rule with comment
period, we are finalizing to reduce the target PCR by 1.0 percentage
point each calendar year until the target PCR equals the PCR of non-
cancer hospitals using the most recently submitted or settled cost
report data. For CY 2024, we are finalizing a target PCR of 0.88 to
determine the CY 2024 cancer hospital payment adjustment to be paid at
cost report settlement. That is, the payment adjustments will be the
additional payments needed to result in a PCR equal to 0.88 for each
cancer hospital.
ASC Payment Update: For CYs 2019 through 2023, we adopted
a policy to update the ASC payment system using the hospital market
basket update. In light of the impact of the COVID-19 PHE on healthcare
utilization, we are finalizing to extend our policy to update the ASC
payment system using the hospital market basket update an additional 2
years--through CYs 2024 and 2025. Using the hospital market basket
methodology, for CY 2024, we are increasing payment rates under the ASC
payment system by 3.1 percent for ASCs that meet the quality reporting
requirements under the ASCQR Program. This increase is based on a
hospital market basket percentage increase of 3.3 percent reduced by a
productivity adjustment of 0.2 percentage point. Based on this final
update, we estimate that total payments to ASCs (including beneficiary
cost sharing and estimated changes in enrollment, utilization, and
case-mix) for CY 2024 will be approximately $7.1 billion, an increase
of approximately $207 million compared to estimated CY 2023 Medicare
payments.
Changes to the List of ASC Covered Surgical Procedures:
For CY 2024, we are adding 37 surgical procedures, including total
shoulder arthroplasty (TSA) (Healthcare Common Procedure Coding System
(HCPCS) code 23472), to the ASC covered procedures list (CPL) based
upon existing criteria at Sec. 416.166.
Hospital Outpatient Quality Reporting (OQR) Program: We
are finalizing our proposals to: (1) modify the COVID-19 Vaccination
Coverage Among Healthcare Personnel (HCP) measure beginning with the CY
2024 reporting period/CY 2026 payment determination; (2) modify the
Cataracts: Improvement in Patient's Visual Function Within 90 Days
Following Cataract Surgery measure beginning with the voluntary CY 2024
reporting period; (3) modify the Appropriate Follow-Up Interval for
Normal Colonoscopy in Average Risk Patients measure beginning with the
CY 2024 reporting period/CY 2026 payment determination; and (4) amend
multiple codified regulations to replace references to ``QualityNet''
with ``CMS-designated information system'' or ``CMS website,'' and to
make other conforming technical edits, to accommodate recent and future
systems requirements and mitigate confusion for program participants.
We are finalizing with modification the proposal to adopt the Risk-
Standardized Patient-Reported Outcome-Based Performance Measure (PRO-
PM) Following Elective Primary Total Hip Arthroplasty (THA) and/or
Total Knee Arthroplasty (TKA) in the HOPD Setting (THA/TKA PRO-PM) with
voluntary reporting beginning with the CY 2025 reporting period through
the CY 2027 reporting period followed by mandatory reporting beginning
one year later than proposed with the CY 2028 reporting period/CY 2031
payment determination.
We are finalizing with modification the proposal to adopt the
Excessive Radiation Dose or Inadequate Image Quality for Diagnostic
Computed Tomography (CT) in Adults (Hospital Level--Outpatient) measure
with voluntary reporting beginning with the CY 2025 reporting period
and mandatory reporting beginning 1 year later than proposed with the
CY 2027 reporting period/CY 2029 payment determination.
We are not finalizing our proposal to remove the Left without Being
Seen measure. We are also not finalizing our proposal to re-adopt with
modification the Hospital Outpatient Volume Data on Selected Outpatient
Procedures measure.
We also requested public comment on: (1) patient and workforce
safety (including sepsis); (2) behavioral health (including suicide
prevention); and (3) telehealth as potential future measurement topic
areas in the Hospital OQR Program.
Ambulatory Surgical Center Quality Reporting (ASCQR)
Program: We are finalizing our proposals to: (1) modify the COVID-19
Vaccination Coverage Among Health Care Personnel (HCP) measure
beginning with the CY 2024 Reporting Period/CY 2026 payment
determination; (2) modify the Cataracts: Improvement in Patient's
Visual Function Within 90 Days Following Cataract Surgery measure
beginning with the voluntary CY 2024 reporting period; (3) modify the
Endoscopy/Polyp Surveillance: Appropriate Follow-Up Interval for Normal
Colonoscopy in Average Risk Patients measure beginning with the CY 2024
reporting period/CY 2026 payment determination; and (4) amend multiple
codified regulations to replace references to ``QualityNet'' with
``CMS-designated information system'' or ``CMS website,'' and to make
other conforming technical edits, to accommodate recent and future
systems requirements and mitigate confusion for program participants.
We are finalizing with modification the proposal to adopt the Risk-
Standardized Patient-Reported Outcome-Based Performance Measure (PRO-
PM) Following Elective Primary Total Hip Arthroplasty (THA) and/or
Total Knee Arthroplasty (TKA) in the ASC Setting (THA/TKA PRO-PM) with
voluntary reporting beginning with the CY 2025 reporting period through
the CY 2027 reporting period followed by mandatory reporting beginning
1 year later than proposed with the CY 2028 reporting period/CY 2031
payment determination.
[[Page 81545]]
We are not finalizing our proposal to re-adopt with modification
the ASC Facility Volume Data on Selected ASC Surgical Procedures
measure.
Rural Emergency Hospital Quality Reporting (REHQR)
Program: We are finalizing our proposals to: (1) codify the statutory
authority for the REHQR Program; (2) adopt and codify policies related
to measure retention and measure modification; (3) adopt one chart-
abstracted measure, Median Time from Emergency Department (ED) Arrival
to ED Departure for Discharged ED Patients, beginning with the CY 2024
reporting period; (4) adopt three claims-based measures, Abdomen
Computed Tomography (CT)--Use of Contrast Material, Facility 7-Day
Risk-Standardized Hospital Visit Rate After Outpatient Colonoscopy, and
Risk-Standardized Hospital Visits Within 7 Days After Hospital
Outpatient Surgery, beginning with the CY 2024 reporting period; (5)
establish related reporting requirements beginning with the CY 2024
reporting period; (6) adopt and codify policies related to public
reporting of data; (7) codify foundational requirements related to
REHQR Program participation; (8) adopt and codify policies related to
the form, manner, and timing of data submission under the REHQR
Program; (9) adopt and codify a review and corrections period for
submitted data; and (10) adopt and codify an Extraordinary
Circumstances Exception (ECE) process for data submission requirements.
We are finalizing with modification the proposal to adopt and
codify a policy related to immediate measure removal such that it is
referred to more appropriately as immediate measure suspension. In such
a case, a quality measure considered by CMS to have potential patient
safety concerns will be immediately suspended from the program and then
addressed in the next appropriate rulemaking cycle.
We also requested comment on the following potential measures and
approaches for implementing quality reporting under the REHQR Program:
(1) electronic clinical quality measures (eCQMs); (2) care coordination
measures; and (3) a tiered approach for quality measure reporting.
Mental Health Services Furnished Remotely by Hospital
Staff to Beneficiaries in Their Homes: For CY 2024, we are finalizing
technical refinements to the existing coding for remote mental health
services to allow for multiple units to be billed daily. We also are
finalizing to create a new, untimed code to describe group
psychotherapy. Finally, we are delaying the in-person visit
requirements until January 1, 2025.
OPPS Payment for Dental Services: For CY 2024, we are
assigning over 240 HCPCS codes describing dental services to various
clinical APCs to align with Medicare payment provisions regarding
dental services adopted in the CY 2024 Physician Fee Schedule (PFS)
final rule (87 FR 69404; November 18, 2023).
Comment Solicitation on Payment for High-Cost Drugs
Provided by Indian Health Service and Tribal Facilities: We sought
comment on whether Medicare should pay separately for high-cost drugs
provided by IHS and tribal facilities. Commenters supported
establishing a payment methodology that would allow IHS and Tribal
healthcare facilities to receive separate payment outside of the IHS
outpatient hospital all-inclusive rate (AIR) for oncology drugs and
services whose costs exceed the AIR. Their preferred approach was to
treat the AIR payment amount as a payment threshold and to have a
separate payment for a drug if the cost of the drug was more than the
AIR. Commenters also wanted CMS to ensure the integrity of the AIR if
separate payment is established for high-cost oncology drugs and other
high-cost services. We will consider these comments for future
rulemaking.
Supervision by Nurse Practitioners, Physician Assistants
and Clinical Nurse Specialists of Cardiac, Intensive Cardiac and
Pulmonary Rehabilitation Services Furnished to Outpatients: For CY
2024, to comply with section 51008 of the Bipartisan Budget Act of 2018
and to ensure consistency with final revisions to Sec. Sec. 410.47 and
410.49 in the CY 2024 PFS final rule, published in the Federal Register
of November 16, 2023 (FR Doc. 2023-24184), we are revising Sec.
410.27(a)(1)(iv)(B)(1) to expand the practitioners who may supervise
cardiac rehabilitation (CR), intensive cardiac rehabilitation (ICR),
and pulmonary rehabilitation (PR) services to include nurse
practitioners (NPs), physician assistants (PAs), and clinical nurse
specialists (CNSs). We also are allowing for the direct supervision
requirement for CR, ICR, and PR to include virtual presence of the
physician through audio-video real-time communications technology
(excluding audio-only) through December 31, 2024, and extend this
policy to the nonphysician practitioners, that is NPs, PAs, and CNSs,
who are eligible to supervise these services in CY 2024.
Payment for Intensive Cardiac Rehabilitation Services
(ICR) Provided by an Off-Campus, Non-Excepted Provider Based Department
(PBD) of a Hospital: For CY 2024, to address an unintended
reimbursement disparity created by application of the off-campus, non-
excepted payment rate to intensive cardiac rehabilitation services
(ICR), we are paying for ICR services furnished by an off-campus, non-
excepted PBD of a hospital at 100 percent of the OPPS rate, which is
the amount paid for these services under the PFS.
Final Updates to Requirements for Hospitals to Make Public
a List of Their Standard Charges: We are finalizing our proposals to
revise several of our HPT requirements in order to improve our
monitoring and enforcement capabilities by improving access to, and the
usability of, hospital standard charge information; reducing the
compliance burden on hospitals by providing CMS templates and technical
guidance for display of hospital standard charge information; aligning,
where feasible, certain HPT requirements and processes with
requirements and processes we have implemented in the Transparency in
Coverage (TIC) initiative; and making other modifications to our
monitoring and enforcement capabilities that will, among other things,
increase its transparency to the public. Together, we believe these
activities will enhance existing and future enforcement actions while
also providing the public with more meaningful standard charge
information that can be used to improve the accuracy of consumer-
friendly price estimator tools. Specifically, we are finalizing: (1)
definitions of several terms; (2) a requirement that hospitals make a
good faith effort to ensure standard charge information is true,
accurate, and complete, and to include a statement affirming this in
the machine-readable file (MRF); (3) new data elements that hospitals
must include in their MRFs, as well a requirement that hospitals encode
standard charge information in a CMS template layout; (4) phased
implementation timeline applicable to the new requirements we are
finalizing in this final rule with comment period; (5) a requirement
that hospitals to include a .txt file in the root folder that includes
a direct link to the MRF and a link in the footer on its website that
links directly to the publicly available web page that hosts the link
to the MRF; and (6) improvements to our enforcement process by updating
our methods to assess hospital compliance, requiring hospitals to
acknowledge receipt of warning notices, working with health system
officials to address noncompliance issues in one or more hospitals that
are part of a health system, and publicizing more
[[Page 81546]]
information about CMS enforcement activities related to individual
hospital compliance. Specifically, and as discussed in more detail in
section XVIII of this final rule with comment, we are finalizing that
the effective date of the changes to the hospital price transparency
regulations at 45 CFR part 180 will be January 1, 2024. However, the
regulation text will specify later dates by which hospitals must be in
compliance with some of these new requirements, and we will begin
enforcing those requirements on those specified dates. We believe this
phased implementation approach is necessary to provide hospitals time
to collect and encode the required standard charge information
completely and accurately.
Community Mental Health Center (CMHC) Conditions of
Participation (CoPs): The Consolidated Appropriations Act (CAA), 2023
(Pub. L. 117-238) established in section 4124 coverage of intensive
outpatient (IOP) services in CMHCs. The legislation extended Medicare
coverage and payment of IOP services furnished by a CMHC beginning
January 1, 2024, adding to the existing coverage and payment for
partial hospitalization (PHP) services in CMHCs. Section 4121 of the
CAA, 2023 also established a new Medicare benefit category for services
furnished and directly billed by Mental Health Counselors (MHCs) and
Marriage and Family Therapists (MFTs). To implement these provisions of
section 4121 of the CAA, 2023, CMS is finalizing, as proposed, to
modify the requirements for CMHCs to include IOP services throughout
the CoPs. We are also finalizing our proposal to modify the CMHC CoPs
for personnel qualifications to add a definition of marriage and family
therapists and revise the current definition of mental health
counselors. In addition, we are adding MFTs and MHCs to the list of
practitioners who can lead interdisciplinary team meetings when deemed
necessary.
Changes to the Inpatient Prospective Payment System
Medicare Code Editor: Consistent with the process that is used for
updates to the Integrated Outpatient Code Editor (I/OCE) and other
Medicare claims editing systems, we are finalizing our proposal to
remove discussion of the IPPS Medicare Code Editor (MCE) from the
annual IPPS rulemakings, beginning with the FY 2025 rulemaking, and to
generally address future changes or updates to the MCE through
instruction to the MACs.
Request for Public Comments on Potential Payment
under the IPPS and OPPS for Establishing and Maintaining Access to
Essential Medicines: We sought comment on potential separate payment
under the IPPS for establishing and maintaining access to a buffer
stock of essential medicines.
Rural Emergency Hospital (REH) Conditions of Participation
(CoPs): On November 23, 2022, we published a final rule for the REH
health and safety standards, which was included in the ``Medicare
Program: Hospital Outpatient Prospective Payment and Ambulatory
Surgical Center Payment Systems and Quality Reporting Programs; Organ
Acquisition; Rural Emergency Hospitals: Payment Policies, Conditions of
Participation, Provider Enrollment, Physician Self-Referral; New
Service Category for Hospital Outpatient Department Prior Authorization
Process; Overall Hospital Quality Star Rating; COVID-19'' final rule
with comment period (87 FR 71748). We are finalizing as proposed a
technical correction to the REH CoPs under the standard for the
designation and certification of REHs.
3. Summary of Costs and Benefits
In section XXVI of this final rule with comment period, we set
forth a detailed analysis of the regulatory and federalism impacts that
the changes will have on affected entities and beneficiaries. Key
estimated impacts are described below.
a. Impacts of All OPPS Changes
Table 168 in section XXVI.C of this final rule with comment period
displays the distributional impact of all the OPPS changes on various
groups of hospitals and CMHCs for CY 2024 compared to all estimated
OPPS payments in CY 2023. We estimate that the final policies in this
final rule would result in a 3.2 percent overall increase in OPPS
payments to providers. We estimate that total OPPS payments for CY
2024, including beneficiary cost-sharing, to the approximately 3,600
facilities paid under the OPPS (including general acute care hospitals,
children's hospitals, cancer hospitals, and CMHCs) will increase by
approximately $2.2 billion compared to CY 2023 payments, excluding our
estimated changes in enrollment, utilization, and case-mix.
We estimated the isolated impact of our OPPS policies on CMHCs
because CMHCs have historically only been paid for partial
hospitalization services under the OPPS. Beginning in CY 2024, they
will also be paid for new intensive outpatient program (IOP) services
under the OPPS. Continuing the provider-specific structure we adopted
beginning in CY 2011, and basing payment fully on the type of provider
furnishing the service, we estimate a 9.2 percent increase in CY 2024
payments to CMHCs relative to their CY 2023 payments.
b. Impacts of the Updated Wage Indexes
We estimate that our update of the wage indexes based on the fiscal
year (FY) 2024 IPPS final rule wage indexes will result in a 0.0
percent increase for urban hospitals under the OPPS and a 1.2 percent
increase for rural hospitals. These wage indexes include the continued
implementation of the Office of Management and Budget (OMB) labor
market area delineations based on 2010 Decennial Census data, with
updates, as discussed in section II.C of this final rule with comment
period.
c. Impacts of the Rural Adjustment and the Cancer Hospital Payment
Adjustment
We are implementing the reduction to the cancer hospital payment
adjustment for CY 2024 required by section 1833(t)(18)(C) of the Act,
as added by section 16002(b) of the 21st Century Cures Act, and the
final target payment-to-cost ratio (PCR) for CY 2024 cancer hospital
adjustment of 0.89. However, as section 16002 requires that we reduce
the target PCR by 0.01, that brings the final target PCR to 0.88
instead. This is 0.01 less than the target PCR of 0.89 from CY 2021
through CY 2023, which was previously held at the pre-PHE target.
d. Impacts of the OPD Fee Schedule Increase Factor
For the CY 2024 OPPS/ASC, we are establishing an OPD fee schedule
increase factor of 3.1 percent and applying that increase factor to the
conversion factor for CY 2024. As a result of the OPD fee schedule
increase factor and other budget neutrality adjustments, we estimate
that urban hospitals will experience an increase in payments of
approximately 3.2 percent and that rural hospitals will experience an
increase in payments of 4.2 percent. Classifying hospitals by teaching
status, we estimate non-teaching hospitals will experience an increase
in payments of 3.9 percent, minor teaching hospitals will experience an
increase in payments of 3.5 percent, and major teaching hospitals will
experience an increase in payments of 2.4 percent. We also classified
hospitals by the type of ownership. We estimate that hospitals with
voluntary ownership will experience an increase of 3.2 percent in
payments, while hospitals with government ownership will experience an
increase of 2.8 percent in payments. We estimate that hospitals with
proprietary ownership will experience an increase of 4.6 percent in
payments.
[[Page 81547]]
e. Impacts of the Final ASC Payment Update
For impact purposes, the surgical procedures on the ASC covered
surgical procedure list are aggregated into surgical specialty groups
using CPT and HCPCS code range definitions. The percentage change in
estimated total payments by specialty groups under the CY 2024 payment
rates, compared to estimated CY 2023 payment rates, generally ranges
between a decrease of 11 percent and an increase of 8 percent,
depending on the service, with some exceptions. We estimate the impact
of applying the final inpatient hospital market basket update to ASC
payment rates will increase payments by $207 million under the ASC
payment system in CY 2024. We note that an increase based on the
Consumer Price Index for all urban consumers (CPI-U) update would be
2.5 percent and would increase payments by $174 million under the ASC
payment system in CY 2024. This increase would have been based on a
projected CPI-U update of 2.9 percent minus a multifactor productivity
adjustment required by the Affordable Care Act of 0.4 percentage point.
f. Impacts of Hospital Price Transparency
The policies we are finalizing to enhance automated access to
hospital MRFs and aggregation and use of MRF data are estimated to
increase burden on hospitals, including a one-time mean of $2,787 per
hospital, and a total national cost of $19,784,539 ($2,787 x 7,098
hospitals). The cost estimate reflects estimated costs ranging from
$1,274 and $4,181 per hospital, and a total national cost ranging from
$9,040,620 to $29,676,809. As discussed in detail in section XXVI of
this final rule with comment period, we believe that the benefits to
the public (and to hospitals themselves) outweigh the burden imposed on
hospitals.
B. Legislative and Regulatory Authority for the Hospital OPPS
When Title XVIII of the Act was enacted, Medicare payment for
hospital outpatient services was based on hospital-specific costs. In
an effort to ensure that Medicare and its beneficiaries pay
appropriately for services and to encourage more efficient delivery of
care, the Congress mandated replacement of the reasonable cost-based
payment methodology with a prospective payment system (PPS). The
Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33) added section
1833(t) to the Act, authorizing implementation of a PPS for hospital
outpatient services. The OPPS was first implemented for services
furnished on or after August 1, 2000. Implementing regulations for the
OPPS are located at 42 CFR parts 410 and 419.
The Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of
1999 (BBRA) (Pub. L. 106-113) made major changes in the hospital OPPS.
The following Acts made additional changes to the OPPS: the Medicare,
Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000
(BIPA) (Pub. L. 106-554); the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003 (MMA) (Pub. L. 108-173); the Deficit
Reduction Act of 2005 (DRA) (Pub. L. 109-171), enacted on February 8,
2006; the Medicare Improvements and Extension Act under Division B of
Title I of the Tax Relief and Health Care Act of 2006 (MIEA-TRHCA)
(Pub. L. 109-432), enacted on December 20, 2006; the Medicare,
Medicaid, and SCHIP Extension Act of 2007 (MMSEA) (Pub. L. 110-173),
enacted on December 29, 2007; the Medicare Improvements for Patients
and Providers Act of 2008 (MIPPA) (Pub. L. 110-275), enacted on July
15, 2008; the Patient Protection and Affordable Care Act (Pub. L. 111-
148), enacted on March 23, 2010, as amended by the Health Care and
Education Reconciliation Act of 2010 (Pub. L. 111-152), enacted on
March 30, 2010 (these two public laws are collectively known as the
Affordable Care Act); the Medicare and Medicaid Extenders Act of 2010
(MMEA, Pub. L. 111-309); the Temporary Payroll Tax Cut Continuation Act
of 2011 (TPTCCA, Pub. L. 112-78), enacted on December 23, 2011; the
Middle Class Tax Relief and Job Creation Act of 2012 (MCTRJCA, Pub. L.
112-96), enacted on February 22, 2012; the American Taxpayer Relief Act
of 2012 (Pub. L. 112-240), enacted January 2, 2013; the Pathway for SGR
Reform Act of 2013 (Pub. L. 113-67) enacted on December 26, 2013; the
Protecting Access to Medicare Act of 2014 (PAMA, Pub. L. 113-93),
enacted on March 27, 2014; the Medicare Access and CHIP Reauthorization
Act (MACRA) of 2015 (Pub. L. 114-10), enacted April 16, 2015; the
Bipartisan Budget Act of 2015 (Pub. L. 114-74), enacted November 2,
2015; the Consolidated Appropriations Act, 2016 (Pub. L. 114-113),
enacted on December 18, 2015, the 21st Century Cures Act (Pub. L. 114-
255), enacted on December 13, 2016; the Consolidated Appropriations
Act, 2018 (Pub. L. 115-141), enacted on March 23, 2018; the Substance
Use Disorder--Prevention that Promotes Opioid Recovery and Treatment
for Patients and Communities Act (Pub. L. 115-271), enacted on October
24, 2018; the Further Consolidated Appropriations Act, 2020 (Pub. L.
116-94), enacted on December 20, 2019; the Coronavirus Aid, Relief, and
Economic Security Act (Pub. L. 116-136), enacted on March 27, 2020; the
Consolidated Appropriations Act, 2021 (Pub. L. 116-260), enacted on
December 27, 2020; the Inflation Reduction Act, 2022 (Pub. L. 117-169),
enacted on August 16, 2022; and Consolidated Appropriations Act (CAA),
2023 (Pub. L. 117-238), enacted December 29, 2022.
Under the OPPS, we generally pay for hospital Part B services on a
rate-per-service basis that varies according to the APC group to which
the service is assigned. We use the Healthcare Common Procedure Coding
System (HCPCS) (which includes certain Current Procedural Terminology
(CPT) codes) to identify and group the services within each APC. The
OPPS includes payment for most hospital outpatient services, except
those identified in section I.C of this final rule with comment period.
Section 1833(t)(1)(B) of the Act provides for payment under the OPPS
for hospital outpatient services designated by the Secretary (which
includes partial hospitalization services furnished by CMHCs), and
certain inpatient hospital services that are paid under Medicare Part
B.
The OPPS rate is an unadjusted national payment amount that
includes the Medicare payment and the beneficiary copayment. This rate
is divided into a labor-related amount and a nonlabor-related amount.
The labor-related amount is adjusted for area wage differences using
the hospital inpatient wage index value for the locality in which the
hospital or CMHC is located.
All services and items within an APC group are comparable
clinically and with respect to resource use, as required by section
1833(t)(2)(B) of the Act. In accordance with section 1833(t)(2)(B) of
the Act, subject to certain exceptions, items and services within an
APC group cannot be considered comparable with respect to the use of
resources if the highest median cost (or mean cost, if elected by the
Secretary) for an item or service in the APC group is more than 2 times
greater than the lowest median cost (or mean cost, if elected by the
Secretary) for an item or service within the same APC group (referred
to as the ``2 times rule''). In implementing this provision, we
generally use the cost of the item or service assigned to an APC group.
[[Page 81548]]
For new technology items and services, special payments under the
OPPS may be made in one of two ways. Section 1833(t)(6) of the Act
provides for temporary additional payments, which we refer to as
``transitional pass-through payments,'' for at least 2 but not more
than 3 years for certain drugs, biological agents, brachytherapy
devices used for the treatment of cancer, and categories of other
medical devices. For new technology services that are not eligible for
transitional pass-through payments, and for which we lack sufficient
clinical information and cost data to appropriately assign them to a
clinical APC group, we have established special APC groups based on
costs, which we refer to as New Technology APCs. These New Technology
APCs are designated by cost bands which allow us to provide appropriate
and consistent payment for designated new procedures that are not yet
reflected in our claims data. Similar to pass-through payments, an
assignment to a New Technology APC is temporary; that is, we retain a
service within a New Technology APC until we acquire sufficient data to
assign it to a clinically appropriate APC group.
C. Excluded OPPS Services and Hospitals
Section 1833(t)(1)(B)(i) of the Act authorizes the Secretary to
designate the hospital outpatient services that are paid under the
OPPS. While most hospital outpatient services are payable under the
OPPS, section 1833(t)(1)(B)(iv) of the Act excludes payment for
ambulance, physical and occupational therapy, and speech-language
pathology services, for which payment is made under a fee schedule. It
also excludes screening mammography, diagnostic mammography, and
effective January 1, 2011, an annual wellness visit providing
personalized prevention plan services. The Secretary exercises the
authority granted under the statute to also exclude from the OPPS
certain services that are paid under fee schedules or other payment
systems. Such excluded services include, for example, the professional
services of physicians and nonphysician practitioners paid under the
Medicare Physician Fee Schedule (MPFS); certain laboratory services
paid under the Clinical Laboratory Fee Schedule (CLFS); services for
beneficiaries with end-stage renal disease (ESRD) that are paid under
the ESRD prospective payment system; and services and procedures that
require an inpatient stay that are paid under the hospital IPPS. In
addition, section 1833(t)(1)(B)(v) of the Act does not include
applicable items and services (as defined in subparagraph (A) of
paragraph (21)) that are furnished on or after January 1, 2017, by an
off-campus outpatient department of a provider (as defined in
subparagraph (B) of paragraph (21)). We set forth the services that are
excluded from payment under the OPPS in regulations at 42 CFR 419.22.
Under Sec. 419.20(b) of the regulations, we specify the types of
hospitals that are excluded from payment under the OPPS. These excluded
hospitals are:
Critical access hospitals (CAHs);
Hospitals located in Maryland and paid under Maryland's
All-Payer or Total Cost of Care Model;
Hospitals located outside of the 50 States, the District
of Columbia, and Puerto Rico; and
Indian Health Service (IHS) hospitals.
D. Prior Rulemaking
On April 7, 2000, we published in the Federal Register a final rule
with comment period (65 FR 18434) to implement a prospective payment
system for hospital outpatient services. The hospital OPPS was first
implemented for services furnished on or after August 1, 2000. Section
1833(t)(9)(A) of the Act requires the Secretary to review certain
components of the OPPS, not less often than annually, and to revise the
groups, the relative payment weights, and the wage and other
adjustments to take into account changes in medical practices, changes
in technology, the addition of new services, new cost data, and other
relevant information and factors.
Since initially implementing the OPPS, we have published final
rules in the Federal Register annually to implement statutory
requirements and changes arising from our continuing experience with
this system. These rules can be viewed on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices.
E. Advisory Panel on Hospital Outpatient Payment (the HOP Panel or the
Panel)
1. Authority of the Panel
Section 1833(t)(9)(A) of the Act, as amended by section 201(h) of
Public Law 106-113, and redesignated by section 202(a)(2) of Public Law
106-113, requires that we consult with an expert outside advisory panel
composed of an appropriate selection of representatives of providers to
annually review (and advise the Secretary concerning) the clinical
integrity of the payment groups and their weights under the OPPS. In CY
2000, based on section 1833(t)(9)(A) of the Act, the Secretary
established the Advisory Panel on Ambulatory Payment Classification
Groups (APC Panel) to fulfill this requirement. In CY 2011, based on
section 222 of the Public Health Service Act (the PHS Act), which gives
discretionary authority to the Secretary to convene advisory councils
and committees, the Secretary expanded the panel's scope to include the
supervision of hospital outpatient therapeutic services in addition to
the APC groups and weights. To reflect this new role of the panel, the
Secretary changed the panel's name to the Advisory Panel on Hospital
Outpatient Payment (the HOP Panel). The HOP Panel is not restricted to
using data compiled by CMS, and in conducting its review, it may use
data collected or developed by organizations outside the Department.
2. Establishment of the Panel
On November 21, 2000, the Secretary signed the initial charter
establishing the Panel, and, at that time, named the APC Panel. This
expert panel is composed of appropriate representatives of providers
(currently employed full-time, not as consultants, in their respective
areas of expertise) who review clinical data and advise CMS about the
clinical integrity of the APC groups and their payment weights. Since
CY 2012, the Panel also is charged with advising the Secretary on the
appropriate level of supervision for individual hospital outpatient
therapeutic services. The Panel is technical in nature, and it is
governed by the provisions of the Federal Advisory Committee Act
(FACA). The current charter specifies, among other requirements, that
the Panel--
May advise on the clinical integrity of Ambulatory Payment
Classification (APC) groups and their associated weights;
May advise on the appropriate supervision level for
hospital outpatient services;
May advise on OPPS APC rates for ASC covered surgical
procedures;
Continues to be technical in nature;
Is governed by the provisions of the FACA;
Has a Designated Federal Official (DFO); and
Is chaired by a Federal Official designated by the
Secretary.
The Panel's charter was amended on November 15, 2011, renaming the
Panel and expanding the Panel's authority to include supervision of
hospital outpatient therapeutic services and to add critical access
hospital (CAH) representation to its membership. The
[[Page 81549]]
Panel's charter was also amended on November 6, 2014 (80 FR 23009), and
the number of members was revised from up to 19 to up to 15 members.
The Panel's current charter was approved on November 21, 2022, for a 2-
year period.
The current Panel membership and other information pertaining to
the Panel, including its charter, Federal Register notices, membership,
meeting dates, agenda topics, and meeting reports, can be viewed on the
CMS website at: https://www.cms.gov/Regulations-and-Guidance/Guidance/FACA/AdvisoryPanelonAmbulatoryPaymentClassificationGroups.html.
3. Panel Meetings and Organizational Structure
The Panel has held many meetings, with the last meeting taking
place on August 21, 2023. Prior to each meeting, we publish a notice in
the Federal Register to announce the meeting, new members, and any
other changes of which the public should be aware. Beginning in CY
2017, we have transitioned to one meeting per year (81 FR 31941). In CY
2018, we published a Federal Register notice requesting nominations to
fill vacancies on the Panel (83 FR 3715). CMS is currently accepting
nominations at: https://mearis.cms.gov.
In addition, the Panel has established an administrative structure
that, in part, currently includes the use of three subcommittee
workgroups to provide preparatory meeting and subject support to the
larger panel. The three current subcommittees include the following:
APC Groups and Status Indicator Assignments Subcommittee,
which advises and provides recommendations to the Panel on the
appropriate status indicators to be assigned to HCPCS codes, including
but not limited to whether a HCPCS code or a category of codes should
be packaged or separately paid, as well as the appropriate APC
assignment of HCPCS codes regarding services for which separate payment
is made;
Data Subcommittee, which is responsible for studying the
data issues confronting the Panel and for recommending options for
resolving them; and
Visits and Observation Subcommittee, which reviews and
makes recommendations to the Panel on all technical issues pertaining
to observation services and hospital outpatient visits paid under the
OPPS.
Each of these workgroup subcommittees was established by a majority
vote from the full Panel during a scheduled Panel meeting, and the
Panel recommended at the August 21, 2023, meeting that the
subcommittees continue. We accepted this recommendation.
For discussions of earlier Panel meetings and recommendations, we
refer readers to previously published OPPS/ASC proposed and final
rules, the CMS website mentioned earlier in this section, and the FACA
database at https://facadatabase.gov.
F. Public Comments Received on the CY 2024 OPPS/ASC Proposed Rule
We received approximately 3,777 timely pieces of correspondence on
the CY 2024 OPPS/ASC proposed rule that appeared in the Federal
Register on July 31, 2023 (88 FR 49552 through 49921), from
individuals, elected officials, providers and suppliers, practitioners,
manufacturers and advocacy groups. We provide summaries of the public
comments, and our responses are set forth in the various sections of
this final rule with comment period under the appropriate headings. We
note that we received some public comments that were outside the scope
of the CY 2024 OPPS/ASC proposed rule. Out-of-scope-public comments are
not addressed in this CY 2024 OPPS/ASC final rule with comment period.
G. Public Comments Received on the CY 2023 OPPS/ASC Final Rule With
Comment Period
We received approximately 12 timely pieces of correspondence on the
CY 2023 OPPS/ASC final rule with comment period that appeared in the
Federal Register on November 23, 2022 (87 FR 71748).
II. Updates Affecting OPPS Payments
A. Recalibration of APC Relative Payment Weights
1. Database Construction
a. Database Source and Methodology
Section 1833(t)(9)(A) of the Act requires that the Secretary review
not less often than annually and revise the relative payment weights
for Ambulatory Payment Classifications (APCs). In the April 7, 2000,
OPPS final rule with comment period (65 FR 18482), we explained in
detail how we calculated the relative payment weights that were
implemented on August 1, 2000, for each APC group.
For the CY 2024 OPPS, we proposed to recalibrate the APC relative
payment weights for services furnished on or after January 1, 2024, and
before January 1, 2025 (CY 2024), using the same basic methodology that
we described in the CY 2023 OPPS/ASC final rule with comment period (86
FR 63466), using CY 2022 claims data. That is, we proposed to
recalibrate the relative payment weights for each APC based on claims
and cost report data for hospital outpatient department (HOPD) services
to construct a database for calculating APC group weights.
For the purpose of recalibrating the proposed APC relative payment
weights for CY 2024, we began with approximately 180 million final
action claims (claims for which all disputes and adjustments have been
resolved and payment has been made) for HOPD services furnished on or
after January 1, 2022, and before January 1, 2023, before applying our
exclusionary criteria and other methodological adjustments. After the
application of those data processing changes, we used approximately 93
million final action claims to develop the proposed CY 2024 OPPS
payment weights. For exact numbers of claims used and additional
details on the claims accounting process, we refer readers to the
claims accounting narrative under supporting documentation for the CY
2024 OPPS/ASC proposed rule on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient.
Addendum N to the CY 2024 OPPS/ASC proposed rule (which is
available via the internet on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices) included the proposed list of bypass codes for CY
2024. The proposed list of bypass codes contains codes that are
reported on claims for services in CY 2022 and, therefore, includes
codes that were in effect in CY 2022 and used for billing. We retained
these deleted bypass codes on the proposed CY 2024 bypass list because
these codes existed in CY 2022 and were covered OPD services in that
period, and CY 2022 claims data were used to calculate proposed CY 2024
payment rates. Keeping these deleted bypass codes on the bypass list
potentially allows us to create more ``pseudo'' single procedure claims
for ratesetting purposes. ``Overlap bypass codes'' that are members of
the proposed multiple imaging composite APCs are identified by
asterisks (*) in the third column of Addendum N to the CY 2024 OPPS/ASC
proposed rule. HCPCS codes that we proposed to add for CY 2024 are
identified by asterisks (*) in the fourth column of Addendum N.
We did not receive any public comments on our general proposal to
recalibrate the relative payment weights for each APC based on claims
and cost report data for HOPD services or on our
[[Page 81550]]
proposed bypass code process. We are finalizing as proposed the
``pseudo'' single claims process and the final CY 2024 list of bypass
codes, as displayed in Addendum N to this final rule with comment
period (which is available via the internet on the CMS website). For
this final rule with comment period, for the purpose of recalibrating
the final APC relative payment weights for CY 2024, we used
approximately 103 million final actions claims (claims for which all
disputes and adjustments have been resolved and payment has been made)
for HOPD services furnished on or after January 1, 2022, and before
January 1, 2023. For exact numbers of claims used and additional
details on the claims accounting process, we refer readers to the
claims accounting narrative under supporting documentation for this
final rule with comment period on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient.
b. Calculation and Use of Cost-to-Charge Ratios (CCRs)
For CY 2024, we proposed to continue to use the hospital-specific
overall ancillary and departmental cost-to-charge ratios (CCRs) to
convert charges to estimated costs through application of a revenue
code-to-cost center crosswalk. To calculate the APC costs on which the
proposed CY 2024 APC payment rates are based, we calculated hospital-
specific departmental CCRs for each hospital for which we had CY 2022
claims data by comparing these claims data to the most recently
available hospital cost reports, which, in most cases, are from CY
2021. For the proposed CY 2024 OPPS payment rates, we used the set of
claims processed during CY 2022. We applied the hospital-specific CCR
to the hospital's charges at the most detailed level possible, based on
a revenue code-to-cost center crosswalk that contains a hierarchy of
CCRs used to estimate costs from charges for each revenue code. To
ensure the completeness of the revenue code-to-cost center crosswalk,
we reviewed changes to the list of revenue codes for CY 2022 (the year
of claims data we used to calculate the proposed CY 2024 OPPS payment
rates) and updates to the National Uniform Billing Committee (NUBC)
2022 Data specifications Manual. That crosswalk is available for review
and continuous comment on the CMS website at https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient.
In the CY 2023 OPPS/ASC final rule with comment period, a few
commenters recommended that we revise our revenue code-to-cost center
crosswalk to provide consistency with the NUBC definitions and to
improve the accuracy of cost data for OPPS ratesetting with respect to
chimeric antigen receptor therapy (CAR-T) administration services (87
FR 71758). In that final rule with comment period, we stated that we
intend to explore the implications of this recommendation further and
may consider such changes in future rulemaking. In the CY 2024 OPPS/ASC
proposed rule, we explored the impacts of the commenters'
recommendation from the CY 2023 OPPS/ASC final rule with comment period
that we assign primary cost centers to certain CAR-T-related revenue
codes that were not previously assigned cost centers. Specifically, in
the CY 2024 OPPS/ASC proposed rule, we explored the commenter's
recommendations regarding changes to the revenue code-to-cost center
crosswalk, which included:
Revising revenue codes 0870 (Cell/Gene Therapy General
Classification) and 0871 (Cell Collection) to be mapped to a primary
cost center of 9000 (Clinic);
Revising revenue codes 0872 (Specialized Biologic
Processing and Storage--Prior to Transport) and 0873 (Storage and
Processing After Receipt of Cells from Manufacturer) to be mapped to a
primary cost center of 3350 (Hematology);
Revising revenue codes 0874 (Infusion of Modified Cells)
and 0875 (Injection of Modified Cells) to be mapped to a primary cost
center of 6400 (Intravenous Therapy); and
Revising revenue codes 0891 (Special Processed Drugs--FDA
Approved Cell Therapy) and 0892 (Special Processed Drugs--FDA Approved
Gene Therapy) to be mapped to a primary cost center of 7300 (Drugs
Charged to Patients).
After reviewing the impact of these crosswalk revisions on our
proposed CY 2024 OPPS APC geometric mean costs, we only observed an
increase in the geometric mean cost of CPT code 0540T (Chimeric antigen
receptor t-cell (car-t) therapy; car-t cell administration,
autologous)--from $148.31 to $294.17 for the CY 2024 OPPS/ASC proposed
rule--as a result of the revenue code for CPT code 0540T being assigned
to a new cost center and the new corresponding cost-to-charge ratio. We
did not observe any significant impact on APC geometric mean costs or
payment as a result of these revisions. We stated that we believe these
revisions would provide greater consistency with the NUBC definitions
(which already adopted these revenue code revisions) and more
accurately account for the costs of CAR-T administration services under
the OPPS. Therefore, for CY 2024 and subsequent years, we proposed to
adopt the aforementioned revisions to revenue codes 0870, 0871 0872,
0873, 0874, 0875, 0891, and 0892 in our revenue code-to-cost center
crosswalk.
We solicited comment on our proposed changes to the revenue code-
to-cost center crosswalk for CY 2024.
In accordance with our longstanding policy, similar to our
finalized policy for CY 2023 OPPS ratesetting, we proposed to calculate
CCRs for the standard cost centers--cost centers with a predefined
label--and nonstandard cost centers--cost centers defined by a
hospital--accepted by the electronic cost report database. In general,
the most detailed level at which we calculate CCRs is the hospital-
specific departmental level.
While we generally view the use of additional cost data as
improving our OPPS ratesetting process, we have historically not
included cost report lines for certain nonstandard cost centers in the
OPPS ratesetting database construction when hospitals have reported
these nonstandard cost centers on cost report lines that do not
correspond to the cost center number. We believe it is important to
further investigate the accuracy of these cost report data before
including such data in the ratesetting process. Further, we believe it
is appropriate to gather additional information from the public as well
before including them in OPPS ratesetting. For CY 2024, we proposed not
to include the nonstandard cost centers reported in this way in the
OPPS ratesetting database construction.
Comment: Two commenters supported our proposed revenue code-to-cost
center crosswalk changes associated with CAR-T.
Response: We appreciate the commenters' support for our proposal.
Comment: A few commenters listed a number of concerns regarding the
revenue code-to-cost center crosswalk mappings associated with revenue
codes 0815 and 0819. They noted that the 2552-96 revenue code-to-cost
center crosswalk does not show the cost center used for ratesetting.
They also noted that the current 2552-10 revenue code-to-cost center
crosswalk includes a primary cost center mapping to 112.50 and no
secondary or tertiary cost centers listed.
A commenter requested more detail around the cost reporting and
billing patterns related to revenue codes 0815 and cost centers 112.50
and 7700. A commenter believed that the mapping
[[Page 81551]]
for revenue code 0819 to cost center 8600 was incongruent with CMS
instructions for cost reporting periods after 2017 to no longer include
donor costs in cost center 8600. They believed that this mapping should
not apply.
Commenters stated that cost center 7700 represented a logical
alternative mapping for revenue code 0815 but noted that it did not
represent all donor search and cell acquisition costs because those
costs were only recently calculated through Worksheet D-6 of the
Medicare cost report and that data would not be available for
ratesetting for several years. They also suggested that CMS review the
use of the hospital overall ancillary CCR until more accurate
information could be obtained in both cost center 7700 and Worksheet D-
6. A commenter also requested that CMS ensure that the Worksheet D-6 is
available for all cost reporting periods beginning on or after October
1, 2020.
Response: As discussed in this section and briefly in the claims
accounting narrative available online, the revenue code-to-cost center
crosswalk is a hierarchy that attempts to apply departmental cost
center CCRs to estimate costs from charges. Where no specific CCR is
available, the provider's overall ancillary CCR will be applied. There
may be significant differences in the cost reports used in our
ratesetting process, based on providers' charging structures as well as
cost reporting periods. As a result, the revenue code-to-cost center
crosswalk is designed to accommodate that flexibility by selecting what
we believe to be the most accurate CCRs available.
The Medicare cost report form 2552-10 was implemented for cost
reporting periods on or after May 1, 2010. Providers have familiarity
with cost reporting using this form. While there may be a range in the
cost reporting periods available, all cost report data used in
ratesetting for the CY 2024 OPPS final rule with comment period are
based on the Medicare cost report form 2552-10. The 2552-96 crosswalk
is largely provided for historical reference purposes and not because
it is actively used in our ratesetting process. However, we can
consider removing those worksheets from the form if they no longer
serve a purpose for hospitals.
With regard to the primary mapping of revenue code 0815 to cost
center 112.50 (Stem Cell Acquisition) indicated in the display version
of the revenue code-to-cost center crosswalk, the cost center was
inadvertently listed as a primary mapping. The primary and sole mapping
for revenue code 0815 in our current ratesetting process is to cost
center 7700 (Allogeneic Stem Cell Acquisition). In cases where that
cost center CCR is not available in a provider's cost report but
services are billed using revenue code 0815, the overall ancillary CCR
would instead be applied to reduce charges to estimated cost. We note
that there are no cost reports we are including in the CY 2024 OPPS
ratesetting process that report cost and charges under 112.50, and
there are no revenue code-to-cost center crosswalk mappings to that
cost center.
As discussed earlier, the cost reports used in OPPS ratesetting can
have varying cost reporting periods and varying cost reporting
structures. Therefore, the cost center CCR mappings included in the
revenue code-to-cost center crosswalk are designed to accommodate this
variability. For revenue code 0815 (Allogeneic Stem Cell Acquisition
Services), most of the providers billing using this revenue code are
also cost reporting with cost center 7700. Within our ratesetting
process, the CCRs for cost center 7700 are significantly higher than
those for the overall ancillary CCR; and we continue to believe that
the preference should be to use the cost center 7700 CCR unless it is
not otherwise available. We note that billing using revenue code 0819
(Organ Acquisition: Other donor) is extremely limited, with only a
single line observed within our data. We believe that having the
flexibility to use its cost center 8600 mapping where this revenue code
is billed is more reflective than the overall ancillary CCR. However,
we will monitor the data to determine if this cost center CCR mapping
continues to remain appropriate in the future.
While we do not have any specific changes at this time associated
with the data from Worksheet D-6 of the Medicare cost report form, we
will review the data as they become available. Based on that review, we
will consider inclusion of that data and integration into the cost
estimation process, if appropriate. We appreciate commenter input as we
consider possible changes in the OPPS ratesetting process we use to
estimate service costs. We also note that the cost reporting software
has already been updated to allow for submission of data regarding
these acquisition costs for cost reporting periods on or after October
1, 2020.
After consideration of the public comments we received, we are
finalizing the proposed crosswalk, including the proposed changes
associated with CAR-T. In addition, we are making the change to our
display copy of the revenue code-to-cost center crosswalk to assign
cost center 77 as the primary cost center CCR mapping for revenue code
0815.
2. Final Data Development and Calculation of Costs Used for Ratesetting
In this section of this final rule with comment period, we discuss
the use of claims to calculate the OPPS payment rates for CY 2024. The
Hospital OPPS page on the CMS website on which this final rule with
comment period is posted (https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient) provides an accounting
of claims used in the development of the final payment rates. That
accounting provides additional detail regarding the number of claims
derived at each stage of the process. In addition, later in this
section we discuss the file of claims that comprises the data set that
is available upon payment of an administrative fee under a CMS data use
agreement. The CMS website, https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient, includes information
about obtaining the ``OPPS Limited Data Set,'' which now includes the
additional variables previously available only in the OPPS Identifiable
Data Set, including International Classification of Diseases, Tenth
Revision, Clinical Modification (ICD-10-CM) diagnosis codes and revenue
code payment amounts. This file is derived from the CY 2022 claims that
are used to calculate the final payment rates for this final rule with
comment period.
Previously, the OPPS established the scaled relative weights on
which payments are based using APC median costs, a process described in
the CY 2012 OPPS/ASC final rule with comment period (76 FR 74188).
However, as discussed in more detail in section II.A.2.f of the CY 2013
OPPS/ASC final rule with comment period (77 FR 68259 through 68271), we
finalized the use of geometric mean costs to calculate the relative
weights on which the CY 2013 OPPS payment rates were based. While this
policy changed the cost metric on which the relative payments are
based, the data process in general remained the same under the
methodologies that we used to obtain appropriate claims data and
accurate cost information in determining estimated service cost.
We used the methodology described in sections II.A.2.a through
II.A.2.c of this final rule with comment period to calculate the costs
we used to establish the final relative payment weights used in
calculating the OPPS payment rates for CY 2024 shown in Addenda A and B
to this final rule with comment period (which are available via the
internet on
[[Page 81552]]
the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices). We refer
readers to section II.A.4 of this final rule with comment period for a
discussion of the conversion of APC costs to scaled payment weights.
We note that under the OPPS, CY 2019 was the first year in which
the claims data used for setting payment rates (CY 2017 data) contained
lines with the modifier ``PN,'' which indicates nonexcepted items and
services furnished and billed by off-campus provider-based departments
(PBDs) of hospitals. Because nonexcepted items and services are not
paid under the OPPS, in the CY 2019 OPPS/ASC final rule with comment
period (83 FR 58832), we finalized a policy to remove those claim lines
reported with modifier ``PN'' from the claims data used in ratesetting
for the CY 2019 OPPS and subsequent years. For the CY 2024 OPPS, we
proposed to continue to remove claim lines with modifier ``PN'' from
the ratesetting process.
For details of the claims accounting process used in final rule
with comment period, we refer readers to the claims accounting
narrative under supporting documentation for this final rule with
comment period on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient.
We did not receive any public comments on our proposal and are
finalizing our proposal to continue to remove claim lines reported with
modifier ``PN'' from the ratesetting process.
a. Calculation of Single Procedure APC Criteria-Based Costs
(1) Blood and Blood Products
Since the implementation of the OPPS in August 2000, we have made
separate payments for blood and blood products through APCs rather than
packaging payment for them into payments for the procedures with which
they are administered. Hospital payments for the costs of blood and
blood products, as well as for the costs of collecting, processing, and
storing blood and blood products, are made through the OPPS payments
for specific blood product APCs.
In the CY 2024 OPPS/ASC proposed rule, we proposed to continue to
establish payment rates for blood and blood products using our blood-
specific CCR methodology (88 FR 49562), which utilizes actual or
simulated CCRs from the most recently available hospital cost reports
to convert hospital charges for blood and blood products to costs. This
methodology has been our standard ratesetting methodology for blood and
blood products since CY 2005. It was developed in response to data
analysis indicating that there was a significant difference in CCRs for
those hospitals with and without blood-specific cost centers and past
public comments indicating that the former OPPS policy of defaulting to
the overall hospital CCR for hospitals not reporting a blood-specific
cost center often resulted in an underestimation of the true hospital
costs for blood and blood products. To address the differences in CCRs
and to better reflect hospitals' costs, our methodology simulates blood
CCRs for each hospital that does not report a blood cost center by
calculating the ratio of the blood-specific CCRs to hospitals' overall
CCRs for those hospitals that do report costs and charges for blood
cost centers and applies this mean ratio to the overall CCRs of
hospitals not reporting costs and charges for blood cost centers on
their cost reports. We proposed to calculate the costs upon which the
proposed payment rates for blood and blood products are based using the
actual blood-specific CCR for hospitals that reported costs and charges
for a blood cost center and a hospital-specific, simulated, blood-
specific CCR for hospitals that did not report costs and charges for a
blood cost center.
We continue to believe that the hospital-specific, simulated,
blood-specific CCR methodology takes into account the unique charging
and cost accounting structure of each hospital, it better responds to
the absence of a blood-specific CCR for a hospital than alternative
methodologies, such as defaulting to the overall hospital CCR or
applying an average blood-specific CCR across hospitals. This
methodology also yields more accurate estimated costs for these
products and results in payment rates for blood and blood products that
appropriately reflect the relative estimated costs of these products
for hospitals without blood cost centers and for these blood products
in general.
We refer readers to Addendum B to this final rule with comment
period (which is available via the internet on the CMS website at
https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices) for the final CY 2024 payment
rates for blood and blood products (which are generally identified with
status indicator ``R'').
For a more detailed discussion of payments for blood and blood
products through APCs, we refer readers to:
the CY 2005 OPPS proposed rule (69 FR 50524 and 50525) for
a more comprehensive discussion of the blood-specific CCR methodology;
the CY 2008 OPPS/ASC final rule with comment period (72 FR
66807 through 66810) for a detailed history of the OPPS payment for
blood and blood products; and
the CY 2015 OPPS/ASC final rule with comment period (79 FR
66795 and 66796) for additional discussion of our policy not to make
separate payments for blood and blood products when they appear on the
same claims as services assigned to a C-APC.
Comment: Two commenters discussed our payment policies for blood
and blood products. One commenter expressed concerns about lower
payment rates for some blood products in CY 2024 as compared to CY 2023
and encouraged CMS to work with interested parties in the blood
products and blood services community to address this issue. The other
commenter expressed their support for separate payment for blood and
blood products in the OPPS for most services.
Response: We appreciate the input from the commenters, and we will
keep these issues in mind in future rulemaking.
After consideration of the public comments we received, we are
adopting as final our proposals for blood and blood products using our
blood-specific CCR methodology without modification. Refer to Addendum
B to this final rule with comment period (which is available via the
internet on the CMS website) for the final CY 2024 payment rates for
blood and blood products.
(2) Brachytherapy Sources
Section 1833(t)(2)(H) of the Act mandates the creation of
additional groups of covered OPD services that classify devices of
brachytherapy--cancer treatment through solid source radioactive
implants--consisting of a seed or seeds (or radioactive source)
(``brachytherapy sources'') separately from other services or groups of
services. The statute provides certain criteria for the additional
groups. For the history of OPPS payment for brachytherapy sources, we
refer readers to prior OPPS final rules, such as the CY 2012 OPPS/ASC
final rule with comment period (77 FR 68240 and 68241). As we have
stated in prior OPPS updates, we believe that adopting the general OPPS
prospective payment methodology for brachytherapy sources is
appropriate for a number of reasons (77 FR 68240). The general OPPS
methodology uses costs based on claims data to set the relative payment
weights
[[Page 81553]]
for hospital outpatient services. This payment methodology results in
more consistent, predictable, and equitable payment amounts per source
across hospitals by averaging the extremely high and low values, in
contrast to payment based on hospitals' charges adjusted to costs. We
believe that the OPPS methodology, as opposed to payment based on
hospitals' charges adjusted to cost, also would provide hospitals with
incentives for efficiency in the provision of brachytherapy services to
Medicare beneficiaries. Moreover, this approach is consistent with our
payment methodology for the vast majority of items and services paid
under the OPPS. We refer readers to the CY 2016 OPPS/ASC final rule
with comment period (80 FR 70323 through 70325) for further discussion
of the history of OPPS payment for brachytherapy sources.
For CY 2024, except where otherwise indicated, we proposed to use
the costs derived from CY 2022 claims data to set the proposed CY 2024
payment rates for brachytherapy sources because CY 2022 is the year of
data we proposed to use to set the proposed payment rates for most
other items and services that would be paid under the CY 2024 OPPS. We
proposed this methodology for CY 2024 and subsequent years. With the
exception of the proposed payment rate for brachytherapy source C2645
(Brachytherapy planar source, palladium-103, per square millimeter) and
the proposed payment rates for low-volume brachytherapy APCs discussed
in section III.D of the CY 2024 OPPS/ASC proposed rule (88 FR 49563),
we proposed to base the payment rates for brachytherapy sources on the
geometric mean unit costs for each source, consistent with the
methodology that we proposed for other items and services paid under
the OPPS, as discussed in section II.A.2 of the CY 2024 OPPS/ASC
proposed rule (88 FR 49563). We also proposed for CY 2024 and
subsequent years to continue the other payment policies for
brachytherapy sources that we finalized and first implemented in the CY
2010 OPPS/ASC final rule with comment period (74 FR 60537). For CY 2024
and subsequent years, we proposed to pay for the stranded and
nonstranded not otherwise specified (NOS) codes, HCPCS codes C2698
(Brachytherapy source, stranded, not otherwise specified, per source)
and C2699 (Brachytherapy source, non-stranded, not otherwise specified,
per source), at a rate equal to the lowest stranded or nonstranded
prospective payment rate for such sources, respectively, on a per-
source basis (as opposed to, for example, per mCi), which is based on
the policy we established in the CY 2008 OPPS/ASC final rule with
comment period (72 FR 66785). For CY 2024 and subsequent years, we also
proposed to continue the policy we first implemented in the CY 2010
OPPS/ASC final rule with comment period (74 FR 60537) regarding payment
for new brachytherapy sources for which we have no claims data, based
on the same reasons we discussed in the CY 2008 OPPS/ASC final rule
with comment period (72 FR 66786; which was delayed until January 1,
2010, by section 142 of Pub. L. 110-275). Specifically, this policy is
intended to enable us to assign new HCPCS codes for new brachytherapy
sources to their own APCs, with prospective payment rates set based on
our consideration of external data and other relevant information
regarding the expected costs of the sources to hospitals. The proposed
CY 2024 payment rates for brachytherapy sources are included on
Addendum B to the CY 2024 OPPS/ASC proposed rule (which is available
via the internet on the CMS website) and identified with status
indicator ``U.''
For CY 2018, we assigned status indicator ``U'' (Brachytherapy
Sources, Paid under OPPS; separate APC payment) to HCPCS code C2645
(Brachytherapy planar source, palladium-103, per square millimeter) in
the absence of claims data and established a payment rate using
external data (invoice price) at $4.69 per mm\2\ for the brachytherapy
source's APC--APC 2648 (Brachytx planar, p-103). For CY 2019, in the
absence of sufficient claims data, we continued to establish a payment
rate for C2645 at $4.69 per mm\2\ for APC 2648 (Brachytx planar, p-
103). Our CY 2018 claims data available for the CY 2020 OPPS/ASC final
rule with comment period (84 FR 61142) included two claims with a
geometric mean cost for HCPCS code C2645 of $1.02 per mm\2\. In
response to comments from interested parties, we agreed that, given the
limited claims data available and a new outpatient indication for
C2645, a payment rate for HCPCS code C2645 based on the geometric mean
cost of $1.02 per mm\2\ may not adequately reflect the cost of HCPCS
code C2645. In the CY 2020 OPPS/ASC final rule with comment period, we
finalized our policy to use our equitable adjustment authority under
section 1833(t)(2)(E) of the Act, which states that the Secretary shall
establish, in a budget neutral manner, other adjustments as determined
to be necessary to ensure equitable payments, to maintain the CY 2019
payment rate of $4.69 per mm\2\ for HCPCS code C2645 for CY 2020.
Similarly, in the absence of sufficient claims data to establish an APC
payment rate, in the CY 2021, CY 2022, and CY 2023 OPPS/ASC final rules
with comment period (85 FR 85879 and 85880 and 86 FR 63469 and 87 FR
71760 and 71761), we finalized our policy to use our equitable
adjustment authority under section 1833(t)(2)(E) of the Act to maintain
the CY 2019 payment rate of $4.69 per mm\2\ for HCPCS code C2645 for CY
2021, for CY 2022, and for CY 2023.
We reviewed CY 2022 claims data available for the CY 2024 OPPS/ASC
proposed rule, and we observed three claims that reported HCPCS code
C2645. Each claim reported one unit of HCPCS code C2645 and the
geometric mean unit cost from these three claims was $168.67. We stated
we were unable to use these claims for ratesetting purposes given the
reporting of only one unit per claim and the high geometric mean cost.
Therefore, we proposed to use our equitable adjustment authority under
section 1833(t)(2)(E) of the Act to maintain the CY 2023 payment rate
of $4.69 per mm\2\ for HCPCS code C2645, which we proposed to assign to
APC 2648 (Brachytx planar, p-103), for CY 2024.
For this final rule with comment period, we once again reviewed CY
2022 claims data available; and we observed the same three claims that
reported HCPCS code C2645.
Additionally, for CY 2022 and subsequent calendar years, we adopted
a Universal Low Volume APC policy for clinical and brachytherapy APCs.
As discussed in further detail in section X.C of the CY 2022 OPPS/ASC
final rule with comment period (86 FR 63743 through 63747), we adopted
this policy to mitigate wide variation in payment rates that occur from
year to year for APCs with low utilization. Such volatility in payment
rates from year to year can result in even lower utilization and
potential barriers to access. Brachytherapy APCs that have fewer than
100 single claims used for ratesetting purposes are designated as Low
Volume APCs unless an alternative payment rate is applied, such as the
use of our equitable adjustment authority under section 1833(t)(2)(E)
of the Act in the case of APC 2648 (Brachytx planar, p-103), for which
HCPCS code C2645 (Brachytherapy planar source, palladium-103, per
square millimeter) is the only code assigned as discussed previously in
this section.
For CY 2024, we proposed to designate five brachytherapy APCs as
Low Volume APCs as these APCs meet
[[Page 81554]]
our criteria to be designated as a Low Volume APC. For more information
on the brachytherapy APCs we proposed to designate as Low Volume APCs,
see section III.D of the CY 2024 OPPS/ASC proposed rule (88 FR 49628)
and section III.D of this final rule with comment period.
We invited interested parties to submit recommendations for new
codes to describe new brachytherapy sources. We will continue to add
new brachytherapy source codes and descriptors to our systems for
payment on a quarterly basis.
We did not receive any public comments on either proposal
described. We are finalizing, without modification, to use our
equitable adjustment authority under section 1833(t)(2)(E) of the Act
to maintain the CY 2023 payment rate of $4.69 per mm\2\ for HCPCS code
C2645, which is assigned to APC 2648 (Brachytx planar, p-103), for CY
2024.
Similarly, for CY 2024 and subsequent years we are finalizing,
without modification, our proposal to continue to set the payment rates
for other brachytherapy sources that are not otherwise assigned to
designated Low Volume APCs for CY 2024 using our established
prospective payment methodology. The final CY 2024 payment rates for
brachytherapy sources are included in Addendum B to this final rule
with comment period (which is available via the internet on the CMS
website) and are identified with status indicator ``U.'' We continue to
invite interested parties to submit recommendations for new codes to
describe new brachytherapy sources. Such recommendations should be
directed via email to outpatientpps@ cms.hhs.gov or by mail to the
Division of Outpatient Care, Mail Stop C4-01-26, Centers for Medicare
and Medicaid Services, 7500 Security Boulevard, Baltimore, MD 21244. We
will continue to add new brachytherapy source codes and descriptors to
our systems for payment on a quarterly basis.
b. Comprehensive APCs (C-APCs) for CY 2024
(1) Background
In the CY 2014 OPPS/ASC final rule with comment period (78 FR 74861
through 74910), we finalized a comprehensive payment policy that
packages payment for adjunctive and secondary items, services, and
procedures into the most costly primary procedure under the OPPS at the
claim level. The policy was finalized in CY 2014, but the effective
date was delayed until January 1, 2015, to allow additional time for
further analysis, opportunity for public comment, and systems
preparation. The comprehensive APC (C-APC) policy was implemented
effective January 1, 2015, with modifications and clarifications in
response to public comments received regarding specific provisions of
the C-APC policy (79 FR 66798 through 66810).
A C-APC is defined as a classification for the provision of a
primary service and all adjunctive services provided to support the
delivery of the primary service. We established C-APCs as a category
broadly for OPPS payment and implemented 25 C-APCs beginning in CY 2015
(79 FR 66809 and 66810). We have gradually added new C-APCs since the
policy was implemented beginning in CY 2015, with the number of C-APCs
now totaling 72 (80 FR 70332; 81 FR 79584 and 79585; 83 FR 58844
through 58846; 84 FR 61158 through 61166; 85 FR 85885; 86 FR 63474; and
87 FR 71769).
Under our C-APC policy, we designate a service described by a HCPCS
code assigned to a C-APC as the primary service when the service is
identified by OPPS status indicator ``J1.'' When such a primary service
is reported on a hospital outpatient claim, taking into consideration
the few exceptions that are discussed below, we make payment for all
other items and services reported on the hospital outpatient claim as
being integral, ancillary, supportive, dependent, and adjunctive to the
primary service (hereinafter collectively referred to as ``adjunctive
services'') and representing components of a complete comprehensive
service (78 FR 74865 and 79 FR 66799). Payments for adjunctive services
are packaged into the payments for the primary services. This results
in a single prospective payment for each of the primary, comprehensive
services based on the costs of all reported services at the claim
level. One example of a primary service would be a partial mastectomy
and an example of a secondary service packaged into that primary
service would be a radiation therapy procedure.
Services excluded from the C-APC policy under the OPPS include
services that are not covered OPD services, services that cannot by
statute be paid for under the OPPS, and services that are required by
statute to be separately paid. This includes certain mammography and
ambulance services that are not covered OPD services in accordance with
section 1833(t)(1)(B)(iv) of the Act; brachytherapy seeds, which also
are required by statute to receive separate payment under section
1833(t)(2)(H) of the Act; pass-through payment drugs and devices, which
also require separate payment under section 1833(t)(6) of the Act;
self-administered drugs (SADs) that are not otherwise packaged as
supplies because they are not covered under Medicare Part B under
section 1861(s)(2)(B) of the Act; and certain preventive services (78
FR 74865 and 79 FR 66800 and 66801). A list of services excluded from
the C-APC policy is included in Addendum J to this final rule with
comment period (which is available via the internet on the CMS website
at https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices). If a service does not appear
on this list of excluded services, payment for it will be packaged into
the payment for the primary C-APC service when it appears on an
outpatient claim with a primary C-APC service.
The C-APC policy payment methodology set forth in the CY 2014 OPPS/
ASC final rule with comment period and modified and implemented
beginning in CY 2015 is summarized as follows (78 FR 74887 and 79 FR
66800):
Basic Methodology. As stated in the CY 2015 OPPS/ASC final rule
with comment period, we define the C-APC payment policy as including
all covered OPD services on a hospital outpatient claim reporting a
primary service that is assigned to status indicator ``J1,'' \1\
excluding services that are not covered OPD services or that cannot by
statute be paid for under the OPPS. Services and procedures described
by HCPCS codes assigned to status indicator ``J1'' are assigned to C-
APCs based on our usual APC assignment methodology by evaluating the
geometric mean costs of the primary service claims to establish
resource similarity and the clinical characteristics of each procedure
to establish clinical similarity within each APC.
---------------------------------------------------------------------------
\1\ Status indicator ``J1'' denotes Hospital Part B Services
Paid Through a Comprehensive APC. Further information can be found
in CY 2024 Addendum D1.
---------------------------------------------------------------------------
In the CY 2016 OPPS/ASC final rule with comment period, we expanded
the C-APC payment methodology to qualifying extended assessment and
management encounters through the ``Comprehensive Observation
Services'' C-APC (C-APC 8011). Services within this APC are assigned
status indicator ``J2.'' \2\ Specifically, we make a payment through C-
APC 8011 for a claim that:
---------------------------------------------------------------------------
\2\ Status indicator ``J2'' denotes Hospital Part B Services
That May Be Paid Through a Comprehensive APC. Further information
can be found in CY 2024 Addendum D1.
---------------------------------------------------------------------------
[[Page 81555]]
Does not contain a procedure described by a HCPCS code to
which we have assigned status indicator ``T;''
Contains 8 or more units of services described by HCPCS
code G0378 (Hospital observation services, per hour);
Contains services provided on the same date of service or
one day before the date of service for HCPCS code G0378 that are
described by one of the following codes: HCPCS code G0379 (Direct
admission of patient for hospital observation care) on the same date of
service as HCPCS code G0378; CPT code 99281 (Emergency department visit
for the evaluation and management of a patient (Level 1)); CPT code
99282 (Emergency department visit for the evaluation and management of
a patient (Level 2)); CPT code 99283 (Emergency department visit for
the evaluation and management of a patient (Level 3)); CPT code 99284
(Emergency department visit for the evaluation and management of a
patient (Level 4)); CPT code 99285 (Emergency department visit for the
evaluation and management of a patient (Level 5)) or HCPCS code G0380
(Type B emergency department visit (Level 1)); HCPCS code G0381 (Type B
emergency department visit (Level 2)); HCPCS code G0382 (Type B
emergency department visit (Level 3)); HCPCS code G0383 (Type B
emergency department visit (Level 4)); HCPCS code G0384 (Type B
emergency department visit (Level 5)); CPT code 99291 (Critical care,
evaluation and management of the critically ill or critically injured
patient; first 30-74 minutes); or HCPCS code G0463 (Hospital outpatient
clinic visit for assessment and management of a patient); and
Does not contain services described by a HCPCS code to
which we have assigned status indicator ``J1.''
The assignment of status indicator ``J2'' to a specific set of
services performed in combination with each other allows for all other
OPPS payable services and items reported on the claim (excluding
services that are not covered OPD services or that cannot by statute be
paid for under the OPPS) to be deemed adjunctive services representing
components of a comprehensive service and resulting in a single
prospective payment for the comprehensive service based on the costs of
all reported services on the claim (80 FR 70333 through 70336).
Services included under the C-APC payment packaging policy, that
is, services that are typically adjunctive to the primary service and
provided during the delivery of the comprehensive service, include
diagnostic procedures, laboratory tests, and other diagnostic tests and
treatments that assist in the delivery of the primary procedure; visits
and evaluations performed in association with the procedure; uncoded
services and supplies used during the service; durable medical
equipment as well as prosthetic and orthotic items and supplies when
provided as part of the outpatient service; and any other components
reported by HCPCS codes that represent services that are provided
during the complete comprehensive service (78 FR 74865 and 79 FR
66800).
In addition, payment for hospital outpatient department services
that are similar to therapy services, such as speech language
pathology, and delivered either by therapists or nontherapists is
included as part of the payment for the packaged complete comprehensive
service. These services that are provided during the perioperative
period are adjunctive services and are deemed not to be therapy
services as described in section 1834(k) of the Act, regardless of
whether the services are delivered by therapists or other nontherapist
health care workers. We have previously noted that therapy services are
those provided by therapists under a plan of care in accordance with
section 1835(a)(2)(C) and section 1835(a)(2)(D) of the Act and are paid
for under section 1834(k) of the Act, subject to annual therapy caps as
applicable (78 FR 74867 and 79 FR 66800). However, certain other
services similar to therapy services are considered and paid for as
hospital outpatient department services. Payment for these nontherapy
outpatient department services that are reported with therapy codes and
provided with a comprehensive service is included in the payment for
the packaged complete comprehensive service. We note that these
services, even though they are reported with therapy codes, are
hospital outpatient department services and not therapy services. We
refer readers to the July 2016 OPPS Change Request 9658 (Transmittal
3523) for further instructions on reporting these services in the
context of a C-APC service.
Items included in the packaged payment provided in conjunction with
the primary service also include all drugs, biologicals, and
radiopharmaceuticals, regardless of cost, except those drugs with pass-
through payment status and SADs, unless they function as packaged
supplies (78 FR 74868, 74869, and 74909 and 79 FR 66800). We refer
readers to Section 50.2M, Chapter 15, of the Medicare Benefit Policy
Manual for a description of our policy on SADs treated as hospital
outpatient supplies, including lists of SADs that function as supplies
and those that do not function as supplies.\3\
---------------------------------------------------------------------------
\3\ https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/bp102c15.pdf.
---------------------------------------------------------------------------
We define each hospital outpatient claim reporting a single unit of
a single primary service assigned to status indicator ``J1'' as a
single ``J1'' unit procedure claim (78 FR 74871 and 79 FR 66801). Line-
item charges for services included on the C-APC claim are converted to
line-item costs, which are then summed to develop the estimated APC
costs. These claims are then assigned one unit of the service with
status indicator ``J1'' and later used to develop the geometric mean
costs for the C-APC relative payment weights. (We note that we use the
term ``comprehensive'' to describe the geometric mean cost of a claim
reporting ``J1'' service(s) or the geometric mean cost of a C-APC,
inclusive of all the items and services included in the C-APC service
payment bundle.) Charges for services that would otherwise be
separately payable are added to the charges for the primary service.
This process differs from our traditional cost accounting methodology
only in that all such services on the claim are packaged (except
certain services as described above). We apply our standard data trims,
which exclude claims with extremely high primary units or extreme
costs.
The comprehensive geometric mean costs are used to establish
resource similarity and, along with clinical similarity, dictate the
assignment of the primary services to the C-APCs. We establish a
ranking of each primary service (single unit only) to be assigned to
status indicator ``J1'' according to its comprehensive geometric mean
costs. For the minority of claims reporting more than one primary
service assigned to status indicator ``J1'' or units thereof, we
identify one ``J1'' service as the primary service for the claim based
on our cost-based ranking of primary services. We then assign these
multiple ``J1'' procedure claims to the C-APC to which the service
designated as the primary service is assigned. If the reported ``J1''
services on a claim map to different C-APCs, we designate the ``J1''
service assigned to the C-APC with the highest comprehensive geometric
mean cost as the primary service for that claim. If the reported
multiple ``J1'' services on a claim map to the same C-APC, we designate
the most costly service (at the HCPCS code level) as the primary
service for that claim. This
[[Page 81556]]
process results in initial assignments of claims for the primary
services assigned to status indicator ``J1'' to the most appropriate C-
APCs based on both single and multiple procedure claims reporting these
services and clinical and resource homogeneity.
Complexity Adjustments. We use complexity adjustments to provide
increased payment for certain comprehensive services. We apply a
complexity adjustment by promoting qualifying paired ``J1'' service
code combinations or paired code combinations of ``J1'' services and
certain add-on codes (as described further below) from the originating
C-APC (the C-APC to which the designated primary service is first
assigned) to the next higher paying C-APC in the same clinical family
of C-APCs. We apply this type of complexity adjustment when the paired
code combination represents a complex, costly form or version of the
primary service according to the following criteria:
Frequency of 25 or more claims reporting the code
combination (frequency threshold); and
Violation of the 2 times rule, as stated in section
1833(t)(2) of the Act and section III.B.2 of this final rule with
comment period, in the originating C-APC (cost threshold).
These criteria identify paired code combinations that occur
commonly and exhibit materially greater resource requirements than the
primary service. The CY 2017 OPPS/ASC final rule with comment period
(81 FR 79582) included a revision to the complexity adjustment
eligibility criteria. Specifically, we finalized a policy to
discontinue the requirement that a code combination (that qualifies for
a complexity adjustment by satisfying the frequency and cost criteria
thresholds described above) also not create a 2 times rule violation in
the higher level or receiving APC.
After designating a single primary service for a claim, we evaluate
that service in combination with each of the other procedure codes
reported on the claim assigned to status indicator ``J1'' (or certain
add-on codes) to determine if there are paired code combinations that
meet the complexity adjustment criteria. For a new HCPCS code, we
determine initial C-APC assignment and qualification for a complexity
adjustment using the best available information, crosswalking the new
HCPCS code to a predecessor code(s) when appropriate.
Once we have determined that a particular code combination of
``J1'' services (or combinations of ``J1'' services reported in
conjunction with certain add-on codes) represents a complex version of
the primary service because it is sufficiently costly, frequent, and a
subset of the primary comprehensive service overall according to the
criteria described above, we promote the claim including the complex
version of the primary service as described by the code combination to
the next higher cost C-APC within the clinical family, unless the
primary service is already assigned to the highest cost APC within the
C-APC clinical family or assigned to the only C-APC in a clinical
family. We do not create new APCs with a comprehensive geometric mean
cost that is higher than the highest geometric mean cost (or only) C-
APC in a clinical family just to accommodate potential complexity
adjustments. Therefore, the highest payment for any claim including a
code combination for services assigned to a C-APC would be the highest
paying C-APC in the clinical family (79 FR 66802).
We package payment for all add-on codes into the payment for the C-
APC. However, certain primary service add-on combinations may qualify
for a complexity adjustment. As noted in the CY 2016 OPPS/ASC final
rule with comment period (80 FR 70331), all add-on codes that can be
appropriately reported in combination with a base code that describes a
primary ``J1'' service are evaluated for a complexity adjustment.
To determine which combinations of primary service codes reported
in conjunction with an add-on code may qualify for a complexity
adjustment for CY 2024, we apply the frequency and cost criteria
thresholds discussed above, testing claims reporting one unit of a
single primary service assigned to status indicator ``J1'' and any
number of units of a single add-on code for the primary ``J1'' service.
If the frequency and cost criteria thresholds for a complexity
adjustment are met and reassignment to the next higher cost APC in the
clinical family is appropriate (based on meeting the criteria outlined
above), we make a complexity adjustment for the code combination; that
is, we reassign the primary service code reported in conjunction with
the add-on code to the next higher cost C-APC within the same clinical
family of C-APCs. As previously stated, we package payment for add-on
codes into the C-APC payment rate. If any add-on code reported in
conjunction with the ``J1'' primary service code does not qualify for a
complexity adjustment, payment for the add-on service continues to be
packaged into the payment for the primary service and is not reassigned
to the next higher cost C-APC. We list the complexity adjustments for
``J1'' and add-on code combinations for CY 2024, along with all the
other final complexity adjustments, in Addendum J to this final rule
with comment period (which is available via the internet on the CMS
website at https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices).
Addendum J to this final rule with comment period includes the cost
statistics for each code combination that would qualify for a
complexity adjustment (including primary code and add-on code
combinations). Addendum J to this final rule with comment period also
contains summary cost statistics for each of the paired code
combinations that describe a complex code combination that would
qualify for a complexity adjustment and be reassigned to the next
higher cost C-APC within the clinical family. The combined statistics
for all proposed reassigned complex code combinations are represented
by an alphanumeric code with the first four digits of the designated
primary service followed by a letter. For example, the final geometric
mean cost listed in Addendum J for the code combination described by
complexity adjustment assignment 3320R, which is assigned to C-APC 5224
(Level 4 Pacemaker and Similar Procedures), includes all paired code
combinations that will be reassigned to C-APC 5224 when CPT code 33208
is the primary code. Providing the information contained in Addendum J
to this final rule with comment period allows interested parties the
opportunity to better assess the impact associated with the assignment
of claims with each of the paired code combinations eligible for a
complexity adjustment.
Comment: We received support from commenters for a variety of
existing and proposed complexity adjustments.
Response: We thank the commenters for their support.
Comment: Multiple commenters requested that CMS apply a complexity
adjustment to additional code combinations. The specific C-APC
complexity adjustment code combinations requested by the commenters for
CY 2024 are listed in Table 1 below.
BILLING CODE 4150-28-P
[[Page 81557]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.000
[[Page 81558]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.001
[[Page 81559]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.002
[[Page 81560]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.003
BILLING CODE 4150-28-C
Response: We reviewed each of the requested code combinations
suggested by commenters, listed in Table 1, against our complexity
adjustment criteria. The code combination for primary HCPCS code 43270
with secondary HCPCS code 43252 meets our cost and frequency criteria,
qualifying for a complexity adjustment for CY 2024. All the remaining
code combinations listed failed to meet our cost or frequency criteria
and do not qualify for complexity adjustments for CY 2024.
Additionally, the code combinations for primary HCPCS codes, C9600,
92928, 92943, and 92920 with secondary HCPCS code C1761 would not
qualify for complexity adjustments for CY 2024 as the Coronary IVL
device, described by C1761, is still on transitional pass-through
status through June 2024. Addendum J to this final rule with comment
period includes the cost statistics for each code combination that was
evaluated for a complexity adjustment.
Comment: Commenters requested that CMS modify, waive, or eliminate
the established C-APC complexity adjustment eligibility criteria of 25
or more claims reporting the code combination (frequency) and a
violation of the 2 times rule in the originating C-APC (cost) to allow
additional code combinations to qualify for complexity adjustments.
These commenters were concerned that C-APC packaging and a lack of
complexity adjustment would limit access to procedures. Specifically,
some commenters expressed concern that CMS's methodology for
determining complexity adjustments is unnecessarily restrictive,
particularly the 25-claim threshold, and suggested that CMS eliminate
the 25-claim threshold and implement a complexity adjustment whenever a
code pair exceeds the cost threshold. Other commenter suggestions
included considering an amount halfway between the standard APC and the
complexity-adjusted APC as a cost threshold, as well as a implementing
a sliding scale approach for procedures with high frequency that do not
meet the cost criteria.
Commenters were concerned that when multiple ``J1'' primary
services are reported on a claim, along with an add-on service, the
add-on service is not evaluated for a complexity adjustment. Commenters
cited examples where significant claims volume from add-on services may
not be incorporated into the complexity adjustment evaluation.
Commenters also reiterated requests to broaden the complexity
adjustment policy and allow clusters of procedures, consisting of a
``J1'' code pair and multiple other associated add-on codes used in
combination with that ``J1'' code pair, to qualify for complexity
adjustments. Commenters stated that there are certain complex
procedures that include numerous add-on codes and this approach would
allow more accurate reflection of medical practice when multiple
procedures are performed together. They noted that lack of additional
payment for these code combinations can present a financial challenge
for the providers who perform these more resource intensive services.
In addition, commenters requested that CMS expand its review of
procedure combinations to include ``J1'' and expiring transitional
pass-through codes to allow facilities to continue to provide these
services after pass-through expiration.
Response: We appreciate these comments. At this time, we do not
believe changes to the C-APC complexity adjustment criteria are
necessary or that we should make exceptions to the criteria to allow
claims with the code combinations suggested by the commenters to
receive complexity adjustments. As we stated in the CY 2017 OPPS/ASC
final rule (81 FR 79582), we believe that the complexity adjustment
criteria, which require a frequency of 25 or more claims reporting a
code combination and a violation of the 2 times rule in the originating
C-APC, are appropriate to determine if a combination of procedures
represents a complex, costly subset of the primary service that should
qualify for the adjustment and be paid at the next higher paying C-APC
in the clinical family. As we previously stated in the CY 2020 OPPS/ASC
final rule with comment period (84 FR 61161), a minimum of 25 claims is
already a very low threshold for a national payment system. Lowering
the minimum of 25 claims further could lead to unnecessary complexity
adjustments for service combinations that are rarely performed.
As we explained in the CY 2019 OPPS/ASC final rule with comment
period (83 FR 58843), we do not believe that it is necessary to adjust
the complexity adjustment criteria to allow claims that include more
than two ``J1'' procedures, add-on codes, or procedures that are not
assigned to C-APCs to qualify for a complexity adjustment. As
previously mentioned, we believe the current criteria are adequate to
determine if a combination of procedures represents a complex, costly
subset of the primary service. We will continue to monitor the
application of the complexity adjustment criteria for future
rulemaking.
After consideration of the public comments we received, we are
finalizing the C-APC complexity adjustment policy for CY 2024 as
proposed. We are also finalizing the proposed complexity adjustments,
with the addition of one new code combination suggested by commenters,
that meet our complexity adjustment criteria.
(2) Exclusion of Procedures Assigned to New Technology APCs from
the C-APC Policy Services that are assigned to New Technology APCs are
typically new procedures that do not have sufficient claims history to
establish an accurate payment for them. Beginning in CY 2002, we retain
services within New Technology APC groups until we gather sufficient
claims data to enable us to assign the service to an appropriate
clinical APC. This policy allows us to move a service from a New
Technology APC in less than 2 years if sufficient data are available.
It also allows us to retain a service in a New Technology APC for more
than 2 years
[[Page 81561]]
if sufficient data upon which to base a decision for reassignment have
not been collected (82 FR 59277).
The C-APC payment policy packages payment for adjunctive and
secondary items, services, and procedures into the most costly primary
procedure under the OPPS at the claim level. Prior to CY 2019, when a
procedure assigned to a New Technology APC was included on the claim
with a primary procedure, identified by OPPS status indicator ``J1,''
payment for the new technology service was typically packaged into the
payment for the primary procedure. Because the new technology service
was not separately paid in this scenario, the overall number of single
claims available to determine an appropriate clinical APC for the new
service was reduced. This was contrary to the objective of the New
Technology APC payment policy, which is to gather sufficient claims
data to enable us to assign the service to an appropriate clinical APC.
To address this issue and ensure that there are sufficient claims
data for services assigned to New Technology APCs, in the CY 2019 OPPS/
ASC final rule with comment period (83 FR 58847), we finalized
excluding payment for any procedure that is assigned to a New
Technology APC (APCs 1491 through 1599 and APCs 1901 through 1908) from
being packaged when included on a claim with a ``J1'' service assigned
to a C-APC. In the CY 2020 OPPS/ASC final rule with comment period, we
finalized that beginning in CY 2020, payment for services assigned to a
New Technology APC would be excluded from being packaged into the
payment for comprehensive observation services assigned status
indicator ``J2'' when they are included on a claim with a ``J2''
service (84 FR 61167).
(3) Exclusion of Drugs and Biologicals Described by HCPCS Code C9399
(Unclassified Drugs or Biologicals) From the C-APC Policy
Section 1833(t)(15) of the Act, as added by section 621(a)(1) of
the Medicare Prescription Drug, Improvement, and Modernization Act of
2003 (Pub. L. 108-173), provides for payment under the OPPS for new
drugs and biologicals until HCPCS codes are assigned. Under this
provision, we are required to make payment for a covered outpatient
drug or biological that is furnished as part of covered outpatient
department services but for which a HCPCS code has not yet been
assigned in an amount equal to 95 percent of average wholesale price
(AWP) for the drug or biological.
In the CY 2005 OPPS/ASC final rule with comment period (69 FR
65805), we implemented section 1833(t)(15) of the Act by instructing
hospitals to bill for a drug or biological that is newly approved by
the Food and Drug Administration (FDA) and that does not yet have a
HCPCS code by reporting the National Drug Code (NDC) for the product
along with the newly created HCPCS code C9399 (Unclassified drugs or
biologicals). We explained that when HCPCS code C9399 appears on a
claim, the Outpatient Code Editor (OCE) suspends the claim for manual
pricing by the Medicare Administrative Contractor (MAC). The MAC prices
the claim at 95 percent of the drug or biological's AWP, using Red Book
or an equivalent recognized compendium, and processes the claim for
payment. We emphasized that this approach enables hospitals to bill and
receive payment for a new drug or biological concurrent with its
approval by the FDA. The hospital does not have to wait for the next
quarterly release or for approval of a product specific HCPCS code to
receive payment for a newly approved drug or biological or to resubmit
claims for adjustment. We instructed that hospitals would discontinue
billing HCPCS code C9399 and the NDC upon implementation of a product
specific HCPCS code, status indicator, and appropriate payment amount
with the next quarterly update. We also note that HCPCS code C9399 is
paid in a similar manner in the ASC setting, as 42 CFR 416.171(b)
outlines that certain drugs and biologicals for which separate payment
is allowed under the OPPS are considered covered ancillary services for
which the OPPS payment rate, which is 95 percent of AWP for HCPCS code
C9399, applies. Since the implementation of the C-APC policy in 2015,
payment for drugs and biologicals described by HCPCS code C9399 had
been included in the C-APC payment when these products appear on a
claim with a primary C-APC service. Packaging payment for these drugs
and biologicals that appear on a hospital outpatient claim with a
primary C-APC service is consistent with our C-APC packaging policy
under which we make payment for all items and services, including all
non-pass-through drugs, reported on the hospital outpatient claim as
being integral, ancillary, supportive, dependent, and adjunctive to the
primary service and representing components of a complete comprehensive
service, with certain limited exceptions (78 FR 74869). It was our
position that the total payment for the C-APC with which payment for a
drug or biological described by HCPCS code C9399 is packaged includes
payment for the drug or biological at 95 percent of its AWP.
However, we determined that in certain instances, drugs and
biologicals described by HCPCS code C9399 are not being paid at 95
percent of their AWPs when payment for them is packaged with payment
for a primary C-APC service. In order to ensure payment for new drugs,
biologicals, and radiopharmaceuticals described by HCPCS code C9399 at
95 percent of their AWP, for CY 2023 and subsequent years, we finalized
our proposal to exclude any drug, biological, or radiopharmaceutical
described by HCPCS code C9399 from packaging when the drug, biological,
or radiopharmaceutical is included on a claim with a ``J1'' service,
which is the status indicator assigned to a C-APC, and a claim with a
``J2'' service, which is the status indicator assigned to comprehensive
observation services. See Addendum J for the CY 2024 C-APC payment
policy exclusions.
In the CY 2023 OPPS/ASC final rule with comment period, we
finalized the proposal in section XI. ``CY 2023 OPPS Payment Status and
Comment Indicators'' of the CY 2024 OPPS/ASC proposed rule to add a new
definition to status indicator ``A'' to include unclassified drugs and
biologicals that are reportable with HCPCS code C9399 (87 FR 72051).
The definition, found in Addendum D1, would ensure the MAC prices
claims for drugs, biologicals, or radiopharmaceuticals billed with
HCPCS code C9399 at 95 percent of the drug or biological's AWP and pays
separately for the drug, biological, or radiopharmaceutical under the
OPPS when it appears on the same claim as a primary C-APC service.
(4) Additional C-APCs for CY 2024
For CY 2024 and subsequent years, we proposed to continue to apply
the C-APC payment policy methodology. We refer readers to the CY 2017
OPPS/ASC final rule with comment period (81 FR 79583) for a discussion
of the C-APC payment policy methodology and revisions.
Each year, in accordance with section 1833(t)(9)(A) of the Act, we
review and revise the services within each APC group and the APC
assignments under the OPPS. As a result of our annual review of the
services and the APC assignments under the OPPS, we did not propose to
convert any standard APCs to C-APCs in CY 2024, but we did propose to
create two new APCs that will both be C-APCs. Thus, we
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proposed that the number of C-APCs for CY 2024 would be 72 C-APCs.
We proposed to split the Level 2 Intraocular APC (APC 5492) into
two and assign the higher cost procedures previously within this APC to
a new Level 3 Intraocular APC (APC 5493). The previous Level 3, Level
4, and Level 5 Intraocular APCs (APCs 5493, 5494, and 5495) would be
renamed the Level 4, Level 5, and Level 6 Intraocular APC (APCs 5494,
5495, and 5496), respectively. We refer readers to section III.E of the
CY 2024 OPPS/ASC proposed rule (88 FR 49552) for more information
regarding the proposal.
We also proposed to add a new Level 2 Abdominal/Peritoneal/Biliary
and Related Procedures APC (APC 5342) to improve clinical and resource
homogeneity in the Level 1 Abdominal/Peritoneal/Biliary and Related
Procedures APC (APC 5341).
Comment: Commenters supported the creation of the two new proposed
C-APCs, C-APCs 5342 (Level 2 Abdominal/Peritoneal/Biliary and Related
Procedures APC) and 5496 (Level 6 Intraocular APC) for CY 2024, based
on resource cost and clinical characteristics.
Response: We appreciate commenters' support.
Comment: Several commenters expressed concerns with the C-APC
methodology for surgical insertion codes for brachytherapy treatment,
noting that these concerns impact beneficiary access to brachytherapy
in the HOPD setting. These commenters stated that the C-APC methodology
lacks the appropriate charge capture mechanisms to accurately reflect
the services associated with the C-APC, that there are significant
variations in the clinical practice and billing patterns in the
hospital claims data used for ratesetting, and that the C-APC rates do
not accurately or fully reflect the services and costs associated with
the primary procedure. Commenters urged the agency to explore
alternatives, including that CMS discontinue the C-APC policy for all
brachytherapy insertion codes, implementing a modified C-APC
methodology to allow separate payment for specified preparation and
planning codes, or moving brachytherapy for cervical cancer treatment
to C-APC 5416 (Level 6 Gynecologic Procedures).
Response: We appreciate the comments on the C-APC methodology.
However, we believe that the current C-APC methodology is appropriately
applied to these surgical procedures and is accurately capturing costs,
particularly as the brachytherapy sources used for these procedures are
excluded from C-APC packaging and are separately payable. This
methodology also enables hospitals to manage their resources with
maximum flexibility by monitoring and adjusting the volume and
efficiency of services themselves.
We reviewed the request by commenters to move brachytherapy
procedures, CPT code 57155 and CPT code 58346, to a higher paying C-
APC. For CPT code 57155, the claims data in the two times rule
evaluation show that this code is being paid at the appropriate level
in C-APC 5415 (Level 5 Gynecologic Procedures). For CPT code 53846,
given that this code has fewer than 100 claims, it does not meet the
significance threshold for the two times rule evaluation, and we do not
believe the few claims available provide an accurate reflection of the
service's cost sufficient to move this procedure to a higher C-APC. We
will continue to examine these concerns and will determine if any
modifications to this policy are warranted in future rulemaking.
Comment: Several commenters requested that CMS unpackage and pay
separately for all status indicator ``K'' drugs from C-APCs due to
certain instances of high-cost drugs and biologics, such as CAR-T,
being paid through C-APC 8011 and potentially impacting beneficiary
access to high-cost therapies.
Response: We thank the commenters for their comments. We will take
the issue of C-APCs and payments for high-cost drugs into consideration
for future rulemaking.
After consideration of the public comments we received, we are
finalizing as proposed C-APCs 5342 (Level 2 Abdominal/Peritoneal/
Biliary and Related Procedures APC) and 5496 (Level 6 Intraocular APC)
for CY 2024. Table 2 lists the final C-APCs for CY 2024. All C-APCs are
displayed in Addendum J to this CY 2024 OPPS/ASC final rule with
comment period (which is available via the internet on the CMS
website). Addendum J to this final rule with comment period also
contains all the data related to the C-APC payment policy methodology,
including the list of complexity adjustments and other information for
CY 2024.
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c. Calculation of Composite APC Criteria-Based Costs
As discussed in the CY 2008 OPPS/ASC final rule with comment period
(72 FR 66613), we believe it is important that the OPPS enhance
incentives for hospitals to provide necessary, high-quality care as
efficiently as possible. For CY 2008, we developed composite APCs to
provide a single payment for groups of services that are typically
performed together during a single clinical encounter and that result
in the provision of a complete service. Combining payment for multiple,
independent services into a single OPPS payment in this way enables
hospitals to manage their resources with maximum flexibility by
monitoring and adjusting the volume and efficiency of services
themselves. An additional advantage to the composite APC model is that
we can use data from correctly coded multiple procedure claims to
calculate payment rates for the specified combinations of services,
rather than relying upon single procedure claims which may be low in
volume and/or incorrectly coded. Under the OPPS, we currently have
composite policies for mental health services and multiple imaging
services. We refer readers to the CY 2008 OPPS/ASC final rule with
comment period (72 FR 66611 through 66614 and 66650 through 66652) for
a full discussion of the development of the composite APC methodology,
and the CY 2012 OPPS/ASC final rule with comment period (76 FR 74163)
and the CY 2018 OPPS/ASC final rule with comment period (82 FR 59241,
59242, and 59246 through 52950) for more recent background.
(1) Mental Health Services Composite APC
For CY 2024, we proposed to continue our longstanding policy of
limiting the aggregate payment for specified less resource-intensive
mental health services furnished on the same date to the payment for a
day of partial hospitalization services provided by a hospital, which
we consider to be the most resource-intensive of all outpatient mental
health services (88 FR 49572). We refer readers to the April 7, 2000,
OPPS final rule with comment period (65 FR 18452 through 18455) for the
initial discussion of this longstanding policy and the CY 2012 OPPS/ASC
final rule with comment period (76 FR 74168) for more recent
background.
In the CY 2018 OPPS/ASC proposed rule and final rule with comment
period (82 FR 33580, 33581, 59246, and 59247, respectively), we
proposed and finalized the policy for CY 2018 and subsequent years
that, when the aggregate payment for specified mental health services
provided by one hospital to a single beneficiary on a single date of
service, based on the payment rates associated with the APCs for the
individual services, exceeds the maximum per diem payment rate for
partial hospitalization services provided by a hospital, those
specified mental health services will be paid through composite APC
8010 (Mental Health Services Composite). In addition, we set the
payment rate for composite APC 8010 for CY 2018 at the same payment
rate that will be paid for APC 5863, which is the maximum partial
hospitalization per diem payment rate for a hospital, and finalized a
policy that the hospital will continue to be paid the payment rate for
composite APC 8010. Under this policy, the Integrated OCE (I/OCE) will
continue to determine whether to pay for these specified mental health
services individually, or to make a single payment at the same payment
rate established for APC 5863 for all the specified mental health
services furnished by the hospital on that single date of service. We
continue to believe that the costs associated with administering a
partial hospitalization program at a hospital represent the most
resource intensive of all outpatient mental health services.
We proposed that when the aggregate payment for specified mental
health services provided by one hospital to a single beneficiary on a
single date of service, based on the payment rates associated with the
APCs for the individual services, exceeds the per diem payment rate for
3 partial hospitalization services provided in a
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day by a hospital, those specified mental health services would be paid
through composite APC 8010 for CY 2024. In addition, we proposed to set
the payment rate for composite APC 8010 at the same payment rate that
we proposed for APC 5863, which is a partial hospitalization per diem
payment rate for 3 partial hospitalization services furnished in a day
by a hospital, and that the hospital continue to be paid the proposed
payment rate for composite APC 8010. We explained that while APC 5863
is no longer the maximum partial hospitalization per diem payment rate
for a hospital, due to proposed APC 5864, which is 4 or more hospital-
based PHP services per day, discussed in section VIII.B of this CY 2024
OPPS/ASC proposed rule, we believed it was still appropriate to apply
the APC 5863 per diem payment amount as the upper limit on payment per
day for individual OPPS mental health services. This is because the
daily mental health cap would not be expected to reach a level of
intensity beyond 3 services per day, as described by APC 5863. The PHP
is meant to be the most intensive mental health services program,
requiring inpatient care if PHP is not received. We would not
anticipate more than three services per patient on a given day, as
patients needing additional services in 1 day would potentially require
an inpatient admission, as described by APC 5863. Thus, setting the
mental health cap at APC 5863, rather than the 4 service per day APC
5864, is more consistent with our longstanding policy, which has been
for the 3 service per day APC. We note that the proposed CY 2024
payment amount for APC 5863 would be comparable to the CY 2023 payment
amount for APC 5863, which is the PHP APC used to set the daily mental
health cap for CY 2023.
However, as we have historically set the daily mental health cap
for composite APC 8010 at the maximum partial hospitalization per diem
payment rate for a hospital, we also solicited comment on whether the
next higher-level APC, proposed APC 5864, which is for four hospital-
based PHP services per day, would be appropriate to use as the daily
mental health cap.
Comment: One commenter supported CMS's alternative proposal to use
APC 5864 as the basis for setting the daily mental health cap for APC
8010. They stated that as CMS is introducing APC 5864 to capture four
or more hospital-based PHP services per day, as opposed to three
services in APC 5863, the mental health cap should be increased to
match this new code.
Response: We thank the commenter for their comment. Although
setting the daily mental health cap at APC 5863 would be comparable to
the CY 2023 payment for APC 5863, we recognize that raising the cap
allows hospitals increased flexibility to determine the level of care
necessary for their patient. Additionally, setting the mental health
cap at APC 5864 aligns with our longstanding policy of limiting the
aggregate payment for specified less resource-intensive mental health
services furnished on the same date to the payment for a day of partial
hospitalization services provided by a hospital, which we consider to
be the most resource-intensive of all outpatient mental health
services. Based upon the comment we received as well as the fact that
we have historically set the daily mental health cap for composite APC
8010 at the maximum partial hospitalization per diem payment rate for a
hospital, we are finalizing APC 5864, which is for four hospital-based
PHP services per day, as the daily mental health cap.
Comment: Several commenters recommended that CMS change the status
indicator for two neuropsychological testing codes (HCPCS codes 96133
and 96137) from SI = N to SI = Q3 to allow separate payment for
additional hours of testing on the same date or increase the payment
rate for the primary testing procedure code. The commenters noted that
the payment rate for Composite APC 8010, which is capped at the maximum
per diem partial hospitalization rate, is lower than the individual
HCPCS code APC payment rates and does not provide sufficient payment
for these procedures.
Response: After reviewing this issue, we believe the Composite APC
methodology is being appropriately applied in this case, as packaging
multiple testing services performed on a single date of service creates
incentives for hospitals to provide these services in the most cost-
efficient manner. We will continue to examine these concerns and will
determine if any modifications to this policy are warranted in future
rulemaking.
After consideration of the public comments we received, we are
finalizing our proposal, without modification, that when the aggregate
payment for specified mental health services provided by one hospital
to a single beneficiary on a single date of service, based on the
payment rates associated with the APCs for the individual services,
exceeds the maximum per diem payment rate for partial hospitalization
services provided by a hospital, those specified mental health services
would be paid through composite APC 8010 for CY 2024. In addition, we
are finalizing setting the payment rate for composite APC 8010 for CY
2024 at the same payment rate that we set for APC 5864, which is the
maximum partial hospitalization per diem payment rate for a hospital.
(2) Multiple Imaging Composite APCs (APCs 8004, 8005, 8006, 8007, and
8008)
Effective January 1, 2009, we provide a single payment each time a
hospital submits a claim for more than one imaging procedure within an
imaging family on the same date of service, to reflect and promote the
efficiencies hospitals can achieve when performing multiple imaging
procedures during a single session (73 FR 41448 through 41450). We
utilize three imaging families based on imaging modality for purposes
of this methodology: (1) ultrasound; (2) computed tomography (CT) and
computed tomographic angiography (CTA); and (3) magnetic resonance
imaging (MRI) and magnetic resonance angiography (MRA). The HCPCS codes
subject to the multiple imaging composite policy and their respective
families are listed in Table 3 below.
While there are three imaging families, there are five multiple
imaging composite APCs due to the statutory requirement under section
1833(t)(2)(G) of the Act that we differentiate payment for OPPS imaging
services provided with and without contrast. While the ultrasound
procedures included under the policy do not involve contrast, both CT/
CTA and MRI/MRA scans can be provided either with or without contrast.
The five multiple imaging composite APCs established in CY 2009 are:
APC 8004 (Ultrasound Composite);
APC 8005 (CT and CTA without Contrast Composite);
APC 8006 (CT and CTA with Contrast Composite);
APC 8007 (MRI and MRA without Contrast Composite); and
APC 8008 (MRI and MRA with Contrast Composite).
We define the single imaging session for the ``with contrast''
composite APCs as having at least one or more imaging procedures from
the same family performed with contrast on the same date of service.
For example, if the hospital performs an MRI without contrast during
the same session as at least one other MRI with contrast, the hospital
will receive payment based on the payment rate for APC 8008, the ``with
contrast'' composite APC.
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We make a single payment for those imaging procedures that qualify
for payment based on the composite APC payment rate, which includes any
packaged services furnished on the same date of service. The standard
(noncomposite) APC assignments continue to apply for single imaging
procedures and multiple imaging procedures performed across families.
For a full discussion of the development of the multiple imaging
composite APC methodology, we refer readers to the CY 2009 OPPS/ASC
final rule with comment period (73 FR 68559 through 68569).
For CY 2024, we proposed to continue to pay for all multiple
imaging procedures within an imaging family performed on the same date
of service using the multiple imaging composite APC payment
methodology. We continue to believe that this policy would reflect and
promote the efficiencies hospitals can achieve when performing multiple
imaging procedures during a single session.
For CY 2024, except where otherwise indicated, we proposed to use
the costs derived from CY 2022 claims data to set the proposed CY 2024
payment rates. Therefore, for CY 2024, the payment rates for the five
multiple imaging composite APCs (APCs 8004, 8005, 8006, 8007, and 8008)
were based on proposed geometric mean costs calculated from CY 2022
claims available for the CY 2024 OPPS/ASC proposed rule that qualify
for composite payment under the current policy (that is, those claims
reporting more than one procedure within the same family on a single
date of service). To calculate the proposed geometric mean costs, we
used the same methodology that we used to calculate the geometric mean
costs for these composite APCs since CY 2014, as described in the CY
2014 OPPS/ASC final rule with comment period (78 FR 74918). The imaging
HCPCS codes referred to as ``overlap bypass codes'' that we removed
from the bypass list for purposes of calculating the proposed multiple
imaging composite APC geometric mean costs, in accordance with our
established methodology as stated in the CY 2014 OPPS/ASC final rule
with comment period (78 FR 74918), were identified by asterisks in
Addendum N to the CY 2024 OPPS/ASC proposed rule (which is available
via the internet on the CMS website) and are discussed in more detail
in section II.A.1.b of the CY 2024 OPPS/ASC proposed rule (88 FR
49561).
For this CY 2024 OPPS/ASC final rule, we were able to identify
approximately 0.99 million ``single session'' claims out of an
estimated 2.2 million potential claims for payment through composite
APCs from our ratesetting claims data, which represents approximately
45.0 percent of all eligible claims, to calculate the final CY 2024
geometric mean costs for the multiple imaging composite APCs. Table 2
of this CY 2024 OPPS/ASC final rule lists the final HCPCS codes that
would be subject to the multiple imaging composite APC policy and their
respective families and approximate composite APC final geometric mean
costs for CY 2024.
We did not receive any public comments on this policy. We are
finalizing our proposal to continue the use of multiple imaging
composite APCs to pay for services providing more than one imaging
procedure from the same family on the same date without modification.
Table 3 below lists the HCPCS codes that will be subject to the
multiple imaging composite APC policy and their respective families and
approximate composite APC final geometric mean costs for CY 2024.
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3. Changes to Packaged Items and Services
a. Background and Rationale for Packaging in the OPPS
Like other prospective payment systems, the OPPS relies on the
concept of averaging to establish a payment rate for services. The
payment may be more or less than the estimated cost of providing a
specific service or a bundle of specific services for a particular
beneficiary. The OPPS packages payments for multiple interrelated items
and services into a single payment to create incentives for hospitals
to furnish services most efficiently and to manage their resources with
maximum flexibility. Our packaging policies support our strategic goal
of using larger payment bundles in the OPPS to maximize hospitals'
incentives to provide care in the most efficient manner. For example,
where there are a variety of devices, drugs, items, and supplies that
could be used to furnish a service, some of which are more costly than
others, packaging encourages hospitals to use the most cost-efficient
item that meets the patient's needs, rather than to routinely use a
more expensive item, which may occur if separate payment is provided
for the item.
Packaging also encourages hospitals to effectively negotiate with
manufacturers and suppliers to reduce the purchase price of items and
services or to explore alternative group purchasing arrangements,
thereby encouraging the most economical health care delivery.
Similarly, packaging encourages hospitals to establish protocols that
ensure that necessary services are furnished, while scrutinizing the
services ordered by practitioners to maximize the efficient use of
hospital resources. Packaging payments into larger payment bundles
promotes the predictability and accuracy of payment for services over
time. Finally, packaging may reduce the
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importance of refining service-specific payment because packaged
payments include costs associated with higher cost cases requiring many
ancillary items and services and lower cost cases requiring fewer
ancillary items and services. Because packaging encourages efficiency
and is an essential component of a prospective payment system,
packaging payments for items and services that are typically integral,
ancillary, supportive, dependent, or adjunctive to a primary service
has been a fundamental part of the OPPS since its implementation in
August 2000. As we continue to develop larger payment groups that more
broadly reflect services provided in an encounter or episode of care,
we have expanded the OPPS packaging policies. Most, but not necessarily
all, categories of items and services currently packaged in the OPPS
are listed in 42 CFR 419.2(b). Our overarching goal is to make payments
for all services under the OPPS more consistent with those of a
prospective payment system and less like those of a per-service fee
schedule, which pays separately for each coded item. As a part of this
effort, we have continued to examine the payment for items and services
provided under the OPPS to determine which OPPS services can be
packaged to further achieve the objective of advancing the OPPS toward
a more prospective payment system.
b. Policy and Comment Solicitation on Packaged Items and Services
For CY 2024, we examined the items and services currently provided
under the OPPS, reviewing categories of integral, ancillary,
supportive, dependent, or adjunctive items and services for which we
believe payment would be appropriately packaged into payment for the
primary service that they support. Specifically, we examined the HCPCS
code definitions (including CPT code descriptors) and hospital
outpatient department billing patterns to determine whether there were
categories of codes for which packaging would be appropriate according
to existing OPPS packaging policies or a logical expansion of those
existing OPPS packaging policies.
For CY 2024, we did not propose any changes to the overall
packaging policy discussed above. We proposed to continue to
conditionally package the costs of selected newly identified ancillary
services into payment for a primary service where we believe that the
packaged item or service is integral, ancillary, supportive, dependent,
or adjunctive to the provision of care that was reported by the primary
service HCPCS code.
While we did not propose any changes to the overall packaging
policy, we solicited comments on potential modifications to our
packaging policy as described in the following sections.
Comment: Several commenters expressed concerns that packaging
policies may create access barriers and incentives for stinting on
care. They urged CMS to do a comprehensive evaluation and study all
OPPS packaging policies to determine whether they reduce patients'
access to appropriate therapies and quality of care. They also
requested CMS provide continued opportunity for interested parties to
weigh in to help advance patient access to new innovations.
One commenter suggested that packaging can only create the types of
efficiency incentives CMS intends when there are certain principles in
place, recommending CMS only package items/services that truly have
substitutes, take cost and volume into consideration when determining
whether to package an item/service, and package the charges for
packaged items and/or services in a more logical and deliberate manner.
Another commenter clarified that potential access issues cannot always
be identified by a decline in volume of packaged services; access
issues also occur when patients do not receive the most clinically
appropriate drug, biological, or service because of how packaging
policies prioritize minimizing costs. Commenters felt that these issues
are increasingly important as health care moves toward more
personalized medicine and new innovations.
Commenters stated that, when CMS defines a packaging threshold,
manufacturers may select a price to ensure that the costs exceed the
packaging threshold to market the fact that separate CMS payment is
available. Commenter felt this conflicted with CMS' goal to provide
hospitals with incentives to choose the most clinically viable and
cost-effective option for their patients.
Response: We appreciate the comments on this issue, and we will
take these suggestions into consideration for future rulemaking.
After consideration of the public comments we received, we are
finalizing our overall OPPS packing policy, as proposed, for CY 2024.
c. Comment Solicitation on Access to Non-Opioid Treatments for Pain
Relief
The Consolidated Appropriations Act (CAA), 2023 (Pub. L. 117-328),
was signed into law on December 29, 2022. Section 4135(a) and (b) of
the CAA, 2023, titled ``Access to Non-Opioid Treatments for Pain
Relief,'' amended sections 1833(t)(16) and 1833(i) of the Act,
respectively, to provide for temporary additional payments for non-
opioid treatments for pain relief (as that term is defined in section
1833(t)(16)(G)(i) of the Act). In particular, section 1833(t)(16)(G) of
the Act provides that with respect to a non-opioid treatment for pain
relief furnished on or after January 1, 2025, and before January 1,
2028, the Secretary shall not package payment for the non-opioid
treatment for pain relief into payment for a covered OPD service (or
group of services) and shall make an additional payment for the non-
opioid treatment for pain relief as specified in clause (ii) of that
section. Clauses (ii) and (iii) of section 1833(t)(16)(G) of the Act
provide for the amount of additional payment and set a limitation on
that amount, respectively. Because the additional payments are required
to begin on January 1, 2025, we previously stated that we will include
our proposals to implement the CAA, 2023, section 4135 amendments in
the CY 2025 OPPS/ASC proposed rule. We discussed section 4135 of CAA,
2023, at length in section XIII.F of the CY 2024 OPPS/ASC proposed rule
(88 FR 49767), and we solicited comment on numerous aspects of this
future policy. While we expect this policy to operate similarly in the
ASC and HOPD settings, we welcomed comment on whether there are any
HOPD-specific payment issues we should take into consideration as we
plan to implement section 1833(t)(16)(G) of the Act for CY 2025.
We thank commenters for their detailed comments regarding the
implementation of section 4135 of the CAA, 2023. We received a range of
comments regarding potential qualifying drugs, biologicals, devices,
and services, as well as evidence requirements for medical devices,
payment amounts, and payment limitations. See section XIII.F of this
final rule with comment period for a brief summary of the comments
received. We intend to take these comments into consideration as we
develop our proposals for the CY 2025 OPPS/ASC proposed rule.
d. Comment Solicitation on OPPS Packaging Policy for Diagnostic
Radiopharmaceuticals
(i) Background on OPPS Packaging Policy for Diagnostic
Radiopharmaceuticals
Under the OPPS, we package several categories of nonpass-through
drugs, biologicals, and radiopharmaceuticals, regardless of the cost of
the products. As the products are packaged according to
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the policies in Sec. 419.2(b), we refer to these packaged drugs,
biologicals, and radiopharmaceuticals as ``policy-packaged'' drugs,
biologicals, and radiopharmaceuticals. In particular, under Sec.
419.2(b)(15), payment for drugs, biologicals, and radiopharmaceuticals
that function as supplies when used in a diagnostic test or procedure
is packaged with the payment for the related procedure or service.
Packaging costs into a single aggregate payment for a service,
encounter, or episode of care is a fundamental principle that
distinguishes a prospective payment system from a fee schedule. In
general, packaging the costs of supportive items and services into the
payment for the primary procedure or service with which they are
associated encourages hospital efficiencies and enables hospitals to
manage their resources with maximum flexibility.
Diagnostic radiopharmaceuticals, which include contrast agents,
stress agents, and other products, are one specific type of product
that is policy packaged under the category described by Sec.
419.2(b)(15). Since we implemented this policy in CY 2008, interested
parties have raised concerns regarding policy packaging of diagnostic
radiopharmaceuticals. In previous rulemaking (87 FR 71962 and 71963),
commenters recommended that CMS always pay separately for diagnostic
radiopharmaceuticals paid under the OPPS, not just when the products
have pass-through payment status. Many of these commenters mentioned
that pass-through payment status helps the diffusion of new diagnostic
radiopharmaceuticals into the market. However, commenters believe the
packaged payment rate is often inadequate after pass-through status
expires, especially in cases where the diagnostic radiopharmaceutical
is high-cost and has low utilization.
CMS has previously heard from interested parties regarding
alternative payment methodologies, such as subjecting diagnostic
radiopharmaceuticals to the drug packaging threshold and creating
separate APC payments for diagnostic radiopharmaceuticals with a per-
day cost greater than $500. Interested parties have also recommended
that we analyze our nuclear medicine APC structure and consider
establishing additional nuclear medicine APCs to more accurately
reflect the costs of diagnostic radiopharmaceuticals. Historically,
commenters opposed incorporating the cost of diagnostic
radiopharmaceuticals into the associated nuclear medicine APC as the
nuclear medicine APCs are sometimes paid at a lower rate than the
payment rate for the diagnostic radiopharmaceutical itself when it has
pass-through payment status (87 FR 71962 and 71963).
Importantly, commenters historically have also been concerned that
packaging payment for precision diagnostic radiopharmaceuticals in the
outpatient setting creates barriers to beneficiary access for safety
net hospitals serving a high proportion of Medicare beneficiaries and
hospitals serving underserved communities (87 FR 71962 and 71963).
Commenters specified that certain populations, such as those with
Alzheimer's disease, depend on the use of certain high-cost diagnostic
radiopharmaceuticals. Commenters discussed difficulties enrolling
hospitals in clinical studies due to OPPS packaging policies.
Commenters also suggested that CMS pay separately under the OPPS
specifically for radiopharmaceuticals that are used for Alzheimer's
disease. Additionally, commenters have recommended that CMS continue to
apply radiolabeled product edits to the nuclear medicine procedures to
ensure that all packaged costs are included on nuclear medicine claims
in order to establish appropriate payment rates in the future. Many of
these comments and our responses have been discussed in rulemaking
since the policy to package diagnostic radiopharmaceuticals was
adopted. We refer readers to the CY 2023 OPPS/ASC final rule with
comment period (87 FR 71962 and 71963) for the most recent discussion
of this subject.
As stated in the CY 2024 OPPS/ASC proposed rule (88 FR 49577), we
continue to believe that diagnostic radiopharmaceuticals are an
integral component of many nuclear medicine and imaging procedures and
charges associated with them should be reported on hospital claims to
the extent they are used. Accordingly, the payment for the
radiopharmaceuticals should be reflected within the payment for the
primary procedure. We note that ratesetting uses the geometric mean of
reported procedure costs based on data submitted to CMS from all
hospitals paid under the OPPS to set the payment rate for the service.
The costs that are calculated by Medicare reflect the average costs of
items and services that are packaged into a primary procedure and will
not necessarily equal the sum of the cost of the primary procedure and
the average sales price of the specific items and services used in the
procedure in each case. Furthermore, the costs are based on the
reported costs submitted to Medicare by the hospitals and not the list
price established by the manufacturer. Claims data that include the
radiopharmaceutical packaged with the associated procedure reflect the
combined cost of the procedure and the radiopharmaceutical used in the
procedure.
As CMS has reiterated over the years, we believe these packaging
policies are inherent principles of the OPPS and are essential to a
prospective payment system. We are also committed to ensuring
beneficiary access to diagnostic radiopharmaceuticals while also
ensuring the availability of new and innovative diagnostic tools for
Medicare beneficiaries. Therefore, we sought public comments on
potential modifications to our packaging policy for diagnostic
radiopharmaceuticals in order to ensure equitable payment and continued
beneficiary access.
Below we include the comment solicitation described in the CY 2024
OPPS/ASC proposed rule (88 FR 49578) followed by a brief summary of the
public comments we received.
(ii) Comment Solicitation on Potential Issues Caused by Current Payment
of Diagnostic Radiopharmaceuticals Under the OPPS
As described in the CY 2024 OPPS/ASC proposed rule (88 FR 49578),
we solicited comment on how the OPPS packaging policy for diagnostic
radiopharmaceuticals has impacted beneficiary access, including whether
there are specific patient populations or clinical disease states for
whom this issue is especially critical. We sought information on
specific cost-prohibitive diagnostic radiopharmaceuticals that
commenters believe are superior to alternative diagnostic modalities.
We were interested to learn the specific clinical scenarios that exist
for which it is only clinically appropriate to use the more expensive
diagnostic radiopharmaceutical, rather than a lower cost alternative,
as well as what clinical scenarios exist in which the only diagnostic
modality is a high-cost radiopharmaceutical. We sought information or
evidence that these high-cost diagnostic radiopharmaceuticals have
unique clinical value, and access has been negatively impacted by our
packaging policy. We also sought information about whether commenters
believe these high-cost and low-utilization diagnostic
radiopharmaceuticals are being appropriately utilized according to
their clinical treatment algorithm, meaning the stepwise procedures
generally accepted by the medical community for diagnosis, or clinical
practice guidelines.
[[Page 81575]]
We were also interested in learning more about whether there is a
difference in outcomes for patients, or patient quality of care, based
on the radiopharmaceutical used as well as whether there is a
difference for hospitals, such as in terms of financial outcomes, based
on the radiopharmaceutical that used.
(iii) Comment Solicitation on New Approaches To Payment of Diagnostic
Radiopharmaceuticals Under the OPPS
In addition, we solicited comment on the following potential
approaches that would enhance beneficiary access, while also
maintaining the principles of the outpatient prospective payment
system. These approaches included: (1) paying separately for diagnostic
radiopharmaceuticals with per-day costs above the OPPS drug packaging
threshold of $140; (2) establishing a specific per-day cost threshold
that may be greater or less than the OPPS drug packaging threshold; (3)
restructuring APCs, including by adding nuclear medicine APCs for
services that utilize high-cost diagnostic radiopharmaceuticals; (4)
creating specific payment policies for diagnostic radiopharmaceuticals
used in clinical trials; and (5) adopting codes that incorporate the
disease state being diagnosed or a diagnostic indication of a
particular class of diagnostic radiopharmaceuticals.
To expand upon the first listed option on which we solicited
comments, we specifically sought comments about whether we should use
our statutory authority for separately payable drugs, biologicals, and
radiopharmaceuticals under 1833(t)(14)(A)(iii)(II) of the Act in order
to pay separately for diagnostic radiopharmaceuticals and subject those
diagnostic radiopharmaceuticals to the longstanding OPPS drug packaging
threshold policy, proposed to be $140 for CY 2023. Or said another way,
payment for diagnostic radiopharmaceuticals with per-day costs greater
than $140 would not be packaged and would be paid separately based on
available average sales price (ASP), wholesale acquisition cost (WAC),
or average wholesale price (AWP) data with the applicable add-on. This
would be similar to payment for therapeutic radiopharmaceuticals and
other drugs and biologicals as discussed in section V.B. of the CY 2024
OPPS/ASC proposed rule. We believe this could be a reasonable first
step as this threshold is well understood and known to commenters as
therapeutic drugs, biologicals, and radiopharmaceuticals are currently
paid separately if they have a calculated per-day cost above this
threshold and are not policy-packaged. However, it is also our
longstanding belief that diagnostic radiopharmaceuticals should have
their payment packaged as they function as supplies during a diagnostic
test or procedure and enable the provision of an independent service
and are not themselves the primary therapeutic modality. We sought
additional information from interested parties on this approach. We
note, for CY 2024, the OPPS drug packaging threshold was proposed to be
$140. However, based on updated data, we are finalizing a threshold of
$135 for CY 2024. For more information on the drug packaging threshold,
see section V.B.1.a of this final rule with comment period.
Regarding the second listed option, we sought comment on whether to
pay separately for a diagnostic radiopharmaceutical with a specific
per-day cost threshold that may be greater or less than the OPPS drug
packaging threshold. Specifically, we were interested to learn why
interested parties believe a threshold-based policy is important as
well as interested parties' rationale for creating a threshold that
would be different from the OPPS drug packaging threshold.
Regarding the third listed option, we have heard from some
interested parties that they believe APC restructuring, including
adding additional nuclear medicine APCs for services utilizing high-
cost diagnostic radiopharmaceuticals, would be appropriate. We sought
comment as to how these interested parties specifically envision
operationalizing this approach and what advantage this approach would
have for beneficiaries, hospitals, and CMS over other options.
For the fourth listed option, we recently became aware that some
interested parties believe that CMS packaging policies could influence
participation of beneficiaries and testing sites in clinical trials,
particularly those studying Alzheimer's disease, and were interested to
learn more about these concerns. While we believe there could be a
multitude of reasons for difficulty in recruiting study sites and
beneficiaries for clinical trials, including the COVID-19 PHE, we
requested comment as to whether CMS should consider creating payment
policies for diagnostic radiopharmaceuticals used in clinical trials.
Specifically, we were interested to learn what commenters believe an
appropriate payment mechanism would be for these diagnostic
radiopharmaceuticals, whether there are certain disease states or
categories of trials for which we should target our payment policies,
ways in which this policy could help promote equitable recruitment and
diverse participation, and the method by which CMS should determine
which clinical trial diagnostic radiopharmaceuticals should be subject
to this policy.
Finally, for approach five, we sought comment on new codes that CMS
could adopt that may incorporate the disease state being diagnosed or a
diagnostic indication of a particular class of diagnostic
radiopharmaceuticals. CMS could create indication-specific coding to
reflect the imaging procedure and the target of the imaging procedure.
For example, CMS could create a code to represent a positron emission
tomography (PET) scan that detects a specific protein. If multiple
diagnostic radiopharmaceuticals are available to use during this PET
scan to detect this specific protein, then their payment would be
packaged into the payment for this newly created code and reflected in
the payment for this code. Therefore, if there is a specific clinical
indication for which only very costly diagnostic radiopharmaceuticals
are available, our data would appropriately reflect their utilization.
Alternatively, if there is a specific clinical indication in which a
wide variety of diagnostic radiopharmaceuticals can be used, all with
varying costs, then our data would reflect this and our payment rates
would not incentivize a higher-cost diagnostic radiopharmaceutical when
there is a lower-cost, but clinically similar, diagnostic
radiopharmaceutical alternative. This coding approach could be coupled
with the restructuring of the nuclear medicine APC family. We believe
this approach of more granular coding could allow for more specific
data to be reported and thus more targeted and appropriate payment
rates to be developed. This approach would also help to maintain the
principles of a prospective payment system by maintaining current
packaging policies as payment for the diagnostic radiopharmaceutical
would continue to be packaged into the payment for the procedure in
which the diagnostic radiopharmaceutical is used.
We also sought additional explanation from interested parties as to
why they believe their suggested approach is the best policy approach
to ensure beneficiary access to diagnostic radiopharmaceuticals and
equitable payment for innovative and effective technologies. We
welcomed comment regarding ideas discussed in this section, discussed
in prior rulemaking, or new ideas for payment for diagnostic
radiopharmaceuticals in the OPPS.
[[Page 81576]]
Finally, we were interested in hearing from stakeholders how the
discussed policy modifications might impact our overarching goal of
utilizing packaging policies to better align OPPS policies with those
of a prospective payment system rather than a fee schedule. We stated
we would also like to know if making any of the policy changes
discussed previously could have negative consequences for
beneficiaries, such as unintentionally influencing clinical practice
decisions, increasing beneficiary cost-sharing obligations, or
inadvertently encouraging the use of higher-cost diagnostic
radiopharmaceuticals over lower cost, but equally effective, diagnostic
options.
In the CY 2024 OPPS/ASC proposed rule (88 FR 49578), we noted that
depending on the comments received, we may adopt as final one or more
alternative payment mechanisms for radiopharmaceuticals for CY 2024.
Comment: We received a significant number of comments in response
to the comment solicitation on potential issues caused by our current
payment policy for diagnostic radiopharmaceuticals under the OPPS and
on new approaches to payment for these products. Overall, commenters
described clinical scenarios in which they believed CMS' payment
policies created the most significant access issues, and accordingly,
commenters urged CMS to reform payment policy for diagnostic
radiopharmaceuticals to address these concerns. However, there was not
a general consensus among commenters as to the most effective way for
CMS to reform its OPPS diagnostic radiopharmaceutical payment policy.
Commenters expressed concerns regarding the CMS policy to package
diagnostic radiopharmaceuticals and the financial burden it has on
facilities. These commenters believed radiopharmaceuticals are not
supplies but instead are essential elements in driving the procedures
themselves. Commenters believe that, for newer, more innovative
radiopharmaceuticals, the current OPPS packaging policy has led to a
lack of patient access to the technologies after their pass-through
status expires, especially if there is no clinical alternative.
Commenters also suggested that many of these diagnostic
radiopharmaceuticals offer additional precision and improved clinical
outcomes compared to predecessor products for a variety of disease
states. Commenters also discussed that, in their view, some groups were
more disadvantaged than others, such as rural communities and minority
groups, from the lack of access. Similarly, some commenters discussed
that the impact was more profound on certain disease states, such as
neuroendocrine tumors, Alzheimer's disease, Parkinson's disease, Lewy
body dementia, epilepsy, brain disorders, thyroid disorders,
neuroendocrine tumors, heart disease, and a variety of cancers.
Many commenters suggested potential ways to develop a payment
policy to address some of these issues. Predominately, most commenters
requested that CMS provide separate payment for diagnostic
radiopharmaceuticals. However, we received many different suggestions
as to the best way to pay separately. Some commenters believed paying
separately for all diagnostic radiopharmaceuticals regardless of their
per-day cost was the best methodology to avoid encouraging upward price
inflation to above a certain threshold. Other commenters thought that
applying the existing OPPS per-day cost threshold (finalized to be $135
for CY 2024) to the payment of diagnostic radiopharmaceuticals would be
an adequate solution. Others supported a $500 threshold, and many cited
the Facilitating Innovative Nuclear Diagnostics Act (FIND Act) of 2023
as their rationale for that number. Some of commenters recommended the
OPPS drug packaging threshold but recognized the $500 threshold number
may be a more targeted approach relative to the OPPS drug packaging
threshold as the higher cost diagnostic radiopharmaceuticals were the
most disadvantaged by the OPPS packaging policy in their view. Still
others contended the opposite that $500 would be too high a threshold.
Many deferred to CMS to pick an appropriate packaging threshold for
diagnostic radiopharmaceuticals. Others requested more information to
allow them to make a more well-informed comment on this issue. Many
commenters requested CMS use the ASP methodology in order to pay for
diagnostic radiopharmaceuticals. Similarly, some suggested we pay for
diagnostic radiopharmaceuticals similarly to the Physician Fee Schedule
methodology and others recommended CMS reassess the pass-through
payment methodology.
The majority of commenters discussed their views on providing
separate payment for diagnostic radiopharmaceuticals, but some
commenters also discussed the other aspects of the policy we solicited
comment on. Commenters' views were mixed on these aspects. For example,
some commenters supported CMS restructuring the nuclear medicine APCs
and more specifically, one commenter supported packaging diagnostic
radiopharmaceuticals in a new APC. However, other commenters did not
believe this was sufficiently targeted enough or that it did not
provide the needed granularity, and some thought new APCs would not
accurately account for the variable costs of diagnostic
radiopharmaceuticals and those yet to be approved. Similarly, many
acknowledged that diagnostic radiopharmaceuticals should be paid
separately in clinical trials, but that a clinical trial-specific
policy would not address the broader issue at hand. Several commenters
did recognize the difficulties that some clinical trials that utilize
diagnostic radiopharmaceuticals have had in recruiting patients, such
as the NEW IDEAS trial. Many commenters did not recommend CMS pursue
issuing new HCPCS codes for disease-specific diagnostic
radiopharmaceuticals as the process would be too complex, burdensome,
lack the required specificity, and require continual updating.
Alternatively, at least one commenter indicated that this methodology
could have some merit in addressing this issue. This commenter stated
that a specific code that incorporates the disease state would provide
clinical and scientific specificity, which would enable CMS to collect
data to improve care.
Many requested CMS create a new policy to be implemented for CY
2024, while others requested that CMS release more information on the
per-day threshold and any proposed changes to the payment methodology
before finalizing a new payment policy. These commenters acknowledged
that reimbursement policy changes are complex and require careful
consideration and an evaluation of all relevant factors. Some
commenters were concerned with how any changes for CY 2024 could impact
the Nuclear Medicine APC rates and requested an opportunity to evaluate
and comment on those changes before they become the new policy.
Response: We sincerely thank commenters for their interest and
engagement on this important issue. We agree this is a complex and
important issue and, given the wide array of information presented
through the public comment process, we intend to further consider these
points and take them into consideration for future notice and comment
rulemaking. We welcome ongoing dialogue and engagement from
stakeholders regarding suggestions for potential future payment
changes, including on any of the five potential approaches included in
the original comment solicitation as well as any other potential
solutions.
[[Page 81577]]
Please also see section V of this final rule with comment period,
OPPS Payment for Drugs, Biologicals, and Radiopharmaceuticals, for
additional details on payment for diagnostic radiopharmaceuticals in
the OPPS.
4. Calculation of OPPS Scaled Payment Weights
We established a policy in the CY 2013 OPPS/ASC final rule with
comment period (77 FR 68283) of using geometric mean-based APC costs to
calculate relative payment weights under the OPPS. In the CY 2023 OPPS/
ASC final rule with comment period (87 FR 71778 through 71780), we
applied this policy and calculated the relative payment weights for
each APC for CY 2023 that were shown in Addenda A and B of the CY 2023
OPPS/ASC final rule with comment period (which were made available via
the internet on the CMS website) using the APC costs discussed in
sections II.A.1 and II.A.2 of the CY 2023 OPPS/ASC final rule with
comment period (87 FR 71757 through 71777). For CY 2024, as we did for
CY 2023, we proposed to continue to apply the policy established in CY
2013 and calculate relative payment weights for each APC for CY 2024
using geometric mean-based APC costs.
For CY 2012 and CY 2013, outpatient clinic visits were assigned to
one of five levels of clinic visit APCs, with APC 0606 representing a
mid-level clinic visit. In the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75036 through 75043), we finalized a policy that created
alphanumeric HCPCS code G0463 (Hospital outpatient clinic visit for
assessment and management of a patient), representing all clinic visits
under the OPPS. HCPCS code G0463 was assigned to APC 0634 (Hospital
Clinic Visits). We also finalized a policy to use CY 2012 claims data
to develop the CY 2014 OPPS payment rates for HCPCS code G0463 based on
the total geometric mean cost of the levels one through five CPT
Evaluation or Assessment and Management (E/M) codes for clinic visits
previously recognized under the OPPS (CPT codes 99201 through 99205 and
99211 through 99215). In addition, we finalized a policy to no longer
recognize a distinction between new and established patient clinic
visits.
For CY 2016, we deleted APC 0634 and reassigned the outpatient
clinic visit HCPCS code G0463 to APC 5012 (Level 2 Examinations and
Related Services) (80 FR 70372). For CY 2024, as we did for CY 2023, we
propose to continue to standardize all of the relative payment weights
to APC 5012. We believe that standardizing relative payment weights to
the geometric mean of the APC to which HCPCS code G0463 is assigned
maintains consistency in calculating unscaled weights that represent
the cost of some of the most frequently provided OPPS services. For CY
2024, as we did for CY 2023, we proposed to assign APC 5012 a relative
payment weight of 1.00 and to divide the geometric mean cost of each
APC by the geometric mean cost for APC 5012 to derive the unscaled
relative payment weight for each APC. The choice of the APC on which to
standardize the relative payment weights does not affect payments made
under the OPPS because we scale the weights for budget neutrality.
Section 1833(t)(9)(B) of the Act requires that APC reclassification
and recalibration changes, wage index changes, and other adjustments be
made in a budget neutral manner. Budget neutrality ensures that the
estimated aggregate weight under the OPPS for CY 2024 is neither
greater than nor less than the estimated aggregate weight that would
have been calculated without the changes. To comply with this
requirement concerning the APC changes, we proposed to compare the
estimated aggregate weight using the CY 2023 scaled relative payment
weights to the estimated aggregate weight using the proposed CY 2024
unscaled relative payment weights.
For CY 2023, we multiplied the CY 2023 scaled APC relative payment
weight applicable to a service paid under the OPPS by the volume of
that service from CY 2022 claims to calculate the total relative
payment weight for each service. We then added together the total
relative payment weight for each of these services in order to
calculate an estimated aggregate weight for the year. For CY 2024, we
proposed to apply the same process using the estimated CY 2024 unscaled
relative payment weights rather than scaled relative payment weights.
We proposed to calculate the weight scalar by dividing the CY 2023
estimated aggregate weight by the unscaled CY 2024 estimated aggregate
weight.
For a detailed discussion of the weight scalar calculation, we
refer readers to the OPPS claims accounting document available on the
CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient. Click on the link labeled
``Hospital Outpatient Prospective Paymen--Notice of Final Rulemaking
with Comment Period (NFRM)'' for 2024, which can be found under the
heading ``Hospital Outpatient Regulations and Notices'' and open the
claims accounting document link, which is labeled ``2024 NPRM OPPS
Claims Accounting (PDF).''
We proposed to compare the estimated unscaled relative payment
weights in CY 2024 to the estimated total relative payment weights in
CY 2023 using CY 2022 claims data, holding all other components of the
payment system constant to isolate changes in total weight. Based on
this comparison, we proposed to adjust the calculated CY 2024 unscaled
relative payment weights for purposes of budget neutrality. We proposed
to adjust the estimated CY 2024 unscaled relative payment weights by
multiplying them by a proposed weight scalar of 1.4529 to ensure that
the proposed CY 2024 relative payment weights are scaled to be budget
neutral. The proposed CY 2024 relative payment weights listed in
Addenda A and B to the CY 2024 OPPS/ASC proposed rule (which are
available via the internet on the CMS website) are scaled and
incorporate the recalibration adjustments discussed in sections II.A.1
and II.A.2 of the CY 2024 OPPS/ASC proposed rule.
Section 1833(t)(14) of the Act provides the payment rates for
certain specified covered outpatient drugs (SCODs). Section
1833(t)(14)(H) of the Act provides that additional expenditures
resulting from this paragraph shall not be taken into account in
establishing the conversion factor, weighting, and other adjustment
factors for 2004 and 2005 under paragraph (9) but shall be taken into
account for subsequent years. Therefore, the cost of those SCODs (as
discussed in section V.B.2 of the CY 2024 OPPS/ASC proposed rule) is
included in the budget neutrality calculations for the CY 2024 OPPS.
We did not receive any public comments on the proposed weight
scalar calculation, and we are finalizing our proposal to use the
calculation process described in the proposed rule, without
modification, for CY 2024. For CY 2024, as we did for CY 2023, we will
continue to apply the policy established in CY 2013 and calculate
relative payment weights for each APC for CY 2024 using geometric mean-
based APC costs. For CY 2024, as we did for CY 2023, we will assign APC
5012 a relative payment weight of 1.00; and we will divide the
geometric mean cost of each APC by the geometric mean cost for APC 5012
to derive the unscaled relative payment weight for each APC. To comply
with this requirement concerning the APC changes, we will compare the
estimated aggregate weight using the CY 2023 scaled relative payment
weights to the estimated
[[Page 81578]]
aggregate weight using the CY 2024 unscaled relative payment weights.
Using updated final rule claims data, we are updating the estimated
CY 2024 unscaled relative payment weights by multiplying them by a
weight scalar of 1.4429 to ensure that the final CY 2024 relative
payment weights are scaled to be budget neutral. The final CY 2024
relative payments weights listed in Addenda A and B of this final rule
with comment period (available via the internet on the CMS website)
were scaled and incorporate the recalibration adjustments discussed in
sections II.A.1 and II.A.2 of this final rule with comment period.
B. Conversion Factor Update
1. OPD Fee Schedule Increase Factor
Section 1833(t)(3)(C)(ii) of the Act requires the Secretary to
update the conversion factor used to determine the payment rates under
the OPPS on an annual basis by applying the OPD fee schedule increase
factor. For purposes of section 1833(t)(3)(C)(iv) of the Act, subject
to sections 1833(t)(17) and 1833(t)(3)(F) of the Act, the OPD fee
schedule increase factor is equal to the hospital inpatient market
basket percentage increase applicable to hospital discharges under
section 1886(b)(3)(B)(iii) of the Act. In the FY 2024 IPPS/Long Term
Care Hospital (LTCH) PPS proposed rule (88 FR 27004 and 27005),
consistent with current law, based on IHS Global, Inc.'s fourth quarter
2022 forecast, the proposed FY 2024 IPPS market basket percentage
increase was 3.0 percent. We noted that under our regular process for
the CY 2024 OPPS/ASC final rule with comment period, we would use the
market basket update for the FY 2024 IPPS/LTCH PPS final rule (88 FR
58640) which would be based on IHS Global, Inc.'s second quarter 2023
forecast of the FY 2024 IPPS market basket percentage increase. We
stated that if that forecast is different than the IPPS market basket
percentage increase used for the CY 2024 OPPS/ASC proposed rule, the CY
2024 OPPS/ASC final rule with comment period OPD fee schedule increase
factor would reflect that updated forecast of the market basket
percentage increase. We proposed for CY 2024 an OPD fee schedule
increase factor of 2.8 percent for the CY 2024 OPPS (which is the
proposed estimate of the hospital inpatient market basket percentage
increase of 3.0 percent, less the proposed 0.2 percentage point
productivity adjustment).
Comment: Many commenters indicated that the proposed CY 2024 OPPS
fee schedule increase factor was inadequate because it failed to take
into account the fiscal reality currently faced by hospitals due to
inflation, operating margins, increased labor costs, and other economic
factors. Some of these commenters reiterated concerns included in
public comments submitted in response to the FY 2024 IPPS/LTCH PPS
proposed rule about what they believed was the inadequacy of the IPPS
market basket percentage increase. Commenters explained that because
section 1833(t)(3)(C)(iv) requires the OPD fee schedule increase factor
for a year to equal the IPPS market basket percentage increase factor
applicable under section 1886(b)(3)(B)(iii) to hospital discharges in
the fiscal year ending in such year, the same concerns that they
articulated about the IPPS market basket apply with respect to the OPPS
fee schedule increase factor.
Several commenters, in support of their argument that the proposed
market basket percentage increase is inadequate, stated that hospitals
continue to face significant inflationary pressures. Commenters
specifically expressed concern that the proposed OPPS payment update
for CY 2024 does not adequately consider the cost growth that hospitals
have faced over the last few years, noting cost increases related to
workforce (including contract labor), drugs, medical supplies, personal
protective equipment (PPE), and capital investment. The commenters
stated that the significant inflation over the past several years due
to the COVID-19 PHE has not been fully captured by the OPPS payment
update. Multiple commenters were concerned that CMS use of time-lagged
data did not reflect current inflationary trends and encouraged CMS to
use more recent economic data to calculate the market basket increase.
Many commenters, in support of their argument that the CY 2024
proposed market basket percentage increase is inadequate, pointed to a
February 2022 analysis from the American Hospital Association stating
that Medicare only pays 84 percent of hospital costs; and they cited
MedPAC's March 2023 report to Congress, which stated that overall
Medicare hospital margins were minus 8.2 percent without COVID-19
relief funds in 2021 and were projected to be minus 10 percent in 2023.
Several commenters appreciated the proposed payment increase but
also agreed with other commenters that the proposed update is
inadequate given inflation and labor and supply pressures that
hospitals, particularly rural hospitals, have been facing and continue
to face.
Many commenters had significant concerns that the proposed OPPS
payment update does not adequately reflect labor costs. Commenters
stated the significant increases in labor expenses over the last couple
of years have been largely driven by increased utilization of contract
staff (due to workforce shortages) and growth in employee salaries. Two
commenters cited their own independent analysis of payroll data done by
one of the commenters to calculate the increased cost of labor, which
they stated was significantly higher than the annual increases for
compensation prices that CMS finalized over the last several years.
Given the significant difference between the increased cost of labor
versus what CMS estimates using the Bureau of Labor Statistics'
Employment Cost Index (ECI), many commenters stated they had
significant concerns that CMS's data source for estimating the cost of
labor does not capture current market dynamics and underestimates the
actual cost of healthcare labor. They cited analysis predicting that
nursing staff shortages will continue for the next several years.
Specifically, commenters raised concerns about CMS's use of the ECI in
the market basket. Commenters stated they believe the Bureau of Labor
Statistics' (BLS) ECI does not accurately reflect the shift from
salaried employees to contract labor since the ECI does not collect
data for contract staff, and thus does not capture extraordinary labor
cost growth associated with hospitals' increased reliance on clinicians
contracted through staffing agencies in response to supply shortages.
Multiple commenters highlighted their belief that a closely related
measure--the Employer Costs for Employee Compensation (ECEC)--may be a
better and more timely data source for growth in hospital compensation
costs compared to the ECI. One commenter claimed that all else being
equal, if the hospital ECI growth had matched the hospital ECEC growth,
this would have meant an additional three percentage point increase in
the IPPS market basket percentage increase over the 2019 to 2022 time
period. The commenter noted that, in the FY 2024 IPPS/LTCH PPS final
rule (88 FR 59032), CMS rejected the use of the ECEC as an alternative
to the ECI as a measure of change in hospital wage costs because it
includes both changes in compensation as well as changes in employment.
However, the commenter felt there were flaws in both the ECI and the
ECEC; and, according to the commenter, the ECEC has, based on a
retrospective analysis, better predicted labor costs during this period
of high inflation and price instability. Several commenters recommended
that CMS
[[Page 81579]]
use its exceptions and adjustments authority under section
1886(d)(5)(I) of the Act to adopt new or supplemental data sources such
as commercial databases on hospital payrolls, to ensure labor costs are
adequately reflected in the payment update in the OPPS final rule.
One commenter also requested CMS identify more accurate data inputs
and use its existing authority to calculate the final rule ``base''
(before additional adjustments) market basket update with data that
better reflect the rapidly increasing input prices facing hospitals.
The commenter suggested that CMS should consider using the average
growth rate in allowable Medicare costs per risk adjusted discharge for
IPPS hospitals between FY 2019 and FY 2021 to calculate the CY 2024
final rule market basket update rather than using the growth in the ECI
as the price proxy for compensation in the IPPS and OPPS market basket.
The commenter requested using Medicare cost report data from Worksheets
D-1, Part II, Lines 48 and 49 and S-3, Part 1, Column 13 to determine
the Medicare costs per discharge. The commenter stated that this growth
rate will capture the increased cost of contract labor, unlike the ECI.
Based on their analysis of Medicare cost report data, they found that
this methodology would yield an unadjusted market basket update of 4.39
percent for FY 2024 and CY 2024 rather than the 2.8 percent net market
basket update proposed by CMS.
The commenter also responded to CMS's analysis of using Medicare
cost report data to Calculate the market basket increase in the FY 2024
IPPS/LTCH PPS final rule (88 FR 59032). The commenter believes that
using the Medicare case mix index to risk adjust the costs per
discharge will eliminate any case-mix changes and provide an accurate
comparison of the resources used to treat patients. The commenter also
believes that because they are measuring changes in costs from FY 2019
to FY 2021 there should be only a minimal impact on service inputs
based on changes in technology. Finally, they assert the increase in
case mix CMS observes is a direct result of hospitals caring for
sicker, more resource-intensive patients as procedures that previously
performed in the inpatient setting have become outpatient procedures.
The commenter also stated that Medicare margins have declined over
the last 20 years and believes this is due to persistently inadequate
Medicare market basket updates. They further stated that hospitals'
financial situations are so precarious that MedPAC recommended to
Congress that it increase IPPS and OPPS payments over what is currently
in the law to preserve access.
Finally, several commenters also requested that CMS use its
exceptions and adjustments authority under section 1886(d)(5)(I) to
increase the CY 2024 OPPS hospital market basket update higher than the
proposed percentage increase. One commenter urged CMS to review the
hospital cost data and the margin on Medicare reimbursement and
readjust payment rates based on the new baseline cost of care that
includes the results of supply shocks and labor shortages. Two other
commenters requested that CMS use its authority to increase the FY 2024
IPPS market basket percentage increase to at least 5 percent, which
would result in a CY 2024 OPPS/ASC fee schedule increase factor of the
same amount.
Response: We acknowledge commenters' concerns, however, as we
stated in the CY 2024 OPPS/ASC proposed rule, section 1833(t)(3)(C)(iv)
of the Act requires the OPD fee schedule increase factor for a year to
equal the IPPS market basket percentage increase factor applicable
under section 1886(b)(3)(B)(iii) to hospital discharges in the fiscal
year ending in such year. Accordingly, we are unable to adopt a final
OPD fee schedule increase factor different than the IPPS market basket
percentage increase factor finalized in the FY 2024 IPPS/LTCH PPS final
rule. We refer commenters to that final rule for responses regarding
the issues commenters raised (88 FR 59032 and 59033).
2. Productivity Adjustment
Section 1833(t)(3)(F)(i) of the Act requires that, for 2012 and
subsequent years, the OPD fee schedule increase factor under
subparagraph (C)(iv) be reduced by the productivity adjustment
described in section 1886(b)(3)(B)(xi)(II) of the Act. Section
1886(b)(3)(B)(xi)(II) of the Act defines the productivity adjustment as
equal to the 10-year moving average of changes in annual economy-wide,
private nonfarm business multifactor productivity (MFP) (as projected
by the Secretary for the 10-year period ending with the applicable
fiscal year, year, cost reporting period, or other annual period) (the
``productivity adjustment''). In the FY 2012 IPPS/LTCH PPS final rule
(76 FR 51689 through 51692), we finalized our methodology for
calculating and applying the productivity adjustment. The U.S.
Department of Labor's Bureau of Labor Statistics (BLS) publishes the
official measures of private nonfarm business productivity for the U.S.
economy. We note that previously the productivity measure referenced in
section 1886(b)(3)(B)(xi)(II) of the Act was published by BLS as
private nonfarm business multifactor productivity. Beginning with the
November 18, 2021, release of productivity data, BLS replaced the term
multifactor productivity (MFP) with total factor productivity (TFP).
BLS noted that this is a change in terminology only and will not affect
the data or methodology. As a result of the BLS name change, the
productivity measure referenced in section 1886(b)(3)(B)(xi)(II) of the
Act is now published by BLS as private nonfarm business total factor
productivity. However, as mentioned, the data and methods are
unchanged. Please see www.bls.gov for the BLS historical published TFP
data. A complete description of IHS Global, Inc.'s (IGI) TFP projection
methodology is available on the CMS website at https://www.cms.gov/data-research/statistics-trends-and-reports/medicare-program-rates-statistics/market-basket-research-and-information. In addition, we note
that beginning with the FY 2022 IPPS/LTCH PPS final rule, we refer to
this adjustment as the productivity adjustment rather than the MFP
adjustment to more closely track the statutory language in section
1886(b)(3)(B)(xi)(II) of the Act. We note that the adjustment continues
to rely on the same underlying data and methodology. In the FY 2024
IPPS/LTCH PPS proposed rule (88 FR 27005), the proposed productivity
adjustment for FY 2024 was 0.2 percentage point.
Therefore, we proposed that the productivity adjustment for the CY
2024 OPPS/ASC would be 0.2 percentage point. We also proposed that if
more recent data subsequently became available after the publication of
the CY 2024 OPPS/ASC proposed rule (for example, a more recent estimate
of the market basket percentage increase and/or the productivity
adjustment), we would use such updated data, if appropriate, to
determine the CY 2024 market basket update and the productivity
adjustment, which are components in calculating the OPD fee schedule
increase factor under sections 1833(t)(3)(C)(iv) and 1833(t)(3)(F) of
the Act.
We note that section 1833(t)(3)(F) of the Act provides that
application of this subparagraph may result in the OPD fee schedule
increase factor under section 1833(t)(3)(C)(iv) of the Act being less
than 0.0 percent for a year and may result in OPPS payment rates being
less than rates for the preceding year. As described in further detail
below, we
[[Page 81580]]
proposed for CY 2024 an OPD fee schedule increase factor of 2.8 percent
for the CY 2024 OPPS/ASC (which is the proposed estimate of the
hospital inpatient market basket percentage increase of 3.0 percent,
less the proposed 0.2 percentage point productivity adjustment).
Comment: Several commenters expressed concern about the application
of the productivity adjustment, stating that the PHE has had
unimaginable impacts on hospital productivity. They stated that even
before the PHE, the CMS Office of the Actuary (OACT) indicated that
hospital productivity will be less than the general economy-wide
productivity, which is the measure that is required by law to be used
to derive the productivity adjustment. Commenters noted that hospitals
are highly labor intensive and the large amounts of staff turnover
during the PHE substantially reduced hospital productivity. Given that
CMS is required by statute to implement a productivity adjustment to
the market basket update, commenters asked the agency to work with
Congress to permanently eliminate what they stated is an unjustified
reduction to hospital payments. Further, they asked CMS to use its
``exceptions and adjustments'' authority under section 1886(d)(5)(I) of
the Act to remove the productivity adjustment for any fiscal year that
was covered under PHE determination (i.e., 2020 (0.4 percent), 2021
(0.0 percent), 2022 (0.7 percent), and 2023 (0.3 percent)) from the
calculation of the market basket update for FY 2024 and any year
thereafter. A few commenters expressed concerns about the proposed
productivity adjustment given the extreme and uncertain circumstances
under which hospitals and health systems are currently operating and
urged CMS to eliminate the productivity cut for FY 2024.
Response: While we appreciate the commenters' concerns, section
1833(t)(3)(F)(i) requires that after determining the OPD fee schedule
increase factor under subparagraph (C)(iv), the Secretary shall reduce
such increase factor by the productivity adjustment described in
section 1886(b)(3)(B)(xi) of the Act. As required by statute, the FY
2024 productivity adjustment is derived based on the 10-year moving
average growth in economy-wide productivity for the period ending FY
2024.
We thank the commenters for their comments. After consideration of
the comments received and consistent with our proposal, we are
finalizing an OPD fee schedule increase factor of 3.1 percent for CY
2024, which consists of the IPPS market basket increase factor of 3.3
percent less a 0.2 percentage point productivity adjustment.
3. Other Conversion Factor Adjustments
To set the OPPS conversion factor for 2024, we proposed to increase
the CY 2023 conversion factor of $85.585 by 2.8 percent. In accordance
with section 1833(t)(9)(B) of the Act, we proposed further to adjust
the conversion factor for CY 2024 to ensure that any revisions made to
the wage index and rural adjustment are made on a budget neutral basis.
We proposed to calculate an overall budget neutrality factor of 0.9974
for wage index changes by comparing proposed total estimated payments
from our simulation model using the proposed FY 2024 IPPS wage indexes
to those payments using the FY 2023 IPPS wage indexes, as adopted on a
calendar year basis for the OPPS. We further proposed to calculate an
additional budget neutrality factor of 0.9975 to account for our
proposed policy to cap wage index reductions for hospitals at 5 percent
on an annual basis.
For CY 2024, we proposed to maintain the current rural adjustment
policy, as discussed in section II.E of the CY 2024 OPPS/ASC proposed
rule. Therefore, the proposed budget neutrality factor for the rural
adjustment was 1.0000.
We proposed to calculate a CY 2024 budget neutrality adjustment
factor for the cancer hospital payment adjustment by transitioning from
the target PCR of 0.89 we finalized for CYs 2020 through 2023 (which
included the 1.0 percentage point reduction as required by section
16002(b) of the 21st Century Cures Act) and incrementally reducing the
target PCR by an additional 1.0 percentage point for each calendar
year, beginning with CY 2024, until the target PCR equals the PCR of
non-cancer hospitals calculated using the most recent data minus 1.0
percentage point as required by section 16002(b) of the 21st Century
Cures Act. Therefore, we proposed to apply a budget neutrality
adjustment factor of 1.0005 to the conversion factor for the cancer
hospital payment adjustment. In accordance with section 1833(t)(18)(C)
of the Act, as added by section 16002(b) of the 21st Century Cures Act
(Pub. L. 114-255), we reduce the target PCR by 0.01, which brings the
proposed target PCR to 0.88. This is 0.01 less than the target PCR of
0.89 from CY 2021 through CY 2023, which was held at the pre-PHE
target.
For the CY 2024 OPPS/ASC proposed rule, we estimated that proposed
pass-through spending for drugs, biologicals, and devices for CY 2024
would equal approximately $234.1 million, which represents 0.26 percent
of total projected CY 2024 OPPS spending. Therefore, we stated that the
proposed conversion factor would be adjusted by the difference between
the 0.16 percent estimate of pass-through spending for CY 2023 and the
0.26 percent estimate of proposed pass-through spending for CY 2024,
resulting in a proposed decrease to the conversion factor for CY 2024
of 0.1 percent.
We proposed that estimated payments for outliers would remain at
1.0 percent of total OPPS payments for CY 2024. We estimated for the CY
2024 OPPS/ASC proposed rule that outlier payments would be
approximately 0.78 percent of total OPPS payments in CY 2023; the 1.00
percent for proposed outlier payments in CY 2024 would constitute a
0.22 percent increase in payment in CY 2024 relative to CY 2023.
For 2024, we proposed to use a conversion factor of $87.488 in the
calculation of the national unadjusted payment rates for those items
and services for which payment rates are calculated using geometric
mean costs; that is, the proposed OPD fee schedule increase factor of
2.8 percent for CY 2024, the required proposed wage index budget
neutrality adjustment of approximately 0.9974, the proposed 5 percent
annual cap for individual hospital wage index reductions adjustment of
approximately 0.9975, the proposed cancer hospital payment adjustment
of 1.0005, and the proposed adjustment of an decrease of 0.1 percentage
point of projected OPPS spending for the difference in pass-through
spending, which resulted in a proposed conversion factor for CY 2024 of
$87.488.
For CY 2024, we also proposed that hospitals that fail to meet the
reporting requirements of the Hospital OQR Program would continue to be
subject to a further reduction of 2.0 percentage points to the OPD fee
schedule increase factor. For hospitals that fail to meet the
requirements of the Hospital OQR Program, we proposed to make all other
adjustments discussed above, but use a reduced OPD fee schedule update
factor of 0.8 percent (that is, the proposed OPD fee schedule increase
factor of 2.8 percent further reduced by 2.0 percentage points). This
resulted in a proposed reduced conversion factor for CY 2024 of $85.782
for hospitals that fail to meet the Hospital OQR Program requirements
(a difference of -1.706 in the conversion factor relative to hospitals
that met the requirements). For further discussion of the Hospital OQR
Program, we refer readers to section XIV of the CY 2024 OPPS/ASC
[[Page 81581]]
proposed rule. For 2024, we proposed to use a reduced conversion factor
of $85.782 in the calculation of payments for hospitals that fail to
meet the Hospital OQR Program requirements (a difference of -1.706 in
the conversion factor relative to hospitals that met the requirements).
We received no comments on our proposed adjustments to the
conversion factor for CY 2024. For this CY 2024 OPPS/ASC final rule
with comment period, based on more recent data available, the OPD fee
schedule increase factor for the CY 2024 OPPS is 3.1 percent (which
reflects the 3.3 percent final estimate of the hospital inpatient
market basket percentage increase with a-0.2 percentage point
productivity adjustment). For CY 2024, we are using a conversion factor
of $87.382 in the calculation of the national unadjusted payment rates
for those items and services for which payment rates are calculated
using geometric mean costs; that is, the OPD fee schedule increase
factor of 3.1 percent for CY 2024, the required wage index budget
neutrality adjustment of 0.9912, the 5 percent annual cap for
individual hospital wage index reductions of 0.9997, the cancer
hospital payment adjustment of 1.0005, and the adjustment of 0.11 (or
0.27 less 0.16) percentage point of projected OPPS spending for the
difference in pass-through spending that results in a conversion factor
for CY 2024 of $87.382. We are also finalizing a reduced conversion
factor of $85.687 in the calculation of payments for hospitals that
fail to meet the Hospital OQR Program requirements (a difference of -
1.695 in the conversion factor relative to hospitals that met the
requirements).
The calculations we performed to determine the CY 2024 final
conversion factor are shown in Table 4.
BILLING CODE 4150-28-P
[[Page 81582]]
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C. Wage Index Changes
Section 1833(t)(2)(D) of the Act requires the Secretary to
determine a wage adjustment factor to adjust the portion of payment and
coinsurance attributable to labor-related costs for relative
differences in labor and labor-related costs across geographic regions
in a budget neutral manner (codified at 42 CFR 419.43(a)). This portion
of the OPPS payment rate is called the OPPS labor-related share. Budget
neutrality is discussed in section II.B of this CY 2024 OPPS/ASC final
rule with comment period.
The OPPS labor-related share is 60 percent of the national OPPS
payment. This labor-related share is based on a regression analysis
that determined that, for all hospitals, approximately 60 percent of
the costs of services paid under the OPPS were attributable to wage
costs. We confirmed that this labor-related share for outpatient
services is appropriate during our regression analysis for the payment
adjustment for rural hospitals in the CY 2006 OPPS final rule with
comment period (70 FR 68553). We proposed to continue this policy for
the CY 2024 OPPS/ASC (88 FR 49584). We refer readers to section II.H of
the CY 2024 OPPS/ASC proposed rule for a description and an example of
how the wage index for a particular hospital is used to determine
payment for the hospital.
We did not receive any public comments on our proposal, and we are
finalizing our proposal without modification.
As discussed in the claims accounting narrative included with the
supporting documentation for this final rule with comment period (which
is available via the internet on the CMS website (https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices)), for estimating APC costs, we would standardize
60 percent of estimated claims costs for geographic area wage variation
using the same FY 2024 pre-reclassified wage index that we use under
the IPPS to standardize costs. This standardization process removes the
effects of differences in area wage levels from the determination of a
national unadjusted OPPS payment rate and copayment amount.
Under 42 CFR 419.41(c)(1) and 419.43(c) (published in the OPPS
April 7, 2000, final rule with comment period (65 FR 18495 and 18545)),
the OPPS adopted the final fiscal year IPPS post-reclassified wage
index as the calendar year wage index for adjusting the OPPS standard
payment amounts for labor market differences. Therefore, the wage index
that applies to a particular acute care, short-stay hospital under the
IPPS also applies to that hospital under the OPPS. As initially
explained in the September 8, 1998, OPPS/ASC proposed rule (63 FR
47576), we believe that using the IPPS wage index as the source of an
adjustment factor for the OPPS is reasonable and logical, given the
inseparable, subordinate status of the HOPD within the hospital
overall. In accordance with section 1886(d)(3)(E) of the Act, the IPPS
wage index is updated annually.
The Affordable Care Act contained several provisions affecting the
wage index. These provisions were discussed in the CY 2012 OPPS/ASC
final rule with comment period (76 FR 74191). Section 10324 of the
Affordable Care Act added section 1886(d)(3)(E)(iii)(II) to the Act,
which defines a frontier State and amended section 1833(t) of the Act
to add paragraph (19), which requires a frontier State wage index floor
of 1.00 in certain cases, and states that the frontier State floor
shall not be applied in a budget neutral manner. We codified these
requirements at Sec. 419.43(c)(2) and (3) of our regulations. In the
CY 2024 OPPS/ASC proposed rule (88 FR 49584 and 49585), we proposed to
implement this provision in the same manner as we have since CY 2011.
Under this policy, the frontier State hospitals would receive a wage
index of 1.00 if the otherwise applicable wage index (including
reclassification, the rural floor, and rural floor budget neutrality)
is less than 1.00. Because the HOPD receives a wage index based on the
geographic location of the specific
[[Page 81584]]
inpatient hospital with which it is associated, the frontier State wage
index adjustment applicable for the inpatient hospital also would apply
for any associated HOPD. We refer readers to the FY 2011 through FY
2023 IPPS/LTCH PPS final rules for discussions regarding this
provision, including our methodology for identifying which areas meet
the definition of ``frontier States'' as provided for in section
1886(d)(3)(E)(iii)(II) of the Act: for FY 2011, 75 FR 50160 through
50161; for FY 2012, 76 FR 51793, 51795, and 51825; for FY 2013, 77 FR
53369 and 53370; for FY 2014, 78 FR 50590 and 50591; for FY 2015, 79 FR
49971; for FY 2016, 80 FR 49498; for FY 2017, 81 FR 56922; for FY 2018,
82 FR 38142; for FY 2019, 83 FR 41380; for FY 2020, 84 FR 42312; for FY
2021, 85 FR 58765; for FY 2022, 86 FR 45178; and for FY 2023, 87 FR
49006.
We did not receive any public comments on our proposal, and we are
finalizing our proposal without modification.
In addition to the changes required by the Affordable Care Act, we
noted in the CY 2024 OPPS/ASC proposed rule (88 FR 49585) that the
proposed FY 2024 IPPS wage indexes continue to reflect a number of
adjustments implemented in past years, including, but not limited to,
reclassification of hospitals to different geographic areas, the rural
floor provisions, the imputed floor wage index adjustment in all-urban
states, an adjustment for occupational mix, an adjustment to the wage
index based on commuting patterns of employees (the out-migration
adjustment), and the permanent 5-percent cap on any decrease to a
hospital's wage index from its wage index in a prior FY. Beginning with
FY 2024, we proposed to include hospitals with Sec. 412.103
reclassification along with geographically rural hospitals in all rural
wage index calculations, and to exclude ``dual reclass'' hospitals
(hospitals with simultaneous Sec. 412.103 and Medicare Geographic
Classification Review Board (MGCRB) reclassifications) implicated by
the hold harmless provision at section 1886(d)(8)(C)(ii) of the Act (88
FR 26973 and 26974). We also proposed to continue the low wage index
hospital policy, under which we increase the wage index for hospitals
with a wage index value below the 25th percentile wage index value for
a fiscal year by half the difference between the otherwise applicable
final wage index value for a year for that hospital and the 25th
percentile wage index value for that year across all hospitals. We
refer readers to the FY 2024 IPPS/LTCH PPS proposed rule (88 FR 26963
through 26986) for a detailed discussion of all proposed changes to the
FY 2024 IPPS wage indexes.
We noted that in the FY 2023 IPPS/LTCH PPS final rule (87 FR 49018
through 49021), we finalized a permanent approach to smooth year-to-
year decreases in hospitals' wage indexes. Specifically, for FY 2023
and subsequent years, we apply a 5-percent cap on any decrease to a
hospital's wage index from its wage index in the prior FY, regardless
of the circumstances causing the decline. That is, a hospital's wage
index for FY 2024 would not be less than 95 percent of its final wage
index for FY 2023, and for subsequent years, a hospital's wage index
would not be less than 95 percent of its final wage index for the prior
FY. We stated that we believe this policy would increase the
predictability of IPPS payments for hospitals and mitigate instability
and significant negative impacts to hospitals resulting from changes to
the wage index. It would also eliminate the need for temporary and
potentially uncertain transition adjustments to the wage index in the
future due to specific policy changes or circumstances outside
hospitals' control. Except for newly opened hospitals, we will apply
the cap for a fiscal year using the final wage index applicable to the
hospital on the last day of the prior fiscal year. A newly opened
hospital would be paid the wage index for the area in which it is
geographically located for its first full or partial fiscal year, and
it would not receive a cap for that first year, because it would not
have been assigned a wage index in the prior year (in accordance with
42 CFR 419.41(c)(1) and 419.43(c), as noted above).
Core Based Statistical Areas (CBSAs) are made up of one or more
constituent counties. Each CBSA and constituent county has its own
unique identifying codes. The FY 2018 IPPS/LTCH PPS final rule (82 FR
38130) discussed the two different lists of codes to identify counties:
Social Security Administration (SSA) codes and Federal Information
Processing Standard (FIPS) codes. Historically, CMS listed and used SSA
and FIPS county codes to identify and crosswalk counties to CBSA codes
for purposes of the IPPS and OPPS wage indexes. However, the SSA county
codes are no longer being maintained and updated, although the FIPS
codes continue to be maintained by the U.S. Census Bureau. The Census
Bureau's most current statistical area information is derived from
ongoing census data received since 2010; the most recent data are from
2015. The Census Bureau maintains a complete list of changes to
counties or county equivalent entities on the website at: https://www.census.gov/geo/reference/county-changes.html (which, as of May 6,
2019, migrated to: https://www.census.gov/programs-surveys/geography.html). In the FY 2018 IPPS/LTCH PPS final rule (82 FR 38130),
for purposes of crosswalking counties to CBSAs for the IPPS wage index,
we finalized our proposal to discontinue the use of the SSA county
codes and begin using only the FIPS county codes. Similarly, for the
purposes of crosswalking counties to CBSAs for the OPPS wage index, in
the CY 2018 OPPS/ASC final rule with comment period (82 FR 59260), we
finalized our proposal to discontinue the use of SSA county codes and
begin using only the FIPS county codes. For CY 2024, under the OPPS, we
are continuing to use only the FIPS county codes for purposes of
crosswalking counties to CBSAs.
In the CY 2024 OPPS/ASC proposed rule, we proposed to use the FY
2024 IPPS post-reclassified wage index for urban and rural areas as the
wage index for the OPPS to determine the wage adjustments for both the
OPPS payment rate and the copayment rate for CY 2024 (88 FR 49585).
Therefore, any policies and adjustments for the FY 2024 IPPS post-
reclassified wage index would be reflected in the final CY 2024 OPPS
wage index beginning on January 1, 2024. We refer readers to the FY
2024 IPPS/LTCH PPS proposed rule (88 FR 26963 through 26986) and the
proposed FY 2024 hospital wage index files posted on the CMS website at
https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/fy-2024-ipps-proposed-rule-home-page. Regarding
budget neutrality for the CY 2024 OPPS wage index, we refer readers to
section II.B of this CY 2024 OPPS/ASC final rule with comment period.
We continue to believe that using the IPPS post-reclassified wage index
as the source of an adjustment factor for the OPPS is reasonable and
logical, given the inseparable, subordinate status of the HOPD within
the hospital overall.
Hospitals that are paid under the OPPS, but not under the IPPS, do
not have an assigned hospital wage index under the IPPS. Therefore, for
non-IPPS hospitals paid under the OPPS, it is our longstanding policy
to assign the wage index that would be applicable if the hospital was
paid under the IPPS, based on its geographic location and any
applicable wage index policies and adjustments. We proposed to continue
this policy for CY 2024 (88 FR 49585 and 49586). We refer readers to
the FY 2024 IPPS/LTCH PPS proposed rule (88 FR 26963 through 26986) for
a detailed
[[Page 81585]]
discussion of the proposed changes to the FY 2024 IPPS wage indexes.
It has been our longstanding policy to allow non-IPPS hospitals
paid under the OPPS to qualify for the out-migration adjustment if they
are located in a section 505 out-migration county (section 505 of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(MMA)) (Pub. L. 108-173). Applying this adjustment is consistent with
our policy of adopting IPPS wage index policies for hospitals paid
under the OPPS. We note that, because non-IPPS hospitals cannot
reclassify, they are eligible for the out-migration wage index
adjustment if they are located in a section 505 out-migration county.
This is the same out-migration adjustment policy that would apply if
the hospital were paid under the IPPS. For CY 2024, we proposed to
continue our policy of allowing non-IPPS hospitals paid under the OPPS
to qualify for the outmigration adjustment if they are located in a
section 505 out-migration county (section 505 of the MMA) (88 FR 49585
and 49586). Furthermore, we proposed that the wage index that would
apply for CY 2024 to non-IPPS hospitals paid under the OPPS would
continue to include the rural floor adjustment and any policies and
adjustments applied to the IPPS wage index to address wage index
disparities. In addition, we proposed that the wage index that would
apply to non-IPPS hospitals paid under the OPPS would include the 5-
percent cap on wage index decreases.
Comment: Multiple commenters supported our policy to apply a 5-
percent cap on any decrease to a hospital's wage index from its wage
index in the prior FY. Commenters also requested that the proposed 5-
percent cap policy be excluded from budget neutrality, which would
allow the cap to be applied while avoiding decreases to the wage index
in areas with high wage indexes.
Response: We appreciate the commenters' support of our policy to
apply a 5-percent cap on any decrease to a hospital's wage index from
its wage index in the prior FY. We finalized the proposal and the
associated proposed budget neutrality adjustment in the FY 2023 IPPS/
LTCH PPS final rule (87 FR 49018 through 49021) and agree that the
policy will promote payment stability for HOPDs as well.
We stated in the FY 2023 IPPS/LTCH PPS final rule (87 FR 49021)
that we will apply the cap in a budget neutral manner through a
national adjustment to the standardized amount each fiscal year.
Specifically, we will apply a budget neutrality adjustment to ensure
that estimated aggregate payments under our wage index cap policy for
hospitals that would have a decrease in their wage indexes for the
upcoming fiscal year of more than 5 percent would equal what estimated
aggregate payments would have been without the wage index cap policy.
We proposed to apply a similar budget neutrality adjustment in the OPPS
for each calendar year (87 FR 44530). For the OPPS, section
1833(t)(2)(D) of the Act requires the Secretary to determine a wage
adjustment factor to adjust the portion of payment and coinsurance
attributable to labor-related costs for relative differences in labor
and labor-related costs across geographic regions in a budget neutral
manner, which is inconsistent with the commenters' request to exclude
the wage index cap policy from budget neutrality.
Comment: Multiple commenters supported our policy to treat urban
hospitals reclassified as rural hospitals under Sec. 412.103 as rural
hospitals for purposes of the rural wage indexes and the rural floor.
Response: We appreciate the commenters' support of our policy.
Comment: Multiple commenters supported our low-wage index policy,
which, for hospitals with a wage index value below the 25th percentile,
increases the hospital's wage index by half the difference between the
otherwise applicable wage index value for that hospital and the 25th
percentile wage index value for all hospitals.
Response: We appreciate the support of the commenters.
After consideration of the public comments we received, we are
finalizing our proposal without modification to use the FY 2024 IPPS
post-reclassified wage index for urban and rural areas as the wage
index for the OPPS to determine the wage adjustments for both the OPPS
payment rate and the copayment rate for CY 2024. Any policies and
adjustments for the FY 2024 IPPS post-reclassified wage index will be
reflected in the final CY 2024 OPPS wage index beginning on January 1,
2024, including, but not limited to, reclassification of hospitals to
different geographic areas, the rural floor provisions, the imputed
floor wage index adjustment in all-urban states, an adjustment for
occupational mix, an adjustment to the wage index based on commuting
patterns of employees (the out-migration adjustment), an adjustment to
the wage index for certain low wage index hospitals to help address
wage index disparities between low and high wage index hospitals, and a
5-percent cap on any decrease to a hospital's wage index from its wage
index in the prior FY. We refer readers to the FY 2024 IPPS/LTCH PPS
final rule (88 FR 58958 through 58988) and the FY 2024 hospital wage
index files posted on the CMS website at https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/fy-2024-ipps-final-rule-home-page. Regarding budget neutrality for the CY 2024 OPPS
wage index, we refer readers to section II.B. of this final rule with
comment period.
For CMHCs, for CY 2024, we proposed to continue to calculate the
wage index by using the post-reclassification IPPS wage index based on
the CBSA where the CMHC is located (88 FR 48586). Furthermore, we
proposed that the wage index that would apply to a CMHC for CY 2024
would continue to include the rural floor adjustment and any policies
and adjustments applied to the IPPS wage index to address wage index
disparities. In addition, the wage index that would apply to CMHCs
would include the 5-percent cap on wage index decreases. Also, we
proposed that the wage index that would apply to CMHCs would not
include the outmigration adjustment because that adjustment only
applies to hospitals.
We did not receive any public comments on our proposals, and we are
finalizing our proposals regarding CMHC wage index calculations without
modification.
Table 4A associated with the FY 2024 IPPS/LTCH PPS final rule
(available via the internet on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps/fy-2024-ipps-final-rule-home-page) identifies counties
that would be eligible for the out-migration adjustment. Table 2
associated with the FY 2024 IPPS/LTCH PPS final rule (available for
download via the website above) identifies IPPS hospitals that would
receive the out-migration adjustment for FY 2024. We are including the
outmigration adjustment information from Table 2 associated with the FY
2024 IPPS/LTCH PPS final rule as Addendum L to this final rule with
comment period, with the addition of non-IPPS hospitals that would
receive the section 505 outmigration adjustment under this final rule
with comment period. Addendum L is available via the internet on the
CMS website. We refer readers to the CMS website for the OPPS at:
https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices. At this link, readers will
find a link to the final FY 2024 IPPS wage index tables and Addendum L.
[[Page 81586]]
D. Statewide Average Default Cost-to-Charge Ratios (CCRs)
In addition to using CCRs to estimate costs from charges on claims
for ratesetting, we use overall hospital-specific CCRs calculated from
the hospital's most recent cost report (OMB NO: 0938-0050 for Form CMS-
2552-10) to determine outlier payments, payments for pass-through
devices, and monthly interim transitional corridor payments under the
OPPS during the PPS year. For certain hospitals, under the regulations
at 42 CFR 419.43(d)(5)(iii), we use the statewide average default CCRs
to determine the payments mentioned earlier if it is not possible to
determine an accurate CCR for a hospital in certain circumstances. This
includes hospitals that are new, hospitals that have not accepted
assignment of an existing hospital's provider agreement, and hospitals
that have not yet submitted a cost report. We also use the statewide
average default CCRs to determine payments for hospitals whose CCR
falls outside the predetermined ceiling threshold for a valid CCR or
for hospitals in which the most recent cost report reflects an all-
inclusive rate status (Medicare Claims Processing Manual (Pub. 100-04),
Chapter 4, Section 10.11).
We discussed our policy for using default CCRs, including setting
the ceiling threshold for a valid CCR, in the CY 2009 OPPS/ASC final
rule with comment period (73 FR 68594 through 68599) in the context of
our adoption of an outlier reconciliation policy for cost reports
beginning on or after January 1, 2009. For details on our process for
calculating the statewide average CCRs, we refer readers to the Claims
Accounting Narrative for this CY 2024 OPPS/ASC final rule with comment
period, which is posted on our website. We proposed to calculate the
default ratios for CY 2024 using the most recent cost report data.
We did not receive any public comments on our proposal, and we are
finalizing our proposal without modification to calculate the default
ratios for CY 2024 using the June 2021 HCRIS cost reports, consistent
with the broader proposal regarding CY 2024 OPPS ratesetting.
We no longer publish a table in the Federal Register containing the
statewide average CCRs in the annual OPPS proposed rule and final rule
with comment period. These CCRs with the upper limit will be available
for download with each OPPS CY proposed rule and final rule on the CMS
website. We refer readers to our website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.html; click on the link on
the left of the page titled ``Hospital Outpatient Regulations and
Notices'' and then select the relevant regulation to download the
statewide CCRs and upper limit in the downloads section of the web
page.
E. Adjustment for Rural Sole Community Hospitals (SCHs) and Essential
Access Community Hospitals (EACHs) Under Section 1833(t)(13)(B) of the
Act for CY 2024
In the CY 2006 OPPS final rule with comment period (70 FR 68556),
we finalized a payment increase for rural sole community hospitals
(SCHs) of 7.1 percent for all services and procedures paid under the
OPPS, excluding drugs, biologicals, brachytherapy sources, and devices
paid under the pass-through payment policy, in accordance with section
1833(t)(13)(B) of the Act, as added by section 411 of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003 (MMA)
(Pub. L. 108-173). Section 1833(t)(13) of the Act provides the
Secretary the authority to make an adjustment to OPPS payments for
rural hospitals, effective January 1, 2006, if justified by a study of
the difference in costs by APC between hospitals in rural areas and
hospitals in urban areas. Our analysis showed a difference in costs for
rural SCHs. Therefore, for the CY 2006 OPPS, we finalized a payment
adjustment for rural SCHs of 7.1 percent for all services and
procedures paid under the OPPS, excluding separately payable drugs and
biologicals, brachytherapy sources, items paid at charges reduced to
costs, and devices paid under the pass-through payment policy, in
accordance with section 1833(t)(13)(B) of the Act.
In the CY 2007 OPPS/ASC final rule with comment period (71 FR 68010
and 68227), for purposes of receiving this rural adjustment, we revised
our regulations at Sec. 419.43(g) to clarify that essential access
community hospitals (EACHs) are also eligible to receive the rural SCH
adjustment, assuming these entities otherwise meet the rural adjustment
criteria. Currently, two hospitals are classified as EACHs, and as of
CY 1998, under section 4201(c) of the Balanced Budget Act of 1997 (BBA)
(Pub. L. 105-33), a hospital can no longer become newly classified as
an EACH.
This adjustment for rural SCHs is budget neutral and applied before
calculating outlier payments and copayments. We stated in the CY 2006
OPPS final rule with comment period (70 FR 68560) that we would not
reestablish the adjustment amount on an annual basis, but we may review
the adjustment in the future and, if appropriate, would revise the
adjustment. We provided the same 7.1 percent adjustment to rural SCHs,
including EACHs, again in CYs 2008 through 2023.
For CY 2024, we proposed to continue the current policy of a 7.1
percent payment adjustment for rural SCHs, including EACHs, for all
services and procedures paid under the OPPS, excluding separately
payable drugs and biologicals, brachytherapy sources, items paid at
charges reduced to costs, and devices paid under the pass-through
payment policy, applied in a budget neutral manner.
Comment: Two commenters requested that the 7.1 percent payment
adjustment be allowed for providers other than rural SCHs and EACHs.
The commenters suggested that Medicare dependent hospitals and urban
sole community hospitals either receive the adjustment or be studied to
see if they are eligible to receive the adjustment.
Response: Our study of the difference in costs by APC between
hospitals in rural areas and hospitals in urban areas only showed a
significant difference in costs for rural SCHs. We did not identify
significant cost differences between hospitals in urban areas and
Medicare dependent hospitals. In addition, our authority under section
1833(t)(13) of the Act only extends to rural hospitals. Therefore, we
are not expanding the types of hospitals eligible for the 7.1 percent
payment adjustment at this time.
Comment: Multiple commenters are in favor of our policy to apply a
7.1 percent payment adjustment for rural SCHs, including EACHs.
Response: We appreciate the commenters' support of our policy.
After consideration of the public comments we received, we are
finalizing our proposal, without modification, to continue in CY 2024
our current policy of utilizing a budget neutral 7.1 percent payment
adjustment for rural SCHs, including EACHs, for all services and
procedures paid under the OPPS, excluding separately payable drugs and
biologicals, devices paid under the pass-through payment policy, and
items paid at charges reduced to costs.
F. Payment Adjustment for Certain Cancer Hospitals for CY 2024
1. Background
Since the inception of the OPPS, which was authorized by the
Balanced
[[Page 81587]]
Budget Act of 1997 (BBA) (Pub. L. 105-33), Medicare has paid the 11
hospitals that meet the criteria for cancer hospitals identified in
section 1886(d)(1)(B)(v) of the Act under the OPPS for covered
outpatient department services. These cancer hospitals are exempted
from payment under the IPPS. With the Medicare, Medicaid and SCHIP
Balanced Budget Refinement Act of 1999 (Pub. L. 106-113), the Congress
added section 1833(t)(7), ``Transitional Adjustment to Limit Decline in
Payment,'' to the Act, which requires the Secretary to determine OPPS
payments to cancer and children's hospitals based on their pre-BBA
payment amount (these hospitals are often referred to under this policy
as ``held harmless'' and their payments are often referred to as ``hold
harmless'' payments).
As required under section 1833(t)(7)(D)(ii) of the Act, a cancer
hospital receives the full amount of the difference between payments
for covered outpatient department services under the OPPS and a ``pre-
BBA amount.'' That is, cancer hospitals are permanently held harmless
to their ``pre-BBA amount,'' and they receive transitional outpatient
payments (TOPs) or hold harmless payments to ensure that they do not
receive a payment that is lower in amount under the OPPS than the
payment amount they would have received before implementation of the
OPPS, as set forth in section 1833(t)(7)(F) of the Act. The ``pre-BBA
amount'' is the product of the hospital's reasonable costs for covered
outpatient department services occurring in the current year and the
base payment-to-cost ratio (PCR) for the hospital defined in section
1833(t)(7)(F)(ii) of the Act. The ``pre-BBA amount'' and the
determination of the base PCR are defined at Sec. 419.70(f). TOPs are
calculated on Worksheet E, Part B, of the Hospital Cost Report or the
Hospital Health Care Complex Cost Report (Form CMS-2552-96 or Form CMS-
2552-10 (OMB NO: 0938-0050), respectively), as applicable each year.
Section 1833(t)(7)(I) of the Act exempts TOPs from budget neutrality
calculations.
Section 3138 of the Affordable Care Act (Pub. L. 111-148) amended
section 1833(t) of the Act by adding a new paragraph (18), which
instructs the Secretary to conduct a study to determine if, under the
OPPS, outpatient costs incurred by cancer hospitals described in
section 1886(d)(1)(B)(v) of the Act with respect to APC groups exceed
outpatient costs incurred by other hospitals furnishing services under
section 1833(t) of the Act, as determined appropriate by the Secretary.
Section 1833(t)(18)(A) of the Act requires the Secretary to take into
consideration the cost of drugs and biologicals incurred by cancer
hospitals and other hospitals. Section 1833(t)(18)(B) of the Act
provides that, if the Secretary determines that cancer hospitals' costs
are higher than those of other hospitals, the Secretary shall provide
an appropriate adjustment under section 1833(t)(2)(E) of the Act to
reflect these higher costs. In 2011, after conducting the study
required by section 1833(t)(18)(A) of the Act, we determined that
outpatient costs incurred by the 11 specified cancer hospitals were
greater than the costs incurred by other OPPS hospitals. For a complete
discussion regarding the cancer hospital cost study, we refer readers
to the CY 2012 OPPS/ASC final rule with comment period (76 FR 74200 and
74201).
Based on these findings, we finalized a policy to provide a payment
adjustment to the 11 specified cancer hospitals that reflects their
higher outpatient costs, as discussed in the CY 2012 OPPS/ASC final
rule with comment period (76 FR 74202 through 74206). Specifically, we
adopted a policy to provide additional payments to the cancer hospitals
so that each cancer hospital's final PCR for services provided in a
given calendar year is equal to the weighted average PCR (which we
refer to as the ``target PCR'') for other hospitals paid under the
OPPS. The target PCR is set in advance of the calendar year and is
calculated using the most recently submitted or settled cost report
data that are available at the time of final rulemaking for the
calendar year. The amount of the payment adjustment is made on an
aggregate basis at cost report settlement. We note that the changes
made by section 1833(t)(18) of the Act do not affect the existing
statutory provisions that provide for TOPs for cancer hospitals. The
TOPs are assessed, as usual, after all payments, including the cancer
hospital payment adjustment, have been made for a cost reporting
period. Table 5 displays the target PCR for purposes of the cancer
hospital adjustment for CY 2012 through CY 2023.
[GRAPHIC] [TIFF OMITTED] TR22NO23.014
[[Page 81588]]
2. Policy for CY 2024
Section 16002(b) of the 21st Century Cures Act (Pub. L. 114-255)
amended section 1833(t)(18) of the Act by adding subparagraph (C),
which requires that in applying Sec. 419.43(i) (that is, the payment
adjustment for certain cancer hospitals) for services furnished on or
after January 1, 2018, the target PCR adjustment be reduced by 1.0
percentage point less than what would otherwise apply. Section 16002(b)
also provides that, in addition to the percentage reduction, the
Secretary may consider making an additional percentage point reduction
to the target PCR that takes into account payment rates for applicable
items and services described under section 1833(t)(21)(C) of the Act
for hospitals that are not cancer hospitals described under section
1886(d)(1)(B)(v) of the Act. Further, in making any budget neutrality
adjustment under section 1833(t) of the Act, the Secretary shall not
take into account the reduced expenditures that result from application
of section 1833(t)(18)(C) of the Act.
In the CY 2024 OPPS/ASC proposed rule (88 FR 49587 through 49589),
we proposed to provide additional payments to the 11 specified cancer
hospitals so that each cancer hospital's proposed PCR is equal to the
weighted average PCR (or ``target PCR'') for the other OPPS hospitals,
generally using the most recent submitted or settled cost report data
that are available, reduced by 1.0 percentage point, to comply with
section 16002(b) of the 21st Century Cures Act, and adjusted by the
proposed post-Public Health Emergency transition as described later in
this section. We did not propose an additional reduction beyond the 1.0
percentage point reduction required by section 16002(b) of the 21st
Century Cures Act for CY 2024.
Under our established policy, to calculate the proposed CY 2024
target PCR, we used the same extract of cost report data from HCRIS
used to estimate costs for the CY 2024 OPPS which, in most cases, would
be the most recently available hospital cost reports. Using these cost
report data, we included data from Worksheet E, Part B, for each
hospital, using data from each hospital's most recent cost report,
whether as submitted or settled.
We then limited the dataset to the hospitals with CY 2022 claims
data that we used to model the impact of the proposed CY 2024 APC
relative payment weights (3,406 hospitals) because it is appropriate to
use the same set of hospitals that are being used to calibrate the
modeled CY 2024 OPPS. The cost report data for the hospitals in this
dataset were from cost report periods with fiscal year ends ranging
from 2017 to 2022; however, the cost reporting periods were
predominantly from fiscal years ending in 2021 and 2022. We then
removed the cost report data of the 47 hospitals located in Puerto Rico
from our dataset because we did not believe their cost structure
reflected the costs of most hospitals paid under the OPPS, and,
therefore, their inclusion may bias the calculation of hospital-
weighted statistics. We also removed the cost report data of 14
hospitals because these hospitals had cost report data that were not
complete (missing aggregate OPPS payments, missing aggregate cost data,
or missing both), so that all cost reports in the study would have both
the payment and cost data necessary to calculate a PCR for each
hospital, leading to a proposed analytic file of 3,345 hospitals with
cost report data.
Using this smaller dataset of cost report data, we estimated that,
on average, the OPPS payments to other hospitals furnishing services
under the OPPS were approximately 86 percent of reasonable cost
(weighted average PCR of 0.86). Therefore, after applying the 1.0
percentage point reduction, as required by section 16002(b) of the 21st
Century Cures Act, using our standard process the payment amount
associated with the cancer hospital payment adjustment to be determined
at cost report settlement would be the additional payment needed to
result in a target PCR equal to 0.85 for each cancer hospital.
However, we noted that a proposed cancer hospital target PCR of
0.85 for CY 2024 is dramatically lower than the target PCR from
previous years. Historically, as shown in Table 5 of the final rule,
the target PCR for cancer hospitals has been between 0.88 and 0.92. In
light of our concerns about the impact of the COVID-19 PHE on CY 2020
claims and cost data, we finalized a policy to continue the target PCR
of 0.89 from CY 2021 for CY 2022 and for CY 2023 as an appropriate
cancer hospital adjustment under our authority described in section
1833(t)(2)(E) of the Act. We explained that we believe the impact of
the COVID-19 PHE claims and cost data used to calculate the target PCR
of 0.85 may continue to have some limited influence on our target PCR
calculations. However, we also explained that we believe we should
begin to take into consideration the PCR of non-cancer hospitals based
on the most recently available data for calculating the target PCR. We
noted that we do not know if the changes in the data that have yielded
a significantly lower PCR for non-cancer hospitals using the most
recently available data are likely to continue in future years or if,
when data from after the PHE is available, we will see the target PCR
increase toward its historical norm. We stated that we are concerned
that using the 0.85 target PCR calculated from the most recent data
could lead to instability in cancer hospital adjustment payments and
volatility in the PCR as we transition to utilizing post-PHE data.
Therefore, in the CY 2024 OPPS/ASC proposed rule, we proposed to
transition from the target PCR of 0.89 we finalized for CYs 2020
through 2023 (which included the 1.0 percentage point reduction as
required by section 16002(b) of the 21st Century Cures Act) and
incrementally reduce the target PCR by an additional 1.0 percentage
point for each calendar year, beginning with CY 2024, until the target
PCR equals the PCR of non-cancer hospitals calculated using the most
recent data minus 1.0 percentage point as required by section 16002(b)
of the 21st Century Cures Act. Therefore, utilizing this methodology
for the CY 2024 OPPS/ASC proposed rule, we proposed to reduce the CY
2023 target PCR of 0.89 by 1 percentage point and proposed a cancer
hospital target PCR of 0.88 for CY 2024.
Comment: Several commenters supported the proposed methodology of
incrementally reducing the target PCR until it equals the target PCR
based on cost report data. A few of those commenters also requested
that the repayments made to 340B hospitals associated with the prior
340B-acquired drug policy be included in the final CY 2024 target PCR.
Response: We appreciate commenters' support for our proposal.
We also appreciate the commenters' suggestion to include repayments
made to 340B hospitals in calculating the CY 2024 target PCR. The
cancer hospital adjustment target PCR calculation relies on historical
cost report data, and we believe that the proposed methodology
continues to remain appropriate for the CY 2024 target PCR without the
addition of anticipated future payments. However, the request raises a
valid concern regarding if and how best to accommodate changes made as
part of the final 340B Remedy policy. We believe that having public
input on how to appropriately account for those changes once the 340B
Remedy policy is finalized and implemented will be important, including
because the cancer hospital adjustment is budget neutral within the
OPPS and thus any changes to it will affect not only cancer
[[Page 81589]]
hospitals, but all hospitals paid under the system.
After consideration of the public comments we received, we are
finalizing without modification our proposed policy to reduce the
target PCR by 1 percentage point until such time that it equals the
target PCR calculated based on cost report data. Therefore, a CY 2024
target PCR of 0.88 will apply to the 11 specified cancer hospitals for
CY 2024.
Table 6 shows the estimated percentage increase in OPPS payments to
each cancer hospital for CY 2024, due to the cancer hospital payment
adjustment policy. The actual, final amount of the CY 2024 cancer
hospital payment adjustment for each cancer hospital will be determined
at cost report settlement and will depend on each hospital's CY 2024
payments and costs from the settled CY 2024 cost report. We note that
the requirements contained in section 1833(t)(18) of the Act do not
affect the existing statutory provisions that provide for TOPs for
cancer hospitals. The TOPs will be assessed, as usual, after all
payments, including the cancer hospital payment adjustment, have been
made for a cost reporting period.
[GRAPHIC] [TIFF OMITTED] TR22NO23.015
G. Hospital Outpatient Outlier Payments
1. Background
The OPPS provides outlier payments to hospitals to help mitigate
the financial risk associated with high-cost and complex procedures,
where a very costly service could present a hospital with significant
financial loss. As explained in the CY 2015 OPPS/ASC final rule with
comment period (79 FR 66832 through 66834), we set our projected target
for aggregate outlier payments at 1.0 percent of the estimated
aggregate total payments under the OPPS for the prospective year.
Outlier payments are provided on a service-by-service basis when the
cost of a service exceeds the APC payment amount multiplier threshold
(the APC payment amount multiplied by a certain amount) as well as the
APC payment amount plus a fixed-dollar amount threshold (the APC
payment plus a certain dollar amount). In CY 2023, the outlier
threshold was met when the hospital's cost of furnishing a service
exceeded 1.75 times the APC payment amount (the multiplier threshold)
and exceeded the APC payment amount plus $8,625 (the fixed-dollar
amount threshold) (87 FR 71788 through 71790). If the hospital's cost
of furnishing a service exceeds both the multiplier threshold and the
fixed-dollar threshold, the outlier payment is calculated as 50 percent
of the amount by which the hospital's cost of furnishing the service
exceeds 1.75 times the APC payment amount. Beginning with CY 2009
payments, outlier payments are subject to a reconciliation process
similar to the IPPS outlier reconciliation process for cost reports, as
discussed in the CY 2009 OPPS/ASC final rule with comment period (73 FR
68594 through 68599).
It has been our policy to report the actual amount of outlier
payments as a percent of total spending in the claims being used to
model the OPPS. Our estimate of total outlier payments as a percent of
total CY 2022 OPPS payments, using CY 2022 claims available for this CY
2024 OPPS final rule, is approximately 0.95 percent. Therefore, for CY
2022, we estimate that
[[Page 81590]]
we did not meet the outlier target by 0.05 percent of total aggregated
OPPS payments.
For this final rule with comment period, using CY 2022 claims data
and CY 2023 payment rates, we estimate that the aggregate outlier
payments for CY 2023 would be approximately 0.83 percent of the total
CY 2023 OPPS payments. We provide estimated CY 2024 outlier payments
for hospitals and CMHCs with claims included in the claims data that we
used to model impacts in the Hospital-Specific Impacts--Provider-
Specific Data file on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient.
2. Outlier Calculation for CY 2024
For CY 2024, we proposed to continue our policy of estimating
outlier payments to be 1.0 percent of the estimated aggregate total
payments under the OPPS. We proposed that a portion of that 1.0
percent, an amount equal to less than 0.01 percent of outlier payments
(or 0.0001 percent of total OPPS payments), would be allocated to CMHCs
for PHP and IOP outlier payments. This is the amount of estimated
outlier payments that would result from the proposed CMHC outlier
threshold as a proportion of total estimated OPPS outlier payments. We
proposed to modify our outlier policy and which APCs are eligible for
an outlier payment if a CMHC's cost for services exceeds 3.40 times the
APC payment rate. The outlier payment would be calculated as 50 percent
of the amount by which the cost exceeds 3.40 times the proposed APC
payment rate.
For further discussion of CMHC outlier payments, we refer readers
to section VIII.C of this final rule with comment period.
To ensure that the estimated CY 2024 aggregate outlier payments
would equal 1.0 percent of estimated aggregate total payments under the
OPPS, we proposed that the hospital outlier threshold be set so that
outlier payments would be triggered when a hospital's cost of
furnishing a service exceeds 1.75 times the APC payment amount and
exceeds the APC payment amount plus the fixed-dollar threshold.
We calculated the proposed fixed-dollar threshold using the
standard methodology most recently used for CY 2023 (87 FR 71788
through 71790). For purposes of estimating outlier payments for CY
2024, we use the hospital-specific overall ancillary CCRs available in
the April 2023 update to the Outpatient Provider-Specific File (OPSF).
The OPSF contains provider-specific data, such as the most current
CCRs, which are maintained by the MACs and used by the OPPS Pricer to
pay claims. The claims that we generally use to model each OPPS update
lag by two years.
In order to estimate the CY 2024 hospital outlier payments, we
inflate the charges on the CY 2022 claims using the same proposed
charge inflation factor of 1.118412 that we used to estimate the IPPS
fixed-loss cost threshold for the FY 2024 IPPS/LTCH PPS proposed rule
(88 FR 27220). We used an inflation factor of 1.05755 to estimate CY
2023 charges from the CY 2022 charges reported on CY 2022 claims before
applying CY 2023 CCRs to estimate the percent of outliers paid in CY
2023. The proposed methodology for determining these charge inflation
factors is discussed in the FY 2024 IPPS/LTCH PPS proposed rule (88 FR
27219 and 27220). As we stated in the CY 2005 OPPS final rule with
comment period (69 FR 65844 through 65846), we believe that the use of
the same charge inflation factors is appropriate for the OPPS because,
with the exception of the inpatient routine service cost centers,
hospitals use the same ancillary and cost centers to capture costs and
charges for inpatient and outpatient services.
As noted in the CY 2007 OPPS/ASC final rule with comment period (71
FR 68011), we are concerned that we could systematically overestimate
the OPPS hospital outlier threshold if we did not apply a CCR inflation
adjustment factor. Therefore, we proposed to apply the same CCR
adjustment factor that we proposed to apply for the FY 2024 IPPS
outlier calculation to the CCRs used to simulate the proposed CY 2024
OPPS outlier payments to determine the fixed-dollar threshold.
Specifically, for CY 2024, we proposed to apply an adjustment factor of
0.977799 to the CCRs that were in the April 2023 OPSF to trend them
forward from CY 2023 to CY 2024. The methodology for calculating the
proposed CCR adjustment factor, as well as the solicitation of comments
on an alternative approach, is discussed in the FY 2024 IPPS/LTCH PPS
proposed rule (88 FR 27221).
To model hospital outlier payments for the CY 2024 proposed rule,
we applied the overall CCRs from the April 2023 OPSF after adjustment
(using the proposed CCR inflation adjustment factor of 0.977799 to
approximate CY 2024 CCRs) to charges on CY 2022 claims that were
adjusted (using the proposed charge inflation factor of 1.118412 to
approximate CY 2024 charges). We simulated aggregated CY 2022 hospital
outlier payments using these costs for several different fixed-dollar
thresholds, holding the 1.75 multiplier threshold constant and assuming
that outlier payments would continue to be made at 50 percent of the
amount by which the cost of furnishing the service would exceed 1.75
times the APC payment amount, until the total outlier payments equaled
1.0 percent of aggregated estimated total CY 2024 OPPS payments. We
estimated that a proposed fixed-dollar threshold of $8,350, combined
with the proposed multiplier threshold of 1.75 times the APC payment
rate, would allocate 1.0 percent of aggregated total OPPS payments to
outlier payments. For CMHCs, we proposed that, if a CMHC's cost for
partial hospitalization or intensive outpatient services exceeds 3.40
times the APC payment rate, the outlier payment would be calculated as
50 percent of the amount by which the cost exceeds 3.40 times the APC
payment rate.
Section 1833(t)(17)(A) of the Act, which applies to hospitals, as
defined under section 1886(d)(1)(B) of the Act, requires that hospitals
that fail to report data required for the quality measures selected by
the Secretary, in the form and manner required by the Secretary under
section 1833(t)(17)(B) of the Act, incur a 2.0 percentage point
reduction to their OPD fee schedule increase factor; that is, the
annual payment update factor. The application of a reduced OPD fee
schedule increase factor results in reduced national unadjusted payment
rates that would apply to certain outpatient items and services
furnished by hospitals that are required to report outpatient quality
data and that fail to meet the Hospital Outpatient Quality Reporting
(OQR) Program requirements. For hospitals that fail to meet the
Hospital OQR Program requirements, we proposed to continue the policy
that we implemented in CY 2010 that the hospitals' costs would be
compared to the reduced payments for purposes of outlier eligibility
and payment calculation. For more information on the Hospital OQR
Program, we refer readers to section XIV of the CY 2024 OPPS/ASC
proposed rule.
We note that in section II.G. of the CY 2024 OPPS/ASC proposed rule
and our references here to that proposal, discussion of the proposed
fixed-dollar threshold referenced the prior year's proposal of $8,350
rather than the correct proposed threshold, which was $6,875. However,
the correct proposed fixed-dollar outlier threshold of $6,875 was used
in developing the hospital impacts and was noted in the discussion of
the effect of the CY 2024 proposed
[[Page 81591]]
rule policies on payments to hospitals (88 FR 49895).
Comment: A commenter expressed concern about the increases in the
fixed-dollar outlier threshold, noting that fewer cases would qualify
for OPPS outlier payments.
Response: We appreciate the commenter's concern; however, we note
that both the incorrect proposed fixed-dollar outlier threshold of
$8,350 and the correct proposed threshold of $6,875 are a decrease from
the CY 2023 fixed-dollar outlier threshold of $8,625. We have reviewed
and analyzed our methodology as well as the most up to date CCRs
available in the July 2023 OPSF for determining estimated outlier
payments. We continue to believe that they are appropriate for
estimating hospital costs for establishing the fixed-dollar outlier
threshold.
The fixed-dollar threshold better targets outlier payments to those
high-cost and complex procedures where a very costly service could
present a hospital with significant financial loss. We maintain the
target outlier percentage of 1.0 percent of estimated aggregate total
payment under the OPPS and have a fixed-dollar threshold so that OPPS
outlier payments are made only when the hospital would experience a
significant loss for furnishing a particular service. The methodology
we use to calculate the fixed-dollar threshold for the prospective
payment year is based on several data inputs that may change from prior
payment years. For instance, updated hospital CCR data and changes to
the OPPS payment methodology influence projected outlier payments in
the prospective year. As a result of those and other factors, the
fixed-dollar threshold can also fluctuate from year to year.
In the past several years, we have seen significant increases in
the fixed-dollar outlier threshold; however, the proposed CY 2024
fixed-dollar outlier threshold would have decreased relative to CY
2023. Further, we continue to observe a decrease under our final fixed-
dollar outlier threshold when compared to the CY 2023. We believe that
the changes that we observe in the fixed-dollar outlier threshold
accurately reflect changes that hospitals are experiencing in providing
healthcare. However, we will continue to monitor changes as more
updated data are available.
After consideration of the public comment we received, we are
finalizing our proposal, without modification, to continue our policy
of estimating outlier payments to be 1.0 percent of the estimated
aggregate total payments under the OPPS and to use our established
methodology to set the OPPS outlier fixed-dollar loss threshold for CY
2024.
3. Final Outlier Calculation
Consistent with historical practice, we used updated data for this
final rule with comment period for outlier calculations. For CY 2024,
we are applying the overall CCRs from the July 2023 OPSF file after
adjustment (using the CCR adjustment factor of 0.990843 to approximate
CY 2024 CCRs) to charges on CY 2022 claims that were adjusted using a
charge inflation factor of 1.11904 to approximate CY 2024 charges.
These are the same CCR adjustment and charge inflation factors that
were used to set the IPPS fixed-dollar thresholds for the FY 2024 IPPS/
LTCH PPS final rule (88 FR 59353). We simulated aggregated CY 2024
hospital outlier payments using these costs for several different
fixed-dollar thresholds, holding the 1.75 multiple-threshold constant
and assuming that outlier payments will continue to be made at 50
percent of the amount by which the cost of furnishing the service would
exceed 1.75 times the APC payment amount, until the total outlier
payment equaled 1.0 percent of aggregated estimated total CY 2024 OPPS
payments. We estimate that a fixed-dollar threshold of $7,750 combined
with the multiple threshold of 1.75 times the APC payment rate, will
allocate the 1.0 percent of aggregated total OPPS payments to outlier
payments.
For CMHCs, if a CMHC's cost for partial hospitalization or
intensive outpatient services exceeds 3.40 times the APC payment rate,
the outlier payment will be calculated as 50 percent of the amount by
which the cost exceeds 3.40 times the APC payment rate.
H. Calculation of an Adjusted Medicare Payment From the National
Unadjusted Medicare Payment
The national unadjusted payment rate is the payment rate for most
APCs before accounting for the wage index adjustment or any applicable
adjustments. The basic methodology for determining prospective payment
rates for HOPD services under the OPPS is set forth in existing
regulations at 42 CFR part 419, subparts C and D. For this CY 2024
OPPS/ASC final rule with comment period, the payment rate for most
services and procedures for which payment is made under the OPPS is the
product of the conversion factor calculated in accordance with section
II.B of this final rule with comment period and the relative payment
weight described in section II.A of this final rule with comment
period. The national unadjusted payment rate for most APCs contained in
Addendum A to this final rule with comment period (which is available
via the CMS website ``Hospital Outpatient Regulations and Notices'')
and for most HCPCS codes to which separate payment under the OPPS has
been assigned in Addendum B to this final rule with comment period
(which is available on the CMS website link above) is calculated by
multiplying the final CY 2024 scaled weight for the APC by the CY 2024
conversion factor.
We note that section 1833(t)(17) of the Act, which applies to
hospitals, as defined under section 1886(d)(1)(B) of the Act, requires
that hospitals that fail to submit data required to be submitted on
quality measures selected by the Secretary, in the form and manner and
at a time specified by the Secretary, incur a reduction of 2.0
percentage points to their OPD fee schedule increase factor, that is,
the annual payment update factor. The application of a reduced OPD fee
schedule increase factor results in reduced national unadjusted payment
rates that apply to certain outpatient items and services provided by
hospitals that are required to report outpatient quality data and that
fail to meet the Hospital OQR Program requirements. For further
discussion of the payment reduction for hospitals that fail to meet the
requirements of the Hospital OQR Program, we refer readers to section
XIV of this final rule with comment period.
Below we demonstrate the steps used to determine the APC payments
that will be made in a CY under the OPPS to a hospital that fulfills
the Hospital OQR Program requirements and to a hospital that fails to
meet the Hospital OQR Program requirements for a service that has any
of the following status indicator assignments: ``J1,'' ``J2,'' ``P,''
``Q1,'' ``Q2,'' ``Q3,'' ``Q4,'' ``R,'' ``S,'' ``T,'' ``U,'' or ``V''
(as defined in Addendum D1 to this final rule with comment period,
which is available via the internet on the CMS website), in a
circumstance in which the multiple procedure discount does not apply,
the procedure is not bilateral, and conditionally packaged services
(status indicator of ``Q1'' and ``Q2'') qualify for separate payment.
We note that, although blood and blood products with status indicator
``R'' and brachytherapy sources with status indicator ``U'' are not
subject to wage adjustment, they are subject to reduced payments when a
hospital fails to meet the Hospital OQR Program requirements.
Individual providers interested in calculating the payment amount
that they would receive for a specific service
[[Page 81592]]
from the national unadjusted payment rates presented in Addenda A and B
to this final rule with comment period (which are available via the
internet on the CMS website) should follow the formulas presented in
the following steps. For purposes of the payment calculations below, we
refer to the national unadjusted payment rate for hospitals that meet
the requirements of the Hospital OQR Program as the ``full'' national
unadjusted payment rate. We refer to the national unadjusted payment
rate for hospitals that fail to meet the requirements of the Hospital
OQR Program as the ``reduced'' national unadjusted payment rate. The
reduced national unadjusted payment rate is calculated by multiplying
the reporting ratio of 0.9805 times the ``full'' national unadjusted
payment rate. The national unadjusted payment rate used in the
calculations below is either the full national unadjusted payment rate
or the reduced national unadjusted payment rate, depending on whether
the hospital met its Hospital OQR Program requirements to receive the
full CY 2024 OPPS fee schedule increase factor.
Step 1. Calculate 60 percent (the labor-related portion) of the
national unadjusted payment rate. Since the initial implementation of
the OPPS, we have used 60 percent to represent our estimate of that
portion of costs attributable, on average, to labor. We refer readers
to the April 7, 2000 OPPS/ASC final rule with comment period (65 FR
18496 and 18497) for a detailed discussion of how we derived this
percentage. During our regression analysis for the payment adjustment
for rural hospitals in the CY 2006 OPPS final rule with comment period
(70 FR 68553), we confirmed that this labor-related share for hospital
outpatient services is appropriate.
The formula below is a mathematical representation of Step 1 and
identifies the labor-related portion of a specific payment rate for a
specific service.
X is the labor-related portion of the national unadjusted payment
rate.
X = .60 * (national unadjusted payment rate).
Step 2. Determine the wage index area in which the hospital is
located and identify the wage index level that applies to the specific
hospital. The wage index values assigned to each area would reflect the
geographic statistical areas (which are based upon OMB standards) to
which hospitals are assigned for FY 2024 under the IPPS,
reclassifications through the Medicare Geographic Classification Review
Board (MGCRB), section 1886(d)(8)(B) ``Lugar'' hospitals, and
reclassifications under section 1886(d)(8)(E) of the Act, as
implemented in Sec. 412.103 of the regulations. We are continuing to
apply for the CY 2024 OPPS wage index any adjustments for the FY 2024
IPPS post-reclassified wage index, including, but not limited to, the
rural floor adjustment, a wage index floor of 1.00 in frontier states,
in accordance with section 10324 of the Affordable Care Act of 2010,
and an adjustment to the wage index for certain low wage index
hospitals. For further discussion of the wage index we are applying for
the CY 2024 OPPS, we refer readers to section II.C of this final rule
with comment period.
Step 3. Adjust the wage index of hospitals located in certain
qualifying counties that have a relatively high percentage of hospital
employees who reside in the county, but who work in a different county
with a higher wage index, in accordance with section 505 of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(Pub. L. 108-173). Addendum L to this final rule with comment period
(which is available via the internet on the CMS website) contains the
qualifying counties and the associated wage index increase developed
for the final FY 2024 IPPS wage index (which are listed in Table 3
associated with the FY 2024 IPPS/LTCH PPS final rule and available via
the internet on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/acute-inpatient-pps). (Click on the
link on the left side of the screen titled ``FY 2024 IPPS Final Rule
Home Page'' and select ``FY 2024 Final Rule Tables.'') This step is to
be followed only if the hospital is not reclassified or redesignated
under section 1886(d)(8) or section 1886(d)(10) of the Act.
Step 4. Multiply the applicable wage index determined under Steps 2
and 3 by the amount determined under Step 1 that represents the labor-
related portion of the national unadjusted payment rate.
The formula below is a mathematical representation of Step 4 and
adjusts the labor-related portion of the national unadjusted payment
rate for the specific service by the wage index.
Xa is the labor-related portion of the national unadjusted payment
rate (wage adjusted).
Xa = labor-portion of the national unadjusted payment rate *
applicable wage index.
Step 5. Calculate 40 percent (the nonlabor-related portion) of the
national unadjusted payment rate and add that amount to the resulting
product of Step 4. The result is the wage index adjusted payment rate
for the relevant wage index area.
The formula below is a mathematical representation of Step 5 and
calculates the remaining portion of the national payment rate, the
amount not attributable to labor, and the adjusted payment for the
specific service.
Y is the nonlabor-related portion of the national unadjusted
payment rate.
Y = 0.40 * (national unadjusted payment rate).
Step 6. If a provider is an SCH, as set forth in the regulations at
Sec. 412.92, or an EACH, which is considered to be an SCH under
section 1886(d)(5)(D)(iii)(III) of the Act, and located in a rural
area, as defined in Sec. 412.64(b), or is treated as being located in
a rural area under Sec. 412.103, multiply the wage index adjusted
payment rate by 1.071 to calculate the total payment.
The formula below is a mathematical representation of Step 6 and
applies the rural adjustment for rural SCHs.
Adjusted Medicare Payment (SCH or EACH) = Adjusted Medicare Payment
* 1.071.
Step 7. The adjusted payment rate is the sum of the wage adjusted
labor-related portion of the national unadjusted payment rate and the
nonlabor-related portion of the national unadjusted payment rate.
Xa is the labor-related portion of the national unadjusted payment
rate (wage adjusted).
Y is the nonlabor-related portion of the national unadjusted
payment rate.
Adjusted Medicare Payment = Xa + Y
We are providing examples below of the calculation of both the full
and reduced national unadjusted payment rates that would apply to
certain outpatient items and services performed by hospitals that meet
and that fail to meet the Hospital OQR Program requirements, using the
steps outlined previously. For purposes of this example, we are using a
provider that is located in Brooklyn, New York, that is assigned to
CBSA 35614. This provider bills one service that is assigned to APC
5071 (Level 1 Excision/Biopsy/Incision and Drainage). The final CY 2024
full national unadjusted payment rate for APC 5071 is $671.05. The
final reduced national adjusted payment rate for APC 5071 for a
hospital that fails to meet the Hospital OQR Program requirements is
$658.03. This reduced rate is calculated by multiplying the reporting
ratio of 0.9806 by the full unadjusted payment rate for APC 5071.
Step 1. The labor-related portion of the final full national
unadjusted payment is approximately $402.63 (0.60 * $671.05). The
labor-related portion of the final reduced national adjusted payment is
approximately $394.82 (0.60 * $658.03).
[[Page 81593]]
Step 2 & 3. The FY 2024 wage index for a provider located in CBSA
35614 in New York, which includes the adoption of the final IPPS 2024
wage index policies, is 1.3562.
Step 4. The wage adjusted labor-related portion of the final full
national unadjusted payment is approximately $546.05 ($402.63 *1.3562).
The wage adjusted labor-related portion of the final reduced national
adjusted payment is approximately $535.45 ($394.82 * 1.3562).
Step 5. The nonlabor-related portion of the final full national
unadjusted payment is approximately $268.42 (0.40 * $671.05). The
nonlabor-related portion of the final reduced national adjusted payment
is approximately $263.21 (0.40 * $658.03).
Step 6. For this example of a provider located in Brooklyn, New
York, the rural adjustment for rural SCHs does not apply.
Step 7. The sum of the labor-related and nonlabor-related portions
of the final full national unadjusted payment is approximately $814.47
($546.05 + $268.42). The sum of the portions of the final reduced
national adjusted payment is approximately $798.66 ($535.45 + $263.21)
as shown in Table 7.
[GRAPHIC] [TIFF OMITTED] TR22NO23.016
We did not receive any public comments on these steps under the
methodology that we included in the CY 2024 OPPS/ASC proposed rule to
determine the APC payments for CY 2024. Therefore, we are using the
steps in the methodology specified above, to demonstrate the
calculation of the final CY 2024 OPPS payments using the same
parameters.
I. Beneficiary Copayments
1. Background
Section 1833(t)(3)(B) of the Act requires the Secretary to set
rules for determining the unadjusted copayment amounts to be paid by
beneficiaries for covered OPD services. Section 1833(t)(8)(C)(ii) of
the Act specifies that the Secretary must reduce the national
unadjusted copayment amount for a covered OPD service (or group of such
services) furnished in a year in a manner so that the effective
copayment rate (determined on a national unadjusted basis) for that
service in the year does not exceed a specified percentage. As
specified in section 1833(t)(8)(C)(ii)(V) of the Act, the effective
copayment rate for a covered OPD service paid under the OPPS in CY
2006, and in CYs thereafter, shall not exceed 40 percent of the APC
payment rate.
Section 1833(t)(3)(B)(ii) of the Act provides that, for a covered
OPD service (or group of such services) furnished in a year, the
national unadjusted copayment amount cannot be less than 20 percent of
the OPD fee schedule amount. However, section 1833(t)(8)(C)(i) of the
Act limits the amount of beneficiary copayment that may be collected
for a procedure (including items such as drugs and biologicals)
performed in a year to the amount of the inpatient hospital deductible
for that year.
Section 4104 of the Affordable Care Act eliminated the Medicare
Part B coinsurance for preventive services furnished on and after
January 1, 2011, that meet certain requirements, including flexible
sigmoidoscopies and screening colonoscopies, and waived the Part B
deductible for screening colonoscopies that become diagnostic during
the procedure. For a discussion of the changes made by the Affordable
Care Act with regard to copayments for preventive services furnished on
and after January 1, 2011, we refer readers to section XII.B of the CY
2011 OPPS/ASC final rule with comment period (75 FR 72013).
Section 122 of the Consolidated Appropriations Act (CAA) of 2021
(Pub. L. 116-260), Waiving Medicare Coinsurance for Certain Colorectal
Cancer Screening Tests, amends section 1833(a) of the Act to offer a
special coinsurance rule for screening flexible sigmoidoscopies and
screening colonoscopies, regardless of the code that is billed for the
establishment of a diagnosis as a result of the test, or for the
removal of tissue or other matter or other procedure, that is furnished
in connection with, as a result of, and in the same clinical encounter
as the colorectal cancer screening test. We refer readers to section
X.B of the CY 2022 OPPS/ASC final rule with comment period for the full
discussion of this policy (86 FR 63740 through 63743). Under the
regulation at 42 CFR 410.152(l)(5)(i)(B), the Medicare Part B payment
percentage for colorectal cancer screening tests described in the
regulation at Sec. 410.37(j) that are furnished in CY 2023 through
2026 is 85 percent, with beneficiary coinsurance equal to 15 percent.
On August 16, 2022, the Inflation Reduction Act of 2022 (IRA) (Pub.
L. 117-169) was signed into law. Section 11101(a) of the IRA amended
section 1847A of the Act by adding a new subsection (i), which requires
the payment of rebates into the Supplementary Medical Insurance Trust
Fund for Part B rebatable drugs if the payment limit amount exceeds the
inflation-adjusted payment amount, which is calculated as set forth in
section 1847A(i)(3)(C) of the Act. The provisions of section 11101 of
the IRA are currently being implemented through program instruction, as
permitted under section 1847A(c)(5)(C) of the Act. As such, we issued
guidance for the computation of inflation-adjusted beneficiary
coinsurance under section 1847A(i)(5) of the Act and amounts paid under
section 1833(a)(1)(EE) of the Act on February 9, 2023.4 5
For additional information regarding implementation of section 11101 of
the IRA, please see the inflation rebates resources page at https://www.cms.gov/inflation-reduction-act-and-medicare/inflation-rebates-medicare. We also refer readers
[[Page 81594]]
to the CY 2024 PFS proposed rule (88 FR 52262) for a detailed
discussion of proposals related to inflation-adjusted beneficiary
coinsurance and Medicare payment for Medicare Part B rebatable drugs.
---------------------------------------------------------------------------
\4\ https://www.cms.gov/files/document/medicare-part-b-inflation-rebate-program-initial-guidance.pdf.
\5\ In addition, beginning with the April 2023 ASP Drug Pricing
file, the file includes the coinsurance percentage for each drug and
specifies ``inflation-adjusted coinsurance'' in the ``Notes'' column
if the coinsurance for a drug is less than 20 percent of the
Medicare Part B payment amount. Drug pricing files are available at
https://www.cms.gov/medicare/medicare-fee-for-service-part-b-drugs/mcrpartbdrugavgsalesprice price.
---------------------------------------------------------------------------
Section 11101(b) of the IRA amended sections 1833(i) and 1833(t)(8)
of the Act by adding a new paragraph (9) and subparagraph (F),
respectively. Section 1833(i)(9) requires under the ASC payment system
that in the case of a Part B rebatable drug, in lieu of calculation of
coinsurance that would otherwise apply under the ASC payment system,
the provisions of section 1847A(i)(5) of the Act shall, as determined
appropriate by the Secretary, apply for calculation of beneficiary
coinsurance in the same manner as the provisions of section 1847A(i)(5)
of the Act apply under that section. Similarly, section 1833(t)(8)(F)
of the Act requires under the OPPS that in the case of a Part B
rebatable drug (except for a drug that has no copayment applied under
subparagraph (E) of such section or for which payment is packaged into
the payment for a covered OPD service or group of services), in lieu of
the calculation of the copayment amount that would otherwise apply
under the OPPS, the provisions of section 1847A(i)(5) of the Act shall,
as determined appropriate by the Secretary, apply in the same manner as
the provisions of section 1847A(i)(5) of the Act apply under that
section. Section 1847A(i)(5) of the Act requires that for Part B
rebatable drugs, as defined in section 1847A(i)(2)(A) of the Act,
furnished on or after April 1, 2023, in calendar quarters in which the
amount specified in section 1847A(i)(3)(A)(ii)(I) of the Act (or, in
the case of selected drugs described under section 1192(c) of the Act,
the amount specified in section 1847A(b)(1)(B) of the Act), exceeds the
inflation-adjusted payment amount determined in accordance with section
1847A(i)(3)(C) of the Act, the coinsurance will be 20 percent of the
inflation-adjusted payment amount for such quarter (hereafter, the
inflation-adjusted coinsurance amount). This inflation-adjusted
coinsurance amount is applied as a percent, as determined by the
Secretary, to the payment amount that would otherwise apply for such
calendar quarter in accordance with section 1847A(b)(1)(B) or (C) of
the Act, as applicable, including in the case of a selected drug.
Paragraph (9) of section 1833(i) of the Act and subparagraph (F) of
section 1833(t)(8) of the Act, as added by section 11101(b) of the IRA,
also provide that in lieu of the amounts of payment otherwise
applicable under the ASC payment system and the OPPS, the provisions of
paragraph (1)(EE) of subsection (a) of section 1833 of the Act shall
apply, as determined appropriate by the Secretary. Section 11101(b) of
the IRA amended section 1833(a)(1) of the Act by adding a new
subparagraph (EE), which requires that if the specific payment amount
described in section 1847A(i)(3)(A)(ii)(I) of the Act (or, in the case
of a selected drug, the payment amount described in section
1847A(b)(1)(B) of the Act) exceeds the inflation-adjusted payment
amount of a Part B rebatable drug, the Part B payment will, subject to
the deductible and sequestration, equal the difference between such
payment amount and the inflation-adjusted coinsurance amount.
In the CY 2024 OPPS/ASC proposed rule, we proposed to codify the
OPPS program payment and cost sharing amounts for Part B rebatable
drugs as required by section 1833(t)(8)(F) by adding a new paragraph
(e) to Sec. 419.41, which cross-references the regulations proposed in
the CY 2024 PFS proposed rule (Sec. Sec. 410.152(m) and 489.30(b)(6)).
We also proposed to amend the regulation text to reflect our
longstanding policies for calculating the Medicare program payment and
cost sharing amounts for separately payable drugs and biologicals by
adding a new paragraph (d) to Sec. 419.41. Similarly, we proposed to
codify the ASC cost sharing amounts for Part B rebatable drugs as
required by section 1833(i)(9) of the Act by revising Sec. 416.172(d)
to include a cross-reference to 42 CFR 489.30(b)(6), as proposed in the
CY 2024 PFS proposed rule to codify the cost sharing amounts for Part B
rebatable drugs with prices increasing at a rate faster than inflation.
We did not propose any changes to the ASC regulations at 42 CFR part
416 to reflect the Medicare payment amount for Part B rebatable drugs
with prices increasing at a rate faster than inflation, because 42 CFR
416.171(b) already incorporates, for the ASC payment system, the
payment amounts that apply for the OPPS under 42 CFR part 419. Part 419
would include our proposed new Sec. 419.41(e), which addresses
Medicare payment for Part B rebatable drugs under the OPPS.
We did not receive any public comments on our proposal to codify
amendments to Sec. Sec. 419.41 and 416.172. Therefore, we are
finalizing our proposal to codify the OPPS program payment and cost
sharing amounts for Part B rebatable drugs as required by section
1833(t)(8)(F) of the Act by adding a new paragraph (e) to Sec. 419.41.
We are also finalizing our proposal to amend the regulation text to
reflect our longstanding policies for calculating the Medicare program
payment and cost sharing amounts for separately payable drugs and
biologicals by adding a new paragraph (d) to Sec. 419.41. We are
finalizing our proposal to codify the ASC cost sharing amounts for Part
B rebatable drugs as required by section 1833(i)(9) of the Act by
revising Sec. 416.172(d) to include a cross-reference to 42 CFR
489.30(b)(6), as finalized in the CY 2024 PFS final rule to codify the
cost sharing amounts for Part B rebatable drugs with prices increasing
at a rate faster than inflation.
Comment: A commenter pointed out an error in the preamble of the CY
2024 OPPS/ASC proposed rule related to the rebatable drugs under the
IRA. Specifically, the commenter noted that the preamble language
incorrectly suggested that a provider is paid the amount specified in
section 1833(a)(1)(EE) with respect to a Part B rebatable drug when the
inflation-adjusted amount exceeds the specified payment amount, which
is the inverse of what the statute provides and therefore, is
incorrect.
Response: We thank the commenter for pointing out the error where
the references to the specified payment amount and the inflation-
adjusted amount were inadvertently transposed in the preamble. We have
corrected the preamble for this final rule with comment period.
2. OPPS Copayment Policy
For CY 2024, we proposed to determine copayment amounts for new and
revised APCs using the same methodology that we implemented beginning
in CY 2004. (We refer readers to the November 7, 2003 OPPS final rule
with comment period for a discussion of that methodology (68 FR
63458).) In addition, we proposed to use the same standard rounding
principles that we have historically used in instances where the
application of our standard copayment methodology would result in a
copayment amount that is less than 20 percent and cannot be rounded,
under standard rounding principles, to 20 percent. (We refer readers to
the CY 2008 OPPS/ASC final rule with comment period (72 FR 66687) in
which we discuss our rationale for applying these rounding principles.)
The final national unadjusted copayment amounts for services payable
under the OPPS that would be effective January 1, 2024, are included in
Addenda A and B to this final rule with comment period (which are
available via the internet on the CMS website).
As discussed in section XIV.E of the CY 2024 OPPS/ASC proposed rule
(88
[[Page 81595]]
FR 49594) and this final rule with comment period, for CY 2024, the
Medicare beneficiary's minimum unadjusted copayment and national
unadjusted copayment for a service to which a reduced national
unadjusted payment rate applies will equal the product of the reporting
ratio and the national unadjusted copayment, or the product of the
reporting ratio and the minimum unadjusted copayment, respectively, for
the service.
We note that OPPS copayments may increase or decrease each year
based on changes in the calculated APC payment rates, due to updated
cost report and claims data, and any changes to the OPPS cost modeling
process. However, as described in the CY 2004 OPPS final rule with
comment period, the development of the copayment methodology generally
moves beneficiary copayments closer to 20 percent of OPPS APC payments
(68 FR 63458 and 63459).
In the CY 2004 OPPS final rule with comment period (68 FR 63459),
we adopted a new methodology to calculate unadjusted copayment amounts
in situations including reorganizing APCs, and we finalized the
following rules to determine copayment amounts in CY 2004 and
subsequent years.
When an APC group consists solely of HCPCS codes that were
not paid under the OPPS the prior year because they were packaged or
excluded or are new codes, the unadjusted copayment amount would be 20
percent of the APC payment rate.
If a new APC that did not exist during the prior year is
created and consists of HCPCS codes previously assigned to other APCs,
the copayment amount is calculated as the product of the APC payment
rate and the lowest coinsurance percentage of the codes comprising the
new APC.
If no codes are added to or removed from an APC and, after
recalibration of its relative payment weight, the new payment rate is
equal to or greater than the prior year's rate, the copayment amount
remains constant (unless the resulting coinsurance percentage is less
than 20 percent).
If no codes are added to or removed from an APC and, after
recalibration of its relative payment weight, the new payment rate is
less than the prior year's rate, the copayment amount is calculated as
the product of the new payment rate and the prior year's coinsurance
percentage.
If HCPCS codes are added to or deleted from an APC and,
after recalibrating its relative payment weight, holding its unadjusted
copayment amount constant results in a decrease in the coinsurance
percentage for the reconfigured APC, the copayment amount would not
change (unless retaining the copayment amount would result in a
coinsurance rate less than 20 percent).
If HCPCS codes are added to an APC and, after
recalibrating its relative payment weight, holding its unadjusted
copayment amount constant results in an increase in the coinsurance
percentage for the reconfigured APC, the copayment amount would be
calculated as the product of the payment rate of the reconfigured APC
and the lowest coinsurance percentage of the codes being added to the
reconfigured APC.
We noted in the CY 2004 OPPS final rule with comment period that we
would seek to lower the copayment percentage for a service in an APC
from the prior year if the copayment percentage was greater than 20
percent. We noted that this principle was consistent with section
1833(t)(8)(C)(ii) of the Act, which accelerates the reduction in the
national unadjusted coinsurance rate so that beneficiary liability will
eventually equal 20 percent of the OPPS payment rate for all OPPS
services to which a copayment applies, and with section 1833(t)(3)(B)
of the Act, which achieves a 20-percent copayment percentage when fully
phased in and gives the Secretary the authority to set rules for
determining copayment amounts for new services. We further noted that
the use of this methodology would, in general, reduce the beneficiary
coinsurance rate and copayment amount for APCs for which the payment
rate changes as the result of the reconfiguration of APCs and/or
recalibration of relative payment weights (68 FR 63459).
We did not receive any public comments on our proposal, and we are
finalizing our proposal to determine copayment amounts for new and
revised APCs using the same methodology that we implemented beginning
in CY 2004. In addition, we are finalizing the use of the same standard
rounding principles that we have historically used in instances where
the application of our standard copayment methodology would result in a
copayment amount that is less than 20 percent and cannot be rounded,
under standard rounding principles, to 20 percent. (We refer readers to
the CY 2008 OPPS/ASC final rule with comment period (72 FR 66687) in
which we discuss our rationale for applying these rounding principles.)
The finalized national unadjusted copayment amounts for services
payable under the OPPS that would be effective January 1, 2024, are
included in Addenda A and B to this final rule with comment period
(which are available via the internet on the CMS website).
3. Calculation of an Adjusted Copayment Amount for an APC Group
Individuals interested in calculating the national copayment
liability for a Medicare beneficiary for a given service provided by a
hospital that met or failed to meet its Hospital OQR Program
requirements should follow the formulas presented in the following
steps.
Step 1. Calculate the beneficiary payment percentage for the APC by
dividing the APC's national unadjusted copayment by its payment rate.
For example, using APC 5071, $134.21 is approximately 20 percent of the
full national unadjusted payment rate of $671.05. For APCs with only a
minimum unadjusted copayment in Addenda A and B to this final rule with
comment period (which are available via the internet on the CMS
website), the beneficiary payment percentage is 20 percent.
The formula below is a mathematical representation of Step 1 and
calculates the national copayment as a percentage of national payment
for a given service.
B Is the Beneficiary Payment Percentage
B = National unadjusted copayment for APC/national unadjusted
payment rate for APC.
Step 2. Calculate the appropriate wage-adjusted payment rate for
the APC for the provider in question, as indicated in Steps 2 through 4
under section II.H of this with comment period. Calculate the rural
adjustment for eligible providers, as indicated in Step 6 under section
II.H of this final rule with comment period.
Step 3. Multiply the percentage calculated in Step 1 by the payment
rate calculated in Step 2. The result is the wage-adjusted copayment
amount for the APC.
The formula below is a mathematical representation of Step 3 and
applies the beneficiary payment percentage to the adjusted payment rate
for a service calculated under section II.H of this final rule with
comment period, with and without the rural adjustment, to calculate the
adjusted beneficiary copayment for a given service.
Wage-adjusted copayment amount for the APC = Adjusted Medicare
Payment * B.
Wage-adjusted copayment amount for the APC (SCH or EACH) =
(Adjusted Medicare Payment * 1.071) * B.
Step 4. For a hospital that failed to meet its Hospital OQR Program
requirements, multiply the copayment
[[Page 81596]]
calculated in Step 3 by the reporting ratio of 0.9806.
The finalized unadjusted copayments for services payable under the
OPPS that would be effective January 1, 2024, are shown in Addenda A
and B to this final rule with comment period (which are available via
the CMS website). We note that the final national unadjusted payment
rates and copayment rates shown in Addenda A and B to this final rule
with comment period reflect the CY 2024 OPD fee schedule increase
factor discussed in section II.B of this final rule with comment
period.
In addition, as noted earlier, section 1833(t)(8)(C)(i) of the Act
limits the amount of beneficiary copayment that may be collected for a
procedure performed in a year to the amount of the inpatient hospital
deductible for that year.
III. OPPS Ambulatory Payment Classification (APC) Group Policies
A. OPPS Treatment of New and Revised HCPCS Codes
Payments for OPPS procedures, services, and items are generally
based on medical billing codes, specifically, HCPCS codes, that are
reported on HOPD claims. HCPCS codes are used to report surgical
procedures, medical services, items, and supplies under the hospital
OPPS. The HCPCS is divided into two principal subsystems, referred to
as Level I and Level II of the HCPCS. Level I is comprised of CPT
(Current Procedural Terminology) codes, a numeric and alphanumeric
coding system that is established and maintained by the American
Medical Association (AMA), and consists of Category I, II, III,
multianalyte assays with algorithmic analyses (MAAA), and proprietary
laboratory analyses (PLAA) CPT codes. Level II, which is established
and maintained by CMS, is a standardized coding system that is used
primarily to identify products, supplies, and services not included in
the CPT codes. Together, Level I and II HCPCS codes are used to report
procedures, services, items, and supplies under the OPPS payment
system. Specifically, we recognize the following codes on OPPS claims:
Category I CPT codes, which describe surgical procedures,
diagnostic and therapeutic services, and vaccine codes;
Category III CPT codes, which describe new and emerging
technologies, services, and procedures;
MAAA CPT codes, which describe laboratory multianalyte
assays with algorithmic analyses (MAA);
PLA CPT codes, which describe proprietary laboratory
analyses (PLA) services; and
Level II HCPCS codes (also known as alpha-numeric codes),
which are used primarily to identify drugs, devices, supplies,
temporary procedures, and services not described by CPT codes.
The codes are updated and changed throughout the year. CPT and
Level II HCPCS code changes that affect the OPPS are published through
the annual rulemaking cycle and through the OPPS quarterly update
Change Requests (CRs). Generally, these code changes are effective
January 1, April 1, July 1, or October 1. CPT code changes are released
by the AMA (via their website) while Level II HCPCS code changes are
released to the public via the CMS HCPCS website. CMS recognizes the
release of new CPT and Level II HCPCS codes outside of the formal
rulemaking process via OPPS quarterly update CRs. Based on our review,
we assign the new codes to interim status indicators (SIs) and APCs.
These interim assignments are finalized in the OPPS/ASC final rules.
This quarterly process offers hospitals access to codes that more
accurately describe the items or services furnished and provides
payment for these items or services in a timelier manner than if we
waited for the annual rulemaking process. We solicit public comments on
the new CPT and Level II HCPCS codes, status indicators, and APC
assignments through our annual rulemaking process.
We note that, under the OPPS, the APC assignment determines the
payment rate for an item, procedure, or service. The items, procedures,
or services not exclusively paid separately under the hospital OPPS are
assigned to appropriate status indicators. Certain payment status
indicators provide separate payment while other payment status
indicators do not. In section XI. (CY 2024 Payment Status and Comment
Indicators) of this final rule with comment period, we discuss the
various status indicators used under the OPPS. We also provide a
complete list of the status indicators and their definitions in
Addendum D1 to this final rule with comment period.
1. April 2023 HCPCS Codes Proposed Rule Comment Solicitation
For the April 2023 update, 67 new HCPCS codes were established and
made effective on April 1, 2023. Through the April 2023 OPPS quarterly
update CR (Transmittal 11937, Change Request 13136, dated March 31,
2023), we recognized several new HCPCS codes for separate payment under
the OPPS. We solicited public comments on the proposed APC and status
indicator assignments for the codes listed in Table 6 (New HCPCS Codes
Effective April 1, 2023) of the CY 2024 OPPS/ASC proposed rule (88 FR
49595 through 49599), which are also displayed in Table 8.
We received some public comments on the proposed OPPS APC and SI
assignments for the new Level II HCPCS codes implemented in April 2023.
The comments and our responses are addressed in their respective
sections of this final rule with comment period, which include, but are
not limited to: sections III.C. (New Technology APCs), III.E. (OPPS
APC-Specific Policies), and IV. (OPPS Payment for Devices). For those
April 2023 codes for which we received no comments, we are finalizing
the proposed APC and status indicator assignments. We note that several
of the HCPCS C-codes have been replaced with HCPCS J-codes, effective
January 1, 2024. Their replacement codes are listed in Table 8. In
addition, in prior years we included the final OPPS status indicators
and APC assignments in the coding preamble tables, however, because the
same information can be found in Addendum B, we are no longer including
them in Table 8. Therefore, readers are advised to refer to the OPPS
Addendum B for the final OPPS status indicators, APC assignments, and
payment rates for all codes reportable under the hospital OPPS. These
new codes that were effective April 1, 2023, were assigned to comment
indicator ``NP'' in Addendum B to the CY 2024 OPPS/ASC proposed rule to
indicate that the codes are assigned to an interim APC assignment and
comments would be accepted on their interim APC assignments. The
complete list of status indicators and definitions used under the OPPS
can be found in Addendum D1 to this final rule with comment period,
while the complete list of comment indicators and definitions can be
found in Addendum D2 to this final rule with comment period. We note
that OPPS Addendum B (OPPS payment file by HCPCS code), Addendum D1
(OPPS Status Indicators), and Addendum D2 (OPPS Comment Indicators) are
available via the internet on the CMS website.
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2. July 2023 HCPCS Codes Proposed Rule Comment Solicitation
For the July 2023 update, 97 new codes were established and made
effective July 1, 2023. Through the July 2023 OPPS quarterly update CR
(Transmittal 12077, Change Request 13210, dated June 13, 2023), we
recognized several new codes for separate payment and assigned them to
appropriate interim OPPS status indicators and APCs. We solicited
public comments on the proposed APC and status indicator assignments
for the codes listed in Table 7 (New HCPCS Codes Effective July 1,
2023) of the CY 2024 OPPS/ASC proposed rule (88 FR 49599-49605), which
are also listed in Table 9.
We received some public comments on the proposed OPPS APC and SI
assignments for the new Level II HCPCS codes implemented on July 1,
2023. The comments and our responses are addressed in their respective
sections of this final rule with comment period, which include, but are
not limited to: sections III.C (New Technology APCs), III.E (OPPS APC-
Specific Policies), and IV (OPPS Payment for Devices). For those July
1, 2023, codes for which we received no comments, we are finalizing the
proposed APC and status indicator assignments. We note that one HCPCS
C-code has been replaced with a HCPCS J-code. The replacement code is
listed in Table 9. Additionally, we note that in prior years we
included the final OPPS status indicators and APC assignments in the
coding preamble tables, however, because the same information can be
found in Addendum B, we are no longer including them in Table 9.
Therefore, readers are advised to refer to the OPPS Addendum B for the
final OPPS status indicators, APC assignments, and payment rates for
all codes reportable under the hospital OPPS. These new codes that were
effective July 1, 2023, were assigned to comment indicator ``NP'' in
Addendum B to the CY 2024 OPPS/ASC proposed rule to indicate that the
codes are assigned to an interim APC assignment and comments would be
accepted on their interim APC assignments. The complete list of status
indicators and definitions used under the OPPS can be found in Addendum
D1 to this final rule with comment period, while the complete list of
comment indicators and definitions can be found in Addendum D2 to this
final rule with comment period. We note that OPPS Addendum B (OPPS
payment file by HCPCS code), Addendum D1 (OPPS Status Indicators), and
Addendum D2 (OPPS Comment Indicators) are available via the internet on
the CMS website.
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3. October 2023 HCPCS Codes Final Rule Comment Solicitation
For the October 2023 update, 64 new codes were established and made
effective October 1, 2023. Through the October 2023 OPPS quarterly
update CR (Transmittal 12077, Change Request 13210, dated June 13,
2023), we recognized several new codes for separate payment and
assigned them to appropriate interim OPPS status indicators and APCs.
For CY 2024, consistent with our established policy, we proposed in the
CY 2024 OPPS/ASC
[[Page 81606]]
proposed rule (88 FR 49605) that the HCPCS codes that would be
effective October 1, 2023, would be flagged with comment indicator
``NI'' in Addendum B in the CY 2024 OPPS/ASC final rule with comment
period to indicate that we have assigned the codes to interim OPPS
status indicators for CY 2024. Table 10 below lists the codes that were
effective October 1, 2023. We note that several of the temporary C-
codes have been replaced with permanent J-codes effective January 1,
2024. We are inviting public comments in this final rule on the interim
payment indicators, which will be finalized in the CY 2025 OPPS/ASC
final rule with comment period. We note these same codes will be
subject to comment in the CY 2025 OPPS/ASC proposed rule with comment
period, and will be finalized in the CY 2025 OPPS/ASC final rule with
comment period.
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4. January 2024 HCPCS Codes
a. New Level II HCPCS Codes Final Rule Comment Solicitation
Consistent with past practice, we are soliciting comments on the
new Level II HCPCS codes that will be effective January 1, 2024, in
this final rule with comment period, thereby allowing us to finalize
the status indicators and APC assignments for the codes in the CY 2025
OPPS/ASC final rule with comment period. Unlike the CPT codes that are
effective January 1 and are included in the OPPS/ASC proposed rules,
and except for the proposed new C-codes and G-codes listed in Addendum
O of the CY 2024 OPPS/ASC proposed rule, most Level II HCPCS codes are
not released until sometime around November to be effective
[[Page 81611]]
January 1. Because these codes are not available until November, we are
unable to include them in the OPPS/ASC proposed rules. Consequently,
for CY 2024, we proposed to include the new Level II HCPCS codes
effective January 1, 2024 (that would be incorporated in the January
2024 OPPS quarterly update CR), in Addendum B to the CY 2024 OPPS/ASC
final rule with comment period. Specifically, for CY 2024, we proposed
to continue our established policy of assigning comment indicator
``NI'' in Addendum B to this final rule with comment period to the new
HCPCS codes that will be effective January 1, 2024, to indicate that we
are assigning them an interim status indicator, which is subject to
public comment. We are inviting public comments in this final rule with
comment period on the status indicators and APC assignments, which will
be finalized in the CY 2025 OPPS/ASC final rule with comment period.
Similar to the codes effective October 1, 2023, these new Level II
HCPCS codes that will be effective January 1, 2024, will be subject to
comment in the CY 2025 OPPS/ASC proposed rule with comment period, and
will be finalized in the CY 2025 OPPS/ASC final rule with comment
period.
b. New CY 2024 CPT Codes Proposed Rule Comment Solicitation
In the CY 2015 OPPS/ASC final rule with comment period (79 FR 66841
through 66844), we finalized a revised process of assigning APCs and
status indicators for new and revised Category I and III CPT codes that
would be effective January 1. Specifically, for the new/revised CPT
codes that we receive in a timely manner from the AMA's CPT Editorial
Panel, we finalized our proposal to include the codes that would be
effective January 1 in the OPPS/ASC proposed rules, along with proposed
APC and status indicator assignments for them, and to finalize the APC
and status indicator assignments in the OPPS/ASC final rules beginning
with the CY 2016 OPPS update. For those new/revised CPT codes that were
received too late for inclusion in the OPPS/ASC proposed rule, we
finalized our proposal to establish and use HCPCS G-codes that mirror
the predecessor CPT codes and retain the current APC and status
indicator assignments for a year until we can propose APC and status
indicator assignments in the following year's rulemaking cycle. We note
that even if we find that we need to create HCPCS G-codes in place of
certain CPT codes for the PFS proposed rule, we do not anticipate that
these HCPCS G-codes will always be necessary for OPPS purposes. We will
make every effort to include proposed APC and status indicator
assignments for all new and revised CPT codes that the AMA makes
publicly available in time for us to include them in the proposed rule,
and to avoid resorting to use of HCPCS G-codes and the resulting delay
in utilization of the most current CPT codes. Also, we finalized our
proposal to make interim APC and status indicator assignments for CPT
codes that are not available in time for the proposed rule and that
describe wholly new services (such as new technologies or new surgical
procedures), to solicit public comments in the final rule, and to
finalize the specific APC and status indicator assignments for those
codes in the following year's final rule.
For the CY 2024 OPPS update, we received the CPT codes that will be
effective January 1, 2024, from the AMA in time to be included in the
CY 2024 OPPS/ASC proposed rule with comment period. The new, revised,
and deleted CPT codes can be found in Addendum B to the proposed rule
(which is available via the internet on the CMS website). We note that
the new and revised CPT codes are assigned to a proposed APC assignment
and comment indicator ``NP'' in Addendum B of the proposed rule to
indicate that the code is new for the next calendar year or the code is
an existing code with substantial revision to its code descriptor in
the next calendar year as compared to the current calendar year, and
that comments will be accepted on the proposed APC assignment and
status indicator.
Further, we reminded readers that the CPT code descriptors that
appear in Addendum B are short descriptors and do not accurately
describe the complete procedure, service, or item described by the CPT
code. Therefore, we included the 5-digit placeholder codes and their
long descriptors for the new and revised CY 2024 CPT codes in Addendum
O to the proposed rule (which is available via the internet on the CMS
website) so that the public could adequately comment on the proposed
APCs and SI assignments. The 5-digit placeholder codes were included in
Addendum O, specifically under the column labeled ``CY 2024 OPPS/ASC
Proposed Rule 5-Digit AMA Placeholder Code,'' to the proposed rule. We
noted that the final CPT code numbers would be included in this CY 2024
OPPS/ASC final rule with comment period. We also noted that not every
code listed in Addendum O is subject to public comment. For the new and
revised Category I and III CPT codes, we requested public comments on
only those codes that are assigned comment indicator ``NP.''
In summary, in the CY 2024 OPPS/ASC proposed rule, we solicited
public comments on the proposed CY 2024 SI and APC assignments for the
new and revised Category I and III CPT codes that would be effective
January 1, 2024. The CPT codes were listed in Addendum B to the
proposed rule with short descriptors only. We listed them again in
Addendum O to the proposed rule with long descriptors. We also proposed
to finalize the SI and APC assignments for these codes (with their
final CPT code numbers) in the CY 2024 OPPS/ASC final rule with comment
period. The proposed SI and APC assignments for these codes were
included in Addendum B to the proposed rule (which is available via the
internet on the CMS website).
We received comments on several of the new CPT codes that were
assigned to comment indicator ``NP'' in Addendum B to the CY 2024 OPPS/
ASC proposed rule. We have responded to those public comments in
sections III.C, III.E, and IV of this CY 2024 OPPS/ASC final rule with
comment period.
The final SIs, APC assignments, and payment rates for the new CPT
codes that are effective January 1, 2024, can be found in Addendum B to
this final rule with comment period. In addition, the SI meanings can
be found in Addendum D1 (OPPS Payment Status Indicators for CY 2024) to
this final rule with comment period. Addenda B and D1 are available via
the internet on the CMS website.
Finally, Table 11, which is a reprint of Table 8 from the CY 2024
OPPS/ASC proposed rule (88 FR 49606), shows the comment timeframe for
new and revised HCPCS codes. The table provides information on our
current process for updating codes through our OPPS quarterly update
CRs, seeking public comments, and finalizing the treatment of these
codes under the OPPS.
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B. OPPS Changes--Variations Within APCs
1. Background
Section 1833(t)(2)(A) of the Act requires the Secretary to develop
a classification system for covered hospital outpatient department
services. Section 1833(t)(2)(B) of the Act provides that the Secretary
may establish groups of covered OPD services within this classification
system, so that services classified within each group are comparable
clinically and with respect to the use of resources. In accordance with
these provisions, we developed a grouping classification system,
referred to as Ambulatory Payment Classifications (APCs), as set forth
in regulations at 42 CFR 419.31. We use Level I (also known as CPT
codes) and Level II HCPCS codes (also known as alphanumeric codes) to
identify and group the services within each APC. The APCs are organized
such that each group is homogeneous both clinically and in terms of
resource use. Using this classification system, we have established
distinct groups of similar services. We also have developed separate
APC groups for certain medical devices, drugs, biologicals, therapeutic
radiopharmaceuticals, and brachytherapy devices that are not packaged
into the payment for the procedure.
We have packaged into the payment for each procedure or service
within an APC group the costs associated with those items and services
that are typically ancillary and supportive to a primary diagnostic or
therapeutic modality and, in those cases, are an integral part of the
primary service they support. Therefore, we do not make separate
payment for these packaged items or services. In general, packaged
items and services include, but are not limited to, the items and
services listed in regulations at 42 CFR 419.2(b). A further discussion
of packaged services is included in section II.A.3 of this final rule
with comment period.
Under the OPPS, we generally pay for covered hospital outpatient
services on a rate-per-service basis, where the service may be reported
with one or more HCPCS codes. Payment varies according to the APC group
to which the independent service or combination of services is
assigned. In the CY 2024 OPPS/ASC proposed rule (88 FR 49607), for CY
2024, we proposed that each APC relative payment weight represents the
hospital cost of the services included in that APC, relative to the
hospital cost of the services included in APC 5012 (Clinic Visits and
Related Services). The APC relative payment weights are scaled to APC
5012 because it is the hospital clinic visit APC and clinic visits are
among the most frequently furnished services in the hospital outpatient
setting.
2. Application of the 2 Times Rule
Section 1833(t)(9)(A) of the Act requires the Secretary to review,
not less often than annually, and revise the APC groups, the relative
payment weights, and the wage and other adjustments described in
paragraph (2) to take into account changes in medical practice, changes
in technology, the addition of new services, new cost data, and other
relevant information and factors. Section 1833(t)(9)(A) of the Act also
requires the Secretary to consult with an expert outside advisory panel
composed of an appropriate selection of
[[Page 81613]]
representatives of providers to review (and advise the Secretary
concerning) the clinical integrity of the APC groups and the relative
payment weights. We note that the Advisory Panel on Hospital Outpatient
Payment (also known as the HOP Panel or the Panel) recommendations for
specific services for the CY 2024 OPPS update will be discussed in the
relevant specific sections throughout this final rule with comment
period.
In addition, section 1833(t)(2) of the Act provides that, subject
to certain exceptions, the items and services within an APC group
cannot be considered comparable with respect to the use of resources if
the highest cost for an item or service in the group is more than 2
times greater than the lowest cost for an item or service within the
same group (referred to as the ``2 times rule''). The statute
authorizes the Secretary to make exceptions to the 2 times rule in
unusual cases, such as for low-volume items and services (but the
Secretary may not make such an exception in the case of a drug or
biological that has been designated as an orphan drug under section 526
of the Federal Food, Drug, and Cosmetic Act). In determining the APCs
with a 2 times rule violation, we consider only those HCPCS codes that
are significant based on the number of claims. We note that, for
purposes of identifying significant procedure codes for examination
under the 2 times rule, we consider procedure codes that have more than
1,000 single major claims or procedure codes that both have more than
99 single major claims and contribute at least 2 percent of the single
major claims used to establish the APC cost to be significant (75 FR
71832). This longstanding definition of when a procedure code is
significant for purposes of the 2 times rule was selected because we
believe that a subset of 1,000 or fewer claims is negligible within the
set of approximately 100 million single procedure or single session
claims we use for establishing costs. Similarly, a procedure code for
which there are fewer than 99 single claims and that comprises less
than 2 percent of the single major claims within an APC will have a
negligible impact on the APC cost (75 FR 71832). In the CY 2024 OPPS/
ASC proposed rule, for CY 2024, we proposed to make exceptions to this
limit on the variation of costs within each APC group in unusual cases,
such as for certain low-volume items and services.
For the CY 2024 OPPS update, we identified the APCs with violations
of the 2 times rule; and we proposed changes to the procedure codes
assigned to these APCs (with the exception of those APCs for which we
proposed a 2 times rule exception) in Addendum B to the CY 2024 OPPS/
ASC proposed rule. We note that Addendum B does not appear in the
printed version of the Federal Register as part of this final rule with
comment period. Rather, it is published and made available via the
internet on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices. To
eliminate a violation of the 2 times rule and improve clinical and
resource homogeneity in the APCs for which we did not propose a 2 times
rule exception, we proposed to reassign these procedure codes to new
APCs that contain services that are similar with regard to both their
clinical and resource characteristics. In many cases, the proposed
procedure code reassignments and associated APC reconfigurations for CY
2024 included in the CY 2024 OPPS/ASC proposed rule are related to
changes in costs of services that were observed in the CY 2022 claims
data available for CY 2024 ratesetting. Addendum B to the CY 2024 OPPS/
ASC proposed rule identifies with a comment indicator ``CH'' those
procedure codes for which we proposed a change to the APC assignment or
status indicator, or both, that were initially assigned in the July 1,
2023 OPPS Addendum B Update (available via the internet on the CMS
website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/addendum-a-b-updates).
3. APC Exceptions to the 2 Times Rule
Taking into account the APC changes that we proposed to make for CY
2024, we reviewed all of the APCs for which we identified 2 times rule
violations to determine whether any of the APCs would qualify for an
exception. We used the following criteria to evaluate whether to
propose exceptions to the 2 times rule for affected APCs:
Resource homogeneity;
Clinical homogeneity;
Hospital outpatient setting utilization;
Frequency of service (volume); and
Opportunity for upcoding and code fragments.
For a detailed discussion of these criteria, we refer readers to
the April 7, 2000 final rule (65 FR 18457 and 18458).
Based on the CY 2022 claims data available for the CY 2024 OPPS/ASC
proposed rule, we found 21 APCs with violations of the 2 times rule. We
applied the criteria as described above to identify the APCs for which
we proposed to make exceptions under the 2 times rule for CY 2024 and
found that all of the 21 APCs we identified met the criteria for an
exception to the 2 times rule based on the CY 2022 claims data
available for the CY 2024 OPPS/ASC proposed rule. We note that, on an
annual basis, based on our analysis of the latest claims data, we
identify violations to the 2 times rule and propose changes when
appropriate. Those APCs that violate the 2 times rule are identified
and appear in Table 12 below. In addition, we did not include in that
determination those APCs where a 2 times rule violation was not a
relevant concept, such as APC 5401 (Dialysis), which only has two HCPCS
codes assigned to it that have similar geometric mean costs and do not
create a 2 times rule violation. Therefore, we have only identified
those APCs, including those with criteria-based costs, such as device-
dependent CPT/HCPCS codes, with violations of the 2 times rule, where a
2 times rule violation is a relevant concept.
Table 9 of the CY 2024 OPPS/ASC proposed rule (88 FR 49608) listed
the 21 APCs for which we proposed to make an exception under the 2
times rule for CY 2024 based on the criteria cited above and claims
data submitted between January 1, 2022, and December 31, 2022, and
processed on or before June 30, 2023, and CCRs, if available. The
proposed geometric mean costs for covered hospital outpatient services
for these and all other APCs that were used in the development of the
proposed rule can be found on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices.
Based on the updated final rule CY 2022 claims data used for this
CY 2024 final rule with comment period, we found a total of 22 APCs
with violations of the 2 times rule. Of these 22 total APCs, 19 were
identified in the proposed rule and three are newly identified APCs.
The following two APCs appeared in Table 9 of the CY 2024 OPPS/ASC
proposed rule (88 FR 49608) as violating the 2 times rule, however,
after conducting our data analysis for this final rule with comment
period, we found that the APCs no longer violate the 2 times rule:
APC 5303 (Level 3 Upper GI Procedures)
APC 5822 (Health and Behavior Services)
In addition, the three newly identified APCs with violations of the
2 times rule include the following:
APC 5734 (Level 4 Minor Procedures)
[[Page 81614]]
APC 5743 (Level 3 Electronic Analysis of Devices)
APC 5791 (Level 1 Pulmonary Treatment)
Although we did not receive any comments on Table 9 of the proposed
rule, we did receive comments on APC assignments for specific HCPCS
codes. The comments, and our responses, can be found in section III.E.
of this final rule with comment period. In addition, we received a
comment related to the application of the 2 times rule to the nuclear
medicine APCs and packaged diagnostic radiopharmaceuticals. Below is
the comment and our response.
Comment: A commenter stated that the statutory standard at section
1833(t)(2)(B) of the Social Security Act applies to the resources of
both items and services, and if CMS continues to package diagnostic
radiopharmaceuticals, the commenter suggested including the cost of the
packaged radiopharmaceuticals when evaluating the nuclear medicine APCs
for 2 times rule violations. The commenter added that, if needed, CMS
should consider establishing additional APCs to ensure that the nuclear
medicine APCs do not violate the 2 times rule when the costs of the
packaged diagnostic radiopharmaceuticals are included.
Response: As we stated in the CY 2023 OPPS/ASC final rule (87 FR
71963), diagnostic radiopharmaceuticals are an integral component of
many nuclear medicine and imaging procedures, and the payment for them
is packaged with the primary procedure. We reiterate that the payment
rates for the nuclear medicine APCs are established in a manner that
uses the reported costs to furnish the procedure based on data
submitted to CMS from all hospitals paid under the OPPS. The costs that
are calculated for the nuclear medicine APCs reflect the average costs
of items and services that are packaged into a primary procedure and
will not necessarily equal the sum of the cost of the primary procedure
and diagnostic radiopharmaceutical used in the procedure. Claims data
that include the radiopharmaceutical packaged with the associated
procedure reflect the combined cost of the procedure and the
radiopharmaceutical used in the procedure. Consequently, we believe
that our general standard of applying the 2 times rule to all clinical
APCs, including the nuclear medicine APCs, is appropriate.
After considering the public comments we received on APC
assignments and our analysis of the CY 2022 costs from hospital claims
and cost report data available for this CY 2024 final rule with comment
period, we are finalizing our proposals with some modifications.
Specifically, we are finalizing our proposal to except 19 of the 21
proposed APCs from the 2 times rule for CY 2022 claims data and also
excepting three additional APCs (APCs 5734, 5743, and 5791) for a total
of 22 APCs.
In summary, Table 12 lists the 22 APCs that we are excepting from
the 2 times rule for CY 2024 based on the criteria described earlier
and a review of updated claims data for dates of service between
January 1, 2022, and December 31, 2022, that were processed on or
before June 30, 2023, and updated CCRs, if available. We note that, for
cases in which a recommendation by the HOP Panel appears to result in
or allow a violation of the 2 times rule, we generally accept the HOP
Panel's recommendation because those recommendations are based on
explicit consideration of resource use, clinical homogeneity, site of
service, and the quality of the claims data used to determine the APC
payment rates. The geometric mean costs for hospital outpatient
services for these and all other APCs that were used in the development
of this final rule with comment period can be found on the CMS website
at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices.
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BILLING CODE 4150-28-C
C. New Technology APCs
1. Background
In the CY 2002 OPPS final rule (66 FR 59903), we finalized changes
to the time period in which a service can be eligible for payment under
a New Technology APC. Beginning in CY 2002, we retain services within
New Technology APC groups until we gather sufficient claims data to
enable us to assign the service to an appropriate clinical APC. This
policy allows us to move a service from a New Technology APC in less
than 2 years if sufficient data are available. It also allows us to
retain a service in a New Technology APC for more than 2 years if
sufficient data upon which to base a decision for reassignment have not
been collected.
We also adopted in the CY 2002 OPPS final rule the following
criteria for assigning a complete or comprehensive service to a New
Technology APC: (1) the service must be truly new, meaning it cannot be
appropriately reported by an existing HCPCS code assigned to a clinical
APC and does not appropriately fit within an existing clinical APC; (2)
the service is not eligible for transitional pass-through payment
(however, a truly new, comprehensive service could qualify for
assignment to a new technology APC even if it involves a device or drug
that could, on its own, qualify for a pass-through payment); and (3)
the service falls within the scope of Medicare benefits under section
1832(a) of the Act and is reasonable and necessary in accordance with
section 1862(a)(1)(A) of the Act (66 FR 59898 through 59903). For
additional information about our New Technology APC policy, we refer
readers to https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/pass-through-payment-status-new-technology-ambulatory-payment-classification-apc and then follow the instructions
to access the MEARIS\TM\ system for OPPS New Technology APC
applications.
In the CY 2004 OPPS final rule with comment period (68 FR 63416),
we restructured the New Technology APCs to make the cost intervals more
consistent across payment levels and refined the cost bands for these
APCs to retain two parallel sets of New Technology APCs: one set with a
status indicator of ``S'' (Significant Procedures, Not Discounted when
Multiple. Paid under OPPS; separate APC payment) and the other set with
a status indicator of ``T'' (Significant Procedure, Multiple Reduction
Applies. Paid under OPPS; separate APC payment). These current New
Technology APC configurations allow us to price new technology services
more appropriately and consistently.
For CY 2023, there were 52 New Technology APC levels, ranging from
the lowest cost band assigned to APC 1491 (New Technology--Level 1A
($0-$10)) to the highest cost band assigned to APC 1908 (New
Technology--Level 52 ($145,001-$160,000)). We note that the cost bands
for the New Technology
[[Page 81616]]
APCs, specifically, APCs 1491 through 1599 and 1901 through 1908, vary
with increments ranging from $10 to $14,999. These cost bands identify
the APCs to which new technology procedures and services with estimated
service costs that fall within those cost bands are assigned under the
OPPS. Payment for each APC is made at the mid-point of the APC's
assigned cost band. For example, payment for New Technology APC 1507
(New Technology--Level 7 ($501-$600)) is made at $550.50.
Under the OPPS, one of our goals is to make payments that are
appropriate for the services that are necessary for the treatment of
Medicare beneficiaries. The OPPS, like other Medicare payment systems,
is budget neutral and increases are limited to the annual hospital
market basket increase reduced by the productivity adjustment. We
believe that our payment rates reflect the costs that are associated
with providing care to Medicare beneficiaries and are adequate to
ensure access to services (80 FR 70374). For many emerging
technologies, there is a transitional period during which utilization
may be low, often because providers are first learning about the
technologies and their clinical utility. Quite often, parties request
that Medicare make higher payments under the New Technology APCs for
new procedures in that transitional phase. These requests, and their
accompanying estimates for expected total patient utilization, often
reflect very low rates of patient use of expensive equipment, resulting
in high per-use costs for which requesters believe Medicare should make
full payment. Medicare does not, and we believe should not, assume
responsibility for more than its share of the costs of procedures based
on projected utilization for Medicare beneficiaries and does not set
its payment rates based on initial projections of low utilization for
services that require expensive capital equipment. For the OPPS, we
rely on hospitals to make informed business decisions regarding the
acquisition of high-cost capital equipment, taking into consideration
their knowledge about their entire patient base (Medicare beneficiaries
included) and an understanding of Medicare's and other payers' payment
policies. We refer readers to the CY 2013 OPPS/ASC final rule with
comment period (77 FR 68314) for further discussion regarding this
payment policy.
Some services assigned to New Technology APCs have very low annual
volume, which we consider to be fewer than 100 claims (86 FR 63528).
Where utilization of services assigned to a New Technology APC is low,
it can lead to wide variation in payment rates from year to year,
resulting in even lower utilization and potential barriers to access to
new technologies, which ultimately limits our ability to assign the
service to the appropriate clinical APC. To mitigate these issues, we
finalized a policy, in the CY 2019 OPPS/ASC final rule with comment
period, to utilize our equitable adjustment authority at section
1833(t)(2)(E) of the Act to adjust how we determine the costs for low-
volume services assigned to New Technology APCs (83 FR 58892 and
58893). Specifically, in the CY 2019 OPPS/ASC final rule with comment
period (83 FR 58893), we established that, in each of our annual
rulemakings, we would calculate and present the result of each
statistical methodology (arithmetic mean, geometric mean, and median)
based on up to 4 years of claims data and solicit public comment on
which methodology should be used to establish the payment rate for the
low-volume new technology service. In the CY 2022 OPPS/ASC final rule
with comment period (86 FR 63529), we replaced the New Technology APC
low volume policy with the universal low volume APC policy. Unlike the
New Technology APC low volume policy, the universal low volume APC
policy applies to clinical APCs and brachytherapy APCs, in addition to
procedures assigned to New Technology APCs, and uses the highest of the
geometric mean, arithmetic mean, or median based on up to 4 years of
claims data to set the payment rate for the APC. We refer readers to
the CY 2022 OPPS/ASC final rule with comment period (86 FR 63529) for
further discussion regarding this policy.
Finally, we note that, in a budget-neutral system, payments may not
fully cover hospitals' costs in a particular circumstance, including
those for the purchase and maintenance of capital equipment. We rely on
hospitals to make their decisions regarding the acquisition of high-
cost equipment with the understanding that the Medicare program must be
careful to establish its initial payment rates, including those made
through New Technology APCs, for new services that lack hospital claims
data based on realistic utilization projections for all such services
delivered in cost-efficient hospital outpatient settings. As the OPPS
acquires claims data regarding hospital costs associated with new
procedures, we regularly examine the claims data and any available new
information regarding the clinical aspects of new procedures to confirm
that our OPPS payments remain appropriate for procedures as they
transition into mainstream medical practice (77 FR 68314). For CY 2024,
we included the proposed payment rates for New Technology APCs 1491 to
1599 and 1901 through 1908 in Addendum A to the CY 2024 OPPS/ASC
proposed rule (which is available on the CMS website at https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices).
2. Procedures Assigned to New Technology APC Groups for CY 2024
As we described in the CY 2002 OPPS final rule (66 FR 59902), we
generally retain a procedure in the New Technology APC to which it is
initially assigned until we have obtained sufficient claims data to
justify reassignment of the procedure to a clinically appropriate APC.
In addition, in cases where we find that our initial New Technology APC
assignment was based on inaccurate or inadequate information (although
it was the best information available at the time), where we obtain new
information that was not available at the time of our initial New
Technology APC assignment, or where the New Technology APCs are
restructured, we may, based on more recent resource utilization
information (including claims data) or the availability of refined New
Technology APC cost bands, reassign the procedure or service to a
different New Technology APC that more appropriately reflects its cost
(66 FR 59903).
Consistent with our current policy, for CY 2024, we proposed to
retain services within New Technology APC groups until we obtain
sufficient claims data to justify reassignment of the service to an
appropriate clinical APC. The flexibility associated with this policy
allows us to reassign a service from a New Technology APC in less than
2 years if we have obtained sufficient claims data. It also allows us
to retain a service in a New Technology APC for more than 2 years if we
have not obtained sufficient claims data upon which to base a
reassignment decision (66 FR 59902).
a. Administration of Subretinal Therapies Requiring Vitrectomy (APC
1563)
Effective January 1, 2021, CMS established HCPCS code C9770
(Vitrectomy, mechanical, pars plana approach, with subretinal injection
of pharmacologic/biologic agent) and assigned it to a New Technology
APC based on the geometric mean cost of CPT code 67036 (Vitrectomy,
[[Page 81617]]
mechanical, pars plana approach) due to similar resource utilization.
For CY 2021, HCPCS code C9770 was assigned to APC 1561 (New
Technology--Level 24 ($3001-$3500)). This code may be used to describe
the administration of HCPCS code J3398 (Injection, voretigene
neparvovec-rzyl, 1 billion vector genomes). This procedure was
previously discussed in depth in the CY 2021 OPPS/ASC final rule with
comment period (85 FR 85939 and 85940). For CY 2022, we maintained the
APC assignment of APC 1561 (New Technology--Level 24 ($3001-$3500)) for
HCPCS code C9770 (86 FR 63531 and 63532).
HCPCS code J3398 (Injection, voretigene neparvovec-rzyl, 1 billion
vector genomes) is for a gene therapy product indicated for a rare
mutation-associated retinal dystrophy. Voretigene neparvovec-rzyl
(Luxturna[supreg]) was approved by FDA in December of 2017 and is an
adeno-associated virus vector-based gene therapy indicated for the
treatment of patients with confirmed biallelic RPE65 mutation-
associated retinal dystrophy.\6\ This therapy is administered through a
subretinal injection, which interested parties describe as an extremely
delicate and sensitive surgical procedure. The FDA package insert
describes one of the steps for administering Luxturna as, ``after
completing a vitrectomy, identify the intended site of administration.
The subretinal injection can be introduced via pars plana.''
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\6\ Luxturna. FDA Package Insert. Available: https://www.fda.gov/media/109906/download.
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Interested parties, including the manufacturer of Luxturna[supreg],
recommended CPT code 67036 (Vitrectomy, mechanical, pars plana
approach) for the administration of the gene therapy.\7\ However, the
manufacturer previously contended the administration was not accurately
described by any existing codes as CPT code 67036 (Vitrectomy,
mechanical, pars plana approach) does not account for the
administration itself.
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\7\ LUXTURNA REIMBURSEMENT GUIDE FOR TREATMENT CENTERS. https://mysparkgeneration.com/uploads/2022/09/LUXTURNA-Reimbursement-Guide-for-Treatment-Centers-ISI-Update-April-2022-P-RPE65-US-320025.pdf.
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CMS recognized the need to accurately describe the unique procedure
that is required to administer the therapy described by HCPCS code
J3398. Therefore, in the CY 2021 OPPS/ASC proposed rule (85 FR 48832),
we proposed to establish a new HCPCS code, C97X1 (Vitrectomy,
mechanical, pars plana approach, with subretinal injection of
pharmacologic/biologic agent) to describe this process. We stated that
we believed this new HCPCS code accurately described the unique service
associated with intraocular administration of HCPCS code J3398. We
recognized that CPT code 67036 represents a clinically similar
procedure and process that approximates similar resource utilization to
C97X1. However, we also recognized that it is not prudent for the code
that describes the administration of this unique gene therapy, C97X1,
to be assigned to the same C-APC to which CPT code 67036 is assigned,
as this would package the primary therapy, HCPCS code J3398, into the
code that represents the process to administer the gene therapy.
Therefore, for CY 2021, we proposed to assign the services
described by C97X1 to a New Technology APC with a cost band that
contains the geometric mean cost for CPT code 67036. The placeholder
code C97X1 was replaced by HCPCS code C9770. For CY 2021, we finalized
our proposal to create HCPCS code C9770 (Vitrectomy, mechanical, pars
plana approach, with subretinal injection of pharmacologic/biologic
agent), and we assigned this code to APC 1561 (New Technology--Level 24
($3001-$3500)) using the geometric mean cost of CPT code 67036. For CY
2022, we continued to assign HCPCS code C9770 to APC 1561 (New
Technology--Level 24 ($3001-$3500)) using the geometric mean cost of
CPT code 67036.
CY 2023 was the first year that claims data were available for
HCPCS code C9770; so we proposed and finalized a policy to base the
payment rate of HCPCS code C9770 on claims data for that code rather
than on the geometric mean cost of CPT code 67036. Given the low number
of claims for this procedure, we designated HCPCS code C9770 as a low
volume procedure under our universal low volume APC policy and used the
greater of the geometric mean, arithmetic mean, or median cost
calculated based on the available claims data to calculate an
appropriate payment rate for purposes of assigning HCPCS code C9770 to
a New Technology APC.
Based on the claims data available for the CY 2023 OPPS/ASC final
rule with comment period, we found the median was the statistical
methodology that estimated the highest cost for the service. The
payment rate calculated using this methodology fell within the cost
band for New Technology APC 1562 (New Technology--Level 25 ($3501-
$4000)). Therefore, we finalized our proposal to assign HCPCS code
C9770 to APC 1562 for CY 2023.
CPT code 0810T (Subretinal injection of a pharmacologic agent,
including vitrectomy and 1 or more retinotomies) will be effective July
1, 2023. We recognized the similarity between HCPCS code C9770 and CPT
code 0810T; therefore, we proposed to delete HCPCS code C9770 effective
December 31, 2023, and to recognize CPT code 0810T starting January 1,
2024. We proposed to determine the payment rate for the procedure using
the claims data for HCPCS code C9770. Similar to CY 2023, for CY 2024,
given that there are only 10 single frequency claims available for
ratesetting, we proposed to designate CPT code 0810T as a low volume
procedure under our universal low volume APC policy and to use the
greater of the geometric mean, arithmetic mean, or median cost
calculated based on the available claims data for HCPCS code C9770 to
calculate an appropriate payment rate for purposes of assigning CPT
code 0810T to a New Technology APC.
Using all available claims from the 4-year lookback period, we
determined the geometric mean cost to be $3,944, the arithmetic mean
cost to be $4,192, and the median cost to be $4,148. Because the
arithmetic mean is the statistical methodology that estimated the
highest cost for the service, we proposed to use this cost to determine
the New Technology APC placement. The arithmetic mean of $4,192 falls
within the cost band for New Technology APC 1563 (New Technology--Level
26 ($4001-$4500)). Therefore, we proposed to assign CPT code 0810T to
APC 1563 for CY 2024. Additionally, we proposed to perform a similar
analysis using updated claims data in the CY 2024 OPPS/ASC final rule
with comment period and update the APC placement as needed.
Please refer to Table 13 below for the proposed OPPS New Technology
APC and status indicator assignments for HCPCS code C9770 and CPT code
0810T for CY 2024. The proposed CY 2024 payment rates can be found in
Addendum B to the CY 2024 OPPS/ASC proposed rule via the internet on
the CMS website.
[[Page 81618]]
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Comment: We received three comments in support of our proposal to
delete HCPCS code C9770 and reassign CPT code 0810T to APC 1563 for CY
2024.
Response: We thank the commenters for their support. After
consideration of the public comment we received, we are finalizing our
policy as proposed. Specifically, we are finalizing our proposal to
delete HCPCS code C9770 and assign CPT code 0810T to APC 1563 (New
Technology--Level 26 ($4001-$4500)) for CY 2024. We are also finalizing
our proposal to designate CPT code 0810T as a low volume procedure
under our universal low volume APC policy and use the greater of the
geometric mean, arithmetic mean, or median cost calculated based on the
available claims data for HCPCS code C9770 to calculate an appropriate
payment rate for purposes of assigning CPT code 0810T to a New
Technology APC.
Based on updated claims data available for this final rule with
comment period from the 4-year lookback period, we found the geometric
mean cost for the service to be approximately $3,901.57, the arithmetic
mean cost to be approximately $4,129.91, and the median cost to be
approximately $4,141.06. The median was the statistical methodology
that estimated the highest cost for the service. The payment rate
calculated using this methodology falls within the cost band for New
Technology APC 1563 (New Technology--Level 26 ($4001-$4500)).
Therefore, we are assigning HCPCS code C9770 to APC 1563 for CY 2023.
Please refer to Table 14 below for the final OPPS New Technology APC
and status indicator assignments for HCPCS code C9770 and CPT code
0810T for CY 2024. The final CY 2024 payment rates can be found in
Addendum B to this final rule with comment period via the internet on
the CMS website.
[[Page 81619]]
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b. Bronchoscopy with Transbronchial Ablation of Lesion(s) by Microwave
Energy (APC 1562)
Effective January 1, 2019, CMS established HCPCS code C9751
(Bronchoscopy, rigid or flexible, transbronchial ablation of lesion(s)
by microwave energy, including fluoroscopic guidance, when performed,
with computed tomography acquisition(s) and 3-D rendering, computer-
assisted, image-guided navigation, and endobronchial ultrasound (EBUS)
guided transtracheal and/or transbronchial sampling (eg, aspiration[s]/
biopsy[ies]) and all mediastinal and/or hilar lymph node stations or
structures and therapeutic intervention(s)). This microwave ablation
procedure utilizes a flexible catheter to access the lung tumor via a
working channel and may be used as an alternative procedure to a
percutaneous microwave approach. Based on our review of the New
Technology APC application for this service and the service's clinical
similarity to existing services paid under the OPPS, we estimated the
likely cost of the procedure would be between $8,001 and $8,500.
In claims data available for CY 2019 for the CY 2021 OPPS/ASC final
rule with comment period, there were four claims reported for
bronchoscopy with transbronchial ablation of lesions by microwave
energy. Given the low volume of claims for the service, we proposed for
CY 2021 to apply the universal low volume APC policy we adopted in CY
2019, under which we utilize our equitable adjustment authority under
section 1833(t)(2)(E) of the Act to calculate the geometric mean,
arithmetic mean, and median costs to determine an appropriate payment
rate for purposes of assigning bronchoscopy with transbronchial
ablation of lesions by microwave energy to a New Technology APC. We
found the geometric mean cost for the service to be approximately
$2,693, the arithmetic mean cost to be approximately $3,086, and the
median cost to be approximately $3,708. The median was the statistical
methodology that estimated the highest cost for the service. The
payment rate calculated using this methodology fell within the cost
band for New Technology APC 1562 (New Technology--Level 25 ($3501-
$4000)). Therefore, we assigned HCPCS code C9751 to APC 1562 for CY
2021.
In CY 2022, we again used the claims data from CY 2019 for HCPCS
code C9751. Because the claims data was unchanged from when it was used
in CY 2021, the values for the geometric mean cost ($2,693), the
arithmetic mean cost ($3,086), and the median cost ($3,708) for the
service described by HCPCS code C9751 remained the same. The highest
cost metric using these methodologies was again the median and within
the cost band for New Technology APC 1562 (New Technology--Level 25
($3,501-$4,000)). Therefore, we continued to assign HCPCS code C9751 to
APC 1562 (New Technology--Level 25 ($3,501- $4,000)), with a payment
rate of $3,750.50 for CY 2022.
There were no claims reported in CY 2020, CY 2021, or CY 2022 for
HCPCS code C9751. Therefore, for CY 2024, the only available claims for
HCPCS code C9751 continue to be from CY 2019; and the reported claims
are the same claims used to calculate the payment rate for the service
in the CY 2021, CY 2022, and CY 2023 OPPS/ASC final rules with comment
period. Given the low number of claims for this procedure, we proposed
to continue to designate this procedure as a low volume procedure under
our universal low volume policy and use the highest of the geometric
mean cost, arithmetic mean cost, or median cost based on up to 4 years
of claims data to assign the procedure to the appropriate New
Technology APC. Because our proposal uses the same claims as we used
for CY 2021, CY 2022, and CY 2023, the same values for the geometric
mean cost, arithmetic mean cost, and the median cost are used to
propose a payment rate for CY 2024. Once again, the median ($3,708) was
the statistical methodology that estimated the highest cost for the
service. The payment rate calculated using this methodology continues
to fall within the cost band for New Technology APC 1562 (New
Technology--Level 25 ($3501-$4000)). Therefore, we proposed to continue
to assign HCPCS code C9751 to APC 1562 (New Technology--Level 25
($3501-$4000)), with a proposed payment rate of $3,750.50 for CY 2024.
Comment: We received one comment in support of our proposal to
continue to assign HCPCS code C9751 to APC 1562.
Response: We thank the commenter for their support. After
consideration of the public comment we received, we are finalizing our
policy as proposed. Please refer to Table 15 below for the final
[[Page 81620]]
OPPS New Technology APC and status indicator assignment for HCPCS code
C9751 for CY 2024. The final CY 2024 payment rates can be found in
Addendum B to this final rule with comment period via the internet on
the CMS website.
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c. Cardiac Positron Emission Tomography (PET)/Computed Tomography (CT)
Studies (APCs 1520, 1521, and 1522)
Effective January 1, 2020, we assigned three CPT codes (78431,
78432, and 78433) that describe the services associated with cardiac
PET/CT studies to New Technology APCs. CPT code 78431 was assigned to
APC 1522 (New Technology--Level 22 ($2001-$2500)) with a payment rate
of $2,250.50. CPT codes 78432 and 78433 were assigned to APC 1523 (New
Technology--Level 23 ($2501-$3000)) with a payment rate of $2,750.50.
We did not receive any claims data for these services for either of the
CY 2021 or CY 2022 OPPS proposed or final rules. Therefore, we
continued to assign CPT code 78431 to APC 1522 (New Technology--Level
22 ($2001-$2500)) with a payment rate of $2,250.50 in CY 2021 and CY
2022. Likewise, we continued to assign CPT codes 78432 and 78433 to APC
1523 (New Technology--Level 23 ($2501-$3000)) with a payment rate of
$2,750.50.
For CY 2023, we used CY 2021 claims data to determine the payment
rates for CPT codes 78431, 78432, and 78433. Based on our analysis of
the available claims data, for CY 2023, we assigned CPT code 78431 to
APC 1523 (New Technology--Level 23 ($2501-$3000)) with a payment rate
of $2,750.50; CPT code 78432 to APC 1520 (New Technology--Level 20
($1801-$1900)) with a payment rate of $1,850.50 based on the
application of the universal low-volume policy; and CPT code 78433 to
APC 1521 (New Technology--Level 21 ($1901-$2000)) with a payment rate
of $1,950.50.
For CY 2024, the OPPS payment rates were proposed to be based on
available CY 2022 claims data. CPT code 78431 had over 22,000 single
frequency claims in CY 2022. The geometric mean for CPT code 78431 was
approximately $2,300, which is an amount that is below the cost band
for APC 1523 (New Technology--Level 23 ($2501-$3000)), where the
procedure is currently assigned. We proposed, for CY 2024, that CPT
code 78431 be reassigned to APC 1522 (New Technology--Level 22 ($2001-
$2500)) with a payment rate of $2,250.50. Please refer to Table 16
below for the proposed New Technology APC and status indicator
assignments for CPT code 78431.
There were only six single frequency claims in CY 2022 for CPT code
78432. As this is below the threshold of 100 claims for a service
within a year, we proposed to apply our universal low volume APC policy
and use the highest of the geometric mean cost, arithmetic mean cost,
or median cost based on up to 4 years of claims data to assign CPT code
78432 to the appropriate New Technology APC. Using available claims
data from CY 2021 and CY 2022, our analysis found the geometric mean
cost of the service is approximately $1,658, the arithmetic mean cost
of the service is approximately $1,445, and the median cost of the
service is approximately $1,562. The geometric mean was the statistical
methodology that estimated the highest cost for the service. The
geometric mean cost of $1,658, is an amount that is below the cost band
for APC 1520 (New Technology--Level 20 ($1801-$1900)), where the
procedure is currently assigned. Therefore, we proposed, for CY 2024,
to assign CPT code 78432 to APC 1518 (New Technology--Level 18 ($1601-
$1700)) with a payment rate of $1,650.50. Please refer to Table G12 for
the proposed New Technology APC and status indicator assignments for
CPT code 78432.
There were over 1200 single frequency claims for CPT code 78433 in
CY 2022. The geometric mean for CPT code 78433 was approximately
$1,960, which is an amount that is within the cost band for APC 1521
(New Technology--Level 21 ($1901-$2000)), to which it is currently
assigned. Therefore, for CY 2024, we propose to continue to assign CPT
code 78433 to APC 1521 with a payment rate of $1,950.50.
Please refer to Table 16 below for the proposed OPPS New Technology
APC and status indicator assignment for CPT codes 78431, 78432, and
78433 for CY 2024. The proposed CY 2024 payment rates can be found in
Addendum B to the CY 2024 OPPS/ASC proposed rule via the internet on
the CMS website.
[[Page 81621]]
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Comment: We received several comments disagreeing with the proposed
payment rates for CPT codes 78431, 78432, and 78433. Several commenters
stated that the proposed APC assignments for 2024 are not consistent
with the resources needed to perform these services and requested that
CMS assign all three CPT codes to New Technology APC 1523 (New
Technology--Level 23 ($2501-$3000)). While commenters explained
differences between each service, commenters still requested that all
three codes be assigned to the same New Technology APC.
Response: We thank the commenters for their input on our proposal.
We do not agree that it would be appropriate to assign all three codes
describing the services associated with cardiac PET/CT studies to the
same New Technology APC. Since CPT codes 78431, 78432, and 78433 first
became effective on January 1, 2020, they have all been assigned to
different New Technology APCs based on the perceived resource
expenditures stemming from clinical differences in their code
descriptors. Since first receiving claims data for these codes for the
CY 2023 rulemaking cycle, there are differences between the codes in
terms of claims data and claims frequency that serve as further
evidence for the need for variations in New Technology APC assignments.
Additionally, public comments regarding the clinical and resource
differences between each code further underscore the need for different
New Technology APC assignments. Therefore, we are not accepting
commenters' suggestion to reverse course at this time and assign the
three codes describing different services associated with cardiac PET/
CT studies to the same New Technology APC.
Comment: Some commenters urged that CMS maintain stable payment
rates for three to five years to allow for
[[Page 81622]]
appropriate adoption and implementation of the cardiac PET/CT services.
Commenters explained that it takes time for hospitals to gain
experience with new codes and for providers to become aware of how to
appropriately bill new codes. Commenters pointed out that CPT codes
78431, 78432, and 78432 were made effective in 2020, which coincided
with the COVID-19 public health emergency, and explained that there are
still lingering effects of COVID-19 in terms of hospitals ordering and
implementing new technology.
Response: We note that we did not change the New Technology APC
assignments for CPT codes 78431, 78432, and 78433 between CY 2020
through CY 2022. Therefore, CPT codes 78431, 78432, and 78433 had the
exact same payment rate for three full calendar years. We believe that
the time that has already been provided is sufficient for interested
parties to educate providers on coding and for hospitals to
appropriately report the services performed. Additionally, it is
generally not our policy to judge the accuracy of provider coding and
charging for purposes of ratesetting. We rely on hospitals and
providers to accurately report the use of HCPCS codes in accordance
with their code descriptors, and CPT and CMS instructions, and to
report services accurately on claims and charges and costs for the
services on their Medicare hospital cost report.
Comment: Commenters strongly disagreed with the proposed APC
reassignment for CPT code 78432 from APC 1520 to APC 1518 for CY 2024,
and urged that CMS reassign CPT code 78432 to New Technology APC 1523,
the New Technology APC to which it was first assigned in CY 2020 when
there were no claims data yet available for the code. Commenters stated
that they believed that six single frequency claims is not sufficient
data to set payment rates for CPT code 78432. Other commenters
explained that CPT code 78432 uses more resources than CPT code 78431
and requested that CMS consider collecting additional claims data in CY
2024 for CPT code 78432 before proposing to make an APC reassignment.
Some commenters stated that they did not believe that it would benefit
hospitals to adjust APC assignments year to year. These commenters
stated that changes in APC assignments causes instability in payments
and angst for hospitals.
Response: We thank the commenters for their input, but note that
section 1833(t)(9)(A) of the Act requires that the Secretary review not
less often than annually and revise the groups, the relative payment
weights, and the wage and other adjustments to take into account, among
other things, new cost data. For services assigned to New Technology
APCs, as the OPPS acquires claims data regarding hospital costs
associated with new procedures, we regularly examine the claims data
and any available new information regarding the clinical aspects of new
procedures to confirm that our OPPS payments remain appropriate for
procedures as they transition into mainstream medical practice (77 FR
68314). Therefore, we do not agree with commenters' suggestions that we
should not regularly update the APC assignments for services like
cardiac PET/CT.
With that said, we are sympathetic to comments regarding the
instability of the payment rate for CPT code 78432 if we were to
finalize its proposed APC assignment based on the extremely limited
number of claims that exist for the code. While there have been 2 more
claims processed for CPT code 78432 since the time of the publication
of the CY 2024 OPPS/ASC proposed rule, the claims frequency for CPT
code 78432 remains extremely low at only 7 claims. As we have stated
previously, low utilization of services assigned to a New Technology
APC can lead to wide variation in payment rates from year to year,
resulting in even lower utilization and potential barriers to access to
new technologies, which in turn limits our ability to assign the
service to an appropriate clinical APC (83 FR 58893). In order to
mitigate the wide payment fluctuations that have occurred for new
technology services with fewer than 100 claims and to provide more
predictable payment for these services, in the CY 2019 OPPS/ASC final
rule with comment period (83 FR 58893) we established that, in each of
our annual rulemakings, we would seek public comments on which
statistical methodology (arithmetic mean, geometric mean, or median)
should be used for each low-volume service assigned to a New Technology
APC. In addition, we explained that we would use our assessment of the
resources used to perform a service and guidance from the developer or
manufacturer of the service, as well as other stakeholders, to
determine the most appropriate payment rate. For CY 2022, we proposed
to continue to utilize our equitable adjustment authority under section
1833(t)(2)(E) of the Act to calculate the geometric mean, arithmetic
mean, and median using up to 4 years of claims data to select the
appropriate payment rate for purposes of assigning services with fewer
than 100 claims per year to a New Technology APC. Because there were
fewer than 100 claims per year for CPT code 78432, we would usually
apply our universal low volume APC policy to determine its New
Technology APC assignment.
However, we recognize that if we utilized our universal low volume
APC policy to establish a New Technology APC assignment for CY 2024 for
CPT 78432, the same negative impacts caused by wide variations in
payment rate that we sought to mitigate by adopting the universal low
volume APC policy would result if we assigned CPT 78432 to the APC we
proposed based on our universal low volume APC policy. While some
payment fluctuations are expected and would not justify deviating from
applying our universal low volume APC policy or making regular
ratesetting changes, we have concerns that if we were to apply the
universal low volume APC policy in this case to CPT code 78432 as
proposed, we would see even lower utilization of CPT code 78432
compared to CPT codes 78431 and 78433, which have seen steady claims
frequency increases since first being assigned to New Technology APCs.
For example, for the CY 2023 OPPS/ASC final rule, we assigned CPT code
78431 to New Technology APC 1523 based on over 18,000 claims and CPT
code 78433 to APC 1521 based on nearly 1,000 claims. For CY 2024, the
claims volumes for both CPT code 78431 and 78433 have continued to
increase to over 24,000 and 1,300 claims respectively, while
utilization for CPT code 78432 has remained extremely limited.
Specifically, there are only two more claims, 7 total, that we can use
to set the payment rate for CPT code 78432 for CY 2024 compared to CY
2023. Because CPT code 78432 is one of three codes that describe the
services associated with cardiac PET/CT studies, we have concerns that
continued low claims frequency for CPT code 78432 will limit our
ability to assign the service to an appropriate clinical APC. We
believe that changing the APC payment rate based on an extremely low
number of claims for CPT code 78432 for CY 2024 would further
discourage utilization of the code as compared to CPT codes 78431 and
78433. While it is possible that patients may have a greater need for
the services described by CPT code 78431 or 78433 rather than the
service described by CPT code 78432, such that claims volume may always
be lower for CPT code 78432 than the other codes describing cardiac
PET/CT imaging
[[Page 81623]]
services, we would not want to make a change in payment that may
further discourage utility of CPT code 78432 without first confirming
that this is the case. Furthermore, we did not receive any comments on
our proposal that explained that the service described by CPT code
78432 should only be furnished in extremely rare circumstances compared
to CPT codes 78431 and 78433. Therefore, for CY 2024, we believe it is
appropriate to utilize our equitable adjustment authority under section
1833(t)(2)(E) of the Act to maintain the New Technology APC assignment
for CPT code 78432 as finalized in the CY 2023 OPPS Final Rule for one
additional year by assigning the code to New Technology APC 1520.
Comment: Several commenters also disagreed with the proposal to
reassign CPT code 78431 from APC 1523 to APC 1522 based on the claims
data available. Although one commenter stated that with over 22,000
claims considered for CPT code 78431, the proposed APC payment for CPT
code 78431 appears to be based on a large volume of information and
appears to be reliable, the commenter disagreed with the proposal due
to the impact a $500 reduction in payment rate may have on service
lines.
Response: We disagree that it is inappropriate to change the APC
assignment for CPT code 78431 based on the claims available. We based
our proposal on over 22,000 claims for CPT code 78431, which
demonstrate that the code had a geometric mean cost of approximately
$2,300. Since the publication of the CY 2024 OPPS proposed rule (88 FR
49552), there are over 2,000 additional claims available for rate
setting for CPT code 78431 for CY 2024. With the significant number of
claims available for CPT code 78431, we believe it is appropriate to
modify the APC assignment for CPT code 78431 based on our claims data
for CY 2024.
Comment: Some commenters suggested that CMS consider alternatives
to making adjustments in payment rates for services assigned to New
Technology APCs that would allow for greater stability and
predictability in payment rates from year to year. For example, one
commenter suggested that CMS consider creating New Technology APCs with
narrower cost bands between each APC or utilize several years of cost
data--not unlike the low volume APC policy--to smooth the potential for
large fluctuations.
Response: We appreciate the commenters' feedback and will consider
the suggestions for future rulemaking.
Based on the comments received, we are finalizing our proposals for
CPT codes 78431, 78432, and 78433 with modification. For CY 2024, we
are finalizing the APC assignments for CPT codes 78431 and 78433 as
proposed. Therefore, for CY 2024, we are assigning CPT code 78431 to
New Technology APC 1522 and CPT code 78433 to New Technology APC 1521,
as proposed. For CPT code 78432, we are invoking our equitable
adjustment authority under section 1833(t)(2)(E) of the Act to maintain
the New Technology APC assignment for CPT code 78432 as finalized in
the CY 2023 OPPS final rule for an additional year. Therefore, we are
assigning CPT code 78432 to APC 1520 for CY 2024.
Please refer to Table 17 below for the final OPPS New Technology
APC and status indicator assignments for CPT codes 7843, 78432, and
78433 for CY 2024. The final CY 2024 payment rates can be found in
Addendum B to this final rule with comment via the internet on the CMS
website.
BILLING CODE 4150-28-P
[[Page 81624]]
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d. V-Wave Medical Interatrial Shunt Procedure (APC 1590)
A randomized, double-blinded, controlled IDE study is currently in
progress for the V-Wave interatrial shunt. The V-Wave interatrial shunt
is for patients with severe symptomatic heart failure and is designed
to regulate left atrial pressure in the heart. All participants who
passed initial screening for the study receive a right heart
catheterization procedure described by CPT code 93451 (Right heart
catheterization including measurement(s) of oxygen saturation and
cardiac output, when performed). Participants assigned to the
experimental group also receive the V-Wave interatrial shunt procedure
while participants assigned to the control group only receive right
heart catheterization. The developer of V-Wave was concerned that the
current coding of these services by Medicare would reveal to the study
participants whether they had received the interatrial shunt because an
additional procedure code, CPT code 93799 (Unlisted cardiovascular
service or procedure), would be included on the claims for participants
receiving the interatrial shunt. Therefore, for CY 2020, we created a
temporary HCPCS code to describe the V-Wave interatrial shunt procedure
for both the experimental group and the control group in the study.
Specifically, we established HCPCS code C9758 (Blinded procedure for
NYHA class III/IV heart failure; transcatheter implantation of
interatrial shunt or placebo control, including right heart
catheterization,
[[Page 81625]]
trans-esophageal echocardiography (TEE)/intracardiac echocardiography
(ICE), and all imaging with or without guidance (e.g., ultrasound,
fluoroscopy), performed in an approved investigational device exemption
(IDE) study) to describe the service, and we assigned the service to
New Technology APC 1589 (New Technology--Level 38 ($10,001-$15,000))
with a payment rate of $12,500.50.
In the CY 2021 OPPS/ASC final rule with comment period (85 FR
85946), we stated that we believe similar resources and device costs
are involved with the V-Wave interatrial shunt procedure and the Corvia
Medical interatrial shunt procedure (HCPCS code C9760), except that
payment for HCPCS codes C9758 and C9760 differs based on how often the
interatrial shunt is implanted when each code is billed. An interatrial
shunt is implanted one-half of the time HCPCS code C9758 is billed,
whereas an interatrial shunt is implanted every time HCPCS code C9760
is billed. Accordingly, for CY 2021, we reassigned HCPCS code C9758 to
New Technology APC 1590 (New Technology--Level 39 ($15,001-$20,000)),
which reflects the cost of receiving the interatrial shunt one-half of
the time the procedure is performed.
For CY 2022, we used the same claims data from CY 2019 that we did
for the CY 2021 OPPS final rule with comment period. Because there were
no claims reporting HCPCS code C9758, we continued to assign HCPCS code
C9758 to New Technology APC 1590 with a payment rate of $17,500.50 for
CY 2022. For CY 2023 we used claims data from CY 2019 through CY 2022.
Because there were no claims reporting HCPCS code C9758, we continued
to assign HCPCS code C9758 to New Technology APC 1590 with a payment
rate of $17,500.50 for CY 2023.
For CY 2024, the OPPS payment rates are proposed to be based on
available CY 2022 claims data. Although HCPCS code C9758 was effective
January 1, 2020, we have no claims data at this time. Because we have
no claims data, for CY 2024, we proposed to continue to assign HCPCS
code C9758 to New Technology APC 1590 with a proposed payment rate of
$17,500.50.
Please refer to Table 18 below for the proposed OPPS New Technology
APC and status indicator assignment for HCPCS code C9758 for CY 2024.
The proposed CY 2024 payment rates can be found in Addendum B to the CY
2024 OPPS/ASC proposed rule via the internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.036
Comment: We received one comment on our proposal. The commenter
supports our assignment of HCPCS code C9758 to APC 1590 for CY 2024.
Response: We appreciate the commenter's support for our proposal.
After consideration of the public comments we received, we are
finalizing our proposal without modification. Please refer to Table 19
below for the final OPPS New Technology APC and status indicator
assignments for HCPCS code C9758 for CY 2024. The final CY 2024 payment
rates can be found in Addendum B to this final rule with comment via
the internet on the CMS website.
BILLING CODE 4150-28-C
[[Page 81626]]
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e. Corvia Medical Interatrial Shunt Procedure (APC 1592)
On July 1, 2020, we established HCPCS code C9760 (Non-randomized,
non-blinded procedure for nyha class ii, iii, iv heart failure;
transcatheter implantation of interatrial shunt or placebo control,
including right and left heart catheterization, transeptal puncture,
trans-esophageal echocardiography (tee)/intracardiac echocardiography
(ice), and all imaging with or without guidance (e.g., ultrasound,
fluoroscopy), performed in an approved investigational device exemption
(ide) study) to facilitate payment for the implantation of the Corvia
Medical interatrial shunt.
As we stated in the CY 2021 OPPS final rule with comment period (85
FR 85947), we believe that similar resources and device costs are
involved with the Corvia Medical interatrial shunt procedure and the V-
Wave interatrial shunt procedure. But unlike the V-Wave interatrial
shunt, which is implanted half the time the associated interatrial
shunt procedure described by HCPCS code C9758 is billed, the Corvia
Medical interatrial shunt is implanted every time the associated
interatrial shunt procedure (HCPCS code C9760) is billed. Therefore,
for CY 2021, we assigned HCPCS code C9760 to New Technology APC 1592
(New Technology--Level 41 ($25,001-$30,000)) with a payment rate of
$27,500.50. We also modified the code descriptor for HCPCS code C9760
to remove the phrase ``or placebo control,'' from the descriptor. In CY
2022, we used the same claims data as was used in the CY 2021 OPPS
final rule to determine the payment rate for HCPCS code C9760 because
there were no claims for this service in CY 2019, the year used for
ratesetting for CY 2022. Accordingly, we continued to assign HCPCS code
C9760 to New Technology APC 1592 in CY 2022. For CY 2023, we used
claims data from CY 2021 through CY 2022 to determine the payment rate
for HCPCS code C9760. Because there were no claims for this service, we
continued to assign HCPCS code C9760 to New Technology APC 1592 in CY
2023.
For CY 2024, the OPPS payment rates were proposed to be based on
available CY 2022 claims data. There was only one claim for HCPCS code
C9760 within this time period. As this is below the threshold of 100
claims for a service within a year, we would designate C9760 as a low
volume service and apply our universal low volume APC policy. Under
this policy, we would use the highest of the geometric mean cost,
arithmetic mean cost, or median cost based on up to 4 years of claims
data to assign HCPCS code C9760 to the appropriate New Technology APC.
Using the only one claim available for HCPCS code C9760, the geometric
mean, arithmetic mean, and median costs were estimated to be
approximately $7,945 for this service. However, because there is only a
single claim for HCPCS code C9760, its payment rate appears to be an
outlier based on the cost information we received from the
manufacturer. Therefore, we have concerns that the
[[Page 81627]]
universal low volume APC policy calculations do not accurately capture
the cost of the service. Therefore, we proposed to continue assigning
HCPCS code C9760 to New Technology APC 1592.
Please refer to Table 20 below for the proposed OPPS New Technology
APC and status indicator assignment for HCPCS code C9760 for CY 2024.
The proposed CY 2024 payment rates can be found in Addendum B to the CY
2024 OPPS/ASC proposed rule via the internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.038
Comment: We received one comment on our proposal. The commenter
expressed support for finalizing the New Technology APC assignment as
proposed. The commenter stated that continuing the current APC
assignments is critical to ensure that HCPCS codes C9758 and C9760 can
be furnished during ongoing CMS-approved IDE trials. The commenter
further stated that the proposed APC assignment for HCPCS code C9760
will enable studies to proceed, preserve beneficiary access, and allow
a more robust claims history to be developed on which to base permanent
clinical APC assignment in the future.
Response: We appreciate the commenter's support for our proposal to
assign HCPCS code C9760 to APC 1592.
First, we note that based on update claims data available for this
final rule with comment period, we received one additional claim for CY
2022 since the publication of the CY 2024 OPPS proposed rule. Using the
only two claims available for HCPCS code C9760, the geometric mean,
arithmetic mean, and median costs are estimated to be approximately
$10,520 for this service. However, because there are only two claims
for HCPCS code C9760, we continue to believe its payment rate appears
to be an outlier based on the cost information we received from the
manufacturer. We continue to have concerns that application of the
universal low volume APC policy in this case would not accurately
capture the cost of the service. Therefore, after consideration of the
public comment we received and our analysis of the extremely limited
claims data available, we are finalizing our policy as proposed.
Specifically, we are finalizing our proposal to assign HCPCS code C9760
to APC 1592 New Technology--Level 41 ($25,001-$30,000) for CY 2024.
After consideration of the public comment we received, we are
finalizing our proposal without modification. Please refer to Table 21
below for the final OPPS New Technology APC and status indicator
assignments for HCPCS code C9760 for CY 2024. The CY 2024 payment rates
can be found in Addendum B to this final rule with comment period via
the internet on the CMS website.
[[Page 81628]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.039
f. Supervised Visits for Esketamine Self-Administration (APCs 1513 and
1520)
On March 5, 2019, FDA approved SpravatoTM (esketamine)
nasal spray, used in conjunction with an oral antidepressant, for
treatment of depression in adults who have tried other antidepressant
medicines but have not benefited from them (treatment-resistant
depression (TRD)). This is the first FDA approval of esketamine for any
use.
Esketamine is a noncompetitive N-methyl D-aspartate (NMDA) receptor
antagonist. It is a nasal spray supplied as an aqueous solution of
esketamine hydrochloride in a vial with a nasal spray device. Each
device delivers two sprays containing a total of 28 mg of esketamine.
Patients would require either two (2) devices (for a 56 mg dose) or
three (3) devices (for an 84 mg dose) per treatment.
Because of the risk of serious adverse outcomes resulting from
sedation and dissociation caused by esketamine nasal spray
administration, and the potential for misuse or abuse of the product,
it is only available through a restricted distribution system under a
Risk Evaluation and Mitigation Strategy (REMS). A REMS is a drug safety
program that the FDA can require for certain medications with serious
safety concerns to help ensure the benefits of the medication outweigh
its risks. The SpravatoTM REMS program requires the
esketamine nasal spray to be dispensed and administered to enrolled
patients in health care settings that are certified in the REMS. See
www.fda.gov for more information regarding the SpravatoTM
REMS program compliance requirements.
A treatment session of esketamine consists of instructed nasal
self-administration by the patient followed by a period of at least two
(2) hours post-administration observation of the patient under direct
supervision of a health care professional in the certified health care
setting. Please refer to the CY 2020 PFS final rule and interim final
rule for more information about supervised visits for esketamine nasal
spray self-administration (84 FR 63102 through 63105).
To facilitate prompt beneficiary access to the new, potentially
life-saving treatment for TRD using esketamine, we created two new
HCPCS G codes, G2082 and G2083, effective January 1, 2020. HCPCS code
G2082 is for an outpatient visit for the evaluation and management of
an established patient that requires the supervision of a physician or
other qualified health care professional and provision of up to 56 mg
of esketamine through nasal self-administration and includes two hours
of post-administration observation. For CY 2020, HCPCS code G2082 was
assigned to New Technology APC 1508 (New Technology--Level 8 ($601-
$700)) with a payment rate of $650.50. HCPCS code G2083 describes a
similar service to HCPCS code G2082 but involves the administration of
more than 56 mg of esketamine. For CY 2020, HCPCS code G2083 was
assigned to New Technology APC 1511 (New Technology--Level 11 ($901-
$1,000)) with a payment rate of $950.50. Updates to the APC assignments
for G2082 and G2083 have been made in past rules. Please see the CY
2021 OPPS/ASC final rule with comment period (85 FR 85948), CY 2022
OPPS/ASC final rule with comment period (86 FR 63538), and the CY 2023
OPPS/ASC final rule with comment period (87 FR 71816).
For CY 2024, we proposed to use CY 2022 available claims data to
determine the payment rates for HCPCS codes G2082 and G2083. Therefore,
for CY 2024, we proposed to assign these two HCPCS codes to New
Technology APCs based on the codes' geometric mean costs. Specifically,
we proposed to assign HCPCS code G2082 to New Technology APC 1513 (New
Technology--Level 13 ($1,101-$1,200)) based on its geometric mean cost
of $1,123. We also proposed to assign HCPCS code G2083 to New
Technology
[[Page 81629]]
APC 1518 (New Technology--Level 18 ($1,601-$1,700)) based on its
geometric mean cost of $1,628.
The proposed New Technology APC and status indicator assignments
for HCPCS codes G2082 and G2083 are shown in Table 22. The CY 2024
payment rates can be found in Addendum B to this final rule with
comment period via the internet on the CMS website.
BILLING CODE 4150-28-P
[GRAPHIC] [TIFF OMITTED] TR22NO23.040
Comment: We received one comment in support of our proposals to
assign HCPCS code G2082 to APC 1513 and HCPCS code G2083 to APC 1518.
Response: We thank the commenter for their support.
We note the geometric mean costs for both HCPCS code G2082 and
HCPCS code G2083 have changed since the proposed rule. Based on the
updated claims data available for this final rule, the approximate
geometric mean cost for HCPCS code G2082 is $1,189.24. Even though the
geometric mean cost has increased slightly since the proposed rule, the
proposed APC assignment of APC 1513 (New Technology--Level 13 ($1,101-
$1,200)) is still appropriate and we are adopting this APC assignment
as the final APC assignment for this HCPCS code G2082. Based on updated
claims data available for this final rule with comment period, the
approximate geometric mean cost for HCPCS code G2083 has increased to
$1,821.48. Based on the updated claims available, we are finalizing a
New Technology APC assignment for HCPCS code G2083 to APC 1520 (New
Technology--Level 20 ($1,801-$1,900)) for CY 2024.
As a final note, as we have begun to gather adequate claims data,
we are considering placement of HCPCS codes G2082 and G2083 into
clinical APCs through future rulemaking.
Details about the New Technology APC and status indicator
assignments for these HCPCS codes are shown in Table 23. The CY 2024
payment rates can be found in Addendum B to this final rule with
comment period via the internet on the CMS website.
[[Page 81630]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.041
BILLING CODE 4150-28-C
g. DARI Motion Procedure (APC 1505)
Effective January 1, 2022, CPT code 0693T (Comprehensive full body
computer-based markerless 3D kinematic and kinetic motion analysis and
report) is associated with the DARI Motion Procedure, a service that
provides human motion analysis to aid clinicians in pre- and post-
operative surgical intervention and in making other treatment
decisions, including selecting the best course of physical therapy and
rehabilitation. The technology consists of eight cameras that surround
a patient, which send live video to a computer workstation that
analyzes the video to create a 3D reconstruction of the patient without
the need for special clothing, markers, or devices attached to the
patient's clothing or skin. For CY 2022, we assigned CPT code 0693T to
New Technology APC 1505 (New Technology--Level 5 ($301-$400)). For CY
2023, the OPPS payment rates were based on claims submitted between
January 1, 2021, and December 31, 2021, processed through June 30,
2022. Due to its effective date of January 1, 2022, there were no
claims available for CPT code 0693T for rate setting in CY 2023.
Therefore, in CY 2023, we continued to assign CPT code 0693T to New
Technology APC 1505.
For CY 2024, the OPPS payment rates are proposed to be based on
available CY 2022 claims data. Although CPT code 0693T was effective
January 1, 2022, we did not have any claims data at the time of the CY
2024 OPPS/ASC proposed rule. Therefore, for CY 2024, we proposed to
continue to assign CPT code 0693T to APC 1505 with a proposed payment
rate of $350.50.
Please refer to Table 24 below for the proposed OPPS New Technology
APC and status indicator assignment for CPT code 0693T for CY 2024. The
proposed CY 2024 payment rates can be found in Addendum B to the CY
2024 OPPS/ASC proposed rule via the internet on the CMS website.
[[Page 81631]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.042
We did not receive any public comments on our proposal, and we
still do not have any claims for the service. Therefore, for CY 2024,
we are finalizing our proposal without modification. Specifically, for
CY 2024, we are assigning CPT code 0693T to APC 1505 and SI ``S.'' The
final New Technology APC and status indicator assignments for CPT code
0693T for CY 2024 are found in Table 25. The CY 2024 payment rates can
be found in Addendum B to this final rule with comment period via the
internet on the CMS website. In addition, we refer readers to Addendum
D1 of this final rule with comment period for the status indicator (SI)
meanings for all codes reported under the OPPS. Addendum D1 can also be
found via the internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.043
h. Liver Histotripsy Service (APC 1576)
CPT code 0686T (Histotripsy (i.e., non-thermal ablation via
acoustic energy delivery) of malignant hepatocellular tissue, including
image guidance) was first effective July 1, 2021, and describes the
histotripsy service associated with the use of the HistoSonics system.
Histotripsy is a non-invasive, non-thermal, mechanical process that
uses a focused beam of sonic energy to destroy cancerous liver tumors
and is currently in a non-randomized, prospective clinical trial to
evaluate the efficacy and safety of the device for the treatment of
primary or metastatic tumors located in the liver.\8\ When HCPCS code
0686T was first effective, the histotripsy procedure was designated as
a Category A IDE clinical study (NCT04573881). Since devices in
Category A IDE studies are excluded from Medicare payment, payment for
CPT code 0686T only reflected the cost of the service that is performed
each time it is reported on a claim. For CY 2023, we assigned CPT code
0686T to New Technology APC 1575 (New Technology--Level 38 ($10,000-
$15,000) with a payment rate of $12,500. However, on March 2, 2023, the
histotripsy IDE clinical study was re-designated as a Category B (Non-
experimental/Investigational) IDE study. Due to this new designation,
the proposed payment for CPT code 0686T in CY 2024 would reflect
payment for both the service that is performed and the device used each
time it is reported on a claim.
---------------------------------------------------------------------------
\8\ ClinicalTrials.gov. ``The HistoSonics System for Treatment
of Primary and Metastatic Liver Tumors Using Histotripsy
(HOPE4LIVER) (HOPE4LIVER).'' Accessed May 10,
2022. https://clinicaltrials.gov/ct2/show/study/NCT04573881.
---------------------------------------------------------------------------
For CY 2024, the OPPS payment rates are proposed to be based on
available CY 2022 claims data. There are only two claims for CPT code
0686T within this time period. We note that 0686T was still designated
as a Category A IDE study for these claims and therefore, the payment
for these claims only included payment for the cost of the service. As
the available claims data is below the threshold of 100 claims for a
service within a year, we could propose to designate CPT code 0686T as
a low volume service under our universal low volume APC policy, and use
the highest of the geometric mean cost, arithmetic mean cost, or median
cost to assign CPT code 0686T to the appropriate New Technology APC.
Based on the two available claims in CY 2022, when CPT
[[Page 81632]]
code 0686T was still designated as a Category A IDE study, the
geometric mean is estimated to be: $4,466; the median is estimated to
be: $4,480; and the arithmetic mean is estimated to be: $4,480. Because
$4,480 is the greatest of these methodologies, we would use this value
to set the payment rate for CPT code 0686T. However, we have concerns
that the available claims data and universal low volume APC policy
calculations would not accurately capture the cost of the service
following its approval as a Category B IDE study in March of 2023. If
0686T were still designated as a Category A IDE study, then the two
claims available would be appropriate to set its payment rate, as the
claims reflect the cost of the service and exclude the cost of the
device. However, because CPT code 0686T was approved as a Category B
IDE study, meaning Medicare coverage and payment of the device is no
longer statutorily prohibited, the two CY 2022 claims available would
not accurately capture the cost of 0686T for CY 2024.
Therefore, based on the service costs reflected in the available
claims and our estimates of the cost of the Category B device, for CY
2024, we proposed to maintain CPT code 0686T's current APC assignment.
Specifically, we proposed to assign CPT code 0686T to APC 1575 (New
Technology--Level 38 ($10,001-$15,000)) with a payment rate of
$12,500.50 as shown in Table 26.
[GRAPHIC] [TIFF OMITTED] TR22NO23.044
Comment: Two commenters, including the developer of the liver
histotripsy procedure have asked us to reassign CPT code 0686T to APC
1577 (New Technology--Level 40 ($20,001-$25,000)) with a payment rate
of $22,500.50 because on March 2, 2023, the FDA changed the device
classification to a Category B IDE study, which allows a device that is
used in the medical procedure to receive additional payment. The
developer stated that the cost of the device used in the procedure was
around $7,500 and asked us to assign the liver histotripsy to a higher-
paying new technology APC cost band that would reflect the cost of both
the procedure and the device used in the procedure.
Response: We agree with the commenters that payment for CPT code
0686T should be increased to reflect that providers participating the
Category B IDE study for the procedure may now receive payment for both
the services provided and the device used to perform the procedure
described by CPT code 0686T. However, we do not believe that a $10,000
payment increase for the procedure is supported by the data when the
device only costs $7,500 and there are only two claims for the service.
Therefore, we are assigning CPT code 0686T to APC 1576 (New
Technology--Level 39 ($15,001-$20,000)) with a payment rate of
$17,500.50.
HCPCS code 0686T (Histotripsy (that is, non-thermal ablation via
acoustic energy delivery) of malignant hepatocellular tissue, including
image guidance) will be assigned to APC 1576 (New Technology--Level 39
($15,001-$20,000)) with a payment rate of $17,500.50. Please refer to
Table 27 below for the OPPS New Technology APC and status indicator
assignment for CPT code 0686T for CY 2024. The final CY 2024 payment
rates can be found in Addendum B to this final rule via the internet on
the CMS website.
[[Page 81633]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.045
i. Liver Multiscan Service (APC 1511)
Effective July 1, 2021, CPT codes 0648T (Quantitative magnetic
resonance for analysis of tissue composition (e.g., fat, iron, water
content), including multiparametric data acquisition, data preparation
and transmission, interpretation and report, obtained without
diagnostic mri examination of the same anatomy (e.g., organ, gland,
tissue, target structure) during the same session; single organ) and
0649T (Quantitative magnetic resonance for analysis of tissue
composition (e.g., fat, iron, water content), including multiparametric
data acquisition, data preparation and transmission, interpretation and
report, obtained with diagnostic mri examination of the same anatomy
(e.g., organ, gland, tissue, target structure); single organ (list
separately in addition to code for primary procedure)) are associated
with the Liver MultiScan service. LiverMultiScan is a Software as a
medical Service (SaaS) that is intended to aid the diagnosis and
management of chronic liver disease, the most prevalent of which is
Non-Alcoholic Fatty Liver Disease (NAFLD). It provides standardized,
quantitative imaging biomarkers for the characterization and assessment
of inflammation, hepatocyte ballooning, and fibrosis, as well as
steatosis, and iron accumulation. LiverMultiScan receives MR images
acquired from patients' providers and analyzes the images using their
proprietary Artificial Intelligence (AI) algorithms. It then sends the
providers a quantitative metric report of the patient's liver fibrosis
and inflammation. For CY 2023, we assigned CPT codes 0648T and 0649T to
New Technology APC 1511 (New Technology--Level 11 ($901-$1,000) with a
payment rate of $950.50.
For CY 2024, the OPPS payment rates are proposed to be based on
available CY 2022 claims data. We identified only 39 claims each for
CPT code 0648T and CPT code 0649T during this time period. As this is
below the threshold of 100 claims for a service within a year, we
proposed to apply our universal low volume APC policy and use the
highest of the geometric mean cost, arithmetic mean cost, or median
cost based on up to 4 years of claims data to assign CPT codes 0648T
and 0649T to the appropriate New Technology APC. There are available
claims data from CY 2021 and CY 2022 for CPT codes 0648T and 0649T. Our
analysis of the data for CPT code 0648T found the geometric mean cost
of the service is approximately $269, the arithmetic mean cost of the
service is approximately $320, and the median cost of the service is
approximately $313. Our analysis of the data for CPT code 0649T found
the geometric mean cost of the service is approximately $102, the
arithmetic mean cost of the service is approximately $136, and the
median cost of the service is approximately $83. The arithmetic mean
was the statistical methodology that estimated the highest cost for CPT
codes 0648T and 0649T. In accordance with our SaaS Add-on Codes policy
(87 FR 72032 and 72033), SaaS CPT add-on codes are assigned to the
identical APCs and the same status indicator assignments as their
standalone codes. Consistent with our SaaS Add-on Codes policy, CPT
code 0649T, the add-on code for Liver MultiScan would be assigned to
the identical APC and status indicator to CPT code 0648T, the
standalone code for the same service. Therefore, we proposed, for CY
2024, to assign CPT codes 0648T and 0649T to APC 1505 (New Technology--
Level 5 ($301-$400)) with a payment rate of $350.50 as shown in Table
28.
BILLING CODE 4150-28-P
[[Page 81634]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.046
Comment: Multiple commenters asked that we not change the APC
assignment for both Liver Multiscan procedures. Many commenters stated
that the cost of each of the services is at least $950, which is the
current payment rate for these services. Other commenters noted that
only 40 claims have been received for each service, which they believe
is an insufficient number of claims to estimate the cost for these
services.
Response: We recognize that software-based technologies are rapidly
evolving, like the product used for both CPT code 0648 and CPT code
0649T. As noted in our comment solicitation on payment policy for
software as a service (SaaS) procedures in the CY 2023 OPPS final rule
(87 FR 72035 and 72036), we are considering for future rulemaking
whether specific adjustments to payment policies and rate calculations
are necessary to more accurately and appropriately pay for these
products and services across settings of care. CMS remains open to
feedback on these issues and welcomes engagement from interested
parties, including from manufacturers, providers, and beneficiaries. We
agree with the commenters that for both CPT code 0648 and CPT code
0649T, we should wait for more claims data before adjusting the current
payment rates for these services.
Comment: One commenter supported our proposal because it would help
lower the cost of non-invasive liver evaluations performed for liver
fibrosis and liver fat quantification by encouraging providers to use a
broader array of diagnostic approaches.
Response: We appreciate the support of the commenter for our
original proposal, but we are adopting a final policy not to change the
payment rates for CPT code 0648T and CPT code 0649T in CY 2024.
After consideration of the public comments we received, we are
implementing our proposal with modifications. We will use our equitable
adjustment authority under section 1833(t)(2)(E) to continue to assign
CPT codes 0648T and 0649T to New Technology APC 1511 (New Technology--
Level 11 ($901-$1,000) with a payment rate of $950.50. Please refer to
Table 29 below for the final OPPS New Technology APC and status
indicator assignments for CPT codes 0648T and 0649T for CY 2024. The
final CY 2024 payment rates can be found in Addendum B to this final
rule via the internet on the CMS website.
[[Page 81635]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.047
BILLING CODE 4150-28-C
j. Minimally Invasive Glaucoma Surgery (MIGS) (APC 5493)
Prior to CY 2022, extracapsular cataract removal with insertion of
intraocular lens was reported using CPT codes describing cataract
removal alongside a CPT code for device insertion. Specifically, the
procedure was described using CPT codes 66982 (Extracapsular cataract
removal with insertion of intraocular lens prosthesis (1-stage
procedure), manual or mechanical technique (e.g., irrigation and
aspiration or phacoemulsification), complex, requiring devices or
techniques not generally used in routine cataract surgery (e.g., iris
expansion device, suture support for intraocular lens, or primary
posterior capsulorrhexis) or performed on patients in the amblyogenic
developmental stage; without endoscopic cyclophotocoagulation) or 66984
(Extracapsular cataract removal with insertion of intraocular lens
prosthesis (1-stage procedure), manual or mechanical technique (e.g.,
irrigation and aspiration or phacoemulsification); without endoscopic
cyclophotocoagulation) and 0191T (Insertion of anterior segment aqueous
drainage device, without extraocular reservoir, internal approach, into
the trabecular meshwork; initial insertion).
For CY 2022, the AMA's CPT Editorial Panel created two new Category
I CPT codes describing extracapsular cataract removal with insertion of
intraocular lens prosthesis, specifically, CPT codes 66989
(Extracapsular cataract removal with insertion of intraocular lens
prosthesis (1-stage procedure), manual or mechanical technique (e.g.,
irrigation and aspiration or phacoemulsification), complex, requiring
devices or techniques not generally used in routine cataract surgery
(e.g., iris expansion device, suture support for intraocular lens, or
primary posterior capsulorrhexis) or performed on patients in the
amblyogenic developmental stage; with insertion of intraocular (e.g.,
trabecular meshwork, supraciliary, suprachoroidal) anterior segment
aqueous drainage device, without extraocular reservoir, internal
approach, one or more) and 66991 (Extracapsular cataract removal with
insertion of intraocular lens prosthesis (1 stage procedure), manual or
mechanical technique (e.g., irrigation and aspiration or
phacoemulsification); with insertion of intraocular (e.g., trabecular
meshwork, supraciliary, suprachoroidal) anterior segment aqueous
drainage device, without extraocular reservoir, internal approach, one
or more); deleted a Category III CPT code, specifically, CPT code
0191T, describing insertion of anterior segment aqueous drainage
device; and created a new Category III CPT code, specifically, CPT code
0671T, describing anterior segment aqueous drainage device without
concomitant cataract removal.
For CY 2022, we finalized the assignment of CPT codes 66989 and
66991 to New Technology APC 1563 (New Technology--Level 26 ($4,001-
$4,500)). We stated that we believed that the change in coding for MIGS
is significant in that it changes longstanding billing for the service
from reporting two separate CPT codes to reporting a single bundled
code. Without claims data, and given the magnitude of the coding
change, we explained that we did not believe we had the necessary
information on the costs associated with CPT codes 66989 and 66991 to
assign them to a clinical APC at that time. We maintained these APC
assignments for CY 2023.
For CY 2023, the payment rates were based on claims data submitted
between January 1, 2021, and December 31, 2021, and processed on or
before June 30, 2022, and CCRs, if available. Because CPT codes 66989
and 66991 were
[[Page 81636]]
effective January 1, 2022, and we had no claims data for CY 2022, we
finalized continued assignment of CPT codes 66989 and 66991 to New
Technology APC 1563.
For CY 2024, the OPPS payment rates are proposed to be based on
available CY 2022 claims data. For CY 2024, based on our analysis of
claims data, we found a total of 898 single frequency claims and an
estimated geometric mean cost of $5,241.55 for CPT code 66989 and a
total of 5,576 single frequency claims and an estimated geometric mean
cost of $4,957.01 for CPT code 66991. Given the claims volume, we
believe it is appropriate to reassign the service to a clinical APC
using our regular process of using the most recent year of claims data
for a procedure. Upon review, we determined that the most appropriate
clinical APC family for CPT codes 66989 and 66991 would be the
Intraocular Procedures APC family (APC 5491 through 5495). However,
there was a large payment rate difference between the level 2
Intraocular Procedures APC (APC 5492), which has a payment rate of
$3,970.62, and the level 3 Intraocular Procedures APC (APC 5493), which
has a payment rate of $14,067.62. Assigning CPT codes 66989 and 66991
to either APC 5492 or 5493 would result in a payment rate that would
not reflect the cost for these procedures.
Therefore, given the significant difference in payment between APC
5492 and APC 5493, we believe it is appropriate to restructure the
Intraocular Procedures APC family. Specifically, we proposed to create
a sixth level in the Intraocular Procedures APC family by dividing APC
5492 into two APCs--an APC for services with a geometric mean cost of
less than $5,000 and an APC for services with a geometric mean cost of
greater than, or equal to, $5000. We believe that the creation of an
additional level in the Intraocular APC family will create a smoother
distribution of the costs between the different levels based on their
resource costs and clinical characteristics. See section III.E. of the
CY 2024 OPPS/ASC proposed rule for a detailed discussion of our
proposal to restructure the Intraocular Procedures APC family.
Reorganizing the Intraocular Procedures APCs would create a proposed
Level 3 APC to be referred to as ``Proposed APC 5493'' with a payment
rate of approximately $5,110.58, which is closer to the geometric mean
of CPT codes 66989 and 66991. We note that, although these services
have different estimated geometric mean costs, interested parties have
indicated that it is preferable that they be placed within the same APC
due to clinical similarity; therefore, we propose to reassign CPT codes
66989 and 66991 to Proposed APC 5493 for CY 2024.
The proposed clinical APC and status indicator assignments for CPT
codes 66989 and 66991 are found in Table 30.
[[Page 81637]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.048
Comment: We received three comments in support of our proposal to
reassign CPT codes 66989 and 66991 to Proposed APC 5493 for CY 2024.
Response: We appreciate the commenters' support for our proposals.
After consideration of the public comments we received, we are
finalizing our proposal without modification. Please refer to Table 31
below for the final OPPS New Technology APC and status indicator
assignment for CPT codes 66989 and 66991. The final CY 2024 payment
rates can be found in Addendum B to this final rule with comment via
the internet on the CMS website.
[[Page 81638]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.049
k. Scalp Cooling (APC 1514)
CPT code 0662T (Scalp cooling, mechanical; initial measurement and
calibration of cap) became effective on July 1, 2021, to describe
initial measurement and calibration of a scalp cooling device for use
during chemotherapy administration to prevent hair loss. According to
Medicare's National Coverage Determination (NCD) policy, specifically,
NCD 110.6 (Scalp Hypothermia During Chemotherapy to Prevent Hair Loss),
the scalp cooling cap itself is classified as an incident to supply to
a physician service, and would not be paid under the OPPS; however,
interested parties have indicated that there are substantial resource
costs of around $1,900 to $2,400 associated with calibration and
fitting of the cap. CPT guidance states that CPT code 0662T should be
billed once per chemotherapy session, which we interpret to mean once
per course of chemotherapy. Therefore, if a course of chemotherapy
involves, for example, 6 or 18 sessions, HOPDs should report CPT 0662T
only once for that 6 or 18 therapy sessions. For CY 2022, we assigned
CPT code 0662T to APC New Technology 1520 (New Technology--Level 20
($1801-$1900)) with a payment rate of $1,850.50. For CY 2023, we did
not have any claims data; so, we continued to assign CPT code 0662T to
APC 1520.
For CY 2024, the OPPS payment rates are proposed to be based on
available
[[Page 81639]]
CY 2022 claims data. The Scalp Cooling service became effective in the
OPPS in CY 2022, and we have identified 11 single frequency paid claims
for CPT code 0662T for CY 2022. As this is below the threshold of 100
claims for a service within a year, we proposed to designate CPT code
0662T as a low volume service under our universal low volume APC policy
and to use the highest of the geometric mean cost, arithmetic mean
cost, or median cost based on up to 4 years of claims data to assign
the service to the appropriate New Technology APC. Based on our review
of the available claims, the geometric mean cost for CPT code 0662T is
$831.16; the median is $797.63; and the arithmetic mean is $1,284.59.
Therefore, for CY 2024, we proposed to designate this service as a low
volume service under our universal low volume APC policy and reassign
CPT code 0662T to APC 1514 (New Technology--Level 14 ($1201-$1300))
with a payment rate of $1,250.50 for CY 2024 based on the arithmetic
mean of $1,284.59 as shown in Table 32.
[GRAPHIC] [TIFF OMITTED] TR22NO23.050
Comment: Multiple commenters asked that we continue to assign CPT
code 0662T to APC New Technology 1520 (New Technology--Level 20 ($1801-
$1900)) with a payment rate of $1,850.50 for CY 2024. The commenters
believe that 12 claims are not enough data to determine the cost of the
procedure and that we should wait for more paid claims for the service
before reducing payment for the service. Commenters stated that they
had concerns with how hospital outpatient departments were billing CPT
code 0662T and believed that they were incorrectly billing for the
service.
Response: We disagree with the commenters. First, it is generally
not our policy to judge the accuracy of provider coding and charging
for purposes of ratesetting. We rely on hospitals and providers to
accurately report the use of HCPCS codes in accordance with their code
descriptors, and CPT and CMS instructions, and to report services
accurately on claims and charges and costs for the services on their
Medicare hospital cost report. The 12 claims for CPT code 0662T have a
geometric mean of around $833 which is over $1,000 below the current
$1,850.50 payment rate for the service. While there may be some future
variation with the geometric mean for this service, it is likely to be
closer to $830 than $1,850. CPT code 0662T is eligible to be evaluated
through the new technology service low volume APC policy and has a
median of $780.47, an arithmetic mean of $1,217.74, and a geometric
mean of $832.96. Therefore, we will assign CPT code 0662T to the APC we
proposed, APC 1514 (New Technology--Level 14 ($1201-$1300)) with a
payment rate of $1,250.50 based on the updated arithmetic mean for the
service of $1,217.74.
After consideration of the public comments we received, we are
implementing our proposal without modification. Please refer to Table
33 below for the final OPPS New Technology APC and status indicator
assignment for CPT code 0662T. The final CY 2024 payment rates can be
found in Addendum B to this final rule with comment via the internet on
the CMS website.
[[Page 81640]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.051
l. Optellum Lung Cancer Prediction (LCP) (APC 1508)
CPT codes 0721T (Quantitative computed tomography (CT) tissue
characterization, including interpretation and report, obtained without
concurrent CT examination of any structure contained in previously
acquired diagnostic imaging) and 0722T (Quantitative computed
tomography (CT) tissue characterization, including interpretation and
report, obtained with concurrent CT examination of any structure
contained in the concurrently acquired diagnostic imaging dataset (list
separately in addition to code for primary procedure)) became effective
July 1, 2022, and are associated with the Optellum LCP technology. The
Optellum LCP applies an algorithm to a patient's CT scan to produce a
raw risk score for a patient's pulmonary nodule. The physician uses the
risk score to quantify the risk of lung cancer and to determine what
the next management step should be for the patient (for example, CT
surveillance versus invasive procedure). For CY 2023, we assigned CPT
codes 0721T and 0722T to APC New Technology 1508 (New Technology--Level
8 ($601-$700)).
For CY 2024, the OPPS payment rates are proposed to be based on
available CY 2022 claims data. There are no claims available for CPT
codes 0721T and 0722T. Therefore, for CY 2024, we proposed to continue
assigning CPT codes 0721T and 0722T to New Technology APC 1508.
Please refer to Table 34 below for the proposed OPPS New Technology
APC and status indicator assignment for HCPCS codes 0721T and 0722T for
CY 2024. The proposed CY 2024 payment rates can be found in Addendum B
to the CY 2024 OPPS/ASC proposed rule via the internet on the CMS
website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.052
We did not receive any public comments on our proposal and are
finalizing it without modification. HCPCS codes 0721T and 0722T will be
assigned to New Technology APC 1508 with a status indication of ``S''
for CY 2024. Please refer to Table 35 below for the final OPPS New
Technology APC and status indicator assignment for CPT
[[Page 81641]]
codes 0721T and 0722T. The final CY 2024 payment rates can be found in
Addendum B to this final rule with comment via the internet on the CMS
website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.053
m. Quantitative Magnetic Resonance Cholangiopancreatography (QMRCP)
(APC 1511)
Effective July 1, 2022, CPT codes 0723T (Quantitative magnetic
resonance cholangiopancreatography (QMRCP) including data preparation
and transmission, interpretation and report, obtained without
diagnostic magnetic resonance imaging (MRI) examination of the same
anatomy (eg, organ, gland, tissue, target structure) during the same
session) and 0724T (Quantitative magnetic resonance
cholangiopancreatography (QMRCP), including data preparation and
transmission, interpretation and report, obtained with diagnostic
magnetic resonance imaging (MRI) examination of the same anatomy (eg,
organ, gland, tissue, target structure) (list separately in addition to
code for primary procedure)) are associated with the QMRCP Software as
a medical Service (SaaS). The service performs quantitative assessment
of the biliary tree and gallbladder. It uses a proprietary algorithm
that produces a three-dimensional reconstruction of the biliary tree
and pancreatic duct and also provides precise quantitative information
of biliary tree volume and duct metrics. For CY 2023, we assigned CPT
codes 0723T and 0724T to New Technology APC 1511 (New Technology--Level
11 ($900-$1,000)).
For CY 2024, the OPPS payment rates are proposed to be based on
available CY 2022 claims data. For CPT code 0723T, there were no claims
during this time period. Because there are no claims available, we
proposed to continue to assign CPT code 0723T to New Technology APC
1511 with a payment rate of $950.50.
For CPT code 0724T, there was only one claim for CY 2022. As this
is below the threshold of 100 claims for a service within a year, we
explained that we could propose to designate CPT code 0724T as a low
volume service under our universal low volume APC policy and use the
highest of the geometric mean cost, arithmetic mean cost, or median
cost based on up to 4 years of claims data to assign the service to an
appropriate New Technology APC. Because there is only one claim
available, the geometric mean, arithmetic mean, and median costs are
estimated to be $26 for this service. However, we explained that
because there is only a single claim for CPT code 0724T, the single
claim available appears to be an outlier based on the cost information
we received from the manufacturer. Therefore, we stated that we had
concerns that the universal low volume APC policy calculations would
not accurately capture the cost of the service. Therefore, for CY 2024,
we proposed to continue assigning CPT code 0724T to New Technology APC
1511 with a payment rate of $950.50.
Please refer to Table 36 below for the proposed OPPS New Technology
APC and status indicator assignment for HCPCS codes 0723T and 0724T for
CY 2024. The proposed CY 2024 payment rates can be found in Addendum B
to the CY 2024 OPPS/ASC proposed rule via the internet on the CMS
website.
[[Page 81642]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.054
We did not receive any public comments on our proposal and are
finalizing it without modification. HCPCS codes 0723T and 0724T will be
assigned to New Technology APC 1511 with a status indication of ``S''
for CY 2024. Please refer to Table 37 below for the final OPPS New
Technology APC and status indicator assignment for HCPCS codes 0723T
and 0724T. The final CY 2024 payment rates can be found in Addendum B
to this final rule with comment via the internet on the CMS website.
[[Page 81643]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.055
n. CardiAMP (APC 1590)
The CardiAMP cell therapy IDE studies are two randomized, double-
blinded, controlled IDE studies: the CardiAMP Cell Therapy Chronic
Myocardial Ischemia Trial \9\ and the CardiAMP Cell Therapy Heart
Failure Trial.\10\ The two trials are designed to investigate the
safety and efficacy of autologous bone marrow mononuclear cells
treatment for the following: (1) patients with medically refractory and
symptomatic ischemic cardiomyopathy; and (2) patients with refractory
angina pectoris and chronic myocardial ischemia. On April 1, 2022, we
established HCPCS code C9782 to describe the CardiAMP cell therapy IDE
studies and assigned HCPCS code C9782 to APC 1574 (New Technology--
Level 37 ($9,501-$10,000)) with the status indicator ``T.'' We
subsequently revised the descriptor for HCPCS code C9782 to: (Blinded
procedure for New York Heart Association (NYHA) Class II or III heart
failure, or Canadian Cardiovascular Society (CCS) Class III or IV
chronic refractory angina; transcatheter intramyocardial
transplantation of autologous bone marrow cells (e.g., mononuclear) or
placebo control, autologous bone marrow harvesting and preparation for
transplantation, left heart catheterization including ventriculography,
all laboratory services, and all imaging with or without guidance
(e.g., transthoracic echocardiography, ultrasound, fluoroscopy), all
device(s), performed in an approved Investigational Device Exemption
(IDE) study) to clarify the inclusion of the Helix transendocardial
injection catheter device in the descriptor. Additionally, we
determined that APC 1590 (New Technology--Level 39 ($15,001-$20,000))
most accurately accounted for the resources associated with furnishing
the procedure described by HCPCS code C9782.
---------------------------------------------------------------------------
\9\ ClinicalTrials.gov. ``Randomized Controlled Pivotal Trial of
Autologous Bone Marrow Cells Using the CardiAMP Cell Therapy System
in Patients With Refractory Angina Pectoris and Chronic Myocardial
Ischemia.'' Accessed May 10, 2022. https://clinicaltrials.gov/ct2/show/NCT03455725?term=NCT03455725&rank=1.
\10\ ClinicalTrials.gov. ``Randomized Controlled Pivotal Trial
of Autologous Bone Marrow Mononuclear Cells Using the CardiAMP Cell
Therapy System in Patients With Post Myocardial Infarction Heart
Failure.'' Accessed May 10, 2022. https://clinicaltrials.gov/ct2/show/NCT02438306.
---------------------------------------------------------------------------
For CY 2024, the OPPS payment rates are proposed to be based on
available CY 2022 claims data. There are no available claims for
ratesetting for CY 2024. Therefore, for CY 2024, we proposed to
continue assigning HCPCS code C9782 to New Technology APC 1590 with a
payment rate of $17,050.50.
Please refer to Table 38 below for the proposed OPPS New Technology
APC and status indicator assignment for HCPCS code C9782 for CY 2024.
The proposed CY 2024 payment rates can be found in Addendum B to the CY
2024 OPPS/ASC proposed rule via the internet on the CMS website.
[[Page 81644]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.056
We did not receive any public comments on our proposal and are
finalizing it without modification. HCPCS code C9782 will be assigned
to New Technology APC 1590 with a status indication of ``T'' for CY
2024. Please refer to Table 39 below for the final OPPS New Technology
APC and status indicator assignment for CPT code C9782. The final CY
2024 payment rates can be found in Addendum B to this final rule with
comment via the internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.057
[[Page 81645]]
o. Surfacer[supreg] Inside-Out[supreg] Access Catheter System (APC
1534)
HCPCS code C9780 (Insertion of central venous catheter through
central venous occlusion via inferior and superior approaches (e.g.,
inside-out technique), including imaging guidance) describes the
procedure associated with the use of the Surfacer[supreg] Inside-
Out[supreg] Access Catheter System that is designed to address central
venous occlusion. HCPCS code C9780 was established on October 1, 2021,
and since its establishment the code has been assigned to New
Technology APC 1534 (New Technology--Level 34 ($8001-$8500)).
For CY 2024, the OPPS payment rates are proposed to be based on
available CY 2022 claims data. Although HCPCS code C9780 was effective
October 1, 2021, we have no claims data at this time. Because we have
no claims data available, for CY 2024, we proposed to continue to
assign HCPCS code C9780 to APC 1534 with a proposed payment rate of
$8,250.50 as shown in Table 40.
[GRAPHIC] [TIFF OMITTED] TR22NO23.058
We did not receive any public comments on our proposal and are
finalizing it without modification. There are no paid claims for the
service described by HCPCS code 9780 for CY 2024. Therefore, we will
continue to assign this service to APC 1534 with a proposed payment
rate of $8,250.50. Please refer to Table 41 below for the final OPPS
New Technology APC and status indicator assignment for HCPCS code C9780
for CY 2024. The final CY 2024 payment rates can be found in Addendum B
to this final rule via the internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.059
p. Insertion or Replacement of Neurostimulator System for Treatment of
Central Sleep Apnea; Complete System (APC 1580)
HCPCS code 0424T (Insertion or replacement of a neurostimulator
system for treatment of central sleep apnea; complete system
(transvenous placement of right or left stimulation lead, sensing lead,
implantable pulse generator)) is associated with the use of the
Remede[supreg] System, which is used to treat adult patients with
moderate to severe Central Sleep Apnea. HCPCS code 0424T was first
effective in January 1, 2016, and subsequently assigned to
Comprehensive APC 5464 (Neurostimulator and Related Procedures APC--
Level 4). For CY 2021, we created a 5-level structure for the
Neurostimulator and Related Procedure APC series, and consequently,
assigned HCPCS code 0424T to the highest level in the series:
Comprehensive APC 5465 (Neurostimulator & Related Procedures APC--Level
5). For CY 2023, we proposed to continue the 5-level structure for the
Neurostimulator and Related Procedure APC series, while also soliciting
comment on the creation of an additional Level 6 APC in the series. In
the CY 2023 final rule with comment period, we finalized our proposal
to continue the 5-level APC structure based on a determination that
[[Page 81646]]
the existing structure remained appropriate based on clinical and cost
characteristics. However, we also recognized that CPT code 0424T was
not appropriately assigned to the Comprehensive APC 5465 based on a
significant difference between its geometric mean cost and that of the
APC. Therefore, for CY 2023, we finalized the assignment of HCPCS code
0424T to New Technology APC 1581 (New Technology--Level 44 ($50,001-
$60,000)).
For CY 2024, the OPPS payment rates are proposed to be based on
available CY 2022 claims data. There are only 30 claims for HCPCS code
0424T available during this time period. As this is below the threshold
of 100 claims for a service within a year, we propose to apply our
universal low volume APC policy and use the highest of the geometric
mean cost, arithmetic mean cost, or median cost based on up to 4 years
of claims data to assign HCPCS code 0424T to the appropriate New
Technology APC. Considering the available claims data for HCPCS code
0424T, the arithmetic mean is $49,468; the median is $48,285; and the
geometric mean cost is $44,287. Of these, the arithmetic mean is the
statistical methodology that estimates the highest cost for the
service. The payment rate calculated using this methodology falls
within the cost band for New Technology APC 1580 (New Technology--Level
43 ($40,001-$50,000)) with a payment rate of $45,000.50. Therefore, for
CY 2024, we proposed to assign HCPCS code 0424T to New Technology APC
1580. We note that for the CY 2024 update, the CPT Editorial Panel is
deleting HCPCS code 0424T and replacing it with placeholder code 3X008
effective January 1, 2024. Consequently, we proposed to assign HCPCS
code 0424T to status indicator ``D'' to indicate the code will be
deleted and assigning its replacement code, specifically, placeholder
code 3X008, to APC 1580 for CY 2024. For placeholder code 3X008, we
stated the final 5-digit CPT code number would be listed in the CY 2024
OPPS/ASC final rule with comment period. This information is summarized
in Table 42.
[GRAPHIC] [TIFF OMITTED] TR22NO23.060
Comment: One commenter, the manufacturer, claimed that in CY 2022
two of the 21 paid claims for CPT code 0424T were inappropriately
billed by hospitals that according to the manufacturer's records could
not have purchased the device used in the procedure described by CPT
code 0424T. The manufacturer asked that we exclude the two claims from
our analysis to determine the payment rate for the procedure.
Response: We appreciate the comment, but as have regularly stated
since the establishment of the OPPS, it is the responsibility of
providers and other interested parties to work with the MACs to fix any
claims that may have been billed or paid inappropriately for a service.
In this case, and in most cases, we assume that if a paid claim has
been present on the claims file for several months that the claim as
been paid appropriately. Therefore, we will not remove the two claims
in question when performing our new technology low volume analyses to
determine the payment rate for HCPCS code 0424T.
After consideration of the public comments we received, we are
implementing our proposal without modification. Our updated low volume
analysis for HCPCS code 0424T finds that the median for paid claims for
the service is $47,387.06, the arithmetic mean is $47,967.41, and the
geometric mean is $43,063.94. The highest amount of the three values is
the arithmetic mean of $47,967.41. Therefore, the service described by
0424T and placeholder code 3X008 will be assigned to New Technology APC
1580
[[Page 81647]]
(New Technology--Level 43 ($40,001-$50,000)) with a payment rate of
$45,000.50. In addition, placeholder code 3X008 has been replaced with
CPT code 33276 (Insertion of phrenic nerve stimulator system (pulse
generator and stimulating lead[s]), including vessel catheterization,
all imaging guidance, and pulse generator initial analysis with
diagnostic mode activation, when performed).
Please refer to Table 43 below for the final OPPS New Technology
APC and status indicator assignment for CPT code 33276 for CY 2024. The
final CY 2024 payment rates can be found in Addendum B to this final
rule via the internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.061
q. Cleerly Labs (APC 1511)
Cleerly Labs is a Software as a Service (SaaS) that assesses the
extent of coronary artery disease severity using Atherosclerosis
Imaging-Quantitative Computer Tomography (AI-QCT). This procedure is
performed to quantify the extent of coronary plaque and stenosis in
patients who have undergone coronary computed tomography analysis
(CCTA). The AMA CPT Editorial Panel established the following four
codes associated with this service, effective January 1, 2021:
0623T: Automated quantification and characterization of coronary
atherosclerotic plaque to assess severity of coronary disease, using
data from coronary computed tomographic; angiography; data preparation
and transmission, computerized analysis of data, with review of
computerized analysis output to reconcile discordant data,
interpretation and report.
0624T: Automated quantification and characterization of coronary
atherosclerotic plaque to assess severity of coronary disease, using
data from coronary computed tomographic angiography; data preparation
and transmission.
0625T: Automated quantification and characterization of coronary
atherosclerotic plaque to assess severity of coronary disease, using
data from coronary computed tomographic angiography; computerized
analysis of data from coronary computed tomographic angiography.
0626T: Automated quantification and characterization of coronary
atherosclerotic plaque to assess severity of coronary disease, using
data from coronary computed tomographic angiography; review of
computerized analysis output to reconcile discordant data,
interpretation and report.
In the CY 2021 OPPS/ASC final rule with comment period, we assigned
the CPT codes 0623T, 06234T, 0625T, and 0626T to status indicator
``E1'' to indicate that the codes are not payable by Medicare when
submitted on outpatient claims because the service had not received FDA
clearance at the time of the assignment.
For the October 2022 update, based on our review of the New
Technology application submitted to CMS for OPPS payment consideration,
we evaluated the current status indicator assignments for CPT codes
0623T-0626T. Based on the technology and its potential utilization in
the HOPD setting, our evaluation of the service, as well as input from
our medical advisors, we assigned CPT code 0625T to a separately
payable status. Specifically, in the October 2022 OPPS Update CR
(Change Request 12885, Transmittal 11594, dated September 9, 2022), we
reassigned CPT code 0625T to status indicator ``S'' (Significant
Procedures, Not Discounted when Multiple. Paid under OPPS; separate APC
payment) and APC 1511 (New Technology--Level 11 ($900-$1000)) with a
payment rate of $950.50, effective October 1, 2022, following our
review of the manufacturer's New Technology APC application.
For CY 2024, the OPPS payment rates were proposed to be based on
available CY 2022 claims data. There are 90 claims for CPT code 0625T
during this time period. As this is below the threshold of 100 claims
for a service within a year, we explained that we could propose to
designate CPT code 0625T as a low volume service under our universal
low volume APC policy and use the highest of the geometric mean cost,
arithmetic mean cost, or median cost based on up to 4 years of claims
data to assign code 0625T to the appropriate New Technology APC. We
found the geometric mean cost for the service to be approximately
$3.70, the
[[Page 81648]]
arithmetic mean cost to be approximately $4.10, and the median cost to
be approximately $3.50. Under our universal low volume APC policy, we
would use the greatest of the statistical methodologies, the arithmetic
mean, to assign CPT code 0625T to New Technology 1491 (New Technology
Level 1A--(0-$10)) with a payment rate of $5.00. However, we
acknowledged that, because CPT code 0625T was only made separately
payable as part of the OPPS in October 2022, and, therefore, the claims
available only reflect two months of data, we were concerned that we do
not have sufficient claims data to justify reassignment to another New
Technology APC (66 FR 69902). Therefore, consistent with our current
policy to retain services within New Technology APC groups until we
obtain sufficient claims data to justify reassignment (66 FR 59902),
for CY 2024 we proposed to maintain CPT code 0625T's current
assignment. Specifically, for CY 2024, we proposed to continue to
assign CPT code 0625T to New Technology APC 1511 with a payment rate of
$950.50.
Please refer to Table 44 below for the proposed OPPS New Technology
APC and status indicator assignment for CPT code 0625T for CY 2024. The
proposed CY 2024 payment rates can be found in Addendum B to the CY
2024 OPPS/ASC proposed rule via the internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.062
Comment: We received comments supporting our proposal for 0625T.
Commenters stated that they agree with our reasoning that there are
limited claims data available because CPT code 0625T was only made
separately payable as part of the OPPS in October 2022. One commenter
noted that there may also be a limited number of claims in CY 2023 and
urged CMS to be cognizant of that in developing the CY 2025 payment
rate for CPT code 0625T. The commenter also stated that there will
likely be sufficient CY 2024 claims data for CMS to consider a
different APC assignment for CPT code 0625T for CY 2026 with the
availability of a new device that may be utilized with service
described by CPT code 0625T.
Response: We thank the commenters for their support of our
proposal. We note that the policy being finalized in this final rule
with comment with regard to CPT code 0625T applies only for CY 2024.
Regarding the APC assignments for CPT code 0625T for future years, we
will similarly consider the claims data available and public comments
received in selecting the APC assignment for the code.
We note that based on updated claims data available for this final
rule with comment period, the low volume policy calculations have
changed slightly. However, the concerns stated in the CY 2024 OPPS/ASC
proposed rule regarding having insufficient claims data to justify
reassignment to another New Technology APC remain. Therefore, after
consideration of the public comments we received and the limited claims
data available, we are finalizing the APC assignment for CPT code 0625T
as proposed.
Please refer to Table 45 below for the final OPPS New Technology
APC and status indicator assignment for CPT code 0625T. The final CY
2024 payment rates can be found in Addendum B to this final rule with
comment via the internet on the CMS website.
[[Page 81649]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.063
D. Universal Low Volume APC Policy for Clinical and Brachytherapy APCs
In the CY 2022 OPPS/ASC final rule with comment period (86 FR 63743
through 63747), we adopted a policy to designate clinical and
brachytherapy APCs as low volume APCs if they have fewer than 100
single claims that can be used for ratesetting purposes in the claims
year used for ratesetting for the prospective year. For the CY 2024
OPPS/ASC proposed rule, CY 2022 claims are generally the claims used
for ratesetting; and clinical and brachytherapy APCs with fewer than
100 single claims from CY 2022 that can be used for ratesetting would
be low volume APCs subject to our universal low volume APC policy. As
we stated in the CY 2022 OPPS/ASC final rule with comment period, we
adopted this policy to reduce the volatility in the payment rate for
those APCs with fewer than 100 single claims. Where a clinical or
brachytherapy APC has fewer than 100 single claims that can be used for
ratesetting, under our low volume APC payment adjustment policy, we
determine the APC cost as the greatest of the geometric mean cost,
arithmetic mean cost, or median cost based on up to 4 years of claims
data. We excluded APC 5853 (Partial Hospitalization for CMHCs) and APC
5863 (Partial Hospitalization for Hospital-based PHPs) from our
universal low volume APC policy given the different nature of policies
that affect the partial hospitalization program. We also excluded APC
2698 (Brachytx, stranded, nos) and APC 2699 (Brachytx, non-stranded,
nos) as our current methodology for determining payment rates for non-
specified brachytherapy sources is appropriate.
Based on claims data available for the CY 2024 OPPS/ASC proposed
rule, we proposed to designate five brachytherapy APCs and five
clinical APCs as low volume APCs under the OPPS. The five brachytherapy
APCs and five clinical APCs meet our criteria of having fewer than 100
single claims in the claims year used for ratesetting (CY 2022 for the
CY 2024 OPPS/ASC proposed rule). Eight of the ten APCs were designated
as low volume APCs in CY 2023. Based on data for the CY 2024 OPPS/ASC
proposed rule, APC 2642 (Brachytx, stranded, C-131) now meets our
criteria to be designated a Low Volume APC; and we proposed to
designate it as such for CY 2024. Further, with the proposed addition
of Level 6 Intraocular APC (APC 5496), as discussed in section III.E of
the CY 2024 OPPS/ASC proposed rule, and the reassignment of certain
intraocular procedures from Level 2 to Level 3, the Level 4 Intraocular
APC (which was the Level 3 Intraocular APC in CY 2023), now meets our
criteria to be designated a Low Volume APC; and we proposed to
designate it as such for CY 2024.
Table 46 includes the APC geometric mean cost without the low
volume APC designation, that is, if we calculated the geometric mean
cost based on CY 2022 claims data available for ratesetting; the
median, arithmetic mean, and geometric mean cost using up to 4 years of
claims data based on the APC's designation as a low volume APC; and the
statistical methodology we proposed to use to determine the APC's cost
for ratesetting purposes for CY 2024. As discussed in our CY 2022 OPPS/
ASC final rule with comment period (86 FR 63751 through 63754), given
our concerns with CY 2020 claims data as a result of the PHE, the 4
years of claims data we proposed to use to calculate the costs for
these APCs are CYs 2018, 2019, 2021, and 2022.
[[Page 81650]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.064
Comment: One commenter requested clarification about the meaning of
the statement ``using up to four years of data'' regarding the
calculation of the geometric mean, arithmetic mean, and median for the
universal low volume APC policy for clinical and brachytherapy APCs (88
FR 49627). The commenter also requested more information on why there
was a difference in the geometric mean amount reported in the CY 2024
OPPS proposed rule in Table 27 for APC 5244 (Level 4 Blood Product
Exchanges and Related Services), which was $52,105 based on claims from
CY 2022 as compared to the geometric mean reported for APC 5244 in the
2 times rule discussion for the CY 2024 OPPS proposed rule, which was
$71,154 and also based on claims from CY 2022 (88 FR 49628).
Response: When we state that we are using up to four years of data
for the universal low volume APC policy for clinical and brachytherapy
APCs, we mean that we will use four years of data
[[Page 81651]]
if four years of data is available for an APC, but we may need to use
between one and three years of data if fewer years of data are
available. We will use the greatest number of years of data available,
unless there is a substantial reason not to use a particular year of
data. The data will also be for consecutive years unless, again, there
is substantial reason not to use a particular year of data. For
example, we stated in the CY 2024 OPPS proposed rule (88 FR 49627) that
we had concerns with CY 2020 claims data as a result of the COVID-19
PHE, and that we were therefore using data from CYs 2018, 2019, 2021,
and 2022.
The commenter correctly noted that we inadvertently provided an
outdated geometric mean cost for APC 5244 based on only CY 2022 claims
data. Based on data available for the proposed rule, the correct
geometric mean cost without low volume APC designation that should have
been displayed in Table 27 for APC 5244 was $71,154.
Comment: One commenter supports the universal low volume APC policy
for clinical and brachytherapy APCs in general but requests that the
policy only be invoked when application of the universal low volume
policy would increase the payment amount for the low-volume APC.
Response: The purpose of the universal low volume APC policy for
clinical and brachytherapy APCs is to bring payment stability to these
low-volume APCs rather than to ensure higher payment rates. With
payment stability, whether it is limiting annual increases or decreases
in the payment rate, providers are better able to plan what their
expenses and compensation will be for performing certain low-volume
services, and they can use that information to help budget for the cost
of these low-volume services over several years.
After consideration of the public comments we received, we are
implementing our proposals without modification except where we are
updating the payment rates for low-volume clinical and brachytherapy
APCs with claims data updated through June 20, 2023.
E. APC-Specific Policies
1. Ablation of Bone Tumors CPT Code 20982 (APC 5115)
CPT code 20982 (Ablation therapy for reduction or eradication of 1
or more bone tumors (eg, metastasis) including adjacent soft tissue
when involved by tumor extension, percutaneous, including imaging
guidance when performed; radiofrequency) describes a primarily
palliative procedure that reduces the size of bone tumors and lessens
the pain from the tumors. For the CY 2024 OPPS proposed rule, CPT code
20982 had a geometric mean of around $11,773 and we proposed to assign
the procedure to APC 5114 (Level 4 Musculoskeletal Procedures), which
has a payment rate of around $6,974.
Comment: One commenter asked that we reassign CPT code 20982 from
APC 5114 to APC 5115 (Level 5 Musculoskeletal Procedures) with a
payment rate of around $13,421. The commenter noted that this bone
tumor ablation procedure was one of the highest cost procedures
assigned to APC 5114 and that the payment rate for APC 5114 only
covered around 60 percent of the cost of CPT code 20982. The commenter
also noted that while the bone tumor ablation procedure would be
overpaid in APC 5115, the additional payment was only 13 percent of the
cost of CPT code 20982.
Response: We agree with the commenter. In addition to the
underpayment and overpayment amounts cited by the commenter, we also
found that if CPT code 20982 had enough claims to be a significant
procedure in APC 5114, it would be in violation of the 2 times rule by
over $1,000 as two times the lowest cost significant procedure in that
APC was around $10,700 while the payment rate for CPT code 20982 is
around $11,773.
After consideration of the public comments we received, we are
assigning CPT code 20982 to APC 5115 (Level 5 Musculoskeletal
Procedures). Table 47 shows the finalized status indicator and APC
assignment for this procedure code. We refer readers to Addendum B of
this final rule with comment period for the payment rates for all codes
reportable under the OPPS. Addendum B is available via the internet on
the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.065
2. Administration of Lacrimal Ophthalmic Insert Into Lacrimal
Canaliculus (APC 5503)
Dextenza, which is described by HCPCS code J1096 (Dexamethasone,
lacrimal ophthalmic insert, 0.1 mg), is a drug indicated for ``the
treatment of ocular inflammation and pain following ophthalmic
surgery'' and for ``the treatment of ocular itching associated with
allergic conjunctivitis.'' \11\
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\11\ Dextenza. FDA Package Insert. https://www.accessdata.fda.gov/drugsatfda_docs/label/2021/208742s007lbl.pdf.
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The manufacturer of the drug previously asserted that this drug is
administered and described by CPT code 0356T (Insertion of drug-eluting
implant (including punctal dilation and implant removal when performed)
into lacrimal canaliculus, each). Interested parties also previously
stated that Dextenza is inserted in a natural opening in the eyelid
(called the punctum) and that the drug is designed
[[Page 81652]]
to deliver a tapered dose of dexamethasone to the ocular surface for up
to 30 days. CPT code 0356T was deleted December 31, 2021, and replaced
with CPT code 68841 (Insertion of drug-eluting implant, including
punctal dilation when performed, into lacrimal canaliculus, each),
effective January 1, 2022. Interested parties currently assert that the
drug, Dextenza, is administered and described by CPT code 68841. We
refer readers to the CY 2023 OPPS/ASC final rule with comment period
for a detailed history on CMS payment assignments for CPT code 0356T
and CPT code 68841 (87 FR 71840).
In the CY 2024 OPPS/ASC proposed rule (87 FR 49765), we proposed
that Dextenza (HCPCS code J1096) continues to function as a surgical
supply that meets the criteria described at Sec. 416.174, and we
proposed to continue to make separate payment for Dextenza as a non-
opioid pain management drug that functions as a supply in a surgical
procedure under the ASC payment system for CY 2024. We proposed that
payment for Dextenza would continue to be packaged when furnished in
the HOPD but paid separately when furnished in an ASC. We proposed to
package HCPCS code J1096 under the OPPS and assign the code to a status
indicator of ``N'' (packaged). This is consistent with our packaging
policy outlined at 42 CFR 419.2(b), which lists the types of items and
services for which payment is packaged under the OPPS. Specifically,
Sec. 419.2(b)(16) includes drugs and biologicals that function as
supplies when used in a surgical procedure as packaged costs.
Historically, we have stated that we consider all items related to the
surgical outcome and provided during the hospital stay in which the
surgery is performed, including postsurgical pain management drugs, to
be part of the surgery for purposes of our drug and biological surgical
supply packaging policy (79 FR 66875).
For CY 2024, we proposed to continue to assign CPT code 68841 to
APC 5503 (Level 3 Extraocular, Repair, and Plastic Eye Procedures) with
a proposed payment rate of $2,249.64. We also proposed to continue to
assign CPT code 68841 OPPS status indicator ``Q1'' and an ASC payment
indicator of ``N1.''
The issue of payment for CPT code 68841 was brought to the Advisory
Panel on Hospital Outpatient Payment (also known as HOP Panel) in 2023
for CY 2024 rulemaking. At the August 2023 meeting, based on the
information presented, the Panel recommended that CMS assign HCPCS code
68841 a status indicator (SI) of ``J1'' (Hospital Part B Services Paid
Through a Comprehensive APC) as they believed this assignment would
treat CPT code 68841 similarly to other clinically related codes.
Comment: Several commenters stated that increased payment, and
separate payment, for CPT code 68841, the code that describes the
administration of the drug, was required to ensure continued
beneficiary access to the drug Dextenza (HCPCS code J1096) in both the
HOPD and ASC settings. Some commenters did not make a specific
suggestion as to the final APC assignment but contended that the
proposed payment was inadequate. Commenters cited various payment
rates, such as $500, $1,200, $2,350, and $2,500 as potential
appropriate payment rates for CPT 68841 under the OPPS and ASC payment
system. Commenters emphasized that a change was needed to ensure
adequate payment in the ASC setting, where the commenters stated the
majority of these Dextenza administrations occur.
Several commenters argued for a change in the OPPS status indicator
and the ASC payment indicator to allow separate payment for CPT code
68841. Some commenters stated that a ``Q1'' status indicator (STV-
Packaged Codes) was inappropriate but did not provide an alternative
suggestion. However, some other commenters suggested assignment to a
``J1''(Hospital Part B Services Paid Through a Comprehensive APC)
status indicator. One commenter contended that a status indicator of
``S'' (Procedure or Service, Not Discounted When Multiple) or ``T''
(Procedure or Service, Multiple Procedure Reduction Applies) would also
be appropriate but believed that ``J1'' would be the most accurate and
would generate consistency among APC 5503, as all other codes within
APC 5503 are assigned to status indicator ``J1.''
Several commenters pointed to the clinical importance of providing
Dextenza to patients, noting that it reduces ocular pain and
inflammation and reduces the burden of topical eyedrop application.
Additionally, commenters stated that they usually perform the procedure
to administer Dextenza in conjunction with ophthalmic surgeries.
Commenters believed the procedure is a distinct surgical procedure that
requires additional operating room time and resources. These commenters
believed that the cataract surgery is conducted and concluded, as
evidenced by the removal of the surgical drape and speculum, and then
the Dextenza administration procedure begins. The commenters further
mentioned that additional payment was needed to compensate for a
variety of tasks associated with the administration of Dextenza, such
as ordering, billing, counting inventory, technician training, surgical
tools, and instrument sterilization, among others. Commenters also
pointed to the fact that there are 112 single frequency claims as
evidence that both Dextenza and its administration should be paid
separately as there is no other procedure on the claim.
Overall, commenters were concerned that the lack of increased or
separate payment may reduce access to Dextenza, particularly in the ASC
setting.
Response: We thank commenters for their feedback. We agree with
commenters that it is still appropriate to assign CPT code 68841 to APC
5503 (Level 3 Extraocular, Repair, and Plastic Eye Procedures).
For the CY 2024 OPPS update, based on claims submitted between
January 1, 2022, and December 30, 2022, processed through June 30,
2023, our analysis of the latest claims data for this final rule with
comment period shows a geometric mean cost of approximately $1,993.20
for predecessor CPT code 68841 based on 172 single claims, which is
comparable to the geometric mean cost of about $2,288.49 for APC 5503.
Based on the data, we continue to believe that assignment to APC 5503
for CPT code 68841 is appropriate.
We also continue to believe that assignment of CPT code 68841 to an
OPPS status indicator of ``Q1'' and an associated ASC payment indicator
of ``N1,'' is appropriate. We continue to believe that CPT code 68841
is mostly performed during ophthalmic surgeries, such as cataract
surgeries. A status indicator ``Q1,'' indicating a conditionally
packaged procedure, describes a HCPCS code where the payment is
packaged when it is provided with a significant procedure but is
separately paid when the service appears on the claim without a
significant procedure. Because ASC services always include a surgical
procedure, HCPCS codes that are conditionally packaged under the OPPS
are generally packaged (payment indictor ``N1'') under the ASC payment
system. Although stakeholders state this is an independent surgical
procedure and should not be packaged into the primary ophthalmic
procedure in which the drug and drug administration are associated,
based on observed clinical patterns as to how the drug is used, we do
not agree. Based on claims data, out of over 7,000 total frequency
claims, CPT code 68841 is used independently only about 2 percent of
the time,
[[Page 81653]]
meaning that the other 98 percent of the time CPT code 68841 has its
payment packaged into the primary procedure with which it is
associated. These data reinforce our belief that Dextenza and CPT code
68841 are not furnished independent of a surgical procedure and should
be packaged into the primary ophthalmic procedure with which the drug
and drug administration are associated.
While we recognize that there are some claims that may only include
CPT code 68841 without a primary ophthalmic surgery on the claim, we do
not believe that this is a frequent occurrence based on our claims data
and clinical use patterns; as previously mentioned, our claims data
shows that only 172 out of 7,327 claims are performed independently of
another primary procedure (only about 2 percent of claims).
After consideration of the public comments, we are finalizing our
proposal, without modification, to assign CPT code 68841 to APC 5503
with OPPS status indicator ``Q1'' (STVPackaged Codes) for CY 2024,
which typically means there will be a packaged APC payment if this code
is billed on the same claims as a HCPCS code assigned to status
indictor ``S,'' ``T,'' or ``V'' (Clinic or Emergency Department Visit).
In addition, based on the OPPS assignments, we are finalizing an ASC
payment indicator of ``N1'' (Packaged service/item; no separate payment
made) for CPT code 68841 for CY 2024.
For the final CY 2024 OPPS payment rates, we refer readers to OPPS
Addendum B to this final rule with comment period. In addition, we
refer readers to OPPS Addendum D1 to this final rule with comment
period for the status indicator definitions for all codes reported
under the OPPS. For the final CY 2024 ASC payment rates and payment
indicators, we refer readers to Addendum AA and Addendum BB for the ASC
payment rates, and Addendum DD1 for the ASC payment indicator and their
definitions. The OPPS Addenda B and D1 and ASC Addenda AA, BB, and DD1
are available via the internet on the CMS website.\12\
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Please refer to Table 48 for the code descriptor, APC assignment,
status indicator assignment, and payment indicator assignment for CPT
code 68841 for CY 2024.
[GRAPHIC] [TIFF OMITTED] TR22NO23.066
Similar to our rationale outlined for CPT code 68841, we also find
it appropriate to package Dextenza (HCPCS code J1096) based on its
clinical use patterns. Consistent with our clinical review and
commenters' input, we believe this drug is mostly administered during
ophthalmic surgeries, such as cataract surgeries. The packaging of this
drug is consistent with our regulations at 42 CFR 419.2(b).
Specifically, 42 CFR 419.2(b)(16) includes among the items and services
for which payment is packaged under the OPPS, drugs and biologicals
that function as supplies when used in a surgical procedure.
Historically, we have stated that we consider all items related to the
surgical outcome and provided during the hospital stay in which the
surgery is performed, including postsurgical pain management drugs, to
be part of the surgery for purposes of our drug and biological surgical
supply packaging policy (79 FR 66875). We therefore believe packaging
of HCPCS code J1096 is appropriate in the HOPD setting for CY 2024.
Although packaged under the OPPS, as discussed in section XIII.E.
of this final rule with comment period, we believe Dextenza (HCPCS code
J1096), meets the criteria described at Sec. 416.174; and we are
finalizing our proposal to make separate payment for Dextenza as a non-
opioid pain management drug that functions as a supply in a surgical
procedure under the ASC payment system for CY 2024. For more
information on the ASC payment for HCPCS code J1096 for CY 2024, refer
to section XIII.E. of this final rule with comment period.
As a reminder, for OPPS billing, because charges related to
packaged services are used for outlier and future rate setting,
hospitals are advised to report both CPT code 68841, the administration
service, and HCPCS code J1096, the Dextenza drug, on the claim whenever
Dextenza is provided in the HOPD setting. It is extremely important
that hospitals report all HCPCS codes consistent with their
descriptors, CPT and/or CMS instructions and correct coding principles,
and all charges for all services they furnish, whether payment for the
services is made separately or is packaged.
Finally, for the final CY 2024 OPPS payment rates, we refer readers
to OPPS Addendum B to this final rule with comment period. In addition,
we refer readers to OPPS Addendum D1 to this final rule with comment
period for the status indicator definitions for all codes reported
under the OPPS. For the final CY 2024 ASC payment rates and payment
indicators, we refer readers to Addendum AA and Addendum BB for the ASC
payment rates and Addendum DD1 for the ASC payment indicator and their
definitions. The OPPS Addenda B and D1 and ASC Addenda AA, BB, and DD1
are available via the internet on the CMS website.\13\
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[[Page 81654]]
3. Aquabeam Waterjet Ablation Service CPT Code 0421T (APC 5376)
CPT code 0421T (Transurethral waterjet ablation of prostate,
including control of post-operative bleeding, including ultrasound
guidance, complete (vasectomy, meatotomy, cystourethroscopy, urethral
calibration and/or dilation, and internal urethrotomy are included when
performed) describes the Aquabeam waterjet ablation service. According
to the manufacturer, Aquabeam is for treating lower urinary tract
symptoms (LUTS) due to benign prostatic hyperplasia (BPH) by using a
high-velocity water stream to ablate and remove tissue from enlarged
prostates.
For the OPPS CY 2024 proposed rule, we calculated the geometric
mean for CPT code 0421T to be $9,609.07, and we assigned the service to
APC 5376 (Level 6 Urology and Related Services), which has a payment
rate of $8,947.91. There were 2,375 claims used to calculate the
geometric mean for CPT code 0421T.
Comment: One commenter, the manufacturer of the Aquabeam system,
requested that we assign CPT code 0421T to APC 5377 (Level 7 Urology
and Related Services) with a payment rate of $12,712.15 instead of
assigning the service to APC 5376 with a payment rate of $8,947.91. The
commenter asserts that the Aquabeam procedure has more clinical and
resource similarity to procedures in APC 5377 than in APC 5376 because,
according to the commenter, the procedures in APC 5377 are device-
intensive procedures similar to how the Aquabeam procedure is a device-
intensive procedure. The commenter also notes that the Aquabeam
procedure is one of the highest cost procedures assigned to APC 5376.
Response: We disagree with the commenter. CPT code 0421T is one of
the more costly procedures in APC 5376 but it is not the costliest. The
cost of the procedure is around $800 more than the payment rate of APC
5376, but it is over $2,700 less than the payment rate of APC 5377. The
Aquabeam procedure also does not violate the 2 times rule in its
current assignment in APC 5376, and several of the procedures with
similar cost to the Aquabeam procedure are device-intensive procedures
with a similar percentage device offset as the Aquabeam procedure.
Finally, if CPT code 0421T were to be reassigned into APC 5377, its
cost would be over $2,000 less than the lowest-cost significant
procedure in that APC.
After consideration of the public comments we received, we are
finalizing our proposal without modification for CPT code 0421T. Table
49 shows the finalized status indicator and APC assignment for all of
the procedure codes. We refer readers to Addendum B of this final rule
with comment period for the payment rates for all codes reportable
under the OPPS. Addendum B is available via the internet on the CMS
website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.067
4. Aquadex[supreg] Ultrafiltration (APC 5241)
CPT code 0692T (Therapeutic ultrafiltration) describes an apheresis
procedure through which plasma water and sodium are removed from the
blood using the Aquadex[supreg] SmartFlow System. The procedure is
indicated in patients who are diagnosed with hypervolemia and are non-
responsive to the more traditional treatments such as diuretic
medications. CPT code 0692T was established effective January 1, 2022,
and since its establishment, the code has been assigned to APC 5241
(Level 1 Blood Product Exchange and Related Services). At the August
21, 2023, HOP Panel Meeting, a presenter provided information to the
Panel on the description of the service and the cost of the
Aquadex[supreg] Ultrafiltration device and procedure. At the conclusion
of the presentation, the presenter advised the Panel to request that
CMS reassign CPT code 0692T from APC 5241 to APC 5242. The HOP Panel
had no recommendations. For CY 2024, we proposed to maintain the
assignment to APC 5241, with a payment rate of $417.32.
Comment: We received one comment from the manufacturer requesting
that CMS reassign CPT code 0692T from APC 5241 with a payment of
$426.24 to APC 5242 (Level 2 Blood Product Exchange and Related
Services) with a payment of $1,504.13. The commenter stated that the
proposed APC assignment and payment does not accurately reflect the
resources, time, and costs necessary to complete the therapeutic
ultrafiltration procedure. The commenter pointed out that the current
APC assignment consists of mostly transfusion procedures, with CPT code
36430 (Transfusion, blood or blood components) accounting for 99
percent of the more than 200,000 single frequency claims for services
assigned to this APC. They also note that there are several apheresis
procedures assigned to APC 5242.
Response: Under the OPPS, we review our claims data on an annual
basis to determine the payment rates. For CY 2024, the OPPS payment
rates are based on claims submitted between January 1, 2022, and
December 31, 2022, processed through June 30, 2023. Because the code
was new in 2022, we have very limited claims data (1 claim). However,
we note that with all new codes for which we lack pricing information,
our policy has been to assign the service to an existing APC based on
input from a variety of sources, including, but not limited to, review
of the clinical similarity of the
[[Page 81655]]
service to existing procedures, input from CMS medical advisors, and
review of all other information available to us. The OPPS is a
prospective payment system that provides payment for groups of services
that share clinical and resource use characteristics. Based on our
understanding of the service and input from our medical advisors, we do
not agree that CPT code 0692T is dissimilar to other services in APC
5241 such that it should be assigned to a different APC. In particular,
our medical advisors noted the similarities between platelet apheresis
(CPT code 36513) and the therapeutic ultrafiltration procedure. For CY
2024, based on our evaluation, we are finalizing our proposal to
continue the assignment to APC 5241 for CPT code 0692T.
In summary, after consideration of the public comment, we are
finalizing our proposal, without modification, to assign CPT code 0692T
to APC 5241 for CY 2024. The final CY 2024 payment rate for the code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the SI meanings for all codes reported under the
OPPS. Addenda B and D1 are available via the internet on the CMS
website.
5. Aqueous Shunt Procedure (APC 5492)
For CY 2023, we assigned CPT code 66180 (Aqueous shunt to
extraocular equatorial plate reservoir, external approach; with graft)
to APC 5492 (Level 2 Intraocular Procedures) with a payment of
$3,995.58. For CY 2024, as shown in OPPS Addendum B that was released
with the CY 2024 OPPS/ASC proposed rule with comment period, we
proposed to maintain the APC assignment to APC 5492 with a payment rate
of $3,970.62 for CPT code 66180.
Comment: One commenter suggested reassigning CPT code 66180 to APC
5493 (Level 3 Intraocular Procedures, with a payment rate of $5,110.58,
based on its similarity to CPT code 66179 (Aqueous shunt to extraocular
equatorial plate reservoir, external approach; without graft), which is
proposed in APC 5493. The commenter explained that CPT code 66180 and
CPT code 66179 are very similar procedures but clarified that CPT code
66180 requires additional time and resources to affix the scleral patch
graft used in the procedure. Based on their similarity, the commenter
urged CMS to reassign CPT code 66179 to APC 5493.
Response: While the procedures may be the same, our claims data for
this final rule with comment period shows that the resources to perform
the procedures are significantly different. For 2024, the OPPS payment
rates are based on claims submitted between January 1, 2022, and
December 31, 2022, processed through June 30, 2023. Based on our
evaluation of the claims data, the geometric mean cost for CPT code
66180 is lower than CPT code 66179. Specifically, our claims data show
a geometric mean cost of about $4,595 for CPT code 66180 based on 3,124
single claims (out of 3,140 total claims). In contrast, the geometric
mean cost for CPT code 66179 is slightly higher at approximately $4,988
based on 134 single claims (out of 135 total claims). The cost range
for the significant procedures assigned to APC 5492 is between
approximately $3,138 (for CPT code 65820) and $4,694 (for CPT code
66183), while the cost range for the significant procedures assigned to
APC 5493 is between about $4,943 (for CPT code 66991) and $5,357 (for
CPT code 66989). Based on the cost range for APC 5492 and 5493, we
believe that the resource costs and clinical homogeneity for CPT code
66180 are consistent with those procedures in APC 5492, rather than APC
5493. Therefore, we believe we should continue to assign CPT code 66180
to APC 5492.
In summary, after consideration of the public comment we received,
we are finalizing our proposal, without modification, to continue to
assign CPT code 66180 to APC 5492 for CY 2024. We refer readers to
Addendum B of this final rule with comment period for the payment rates
for all codes reported under the OPPS. In addition, we refer readers to
Addendum D1 of this final rule with comment period for the status
indicator meanings for all codes reported under the OPPS. Addenda D1
and Addendum B are available via the internet on the CMS website.
6. Arthrodesis, Sacroiliac Joint, Percutaneous, with Image Guidance,
Including Placement of Intra-Articular Implant(s) (e.g., Bone
Allograft[s], Synthetic Device[s]), Without Placement of Transfixation
Device (APC 5116)
The CPT Editorial Panel established CPT code 27278, to describe
arthrodesis, sacroiliac joint, percutaneous, with image guidance,
including placement of intra-articular implant(s) (e.g., bone
allograft[s], synthetic device[s]), without placement of transfixation
device, effective January 1, 2024. Because the final CY 2024 CPT code
numbers were not available when we published the proposed rule, the
code was listed as placeholder code 2X000 in the OPPS Addendum B of the
CY 2024 OPPS/ASC proposed rule.
For CY 2024, we proposed to assign CPT code 27278 to status
indicator ``J1'' and APC 5116 (Level 6 Musculoskeletal Procedures) with
a proposed payment rate of $20,692.25 based on clinical similarity and
resource use to the predecessor code 0775T.
Comment: One commenter supported our proposal to assign CPT code
27278 to APC 5116 due to clinical similarity and resource use to the
predecessor code 0775T.
Response: We appreciate the commenter's feedback on this new CPT
code and we agree with the commenter's recommendation to finalize the
APC assignment.
In summary, after reviewing the public comment for the proposal, we
are adopting as final our proposal to assign CPT code 27278 to APC
5116. The final CY 2024 payment rate for this code can be found in
Addendum B to this final rule with comment period. In addition, we
refer readers to Addendum D1 of this final rule with comment period for
the status indicator meanings for all codes reported under the OPPS.
Addenda B and D1 are available via the internet on the CMS website.
7. Artificial Iris Insertion Procedures (APC 5496)
For the July 2020 update, the AMA's CPT Editorial Panel established
three CPT codes to describe the CustomFlex Artificial Iris device
implantation procedure. Table 50 below lists the long descriptors for
the codes. In addition to the surgical CPT codes, as discussed in the
CY 2021 OPPS/ASC final rule with comment period (85 FR 85990 through
85992), we approved the associated device, specifically, the CustomFlex
Artificial Iris, for pass-through status effective January 1, 2021, and
established a new category for this device, specifically, HCPCS code
C1839 (Iris prosthesis). The designation of pass-through status for the
device indicates that, under the OPPS, the device is paid separately in
addition to the surgical CPT codes.
In the CY 2023 OPPS/ASC final rule with comment period (87 FR
71889), we listed device category HCPCS code C1839 in Table 52 (Devices
with Pass-Through Status (Or Adjusted Separate Payment) Expiring At The
End of the Fourth Quarter of 2022, In 2023, or In 2024), as one of the
device codes whose pass-through status would expire on December 31,
2022. However, section 4141 (Extension of Pass-Through Status Under the
Medicare Program for Certain Devices Impacted by COVID-19) of the
Consolidated Appropriations Act, 2023 extended pass-through status for
a 1-year period beginning on January 1,
[[Page 81656]]
2023, for devices whose pass-through status would have ended on
December 31, 2022. Consequently, pass-through for HCPCS code C1839 will
now expire on December 31, 2023.
As listed in Table 50 below, for CY 2023, we assigned HCPCS code
C1839 to status indicator ``H'' to indicate that the device is on pass-
through status. In addition, we assigned CPT codes 0616T-0618T to APC
5495 (Level 5 Intraocular Procedures) with a payment rate of
$18,089.98. For CY 2024, we proposed to reassign device category code
C1839 from status indicator ``H'' (device pass-through) to status
indicator ``N'' (packaged) since its pass-through status expires on
December 31, 2023. With the additional costs from the expired pass-
through device, we proposed to reassign CPT codes 0616T, 0617T, and
0618T from APC 5495 to APC 5496 (Level 6 Intraocular APC), which is a
Low Volume APC and is discussed in further detail in section III.D of
this final rule with comment period. In addition, the discussion
related to device HCPCS code C1839 can be found in section IV.b of this
final rule with comment period.
[GRAPHIC] [TIFF OMITTED] TR22NO23.068
Comment: Some commenters applauded our proposal to reassign CPT
codes 0616T, 0617T, and 0618T to APC 5496, and requested that CMS
finalize the APC assignment.
Response: As listed in Table 46 in section III.D. of this final
rule with comment period, APC 5496 is designated as one of the low
volume APCs for CY 2024. Based on our review of the claims data for APC
5496, we found the cost for CPT code 0616T to be about $18,080 based on
15 single claims, approximately $12,873 for CPT code 0617T based on 7
claims, and about $17,733 for CPT code 1618T based on 13 single claims.
Based on our analysis of the updated data for this final rule, we
identified APC 5496 as a Low Volume APC with a cost of $16,990.74, and
a final payment amount of $16,547.60 for CY 2024. We believe that APC
5496 is the appropriate assignment for CPT codes 0616T, 0617T, and
0618T based on their clinical characteristic and resource similarity to
the procedure in the APC.
In summary, after consideration of the public comments, we are
finalizing our proposal, without modification, and assigning CPT codes
0616T, 0617T, and 0618T to APC 5496 for CY 2024. Table 51 list the
final OPPS SIs and APC for the codes. The final CY 2024 OPPS payment
rate for the codes can be found in Addendum B to this final rule with
comment period. In addition, we refer readers to Addendum D1 of this
final rule with comment period for the status indicator (SI) meanings
for all codes reported under the OPPS. Addenda B and D1 are available
via the internet on the CMS website.
[[Page 81657]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.069
8. Autologous Adipose-Derived Regenerative Cell (ADRC) Therapy for
Partial Thickness Rotator Cuff Tear (APC 5055)
Effective July 1, 2022, the AMA's CPT Editorial Panel created two
new Category III CPT codes to describe autologous adipose-derived
regenerative cell (ADRC) therapy for partial thickness rotator cuff
tear:
0717T: Autologous adipose-derived regenerative cell (ADRC)
therapy for partial thickness rotator cuff tear; adipose tissue
harvesting, isolation and preparation of harvested cells, including
incubation with cell dissociation enzymes, filtration, washing, and
concentration of ADRCs
0718T: Autologous adipose-derived regenerative cell (ADRC)
therapy for partial thickness rotator cuff tear; injection into
supraspinatus tendon including ultrasound guidance, unilateral
These codes describe a prospective, randomized multicenter pivotal
trial of autologous adult adipose-derived regenerative cell (ADRC)
injection into partial-thickness rotator cuff tears that is currently
in progress. The purpose of this investigation is to evaluate the
safety and superior effectiveness in functional improvement in patients
with partial-thickness rotator cuff tears (PTRCTs) after the
administration of a single injection of adipose-derived regenerative
cells (ADRCs) into the partial-thickness rotator cuff tear compared to
the administration of a single corticosteroid injection into the
associated subacromial space. For CY 2024, we proposed to assign CPT
codes 0717T and 0718T to status indicator ``E1'' to indicate that these
codes are not paid by Medicare when submitted on outpatient claims (any
outpatient bill type) since, at the time, the clinical trial had not
been approved by CMS as IDE Category B study.
Comment: One commenter requested that we reassign CPT codes 0717T
and 0718T from status indicator ``E1'' to status indicator ``J1'' and
assign them to APC 5114 (Level 4 Musculoskeletal Procedures) with a
proposed payment rate of $6,895.06. The commenter stated that this was
the best placement based on clinical and resource coherence. The
commenter also stated that this was consistent with their calculation
that the total cost of the device was $3,186.11. The commenter stated
that the cost of their procedure including the device was $6,316 in
2022. The commenter noted that on August 24, 2023, the CMS Coverage and
Analysis Group (CAG) approved their Category B IDE study and included
it on the approved list of covered Category B IDE trials.
Response: We thank the commenter for the recommendation. Because
the clinical trial was approved by CMS as a Category B IDE study on
August 24, 2023, we are assigning CPT codes 0717T and 0718T to separate
payment under OPPS. Based on input from our medical advisors, we are
assigning both CPT codes 0717T and 0718T to status indicator ``T'' and
APC 5055 (Level 5 Skin Procedures) based on clinical similarity with
CPT code 15771 (Grafting of autologous fat harvested by liposuction
technique to trunk, breasts, scalp, arms, and/or legs; 50 cc or less
injectate).
The final 2024 payment rates for the codes can be found in Addendum
B to this final rule with comment period. In addition, we refer readers
to Addendum D1 of this final rule with comment period for the status
indicator (SI) meanings for all codes reported under the OPPS. Addenda
B and D1 are available via the internet on the CMS website.
[[Page 81658]]
9. Barostim CPT Code 0266T (APC 1580)
Barostim is a fully implantable neurostimulator system with an
indication to treat heart failure symptoms in a limited number of
patients who meet the FDA-approved eligibility criteria. Barostim
received device pass-through status in the OPPS starting in January
2021 and its device pass-through status is scheduled to end on December
31, 2023. In the OPPS, once pass-through status ends for a device, the
cost of the device is packaged into its associated procedure, which for
Barostim is CPT code 0266T (Implantation or replacement of carotid
sinus baroreflex activation device; total system (includes generator
placement, unilateral or bilateral lead placement, intra-operative
interrogation, programming, and repositioning, when performed)).
Claims from CY 2022 will be used to set the payment rate for the
Barostim implant procedure. There are 123 claims for the Barostim
implant procedure in CY 2022, and all claims report using Barostim as a
part of the Barostim implant procedure. Therefore, the geometric mean
cost of the Barostim implant procedure reflects the full cost of the
device and the resources used to implant it. The Neurostimulator and
Related Procedures APC has five payment levels. The estimated payment
amount for CY 2024 for Level 5, which is the highest level, is around
$30,700. The geometric mean cost of the Barostim implant procedure is
nearly $46,000. In the CY 2024 OPPS proposed rule, we proposed to
assign the Barostim implant procedure to APC 5465 (Level 5
Neurostimulator and Related Procedures).
Comment: The HOP Panel and multiple commenters including the
manufacturer requested that CPT code 0266T be assigned to APC 1580 (New
Technology--Level 43 ($40,001-$50,000)) with a payment rate of around
$45,000. The commenters noted that in the CY 2023 OPPS/ASC final rule
we assigned a different neurostimulator procedure whose geometric mean
cost was over $25,000 more than the payment rate for APC 5465, CPT code
0424T (Insertion or replacement of neurostimulator system for treatment
of central sleep apnea; complete system (transvenous placement of right
or left stimulation lead, sensing lead, implantable pulse generator)),
to New Technology APC 1581 (New Technology--Level 44 ($50,001-$60,000)
with a payment rate of around $55,000 as APC 1581 more closely
reflected the cost of the service.
Response: We agree with the commenters. The updated geometric mean
for CPT code 0266T is around $47,300 which is nearly $17,000 more than
the updated payment rate for APC 5465 of around $30,500. Also as noted
by the commenters, we had in CY 2023 moved another neurostimulator
procedure described by CPT code 0424T to a new technology APC when its
geometric mean was found to be substantially higher than the payment
rate for APC 5465.
After consideration of the public comments we received, we are not
adopting our proposal as final. Instead, we are adopting a final APC
assignment for CPT code 0266T to APC 1580 (New Technology--Level 43
($40,001-$50,000)). Table 52 shows the finalized status indicator and
APC assignment for all of the procedure codes. We refer readers to
Addendum B of this final rule with comment period for the payment rates
for all codes reportable under the OPPS. Addendum B is available via
the internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.070
10. Barricaid[supreg] Spine/Lumbar Disk Surgery (APC 5115)
For CY 2024, we proposed to assign HCPCS code C9757 (Laminotomy
(hemilaminectomy), with decompression of nerve root(s), including
partial facetectomy, foraminotomy and excision of herniated
intervertebral disc, and repair of annular defect with implantation of
bone anchored annular closure device, including annular defect
measurement, alignment and sizing assessment, and image guidance; 1
interspace, lumbar) to APC 5115 (Level 5 Musculoskeletal Procedures)
with a proposed payment rate of $13,269.40. The proposed short
descriptor for HCPCS code C9757 was ``spine/lumbar disk surgery.''
Comment: We received a comment from the manufacturer of the
Barricaid[supreg] device, which is the bone-anchored annular closure
device that is implanted during the procedure described by HCPCS code
C9757. Specifically, the commenter requested that we revise the short
descriptor for HCPCS code C9757 from ``spine/lumbar disk surgery'' to
``spine bone-anchor implant surgery,'' which could help limit erroneous
claims for HCPCS code C9757 that do not include the Barricaid[supreg]
device. The commenter also requested that CMS issue a transmittal or
Medicare Learning Network[supreg] (MLN) Matters article to educate
hospital outpatient departments that a bone-anchored implant must be
used to report HCPCS code C9757, and that the code cannot be reported
using any other type of non-FDA approved technology or when a suture-
based supply is used.
Response: We thank the commenter for their input. First, we note
that coders are generally aware that they need to read the entire long
descriptors, and not rely on short descriptors alone, for the codes
they are billing to ensure they are
[[Page 81659]]
reporting the procedures, services, and items accurately. In addition,
it is generally not our policy to judge the accuracy of provider coding
and charging for purposes of ratesetting. We rely on hospitals and
providers to accurately report the use of HCPCS codes in accordance
with their code descriptors and CPT and CMS instructions, and to report
services accurately on claims and charges and costs for the services on
their Medicare hospital cost report. Nonetheless, we are sympathetic to
the commenter's concern regarding the descriptor, and consequently, we
believe that a slight modification to the short descriptor may be
helpful to ensuring that a device is used every time the HCPCS code
C9757 is billed on a claim. We note that there is a maximum number of
characters that can be used for the short descriptor field. In light of
this character field limitation and to further clarify that a device
should be implanted each time HCPCS code C9757 is billed, for CY 2024
we are revising the short descriptor for the code from ``Spine/lumbar
disk surgery'' to ``Spine device implant surgery.''
After consideration of the public comment, we are finalizing our
proposal to assign HCPCS code C9757 to APC 5115 with one modification
to the code's short descriptor. For CY 2024, the short descriptor for
HCPCS code C9757 is ``Spine device implant surgery'' to clarify that a
device must be implanted each time the service is performed. The final
CY 2024 short descriptor for HCPCS code C9757 can be found in Addendum
B to this final rule with comment period. Addendum B is available via
the internet on the CMS website. We also refer readers to Addendum D1
of this final rule with comment period for the SI meanings for all
codes reported under the OPPS. Addenda B and D1 are available via the
internet on the CMS website.
11. Biliary Endoscopy CPT Codes 47539 and 47564 (APCs 5361 and 5362)
CPT code 47539 (Placement of stent(s) into a bile duct,
percutaneous, including diagnostic cholangiography, imaging guidance
(eg, fluoroscopy and/or ultrasound), balloon dilation, catheter
exchange(s) and catheter removal(s) when performed, and all associated
radiological supervision and interpretation; new access, without
placement of separate biliary drainage catheter) with a geometric mean
cost of around $7,576 and CPT code 47564 (Laparoscopy, surgical;
cholecystectomy with exploration of common duct) with a geometric mean
cost of around $7,576 describe procedures that are performed when a
patient has a blockage of their bile duct. For the CY 2024 OPPS
proposed rule, we proposed to assign both procedures to APC 5361 (Level
1 Laparoscopy and Related Services) with a payment rate of around
$5,608.
Comment: One commenter requested that we assign both CPT code 47539
and CPT code 47564 to APC 5362 (Level 2 Laparoscopy and Related
Services) with a payment rate of around $9,984. The commenter noted
that both of these procedures had a geometric mean cost that was more
than 2-times the lowest-cost significant procedure assigned to APC 5361
(CPT code 49587), with a 2-times limit of around $7,207, which is less
than the $7,576 geometric mean rate for both procedures. The commenters
contended the only reason there is not a 2-times violation is neither
CPT code 47539 nor CPT code 47564 is a significant procedure for
determining the payment rate for APC 5361. The commenter also noted
that the procedures described by CPT codes 47539 and 47564 have
clinical and resource similarities to both the procedures in the
higher-cost portion of APC 5361 and the lower-cost portion of APC 5362,
which was another reason the commenters believed the procedures should
be moved to APC 5362.
Response: We appreciate the request of the commenter. Since the
release of the CY 2024 OPPS proposed rule, we have updated our 2-times
analysis of claims from CY 2022 that are used to set rates for CY 2024.
Our updated results find that the 2-times limit for APC 5361 based on
CPT code 49587 as the lowest-cost significant procedure is around
$7,318. The updated geometric mean cost for CPT code 47539 is around
$7,316, which means by just $2 there would not be a 2 times rule
violation if CPT code 47539 was a significant procedure in determining
the payment rate for APC 5361. For CPT code 47564, the updated
geometric mean cost for the procedure is $7,557, which means there
would be a 2 times rule violation if the procedure was significant in
APC 5361. Our review of the procedures assigned to APC 5361 and APC
5362 found the procedure described by CPT code 47539 had more clinical
and resource similarities with the procedures in APC 5361, while the
procedure described by CPT code 47564 appeared to have more clinical
and resource similarities with the procedures in APC 5362.
After consideration of the public comments we received, we are
implementing our proposal without modification for CPT code 47539 to
assign the procedure to APC 5361 (Level 1 Laparoscopy and Related
Services). We also are implementing our proposal with modification for
CPT code 47564 by assigning the procedure to APC 5362 (Level 2
Laparoscopy and Related Services). Table 53 shows the finalized status
indicator and APC assignment for all of the procedure codes. We refer
readers to Addendum B of this final rule with comment period for the
payment rates for all codes reportable under the OPPS. Addendum B is
available via the internet on the CMS website.
[[Page 81660]]
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12. Bone Density Tests/Bone Mass Measurement: Biomechanical Computed
Tomography (BCT) Analysis and Digital X-ray Radiogrammetry-Bone Mineral
Density (DXR-BMD) Analysis) (APCs 5521, 5523, and 5731)
CPT code 0743T (Bone strength and fracture risk using finite
element analysis of functional data and bone mineral density (BMD),
with concurrent vertebral fracture assessment, utilizing data from a
computed tomography scan, retrieval and transmission of the scan data,
measurement of bone strength and BMD and classification of any
vertebral fractures, with overall fracture-risk assessment,
interpretation and report) became effective January 1, 2023. This code
describes the service associated with BCT analysis with concurrent
vertebral fracture assessment (VFA).
In addition to new CPT code 0743T, there are five existing CPT
codes describing BCT analysis that were effective July 1, 2019. The
codes and their long descriptors are listed below.
0554T: Bone strength and fracture risk using finite
element analysis of functional data and bone-mineral density utilizing
data from a computed tomography scan; retrieval and transmission of the
scan data, assessment of bone strength and fracture risk and bone-
mineral density, interpretation and report.
0555T: Bone strength and fracture risk using finite
element analysis of functional data and bone-mineral density utilizing
data from a computed tomography scan; retrieval and transmission of the
scan data.
0556T: Bone strength and fracture risk using finite
element analysis of functional data and bone-mineral density utilizing
data from a computed tomography scan; assessment of bone strength and
fracture risk and bone mineral density.
0557T: Bone strength and fracture risk using finite
element analysis of functional data and bone-mineral density utilizing
data from a computed tomography scan; interpretation and report.
0558T: Computed tomography scan taken for the purpose of
biomechanical computed tomography analysis.
In the CY 2023 OPPS/ASC notice of proposed rulemaking (NPRM), we
proposed to reassign CPT codes 0554T-0558T to status indicator E1. In
response to public comment on the proposal, in the CY 2023 OPPS/ASC
final rule (87 FR71844 through 71846), we stated that, based on our
review and understanding of the service, BCT analysis does not meet
Medicare's definition of bone mass measurement, as specified in Sec.
410.31(a), which specifies the coverage of, and payment for, bone mass
measurements for Medicare beneficiaries. Therefore, we assigned CPT
codes 0554T-0558T and CPT code 0743T to status indicator ``E1'' to
indicate that these codes are not covered by Medicare, and not paid by
Medicare when submitted on outpatient claims (any outpatient bill
type).
In the CY 2024 OPPS/ASC proposed rule, we proposed to continue to
assign CPT codes 0554T-0558T and CPT code 0743T to status indicator
``E1.''
Comment: Several commenters stated that they disagree with the
status indicator assignment of ``E1'' and that the BCT CPT codes 0554-
0558T and CPT Code 0743T (BCT+VFA) meet the regulatory definition of
Bone Mass Measurement (BMM). Commenters contended that the BCT and
BCT+VFA procedures are reasonable and necessary diagnostic tests that
meet all aspects of both the statutory and regulatory definitions of
BMM.
Another commenter stated that they urge CMS to restore coverage for
BCT codes and BCT with concurrent VFA as covered bone mass measurement
and assign them to status indicators ``S.''
Response: We appreciate these comments. While CMS further considers
this issue, we will not finalize, as proposed, the status indicator of
``E1'' for these codes, but instead are assigning certain BCT codes
describing HOPD services to clinical APCs. Specifically, for CY 2024,
we are assigning CPT code 0555T to APC 5731 (Level 1 Minor Procedures)
and SI ``S,'' CPT code 0556T to APC 5523 (Level 3 Imaging without
Contrast) and SI ``S,'' and CPT code 0558T to APC 5521 (Level 1 Imaging
without Contrast) with SI of ``S,'' which were the same APC assignments
for the codes between CY 2019 and CY 2022. In addition, we are
assigning CPT codes 0554T, 0557T, and 0743T to SI ``M'' (Items and
Services Not Billable to the MAC. Not paid under OPPS.) to indicate
that these codes are not payable under the OPPS since they describe
physician-only services. As we have consistently stated in past rules
(87 FR 71879) and quarterly change requests to assign new codes to APCs
(see, e.g., Pub 100-04 Medicare Claims Processing, Transmittal 11937),
the fact that a drug, device, procedure or service is assigned a HCPCS
code and a payment rate under the OPPS does not imply coverage by the
Medicare program, but indicates only how the product, procedure, or
service may be paid if covered by the program.
[[Page 81661]]
Medicare Administrative Contractors (MACs) determine whether a drug,
device, procedure, or other service meets all program requirements and
conditions for coverage and payment. Accordingly, we emphasize that
HOPDs would only receive payment for these services when the
appropriate MAC determines that the service meets the relevant
conditions for coverage and payment.
In summary, after consideration of the public comments, we are not
finalizing our proposal for CPT codes 0554T-0558T and CPT code 0743T.
The final payment rates for the separately payable codes can be found
in Addendum B to this final rule with comment period. In addition, we
refer readers to Addendum D1 of this final rule with comment period for
the status indicator (SI) meanings for all codes reported under the
OPPS. Addenda B and D1 are available via the internet on the CMS
website.
13. Cardiac Computed Tomography Angiography (CCTA) (APC 5571)
For the 2006 update, the AMA's CPT Editorial Panel established six
Category III CPT codes to describe cardiac computed tomography
angiography with contrast materials effective January 1, 2006. The
codes were active and separately payable under the OPPS between January
1, 2006, through December 31, 2009. The CPT Editorial Panel deleted the
Category III CPT codes and replaced them with Category I CPT codes
75572 through 75574 effective January 1, 2010. With the deletion of the
Category III CPT codes on December 31, 2009, we crosswalked the APC
assignments from the Category III CPT codes (predecessor codes) to the
new Category I CPT codes effective January 1, 2010. Since 2010, the
Category I CPT codes describing cardiac computed tomography angiography
with contrast materials are CPT codes 75572, 75573, and 75574. The
codes and their long descriptors are listed below.
75572: Computed tomography, heart, with contrast material,
for evaluation of cardiac structure and morphology (including 3D image
postprocessing, assessment of cardiac function, and evaluation of
venous structures, if performed)
75573: Computed tomography, heart, with contrast material,
for evaluation of cardiac structure and morphology in the setting of
congenital heart disease (including 3D image postprocessing, assessment
of left ventricular (LV) cardiac function, right ventricular (RV)
structure and function and evaluation of vascular structures, if
performed)
75574: Computed tomographic angiography, heart, coronary
arteries and bypass grafts (when present), with contrast material,
including 3D image postprocessing (including evaluation of cardiac
structure and morphology, assessment of cardiac function, and
evaluation of venous structures, if performed)
For CY 2023, as we indicated in the CY 2023 OPPS/ASC final rule
with comment period (87 FR 71847 through 71850), we assigned the codes
to APC 5571 (Level 1 Imaging with Contrast). As listed in the OPPS
Addendum A (OPPS APCs) that was released with the CY 2023 OPPS/ASC
final rule with comment period, APC 5571 was assigned a payment rate of
$180.34 effective January 1, 2023. We note that the OPPS payment rate
applies only to the hospital outpatient facility and does not include
the physician service payment. Physician services are paid under
Medicare's Physician Fee Schedule (PFS). For reference, the 54 below
shows the total CY 2023 Medicare reimbursement for CPT codes 75572,
75573, and 75574.
[GRAPHIC] [TIFF OMITTED] TR22NO23.072
For CY 2024, based on the latest claims data, we proposed to
continue to assign the codes to APC 5571 with a proposed payment rate
of $177.09. As a reminder, we update the OPPS payment rates on an
annual basis consistent with the requirements set forth in section
1833(t)(9)(A) of the Act that requires the HHS Secretary to review, not
less often than annually, and revise the APC groups, the relative
payment weights, and the wage and other adjustments to take into
account changes in medical practice, changes in technology, the
addition of new services, new cost data, and other relevant information
and factors. We received several comments related to our proposed
payment for the CCTA codes. Many of the comments, which were form
letters, addressed the same issues that were brought to our attention
in the CY 2021 OPPS/ASC final rule (85 FR 85956 through 85959). Below
is a summary of the public comments to the CY 2024 OPPS/ASC proposed
rule and our responses to the comments.
Comment: Several commenters noted that the payment for the CCTA
codes has declined since 2017 and expressed concern with the continued
assignment to APC 5571. They indicated that the reimbursement amount is
insufficient to cover the cost of providing the service and argued that
the payment amount does not take into account the hospital resources
required to perform the test, including the use of the equipment,
medication administration, staff time, and scanner time. To pay
appropriately for the service, many of the commenters requested the
reassignment of CPT codes 75572 and 75573 to APC 5572 (Level 2 Imaging
with Contrast), with a proposed payment of $369.86. These same
commenters also requested the reassignment of CPT code 75574 to APC
5573 (Level 3 Imaging with Contrast), with a proposed payment rate of
$775.83.
Response: Under the OPPS, we use the latest claims data to set the
annual payment rates. Payment rates for CY 2024 are based on claims
with dates of service between January 1, 2022, and December 31, 2022,
processed through June 30, 2023. As illustrated in Table 55
[[Page 81662]]
below, analysis of our claims data shows that the geometric mean cost
for the codes range between $150.58 and $219.06. Specifically, the
geometric mean cost for CPT code 75572 is $150.57 based on 22,575
single claims (out of 40,066 total claims), $219.06 for CPT code 75573
based on 437 single claims (out of 678 total claims), and $193.29 for
CPT code 75574 based on 55,871 single claims (out of 78,932 total
claims). Based on our analysis, the geometric mean costs for all three
codes are consistent with the geometric mean cost for APC 5571, whose
geometric mean cost is $179.94. In contrast, the geometric mean costs
for APCs 5572 and 5573 are $376.62 and $784.12, respectively. Based on
the geometric mean costs for CPT codes 75572 (GMC $150.57) and 75573
(GMC $219.06), we do not believe that reassigning the codes to APC 5572
(GMC $376.62) would be appropriate. Similarly, based on the latest
claims data for CPT code 75574 (GMC $193.29), we do not believe that
reassigning the code to APC 5573 (GMC $784.11) would be appropriate. We
believe that reassigning the codes to either APC 5572 or 5573 would
significantly overpay for the service. Based on the claims data, we
believe that assigning CPT codes 75572, 75573, and 75574 to APC 5571
remains appropriate based on clinical characteristics and resource
homogeneity to the other services in the APC. In addition, because the
CCTA CPT codes have been in existence since 2010, we do not believe
that hospital outpatient facilities have been coding these services
inappropriately. Consequently, we believe our claims data reflect the
cost of providing the service.
[GRAPHIC] [TIFF OMITTED] TR22NO23.073
Comment: A commenter suggested discontinuing payment for CPT code
75573 and instead reassigning the current payment rate for CPT code
75573 for CPT codes 75574, 93571, and 93572. The commenter noted that
in addition to CPT code 75574, CPT codes 93571 and 93572 are under-
reimbursed.
Response: Under the OPPS, we cannot reallocate or remove the
reimbursement from one active/existing code and distribute to other
codes. In cases where
[[Page 81663]]
a code is deleted and replaced with another code, we will crosswalk the
payment for the deleted code/predecessor code to the new code. However,
in this case, CPT code 75573 is an active code under the OPPS, and its
payment cannot be removed and reassigned to another code. Payment
determination under the OPPS is based on analysis of the latest claims
data. For CY 2024, OPPS payments are based on our analysis of claims
with dates of service between January 1, 2022, and December 31, 2022,
processed through June 30, 2023. As stated above, we have claims data
for CPT code 75573, which indicates that the service is performed in
the HOPD setting.
With regard to CPT codes 93571 and 93572 codes, we note these codes
are assigned status indicator ``N'' to indicate that their payment is
packaged in the primary code. Below are the complete long descriptors
for CPT codes 93571 and 93572:
93571: Intravascular doppler velocity and/or pressure
derived coronary flow reserve measurement (coronary vessel or graft)
during coronary angiography including pharmacologically induced stress;
initial vessel (list separately in addition to code for primary
procedure)
93572: Intravascular doppler velocity and/or pressure
derived coronary flow reserve measurement (coronary vessel or graft)
during coronary angiography including pharmacologically induced stress;
each additional vessel (list separately in addition to code for primary
procedure)
The words ``list separately in addition to code for primary
procedure'' are included in the long descriptors for CPT code 93571 and
93572 to indicate that that the codes are considered ``add-ons'' to
another primary code that cannot be reported independently.
Specifically, add-on codes must always be reported with another primary
code on the same day. The AMA states in the CPT 2024 Professional
Edition (page xviii) that ``add-on codes are always performed in
addition to the primary service or procedure and must never be reported
as a stand-alone code.'' In most cases, add-on codes are typically
ancillary and supportive to a primary diagnostic or therapeutic
modality and are an integral part of the primary service they support.
As specified under regulation 42 CFR 419.2(b)(18), add-on codes are
generally packaged under the OPPS, and payment for the codes are
bundled with the primary codes. Consequently, CPT codes 93571 and 93572
are not paid separately under the OPPS, but instead, their payment is
packaged into the primary code.
In addition, because we have claims data for CPT code 75573, we
would not reallocate the payment for the code to CPT codes 93571,
93572, and 75574. As stated above, our claims data show a geometric
mean cost of $219.06 for CPT code 75573 based on 437 single claims (out
of 678 total claims). Therefore, we believe that CPT code 75573 should
continue to be paid separately under APC 5571.
Comment: Many commenters urged CMS to allow hospitals the
flexibility to submit charges for cardiac CT procedures with other than
the general CT revenue code (0350) or the general MRI revenue code
(0610), thereby allowing future estimates to reflect the true cost of
providing the service. Some commenters suggested that the Medicare
Administrative Contractors (MACs) have made it mandatory to report only
the general CT revenue code (0350) for the CCTA codes. Another
commenter reported that MACs have applied edits to the CCTA codes that
prevent hospitals from reporting a cardiac revenue code for cardiac CT
services when appropriate.
Response: Based on our evaluation, we have not found any MAC edits
that prevent hospitals from reporting the appropriate revenue code for
the CCTA codes. We analyzed our claims data and based on claims with
dates of service between January 1, 2022, and December 31, 2022,
processed through June 30, 2023, we found seven revenue codes reported
with CPT codes 75572, 75573, and 75574, specifically, revenue codes
0320, 0321, 0329, 0350, 0351, 0352, and 0359. Of these seven revenue
codes, four apply to CT services, specifically, revenue codes 0350,
0351, 0352, and 0359. As evidenced by the claims data, hospital
outpatient facilities are reporting revenue codes that describe CT
services for the CCTA codes. We note that the general MRI revenue code,
specifically, revenue code 0610, was not reported with the CCTA codes.
Moreover, as listed in Table 56 below, we included the costs for these
revenue codes in the CY 2024 ratesetting. That is, the costs attributed
to the CCTA codes are included in the payment for CPT codes 75572,
75573, and 75574.
[[Page 81664]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.074
Furthermore, as we stated in the CY 2023 OPPS/ASC final rule (87 FR
71849), hospital outpatient facilities are responsible for reporting
the appropriate cost centers and revenue codes. As stated in section
20.5 in Chapter 4 (Part B Hospital) of the Medicare Claims Processing,
CMS ``does not instruct hospitals on the assignment of HCPCS codes to
revenue codes for services provided under OPPS since hospitals'
assignment of cost vary. Where explicit instructions are not provided,
HOPDs should report their charges under the revenue code that will
result in the charges being assigned to the same cost center to which
the cost of those services are assigned in the cost report.''
Therefore, hospital outpatient facilities must determine the most
appropriate cost center and revenue code for the CCTA codes. This
instruction is reiterated in the Medicare Administrative Contractor
(MAC) instructions for revenue code reporting for CCT and CCTA
services, as noted in the various articles listed in Table 57. As
stated in Table 57, MACs ``may specify revenue codes to help providers
identify those revenue codes typically used'' to report a service,
however, the guidance is purely advisory, and not mandatory, which is
in contrast to statements made by several commenters. The MAC
instructions can be found on the CMS.gov website, specifically, on the
Medicare Coverage Database website.
[[Page 81665]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.075
In summary, after consideration of the public comments, we are
finalizing our proposal, without modification, and assigning the CCTA
CPT codes 75572, 75573, and 75574 to APC 5571. The final CY 2024 OPPS
payment rates for the codes can be found in Addendum B to this final
rule with comment period. In addition, we refer readers to Addendum D1
of this final rule with comment period for the status indicator (SI)
meanings for all codes reported under the OPPS. Addenda B and D1 are
available via the internet on the CMS website.
14. Cardiac Leadless Pacemaker Procedures (APCs 5183, 5224, and 5741)
For the July 2023 update, the CPT Editorial Panel established 10
new codes effective July 1, 2023, to describe the various procedures
related to three new leadless pacemaker systems, specifically, the
Aveir VR, Aveir AR, and Aveir DR leadless pacemaker systems. The codes
describe the insertion, removal and replacement, removal-only, and
programming associated with the new devices. The codes, and their long
descriptors are listed in Table 58. Based on our evaluation of the
codes, we determined that the Aveir VR received FDA approval, however,
the Aveir AR and Aveir DR Systems were still pending FDA approval.
Because the Aveir VR System received FDA premarket approval (PMA) in
March 2022 and was approved by CMS for Medicare coverage under Coverage
with Evidence Development (CED) on June 21, 2022 (Study Title: Aveir VR
Coverage With Evidence Development Post-Approval Study;
Clinicaltrials.gov number: NCT05336877), we assigned the related CPT
codes to specific status indicator and APC assignments effective July
1, 2023. For the Aveir AR, and Aveir DR Systems that were still pending
FDA approval, we assigned the codes to status indicator ``E1'' to
indicate that they were not payable by Medicare when submitted on
outpatient claims (any outpatient bill type) because the services
associated with these codes are either not covered by any Medicare
outpatient benefit category, statutorily excluded by Medicare, or not
reasonable and necessary. These codes, and their OPPS SI and APC
assignments were listed in the July 2023 OPPS quarterly update CR
(Transmittal 12077, Change Request 13210, dated June 13, 2023). Table
58 below list the codes, long descriptors, status indicators, and APC
assignments for the 10 codes that were listed in the July 2023 OPPS
quarterly update CR.
BILLING CODE 4150-28-P
[[Page 81666]]
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[[Page 81667]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.077
BILLING CODE 4150-28-C
For CY 2024, as listed in the OPPS Addendum B that was released
with the CY 2024 OPPS/ASC proposed rule, we proposed to continue to
assign the 10
[[Page 81668]]
codes to the same status indicator and APC assignments listed in Table
58. In addition to the codes effective July 1, 2023, we also listed the
four Aveir AR-related CPT codes, specifically, CPT codes 0823T, 0824T,
0825T, and 0826T, that are effective January 1, 2024, in OPPS Addendum
B, and proposed to assign them to status indicator ``E1'' since the
device had not received FDA approval. The codes were listed in OPPS
Addendum B with their placeholder codes since we had not received the
final CPT code numbers from AMA in time for publication of the proposed
rule.
0823T (placeholder code X125T): Insertion of permanent
right atrial single-chamber leadless pacemaker
0824T (placeholder code X126T): Removal of permanent right
atrial single-chamber leadless pacemaker
0825T (placeholder code X127T): Removal and replacement of
permanent right atrial single-chamber leadless pacemaker
0826T (placeholder code X128T): Programming device
evaluation, single chamber
We note a commenter provided background information on the
technology associated with the new codes, the FDA approval for the
three leadless pacemaker systems, and the cost of the complete system.
First, the commenter clarified that the new codes relate to the Aveir
DR dual-chamber leadless pacemaker, which is a modular system, that
consists of two implanted leadless pacemakers, specifically, the Aveir
VR single-chamber right ventricular component, and the Aveir AR single-
chamber right atrial component. Secondly, the commenter clarified that
the Aveir VR received FDA PMA approval in March 2022, and the Aveir DR
and Aveir AR were approved by the FDA for commercial use through a PMA
supplement on June 29, 2023. Additionally, the commenter reported that
the price for the Aveir DR dual chamber leadless pacemaker is $24,000
and includes the following components: one Aveir VR right ventricular
leadless pacemaker, one Aveir AR right atrial leadless pacemaker, two
delivery catheters, and one introducer. The commenter indicated that
the Aveir VR and Aveir AR devices may be implanted at the same time,
thus representing the complete Aveir DR dual-chamber leadless
pacemaker. Alternatively, the single-chamber components (Aveir VR and
Aveir AR) may be implanted separately.
We received several comments related to our proposal. Below are the
responses to the comments.
Comment: A commenter disagreed with the proposed APC assignment for
the codes describing insertion of a leadless pacemaker for the complete
system and single-chamber devices. Specifically, the commenter
disagreed with the proposed assignment of APC 5194 (Level 4
Endovascular Procedures; proposed payment of $17,195.36) for CPT codes
33274 and 0797T, and suggested assignment to APC 5524 (Level 4
Pacemaker and Similar Procedures; proposed payment of $18,718.23). This
same commenter disagreed with the status indicator assignment of ``E1''
for CPT codes 0795T, 0796T, and 0823T, and recommended revision to APC
5524. Another device manufacturer also disagreed with the proposed
status indicator assignment of ``E1'' for CPT codes 0795T, 0796T, and
0823T, and recommended assignment to either APC 5231 (Level 1 ICD and
Similar Procedures; proposed payment of $23,075.10) or APC 5224. This
same device manufacturer recommended reassignment from status indicator
``E1'' to APC 5194 (Level 4 Endovascular Procedures; proposed payment
of $17,195.36) for CPT codes 0796T and 0823T.
Response: Because the codes are new, specifically, CPT codes 0795T,
0796T, 0797T, and 0823T, we have no claims data. In determining the
appropriate APC placement for new codes, we generally rely on input
from a variety of sources, including, but not limited to, review of the
resource costs and clinical similarity of the service to existing
procedures; input from CMS medical advisors; information from
interested specialty societies; and review of all other information
available to us. Based on our evaluation of the codes, we agree that
these insertion codes are more appropriate in APC 5224 (Level 4
Pacemaker and Similar Procedures) based on clinical similarity and
resource homogeneity to the procedures in the APC. Therefore, we are
assigning CPT codes 0795T, 0796T, 0797T, and 0823T, to APC 5224 for CY
2024.
With respect to CPT code 33274, which was effective January 1,
2019, our analysis of the claims data for this final rule shows a
geometric mean cost of about $19,560 based on 4,349 single claims (out
of 4,408 total claims), which we believe is consistent with the
geometric mean cost of approximately $19,082 for APC 5224. Therefore,
we agree with the commenter that CPT code 33274 fits more appropriately
in APC 5224 rather than APC 5194, whose geometric mean cost is about
$17,173. Consequently, we are reassigning CPT code 33274 from APC 5194
to APC 5224 for CY 2024.
Comment: For the removal and replacement codes, specifically, CPT
codes 0801T, 0802T, 0803T, and 0825T, some commenters disagreed with
the proposed status indicator assignment of ``E1.'' For CPT code 0801T,
the commenters recommended assignment to either APC 5224 or 5231, and
for CPT code 0803T, they disagreed with assignment to APC 5194 and
suggested assignment to APC 5224. For CPT codes 0802T and 0825T, the
commenters recommended assignment to APC 5224.
Response: Because these removal and replacement codes are new, we
have no claims data. However, based on our review of the codes, input
from our clinicians, and their clinical similarity to the procedures in
APC 5224, we believe these codes should be assigned to APC 5224 and the
corresponding status indicator ``J1.'' Therefore, for CY 2024, we are
assigning CPT codes 0801T, 0802T, 0803T, and 0825T to APC 5224 and SI
``J1.''
Comment: For the removal-only codes, specifically, CPT codes 0798T,
0799T, and 0824T, the commenters disagreed with the proposed status
indicator assignment of ``E1.'' For CPT code 0798T, one commenter
recommended assignment to APC 5183 (Level 3 Vascular Procedures;
proposed payment of $3,054.97), while another commenter suggested
assignment to APC 5184 (Level 4 Vascular Procedures; proposed payment
of $5,284.18). Similarly, the commenters agreed that CPT codes 0799T
and 0824T should be reassigned from status indicator ``E1'' to APC
5183. Another commenter suggested assigning the new leadless pacemaker
removal-only codes, specifically, CPT codes 0798T, 0799T, 0800T, and
0824T, to the same APC as CPT code 33275 (APC 5183) since they all
describe the same procedure.
Response: With the exception of CPT code 33275, which was effective
January 1, 2019, we have no claims data for the removal-only codes,
specifically, 0798T, 0799T, 0800T, and 0824T. However, based on input
from our clinicians, and their similarity to CPT code 33275, we agree
that all five codes should be placed in APC 5183. Therefore, for CPT
codes 0798T, 0799T, and 0824T, we are reassigning the codes from status
indicator ``E1'' to APC 5183 for CY 2024. We note that we did not
receive any alternative APC recommendations for CPT codes 33275 and
0800T, therefore, we are finalizing their APC assignments as proposed.
Comment: For the programming code, specifically, CPT code 0826T,
the commenters disagreed with the
[[Page 81669]]
proposed status indicator assignment of ``E1,'' and suggested
assignment to APC 5741 (Level 1 Electronic Analysis of Devices;
proposed payment of $36.79). One commenter recommended the assignment
of CPT codes 0804T and 0826T to the same APC as existing CPT code 93279
(APC 5741) since they describe the same service.
Response: Because the code is new, we have no claims data. However,
based on recommendations from our clinicians, and suggestions from the
commenters, we are reassigning CPT code 0826T from status indicator
``E1'' to APC 5741 for CY 2024. Similarly, for CPT code 0804T, because
the code is new, we have no claims data. However, based on input from
the commenters, and suggestions from our clinicians, we are finalizing
our proposal, without modification, to assign the code to APC 5741. For
CPT code 93279, our analysis of the claims data for this final rule
shows a geometric mean cost of approximately $34 based on 13,655 single
claims (out of 22,664 total claims), which is in line with the
geometric mean cost of approximately $37 for APC 5741. Therefore, for
CPT code 93279, we are finalizing our proposal, without modification,
to assign the code to APC 5741.
Comment: A device manufacturer reported that their suggested APCs
for the new leadless pacemaker CPT codes do not include the device cost
since they intend to submit a device pass-through application to CMS.
They note that approval of the pass-through application would enable
hospital outpatient facilities to receive separate payment for the
device for a period of two to three years.
Response: We appreciate the clarification, and suggest the
commenter refer to the Medicare Electronic Application Request
Information System (MEARIS), specifically, at https://mearis.cms.gov/public/home, to submit their device pass-through application.
Comment: A commenter mentioned that in OPPS Addendum B of the CY
2024 OPPS/ASC proposed rule, CMS proposed to continue to assign HCPCS
code G2066 (Interrogation device evaluation(s), (remote) up to 30 days;
implantable cardiovascular physiologic monitor system, implantable loop
recorder system, or subcutaneous cardiac rhythm monitor system, remote
data acquisition(s), receipt of transmissions and technician review,
technical support and distribution of results) to APC 5741, however, in
the CY 2024 PFS proposed rule (88 FR 52321), CMS proposed to delete the
code, and assign the direct practice expense inputs to CPT codes 93297
and 93298. The commenter requested clarification on whether HCPCS code
G2066 will remain active for CY 2024, and if not, what alternative
codes should be reported by the hospital outpatient facilities.
Response: HCPCS code G2066 will be deleted December 31, 2023, with
no replacement code. We note that HCPCS code G2066 does not describe an
interrogation device evaluation associated with a leadless pacemaker
system, rather, it describes an interrogation device evaluation for an
implantable cardiovascular physiologic monitor system, implantable loop
recorder system, or subcutaneous cardiac rhythm monitor system. Under
the OPPS, the interrogation device evaluation code that should be
reported for the leadless pacemaker systems is CPT code 93296. The code
was effective January 1, 2009, and is assigned to APC 5741. Below is
the complete long descriptor for the code:
93296: Interrogation device evaluation(s) (remote), up to
90 days; single, dual, or multiple lead pacemaker system, leadless
pacemaker system, or implantable defibrillator system, remote data
acquisition(s), receipt of transmissions and technician review,
technical support and distribution of results.
In addition, we did not receive any comments on our proposed APC
assignment for CPT code 93296. Therefore, for CY 2024, we are
finalizing our proposed APC for this code. In summary, after
consideration of the comments that we received, we are finalizing our
proposal to the status indicator and APC assignments for the 18 codes
listed in Tables 59, 60, 61, 62, and 63 below. Because the codes for
the leadless pacemaker are new, we have no claims data. We believe that
the assignment to APC 5224 for the insertion, as well as for the
removal and replacement procedure codes, is the best approach at this
time. Similarly, we believe that the assignment to APC 5183 for the
removal-only codes are appropriate. We also believe that the assignment
to APC 5741 for the programming and the interrogation device evaluation
codes is appropriate at this time. We reiterate that we analyze our
claims data on an annual basis to establish the annual OPPS payment
rates. Once we have data, we will reevaluate and, if necessary,
reassign the codes to appropriate APCs based on the latest claims data.
Finally, the final payment rates for the codes can be found in Addendum
B to this final rule with comment period. In addition, we refer readers
to Addendum D1 of this final rule with comment period for the status
indicator (SI) meanings for all codes reported under the OPPS. Addenda
B and D1 are available via the internet on the CMS website.
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15. Cardiac Magnetic Resonance Imaging (APC 5572)
For CY 2023, we assigned CPT code 75561 (Cardiac magnetic resonance
imaging for morphology and function without contrast material(s),
followed by contrast material(s) and further sequences) to APC 5572
(Level 2 Imaging with Contrast) with a payment rate of $368.43. For CY
2024, as listed in OPPS Addendum B that was released with the CY 2024
OPPS/ASC proposed rule, we proposed to maintain the assignment to APC
5572 with a payment rate of $369.86.
Comment: A commenter disagreed with the assignment to APC 5572 for
CPT code 75561 and requested a change to APC 5573. The commenter
indicated that the service described by the code is clinically similar
to the service described by CPT code 75563 (Cardiac magnetic resonance
imaging for morphology and function without contrast material(s),
followed by contrast material(s) and further sequences; with stress
imaging), which is proposed to be assigned to APC 5573 (Level 3 Imaging
with Contrast), with a payment of $775.83.
Response: We reviewed our claims data for this final rule, which is
based on claims submitted between January 1, 2022, and December 31,
2022, processed through June 30, 2023, and found that the resource
costs associated with CPT codes 75561 and 75563 are very different.
Specifically, our claims data show a geometric mean cost of about $440
for CPT code 75561 based on
[[Page 81674]]
23,451 single claims (out of 27,479 total claims), which is
significantly lower than the geometric mean cost of approximately $833
for CPT code 75563 based on 3,377 single claims (out of 3,818 total
claims). We believe that the geometric mean cost of about $440 for CPT
code 75561 is consistent with the geometric mean cost of approximately
$377 for APC 5572, rather than APC 5573, whose geometric mean cost is
approximately $784. Based on the data, we believe that the clinical and
resource characteristics of CPT code 75561 are sufficiently similar to
the other procedures assigned to APC 5572 and should continue to be
assigned to the APC.
In summary, after consideration of the public comment, we are
finalizing our proposal, without modification, to assign CPT code 75561
to APC 5572 for CY 2024. The final CY 2024 payment rate for the code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the SI definitions for all codes reported under the
OPPS. Addenda B and D1 are available via the internet on the CMS
website.
16. Cardiac Resynchronization Therapy Procedures (APCs 5054, 5221,
5223, 5231, 5731, and 5741)
On November 1, 2016, CMS approved for Medicare coverage the
Category B Investigational Device Exemption (IDE) study associated with
EBR System's WiSE System for cardiac resynchronization therapy (Study
Title: Stimulation Of the Left Ventricular Endocardium for Cardiac
Resynchronization Therapy in Non-Responders and Previously Untreatable
Patients, SOLVE CRT; NCT number NCT02922036; IDE number G150244). In
2019, AMA established eight Category III CPT codes associated with the
WiSE System effective January 1, 2019. The codes are CPT codes 0515T
through 0522T, and describe the implant, removal and replacement,
revision, interrogation, and programming of the system. For 2024, the
AMA's CPT Editorial Panel revised the descriptors for existing CPT
codes 0517T, 0518T, 0519T, 0520T, and established three new codes,
specifically, CPT codes 0861T, 0862T, and 0863T, effective January 1,
2024.
For the 2024 update, as listed in OPPS Addendum B that was released
with the CY 2024 OPPS/ASC proposed rule, we proposed to assign the
codes to the SIs and APCs listed in Table 64 below, for the existing,
new, and revised codes.
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We received comments from the WiSE System manufacturer on our
proposed assignments for the codes listed in Table 64. The commenter
clarified that the
[[Page 81676]]
IDE clinical trial associated with the WiSE System has ended and that
they expect FDA PMA approval in the second quarter of 2024. The
commenter also provided the following target pricing for the components
of the WiSE System:
WiSE System: $45,000
Electrode: $17,300
Battery: $9,000
Transmitter: $18,700
Battery and Transmitter: $27,700
Of the 11 codes, the device manufacturer disagreed with the
proposed APC assignments for seven codes listed in Table 64. Below are
the comments associated with certain codes, their suggested APC
assignments, and our responses to the comments.
Comment: For CPT code 0515T (Insertion of wireless cardiac
stimulator for left ventricular pacing, including device interrogation
and programming, and imaging supervision and interpretation, when
performed; complete system (includes electrode and generator
[transmitter and battery])), we proposed to continue to assign to APC
5231 (Level 1 ICD and Similar Procedures; proposed payment of $
23,075.10). The device manufacturer disagreed with the assignment and
suggested reassignment to APC 1581 (New Technology--Level 44 ($50,001-
$60,000)) with a proposed payment of $55,000.50, based on its target
price of $45,000 for the complete WiSE System.
Response: CPT code 0515T was effective January 1, 2019. We note
that the 2024 OPPS payment rates are based on claims submitted between
January 1, 2022, and December 31, 2022, processed through June 30,
2023. Analysis of our claims data show a geometric mean cost of about
$43,974 based on 2 single claims (out of 2 total claims). The commenter
reported a target price of $45,000 for the complete system, however,
based on the low volume of only 2 single claims, we believe that we
should maintain the code's assignment to APC 5231 before reassigning to
a more appropriate APC. We believe that the continued assignment to APC
5231 will enable Medicare to track the services accordingly and
establish an appropriate payment for the code. Therefore, we are
finalizing our proposal to APC 5231 for CPT code 0515T.
Comment: The device manufacturer disagreed with our proposal to
continue to assign CPT code 0516T to APC 5222 (Level 2 Pacemaker and
Similar Procedures; proposed payment of $8,264.84) and recommended
reassignment to APC 5224 (Level 4 Pacemaker and Similar Procedures;
proposed payment of $18,718.23).
Response: CPT code 0516T was also effective January 1, 2019. Our
claims data show a geometric mean cost of about $9,645 based on 2
single claims (out of 2 total claims). Based on our evaluation of the
procedure, opinion from our clinicians, and the similarity of the
procedure to CPT code 33207 (Insertion of new or replacement of
permanent pacemaker with transvenous electrode(s); ventricular), which
we proposed for assignment to APC 5223 (Level 3 Pacemaker and Similar
Procedures; proposed payment of $10,354.26), we believe that APC 5223
is the more appropriate assignment for CPT code 0516T. Therefore, for
CY 2024, we are finalizing our proposal with modification, and
assigning CPT code 0516T to APC 5223.
Comment: As noted in Table 64, the code descriptor for CPT code
0517T in CY 2023 described the insertion of the battery and/or
transmitter only; however, for 2024, the revised descriptor describes
the insertion of both the battery and transmitter. We proposed to
continue to assign CPT code 0517T to APC 5222 (Level 2 Pacemaker and
Similar Procedures; proposed payment of $8,264.84). A commenter
disagreed with the assignment and recommended reassignment to APC 5232
(Level 2 ICD and Similar Procedures; proposed payment of $31,975.11).
We note the commenter listed APC 5231 (Level 1 ICD; proposed payment of
$23,075.10) but included in parentheses the proposed payment of
$31,975.11, which is the proposed payment for APC 5232 (Level 2 ICD).
We believe the commenter meant to suggest APC 5232 rather than APC
5231.
Response: Based on our analysis of the data for this final rule,
our claims data shows a geometric mean cost of approximately $51,240
based on 2 single claims (out of 2 total claims) for CPT code 0517T.
Based on the revised descriptor which describes insertion of a battery
and a transmitter, as well as input from our clinicians, we believe we
should reassign the code from APC 5222 (Level 2 Pacemaker and Similar
Procedures; proposed payment of $8,264.84) to APC 5223 (Level 3
Pacemaker and Similar Procedures; proposed payment of $10,354.26).
Because the IDE clinical study associated with the WiSE System has just
ended and the device is still pending FDA PMA approval, we do not
believe that we should reassign CPT code 0517T to APC 5232 at this
time. We believe that assignment to APC 5223 for CPT code 0517T is the
best approach at this time. Therefore, for CY 2024, we are finalizing
our proposal with modification, and reassigning CPT code 0517T to APC
5223. We will evaluate the APC assignment for CPT code 0517T in next
year's rulemaking to determine whether another APC would be more
appropriate.
Comment: As noted in Table 64, for CY 2023, CPT code 0518T
described the removal of the ``battery and/or transmitter'' and was
assigned to APC 5221 (Level 1 Pacemaker and Similar Procedures).
However, for 2024, based on its revised description of removal of
``battery component only,'' we proposed to reassign the code to APC
5211 (Level 1 Electrophysiologic Procedures; proposed payment of
$1,146.59) to reflect the reduced resources to perform the procedure. A
commenter disagreed with the proposed assignment and suggested
reassignment to APC 5222 (Level 2 Pacemaker and Similar Procedures;
proposed payment of $8,264.84) consistent with the APC assignment for
CPT code 33233 (Removal of permanent pacemaker pulse generator only).
Response: Based on our analysis of the data for this final rule, we
have no claims data for CPT code 0518T. However, based on input from
our clinicians and the code's similarity to 33241 (Removal of
implantable defibrillator pulse generator only), which is proposed to
be assigned to APC 5221 (Level 1 Pacemaker and Similar Procedures), we
believe that we should reassign the code to APC 5221. Therefore, for CY
2024, we are finalizing our proposal with modification, and reassigning
CPT code 0518T to APC 5221.
Comment: As noted in Table 64, for CY 2023, CPT code 0519T
described removal and replacement of the battery and/or transmitter.
However, for CY 2024, the code has been revised to describe the removal
and replacement of both the battery and transmitter. For CY 2024, we
proposed to continue to assign the code to APC 5221 (Level 1 Pacemaker
and Similar Procedures; proposed payment of $ 3,903.23). A commenter
disagreed with the assignment and suggested reassignment to APC 5232
(Level 2 ICD and Similar Procedures; proposed payment of $31,975.11).
Similar to CPT code 0517T, the commenter listed APC 5231 (Level 1 ICD;
proposed payment of $23,075.10) but included in parentheses a proposed
payment amount of $31,975.11, which is the proposed payment for APC
5232 (Level 2 ICD). We believe the commenter meant to suggest APC 5232
rather than APC 5231.
Response: Analysis of our claims data show a geometric mean cost of
about $6,127 for CPT code 0519T based on 4
[[Page 81677]]
single claims (out of 4 total claims). Because the revised code
describes the removal and replacement of the battery and transmitter,
we believe this code should be assigned to the same APC as CPT code
0517T. Therefore, for CY 2024, we are finalizing our proposal with
modification, and assigning CPT code 0519T to APC 5223.
Comment: As noted in Table 64, for CY 2023, CPT code 0520T
described the removal and replacement of a pulse generator, including a
new electrode, and was assigned to APC 5231 (Level 1 ICD and Similar
Procedures) with a payment rate of $22,818.32. However, for 2024, the
code descriptor has been revised significantly and now describes the
removal and replacement of the battery component only. Based on the
reduced work associated with the revised descriptor, we proposed to
reassign CPT code 0520T to APC 5221 (Level 1 Pacemaker and Similar
Procedures; proposed payment of $3,903.23). The device manufacturer
disagreed with the proposal and suggested assignment to APC 5223 (Level
3 Pacemaker and Similar Procedures; proposed payment of $10,354.26),
consistent with the APC assignment for CPT code 33206 (Insertion of new
or replacement of permanent pacemaker with transvenous electrode(s);
atrial)).
Response: We have no claims data for CPT code 0520T, however, based
on our evaluation of the procedure and recommendation from our
clinicians, we agree with the commenter that the code should be
reassigned to APC 5223. Therefore, for CY 2024, we are finalizing our
proposal with modification, and assigning CPT code 0520T to APC 5223.
Comment: CPT code 0861T is a new code for CY 2024. We proposed to
assign the code to APC 5211 (Level 1 Electrophysiologic Procedures;
proposed payment rate of $ 1,146.59), based on its similarity to CPT
code 0518T (Removal of only pulse generator component(s) (battery and/
or transmitter) of wireless cardiac stimulator for left ventricular
pacing), which is also proposed to APC 5211. The commenter disagreed
with the proposal, and recommended assignment to APC 5222 (Level 2
Pacemaker and Similar Procedures; proposed payment of $8,264.84).
Response: Consistent with our final policy for CPT code 0518T, we
believe that we should reassign CPT code 0861T to APC 5221. Therefore,
for CY 2024, we are finalizing our proposal with modification, and
assigning CPT code 0861T to APC 5221.
Comment: As listed in Table GX1, we proposed to assign CPT codes
0862T, 0863T, 0521T, and 0522T, to the APCs listed in Table GX1. The
device manufacturer agreed with our APC assignments for the codes.
Response: We appreciate the commenter's feedback. Therefore, for CY
2024, we are finalizing our proposal without modification for CPT codes
0862T, 0863T, 0521T, and 0522T.
Finally, we remind the commenter that under the OPPS, one of our
goals is to make payments that are appropriate for the services that
are necessary for the treatment of Medicare beneficiaries. The OPPS,
like other Medicare payment systems, is budget neutral and increases
are limited to the annual hospital market basket increase reduced by
the productivity adjustment. We note that, in a budget-neutral system,
payments may not fully cover hospitals' costs in a particular
circumstance, including those for the purchase and maintenance of
capital equipment. We rely on hospitals to make their decisions
regarding the acquisition of high-cost equipment with the understanding
that the Medicare program must be careful to establish its initial
payment rates. For new procedures and items, we get many requests from
manufacturers to increase the reimbursement for the code associated
with their procedures and items. These requests, and their accompanying
estimates for expected total patient utilization, often reflect very
low rates of patient use of expensive equipment, resulting in high per-
use costs for which requesters believe Medicare should make full
payment. Medicare does not, and we believe should not, assume
responsibility for more than its share of the costs of procedures based
on projected utilization for Medicare beneficiaries and does not set
its payment rates based on initial projections of low utilization for
services that require expensive capital equipment. On balance, we
believe that our payment rates reflect the costs that are associated
with providing care to Medicare beneficiaries and are adequate to
ensure access to services (80 FR 70374).
In summary, after consideration of the public comment that we
received, we are finalizing the APC assignments for CPT codes 0515T
through 0522T, and 0861T through 0863T to the APCs listed in Table 65
below. As we do every year, we will reevaluate the APC assignments for
these codes in the next rulemaking cycle. We remind hospitals that we
review, on an annual basis, the APC assignments for all items and
services paid under the OPPS. The final payment rates for the codes can
be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the status indicator (SI) meanings for all codes
reported under the OPPS. Addenda B and D1 are available via the
internet on the CMS website.
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17. Catheter Placement Codes (APCs 5181 Through 5184)
For CY 2024, we proposed to continue to assign catheter placement
CPT codes 36555-36597 status indicator ``J1'' and to APCs 5181 through
5184 with the proposed payment rates listed in table 66.
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Comment: We received one comment where the commenter requested that
we change the status indicator for all catheter placements CPT codes in
the 365XX series from status indicator ``J1'' to status indicator
``T.'' This commenter stated that there are times that patients require
placement of such a catheter and then receive an infusion of a drug
such as chemotherapy. Because several of those codes are assigned to
status indicator ``J1,'' the drug cost, unless the drug is a pass-
through drug, is not reimbursed. For one infusion, Lutathera (HCPCS
code A9513), the drug cost is $55,000 and the $1,487 payment for C-APC
5182 clearly does not cover that cost. The commenter noted that while
outlier payment will apply, it is inadequate to compensate for the
actual expenditure for the treatment.
Response: The Outpatient Coding Editor (IOCE) will package the drug
cost into the Comprehensive APC, even if we change the status
indicators for the catheter placement codes from ``J1'' to ``T''
because the APCs that the catheter placement codes are assigned to are
assigned to status indicator ``J1.'' Therefore, the drug costs would
not be reimbursed separately if we change the status indicators for the
catheter placement codes from ``J1'' to ``T.'' Because of this, the
only way to receive separate payment for the individual
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procedures in these situations would be for the status indicator of the
APC and all services assigned to the APC to be ``T.'' We continue to
believe that this APC is appropriately assigned to comprehensive
status. While there may be cases that would involve more complexity and
cost, those packaged costs are reflected in claims used for ratesetting
and the HCPCS and APC geometric mean costs, to the degree that they are
performed in that manner. Nevertheless, we appreciate the comment, and
we will take the commenter's recommendation into consideration in
future rulemaking.
In summary, after consideration of the comment we have received, we
are finalizing our proposal without modification. Specifically, we will
continue to assign catheter placement codes listed in Table 66 to
status indicator ``J1'' for CY2024. We plan to review the comprehensive
APC policy for CY 2025 to determine if we need to adopt any packaging
changes as part of that rulemaking. The final CY 2024 OPPS payment
rates for these codes can be found in Addendum B to this final rule
with comment period. In addition, we refer readers to Addendum D1 of
this final rule with comment period for the status indicator meanings
for all codes reported under the OPPS. Addenda B and D1 are available
via the internet on the CMS website.
18. Cerene Cryotherapy Endometrial Ablation Procedure (APC 5415)
For CY 2023, we assigned CPT code 58356 (Endometrial cryoablation
with ultrasonic guidance, including endometrial curettage, when
performed) to APC 5415 (Level 5 Gynecologic Procedures) with a payment
rate of $4,635.11. For CY 2024, as listed in OPPS Addendum B that was
released with the CY 2024 OPPS/ASC proposed rule, we proposed to
maintain the assignment for the code to APC 5415 with a payment rate of
$4,783.96.
Comment: A commenter requested that we finalize the proposed
assignment to APC 5415 for CPT code 58356.
Response: We reviewed our claims data for this final rule with
comment period, which is based on claims submitted between January 1,
2022, and December 31, 2022, processed through June 30, 2023, and found
no claims data for CPT code 58356. However, because the code has been
in existence since January 1, 2005, we reviewed our historical claims
data for the last 5 years, specifically, the historical cost statistics
released with the CY 2019 through CY 2023 OPPS/ASC final rules, and
found some claims for the code. Specifically, our historical claims
data show a geometric mean cost that ranged between $1,712 and $5,032,
based on 3 and 5 single claims. Because the code has been assigned to
this same APC for many years now, we believe we should the maintain the
assignment to APC 5415 for CPT code 58356. We note that we review, on
an annual basis, the APC assignments for all services and items paid
under the OPPS.
In summary, after consideration of the public comment, we are
finalizing our proposal, without modification, to assign CPT code 58356
to APC 5415 for CY 2024. The final CY 2024 payment rate for the code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the SI meanings for all codes reported under the
OPPS. Addenda B and D1 are available via the internet on the CMS
website.
19. Complex Bunion Correction Procedures CPT Codes 28297 and 28740 (APC
5114)
CPT code 28297 (Correction, hallux valgus (bunionectomy), with
sesamoidectomy, when performed; with first metatarsal and medial
cuneiform joint arthrodesis, any method) with a geometric mean cost of
around $10,664 and CPT code 28740 (Arthrodesis, midtarsal or
tarsometatarsal, single joint) with a geometric mean cost of around
$10,376 describe complex bunion correction procedures. For the CY 2024
OPPS proposed rule, we proposed assigning both procedures to APC 5114
(Level 4 Musculoskeletal Procedures) with a payment rate of around
$6,974.
Comment: One commenter noted that CPT codes 28297 and 28740 were
close to violating the 2 times rule in APC 5114 and eligible for
reassignment to APC 5115 (Level 5 Musculoskeletal Procedures) with a
payment rate of around $13,421 if these procedures had been identified
as significant procedures for 2 times rule purposes as the lowest-cost
significant procedure. The lowest cost significant procedure in APC
5114 (CPT code 27385) had a geometric mean cost of around $5,357 and
two times the amount would have been $10,714, which is just $50 more
than the cost of CPT 28297 and about $350 more than the cost of CPT
28740. The commenter believed that there was a good chance that these
procedures may have geometric means exceeding the 2 times rule
requirements once the CY 2024 claims data were updated.
Response: Our review of updated data for CY 2024 found that neither
CPT code 28297 nor CPT code 28740 violates the 2 times rule in their
current assignment to APC 5114 if the procedures were significant. The
updated estimated 2-times limit based on CPT code 27385 was around
$10,797. CPT code 28297's updated geometric mean cost was around
$10,728 and CPT code 28740 updated geometric mean cost was around
$10,565. Also, these procedures were towards the higher-cost end of APC
5114 but moving them to APC 5115 would group CPT codes 28297 and 28740
with procedures that are generally more complex and resource-intensive
than the procedures described by CPT codes 28297 and 28740.
After consideration of the public comments we received, we are
implementing our proposal without modification for CPT codes 28297 and
28740. Table 67 shows the finalized status indicator and APC assignment
for all of the procedure codes. We refer readers to Addendum B of this
final rule with comment period for the payment rates for all codes
reportable under the OPPS. Addendum B is available via the internet on
the CMS website.
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20. Cryoablation of the Prostate (APC 5376)
CPT code 55873 (Cryosurgical ablation of the prostate (includes
ultrasonic guidance and monitoring)) describes the procedure associated
with cryoablation of the prostate. For CY 2023, we assigned the code to
APC 5376 (Level 6 Urology and Related Services), with a payment rate of
$8,557.53. For CY 2024, as listed in OPPS Addendum B that was released
with the CY 2024 OPPS/ASC proposed rule, we proposed to continue the
code's assignment to APC 5376 with a payment rate of $8,847.08.
Comment: A commenter requested that we finalize the proposed
assignment to APC 5376 for CPT code 55873.
Response: We note that the CY 2024 OPPS payment rates are based on
claims submitted between January 1, 2022, and December 31, 2022,
processed through June 30, 2023. We reviewed the claims data for this
final rule, and based on our review, we found the geometric mean cost
of approximately $8,942 for CPT code 55873 based on 938 single claims
(out of 942 total claims), is consistent with the geometric mean cost
of about $9,022 for APC 5376. Based on the resource costs, we believe
that CPT code 55873 appropriately fits in APC 5376 based on its
clinical similarity and resource homogeneity to the codes in the APC.
In summary, after consideration of the public comment, we are
finalizing our proposal, without modification, to assign CPT code 55873
to APC 5376 for CY 2024. The final CY 2024 payment rate for the code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the SI meanings for all codes reported under the
OPPS. Addenda B and D1 are available via the internet on the CMS
website.
21. Drug Induced Sleep Endoscopy Evaluation CPT Code 42975 (APC 5153)
For the CY 2024 OPPS final rule, we proposed that CPT code 42975
(Drug-induced sleep endoscopy, with dynamic evaluation of velum,
pharynx, tongue base, and larynx for evaluation of sleep-disordered
breathing, flexible, diagnostic) with a geometric mean around $1,291 be
assigned to APC 5153 (Level 3 Airway Endoscopy) with a payment rate of
around $1,657.
Comment: One commenter supported our decision to assign CPT code
42975 to APC 5153.
Response: We appreciate the support of the commenter.
After consideration of the public comment we received, we are
implementing our proposal without modification for CPT code 42975 to
continue to assign the procedure to APC 5153 (Level 3 Airway
Endoscopy). Table 68 shows the finalized status indicator and APC
assignment for all of the procedure codes. We refer readers to Addendum
B of this final rule with comment period for the payment rates for all
codes reportable under the OPPS. Addendum B is available via the
internet on the CMS website.
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[[Page 81685]]
22. EchoGo Echocardiography Image Processing Service (APC 5743)
Effective July 1, 2023, based on a New Technology application
received by CMS for an echocardiography image processing service, CMS
established C9786 (Echocardiography image post processing for computer
aided detection of heart failure with preserved ejection fraction,
including interpretation and report) and assigned it to APC 5742 (Level
2 Electronic Analysis of Devices). For CY 2024, CMS proposed to
continue to assign HCPCS code C9786 to APC 5742.
Comment: One commenter supported the establishment of HCPCS code
C9786 to describe the service and believed that the clinical APC group
to which we proposed to assign the code for C9786 was appropriate. The
commenter recommended that we work with the manufacturer to ensure
proper accounting of hospital resources used to furnish the service.
Response: We thank the commenter for their support. We welcome
ongoing dialogue and engagement from interested parties, including
manufacturers, regarding hospital resource costs and suggestions for
payment changes for consideration in future rulemaking.
Comment: We received a comment from the manufacturer requesting
that HCPCS code C9786 be reassigned to APC 5743 (Level 3 Imaging
without Contrast), which had a proposed payment rate of $277.18. The
commenter believes that assigning HCPCS code C9786 to APC 5743 would be
more appropriate based on resources involved in furnishing the service.
The commenter explained that in addition to a per-service cost, there
are a number of other costs incurred by hospitals to furnish the
service, including a cardiac sonographer, use of a Picture Archiving
and Communication System (PACS) workstation, and IT related costs. The
commenter explained that the combined costs incurred by hospitals to
furnish C9786 are considerably greater than those for procedures
assigned to APC 5742, but are similar to the costs incurred for
procedures assigned to APC 5743.
Response: We thank the commenter for their recommendation. Based on
our evaluation of the additional information provided and the services
assigned to APC 5743, we agree that there are more resource
similarities between HCPCS code C9786 and the codes assigned to APC
5743 than to the codes assigned to APC 5742. Therefore, for CY 2024 we
are finalizing assigning HCPCS code C9786 to APC 5743.
After consideration of the public comments, we are finalizing the
assignment of HCPCS code C9786 to APC 5743. The final CY 2024 payment
rate for these codes can be found in Addendum B to this final rule with
comment period. We also refer readers to Addendum D1 of this final rule
with comment period for the SI meanings for all codes reported under
the OPPS. Addenda B and D1 are available via the internet on the CMS
website. In addition, we note that CMS recognizes that software-based
technologies are rapidly evolving, like the product used for HCPCS code
C9786. Consistent with our comment solicitation on payment policy for
software as a service (SaaS) procedures in the CY 2023 OPPS final rule
(87 FR 72035 and 72036), we are considering, for future rulemaking,
whether or not specific adjustments to payment policies and rate
calculations are necessary to more accurately and appropriately pay for
these products and services across settings of care. CMS remains open
to feedback on these issues and welcomes engagement from interested
parties, including from manufacturers, providers, and beneficiaries.
23. Endoscopic Procedure--Upper GI Tract CPT Code 43252 (APC 5302)
CPT code 43252 (Esophagogastroduo- denoscopy, flexible, transoral;
with optical endomicroscopy) describes a service that is used to
visualize the upper portions of the GI tract from the esophagus to the
duodenum. For the CY 2024 OPPS proposed rule, the geometric mean cost
for this procedure was around $1,611, and we proposed to assign CPT
code 43252 to APC 5302 (Level 2 Upper GI Procedures) with a payment
rate of around $1,854. The payment rate for APC 5302 is approximately
$240 more than the geometric mean cost of CPT code 43252.
Comment: Two commenters requested that we assign CPT code 43252 to
APC 5303 (Level 3 Upper GI Procedures) with a payment rate of around
$3,803 for CY 2024. The procedure is assigned to APC 5303 for CY 2023
APC. Commenters assert that the payment amount for APC 5302 is too low
for the procedure described by CPT code 43252. One commenter referenced
an independent data analysis showing the number of claims for the
service declined from around 340 services in CY 2021 to around 213
services in CY 2022. The commenter had questions about the quality of
the CY 2022 data as some providers who had previously performed the
procedure described by CPT code 43252 did not perform the procedure in
CY 2022.
Response: As we have stated regularly over the history of the OPPS,
it is the responsibility of providers and other interested parties and
not CMS to resolve potential claims and reporting issues for individual
CPT codes and medical services payable by Medicare. There is no clear
systematic error with the claims data for CPT code 43252. Also, the
geometric mean cost for the service, which is around $1,596, is
substantially lower than the payment rate for APC 5302 which is around
$1,863. We note as well that in CY 2021, the geometric mean cost for
CPT code 43252, which was around $1,985 was roughly $1,350 less than
the payment rate for APC 5303, which was around $3,350. Therefore, it
is not unexpected that the procedure would be reassigned to a lower-
paying APC for CY 2024.
After consideration of the public comments we received, we are
implementing our proposal without modification for CPT code 43252 to
continue to assign the procedure to APC 5302 (Level 2 Upper GI
Procedures). Table 69 shows the finalized status indicator and APC
assignment for the procedure code. We refer readers to Addendum B of
this final rule with comment period for the payment rates for all codes
reportable under the OPPS. Addendum B is available via the internet on
the CMS website.
[[Page 81686]]
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24. Endovascular Procedures With Coronary And Peripheral Intravascular
Lithotripsy (IVL) (APC 5192, 5193, 5194)
Coronary IVL is a device that, according to its manufacturer, can
help surgeons perform a safe and effective angioplasty procedure when
arterial plaque is calcified. These procedures also are known as
percutaneous coronary intervention (PCI). Coronary IVL received device
pass-through status in the OPPS on July 1, 2021, and the device pass-
through status is scheduled to expire on June 30, 2024. The device is
described by HCPCS code C1761 (Catheter, transluminal intravascular
lithotripsy, coronary) and is currently assigned to APC 2033 (Cath,
trans intra litho/coro). The procedure also is reported with add-on CPT
code 0715T (Percutaneous transluminal coronary lithotripsy (list
separately in addition to code for primary procedure)), which is
packaged in the OPPS. In CY 2024, CPT code 0715T is being replaced by
CPT code 92972 (Percutaneous transluminal coronary lithotripsy (list
separately in addition to code for primary procedure)). We propose to
package this code as well.
According to the manufacturer, the Coronary IVL device is used
primarily with four endovascular procedures:
C9600 (Percutaneous transcatheter placement of drug
eluting intracoronary stent(s), with coronary angioplasty when
performed; single major coronary artery or branch);
92928 (Percutaneous transcatheter placement of
intracoronary stent(s), with coronary angioplasty when performed;
single major coronary artery or branch);
92943 (Percutaneous transluminal revascularization of
chronic total occlusion, coronary artery, coronary artery branch, or
coronary artery bypass graft, any combination of intracoronary stent,
atherectomy and angioplasty; single vessel); and
92920 (Percutaneous transluminal coronary angioplasty;
single major coronary artery or branch).
For the OPPS CY 2024 proposed rule, we proposed to assign these
procedures to either APC 5192 (Level 2 Endovascular Procedures) or APC
5193 (Level 3 Endovascular Procedures), based on the geometric mean
cost of each procedure. Because both APC 5192 and APC 5193 are
comprehensive APCs, claims with higher costs for the PCI procedures
described are eligible for a complexity adjustment which can provide
one higher APC level of payment for these procedures. We also proposed
to continue to assign HCPCS code C1761 to APC 2033 until June 30, 2024,
when device pass-through status ends for HCPCS code C1761. Starting
July 1, 2024, HCPCS code C1761 is proposed to be packaged with its
associated endovascular procedures.
Comment: Three commenters including the manufacturer of the
Coronary IVL have requested that we take action to preserve the
additional payment for the device described by HCPCS code C1761 that is
used for PCI procedures through the end of CY 2024. The commenters
suggest that we either use our equitable adjustment authority to extend
pass-through status for HCPCS code C1761 through December 31, 2024, or
increase the payment for the procedures most frequently used with
Coronary IVL starting on July 1, 2024.
Response: We appreciate the commenters' request to ensure
consistent payment throughout CY 2024 for PCI procedures (HCPCS code
C9600, CPT codes 92928, 92943, and 92920) that are performed using the
Coronary IVL device described by HCPCS code C1761. However, only a
small share of the PCI procedures are using the Coronary IVL device.
Less than 6 percent of the procedures billed with HCPCS code C9600, CPT
code 92928, and CPT code 92943 use the device described by HCPCS code
C1761. For CPT code 92920, the percentage of procedures using the
Coronary IVL device is less than 0.5 percent. The low amount of
utilization of the Coronary IVL device with these PCI procedures means
that it would not be appropriate to assign these procedures to a
higher-paying APC to account for the cost of the device. These code
combinations would also not meet the criteria for a complexity
adjustment, as discussed in section II.A.2.b of this final rule with
comment period. Likewise, we do not see a justification for extending
device pass-through status for HCPCS code C1761. Device pass-through
did not start for the Coronary IVL device until after the most serious
disruptions in medical care occurred with the COVID-19 PHE, and none of
the commenters suggested that CMS did not get adequate cost data for
the device. In fact, the manufacturer was even willing to have pass-
through status end early for HCPCS code C1761 because they felt enough
cost data regarding the device had been collected.
After consideration of the public comments we received, we are
implementing our proposal without modification for HCPCS codes C1761
and C9600 and CPT codes 92920, 92928, 92943, and 92972. Table 70 shows
the finalized status indicator and APC assignment for all of the
procedure codes. We refer readers to Addendum B of this final rule with
comment period or the payment rates for all codes reportable under the
OPPS. Addendum B is available via the internet on the CMS website.
BILLING CODE 4150-28-P
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BILLING CODE 4150-28-C
25. Extracorporeal Shock Wave Lithotripsy CPT Code 50590 (APC 5374)
Extracorporeal shock wave lithotripsy is a procedure used to break
up stone in the urinary tract using directed shock wave therapy. Shock
waves are generated by a lithotripter which is a machine and capital
equipment for the provider. The procedure is described by CPT code
50590 (Lithotripsy, extracorporeal shock wave). For the CY 2024 OPPS
proposed rule, CPT code 50590 had a geometric mean of around $3,450,
and we proposed to assign the
[[Page 81688]]
service to APC 5374 (Level 4 Urology and Related Services).
Comment: The HOP Panel and multiple commenters requested that CPT
code 50590 be reassigned to APC 5375 (Level 5 Urology and Related
Services) with a payment rate of around $5,016 to account for some of
the capital cost of the procedure. The capital costs identified were
primarily the purchase and maintenance of the lithotripter which,
according to one commenter, cost $600,000 to purchase and another
$60,000 a year to maintain. The commenters also stated that the
procedure described by CPT code 50590 has clinical and resource
similarity with procedures currently assigned to APC 5375.
Response: We disagree with the commenters. Payments for services
are for costs for providing individual procedures, but capital costs,
depreciation, and other similar costs are largely excluded from our
determination of the cost of a procedure. We note that the OPPS is a
budget neutral system and, as such, the OPPS does not pay the full
hospital cost of services, including for services that require the
purchase and maintenance of high-cost capital equipment. We also
compared the cost of CPT code 50590 to the cost of procedures currently
assigned to APC 5375. While the cost of the procedure described by CPT
code 50590 is around the middle of the cost range for APC 5374, it
would be one of the lowest cost procedures in APC 5375. The number of
procedures for CPT code 50590 would mean it would be a significant
procedure in APC 5375, but its cost is around $700 lower than the
current lowest-cost significant procedure for that APC. In addition,
CPT code 50590 would be overpaid by around $1,500 if it was reassigned
to APC 5375. Accordingly, we are continuing to assign CPT code 50590 to
APC 5374.
After consideration of the public comments we received, we are
implementing our proposal without modification for CPT code 50590 to
continue to assign the procedure to APC 5374 (Level 4 Urology and
Related Services). Table 71 shows the finalized status indicator and
APC assignment for all of the procedure codes. We refer readers to
Addendum B of this final rule with comment period for the payment rates
for all codes reportable under the OPPS. Addendum B is available via
the internet on the CMS website.
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26. Eye-Movement Analysis Without Spatial Calibration (APC 5734)
The CPT Editorial Panel established CPT code 0615T (Eye-movement
analysis without spatial calibration, with interpretation and report),
effective July 1, 2020, to describe eye-movement analysis without
spatial calibration that involves the use of the EyeBOX system as an
aid in the diagnosis of concussion, also known as mild traumatic brain
injury (mTBI). The EyeBOX is intended to measure and analyze eye
movements as an aid in the diagnosis of concussion within one week of
head injury in patients 5 through 67 years of age in conjunction with a
standard neurological assessment of concussion. A negative EyeBOX
classification may correspond to eye movement that is consistent with a
lack of concussion. A positive EyeBOX classification corresponds to eye
movement that may be present in both patients with or without a
concussion.
For CY 2023, we assigned CPT code 0615T to APC 5734 (Level 4 Minor
Procedures) with a payment rate of $116.11. For CY 2024, we proposed to
continue to assign the code to APC 5734 with a payment rate of
$123.302.
Comment: A device manufacturer disagreed with the proposed APC
assignment and requested a revision to APC 5722 (Level 2 Diagnostic
Tests and Related Services) with a payment rate of $ 304.35. The device
manufacturer indicated that the proposed payment is insufficient since
the cost to provide the service is about $250. The commenter noted that
the proposed reimbursement of $123.302 does not include the cost of
providing the EyeBox service, along with the other services provided on
the same day (clinic visit and other services). The device manufacturer
suggested reassigning CPT code 0615T to APC 5722 (Level 2 Diagnostic
Tests and Related Services) to ensure appropriate payment for the
service associated with the EyeBOX test.
Response: For 2024, the OPPS payment rates are based on claims
submitted between January 1, 2022, and December 31, 2022, processed
through June 30, 2023. Even with the latest claims data for this final
rule with comment period, we still have no claims data for CPT code
0615T. We discussed in the CY 2023 OPPS/ASC final rule with comment
period that based on the claims used for the CY 2023 OPPS update, we
saw no claims associated with this code (87 FR 71858). Thus, this is
the second year in which we have no claims data for the code. We
believe that EyeBOX may not be utilized by Medicare patients, and this
may be the reason we have no claims data for the code. Based on the
lack of claims data, we believe that we should maintain the assignment
to APC 5734 for CPT code 0615T. Therefore, we are not revising the APC
assignment for CY 2024 for CPT code 0615T. We remind the commenter that
we review, on an annual basis, the APC assignments for all services and
items paid under the OPPS.
In summary, after consideration of the public comment we received,
we are finalizing our proposal, without modification, to continue
assignment to APC 5734 for CPT code 0615T for CY 2024. We refer readers
to Addendum B of this final rule with comment period for the payment
rates for all codes reported under the OPPS. In addition, we refer
readers to Addendum A of this final rule with comment period for the
status indicator meanings for all codes reported under the OPPS.
Addenda A and Addendum B are available via the internet on the CMS
website.
[[Page 81689]]
27. Femoral Popliteal Revascularization Procedure (APC 5192)
For CY 2023, we assigned CPT code 37224 (Revascularization,
endovascular, open or percutaneous, femoral, popliteal artery(s),
unilateral; with transluminal angioplasty) to APC 5192 (Level 2
Endovascular Procedures), with a payment rate of $5,215.40. For CY
2024, as listed in OPPS Addendum B that was released with the CY 2024
OPPS/ASC proposed rule, we proposed to maintain the assignment to APC
5192 with a payment rate of $5,500.17.
Comment: A commenter requested an APC reassignment for CPT code
37224 from APC 5192 to APC 5193 (Level 3 Endovascular Procedures), with
a payment rate of $10,602.57, based on resource cost and clinical
comparability to the procedures in the APC 5193.
Response: The CY 2024 OPPS payment rates are based on claims
submitted between January 1, 2022, and December 31, 2022, processed
through June 30, 2023. We analyzed the claims data for this final rule,
and based on our review, we found the geometric mean cost of
approximately $8,211 for CPT code 37224 based on 6,690 single claims
(out of 6,730 total claims), is consistent with the geometric mean cost
of about $5,598 for APC 5192, rather than the geometric mean cost of
approximately $10,774 for APC 5193. Based on the claims data, we
believe that CPT code 37224 fits more appropriately in APC 5192 rather
than in APC 5193 based on resource cost and clinical similarity and to
the procedures in APC 5192. We note that we review, on an annual basis,
the APC assignments for all services and items paid under the OPPS
based on our analysis of the latest claims data.
In summary, after consideration of the public comment, we are
finalizing our proposal, without modification, to assign CPT code 37224
to APC 5192 for CY 2024. The final CY 2024 payment rate for the code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the SI meanings for all codes reported under the
OPPS. Addenda B and D1 are available via the internet on the CMS
website.
28. Fluorescence In Situ Hybridization (FISH) Laboratory Service (APC
5672)
For CY 2024, we proposed to reassign CPT code 88366 ((In situ
hybridization (eg, FISH), per specimen; each multiplex procedure) from
APC 5673 (Level 3 Pathology) to APC 5672 (Level 2 Pathology) with a
proposed payment rate of $165.41.
Comment: We received two comments explaining that CMS's proposal to
reassign CPT code 88366 to APC 5672 would not capture the resource
costs of the service. The commenters stated that, while not reflected
in the OPPS claims data, the direct supply and equipment practice
expense costs associated with the service reported under CPT code 88366
are nearly $30 higher than the proposed CY 2024 payment rate for APC
5672. The commenters requested that we continue to assign CPT code
88366 to APC 5673, as CMS has in previous years.
Response: We appreciate the commenters' feedback on our proposal.
However, we have no reason to believe that the claims data used to
calculate the cost for CPT code 88366 does not appropriately reflect
the hospitals' cost for providing this service, as asserted by the
commenter. The commenter did not provide an explanation as to why the
OPPS claims data did not reflect the cost of the service. We examined
our claims data for the last several years, given the concern raised by
the commenter regarding the accuracy of the claims data. In our review
of the claims data for CPT code 88366, we found a steadily moderate
volume of claims, and geometric mean costs that have remained stable,
and consistently lower than the geometric mean costs for APC 5673 while
remaining close to the geometric mean cost for APC 5672. For example,
for the CY 2021 and CY 2022 final rules, the single frequency claims
for CPT code 88366 were approximately 350 per year and the geometric
mean costs for the code were just slightly below the geometric mean
cost of APC 5672. Similarly, when we reviewed the claims data for the
CY 2024 proposed rule, the claims frequency remained consistent at 348
single frequency claims and the geometric mean cost for CPT code 88366
was $113.14, approximately $50 lower than the geometric mean for APC
5672, which was $167.30. Therefore, based on our review of the
available claims data, we believe that assigning CPT code 88366 to APC
5672 would be clinically and resource appropriate.
After consideration of the public comments, we are finalizing our
proposal without modification to assign CPT code 88366 to APC 5672 for
CY 2024. The final CY 2024 payment rate for the code can be found in
Addendum B to this final rule with comment period. We also refer
readers to Addendum D1 of this final rule with comment period for the
SI meanings for all codes reported under the OPPS. Addenda B and D1 are
available via the internet on the CMS website.
29. Fractional Flow Reserve Derived From Computed Tomography (FFRCT)/
HeartFlow (APC 5724)
Fractional Flow Reserve Derived from Computed Tomography (FFRCT),
also known by the trade name HeartFlow, is a noninvasive diagnostic
service that allows physicians to measure coronary artery disease in a
patient through the use of coronary CT scans. The HeartFlow service is
indicated for clinically stable symptomatic patients with coronary
artery disease, and, in many cases, may avoid the need for an invasive
coronary angiogram procedure. HeartFlow uses a proprietary data
analysis process performed at a central facility to develop a three-
dimensional image of a patient's coronary arteries, which allows
physicians to identify the fractional flow reserve to assess whether
patients should undergo further invasive testing (that is, a coronary
angiogram).
HeartFlow is currently described by CPT code 0503T (Noninvasive
estimated coronary fractional flow reserve (ffr) derived from coronary
computed tomography angiography data using computation fluid dynamics
physiologic simulation software analysis of functional data to assess
the severity of coronary artery disease; analysis of fluid dynamics and
simulated maximal coronary hyperemia, and generation of estimated ffr
model). On January 1, 2024, CPT code 0503T will be replaced by CPT code
75580 (Noninvasive estimate of coronary fractional flow reserve (FFR)
derived from augmentative software analysis of the data set from a
coronary computed tomography angiography, with interpretation and
report by a physician or other qualified health care professional).
HeartFlow is currently assigned to APC 5724 (Level 4 Diagnostic Tests
and Related Services), and we have proposed for CY 2024 to continue to
assign HeartFlow (CPT code 75580) to APC 5724 with a payment rate of
around $1,024.
Comment: One commenter expressed concerns that HeartFlow is
underpaid in its current and proposed APC assignment of APC 5724, which
the commenter feels may limit access to the procedure.
Response: The geometric mean cost for the HeartFlow procedure in CY
2024 is around $860 which is substantially lower than the payment rate
for APC 5724 which is around $1,024. The HeartFlow procedure is
receiving a payment that is over $160 the estimated cost of the
service, which means most providers are receiving sufficient payment
for the service.
[[Page 81690]]
Comment: Multiple commenters supported our proposal to continue to
assign HeartFlow to APC 5724 for CY 2024.
Response: We appreciate the support of the commenters of our
policy.
After consideration of the public comments we received, we are
finalizing our proposal without modification. Table 72 shows the
finalized status indicator and APC assignment for CPT code 75580 for CY
2024. We refer readers to Addendum B of this final rule with comment
period for the payment rates for all codes reportable under the OPPS.
Addendum B is available via the internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.094
30. Gastric Electrophysiology Mapping with Simultaneously Validated
Patient System Profiling (GEMS) Service (APC 5723)
Effective July 1, 2023, based on a New Technology application
received by CMS for the GEMS service, CMS established HCPCS code C9787
(Gastric electrophysiology mapping with simultaneous patient symptom
profiling) and assigned it to APC 5723 (Level 3 Diagnostic Tests and
Related Services). For CY 2024, CMS proposed to continue to assign
HCPCS code C9787 to APC 5723 with a proposed payment rate of $512.71
for CY 2024.
Comment: We received several comments, including a comment from the
manufacturer, requesting that we reassign HCPCS code C9787 to New
Technology APC 1520 (New Technology--Level 20 ($1801-$1900)) with a
payment rate of $1,850 given the lack of resource coherence with APC
5723. The commenters provided invoice costs and stated that the
proposed APC assignment would be insufficient to cover the cost of
furnishing the service and, therefore, may limit patient access. Per
the comments received, hospitals would incur a minimum cost of $1,489
for the single-use device and supply costs associated with the Gastric
Alimetry System, in addition to capital equipment costs of $10,000 for
the Gastric Alimetry Reader as well as other capital costs. Given these
costs, one commenter stated that even reassigning HCPCS code C9787 to
the highest level in the same APC series as proposed, APC 5724 (Level 4
Diagnostic Tests and Related Services), would be insufficient to cover
the costs of the service. While one commenter stated that the closest
clinical APC with clinical and resource coherence for the GEMS service
is APC 5302 (Level 2 Upper GI Procedures) with a proposed payment rate
of $1,833.10 for CY 2024, the commenter still believed that assignment
to a New Technology APC would be most appropriate because the service
is new and the technology was first cleared by the FDA in June 2022.
The commenter further stated that without an assignment to a New
Technology APC, there is a significant risk that CMS will never
generate the necessary claims data to assign the service to an
appropriate clinical APC because hospitals will not offer the service
when payment is less than a third of the cost to provide it.
Response: We thank the commenters for their input.
We disagree with the APC assignments recommended by commenters
based on the purported costs of the service. Based on our review of the
technology used as part of the service, clinical similarity of the
service to existing procedures, input from CMS medical advisors, and
review of all other information available to us, after further
evaluation, we have found close resource and clinical similarities
between HCPCS code C9787 and certain procedures currently assigned to
APC 5723, including CPT code 0779T (Gastrointestinal myoelectrical
activity study, stomach through colon, with interpretation and report).
For example, both services are non-invasive diagnostic aids for
gastrointestinal disorders that collect electrical signals through
adhesive patches. From a resource perspective, we believe the costs
associated with CPT code 0779T would be similar to those for HCPCS code
C9787 based on similarities between the technologies and invoice
prices. While the comments submitted focused on the purported resource
costs of HCPCS code C9787, we did not find that the information
provided was sufficient to differentiate between the service described
by CPT code 0779T and that of HCPCS code C9787, and ultimately
demonstrate that an assignment to APC 5723 is inappropriate. Because we
believe that HCPCS code C9787 has similar clinical and resource
characteristics as CPT code 0779T, we are finalizing our proposal to
continue to assign C9787 to APC 5723 for CY 2024.
After consideration of the public comments, we are finalizing our
proposal to continue to assign HCPCS code C9787 to APC 5723. The final
CY 2024 payment rate for the code can be found in Addendum B to this
final rule with comment period. We also refer readers to Addendum D1 of
this final rule with comment period for the SI meanings for all codes
reported under the OPPS. Addenda B and D1 are available via the
internet on the CMS website.
31. High Intensity-Focused Ultrasound (HIFU) of the Prostate (APC 5376)
CPT code 55880 (Ablation of malignant prostate tissue, transrectal,
with high intensity-focused ultrasound (hifu), including ultrasound
guidance) was effective January 1, 2021. For CY 2023, we assigned the
code to APC 5376 (Level 6 Urology and Related Services),
[[Page 81691]]
with a payment rate of $8,557.53. For CY 2024, as listed in OPPS
Addendum B that was released with the CY 2024 OPPS/ASC proposed rule,
we proposed to maintain the assignment to APC 5376 with a payment rate
of $8,847.08.
Comment: A commenter requested that we finalize the proposed
assignment to APC 5376 for CPT code 55880.
Response: Our analysis of the claims data for this final rule
demonstrates that the geometric mean cost for CPT code 55880 is
approximately $6,613, which is consistent with APC 5376, whose
geometric mean cost ranges between $6,613 and $9,827. We believe the
code fits appropriately in APC 5376 based on clinical similarity and
resource homogeneity with the procedures in the APC.
In summary, after consideration of the public comment, we are
finalizing our proposal without modification to assign CPT code 55880
to APC 5376 for CY 2024. The final CY 2024 payment rate for the code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the SI meanings for all codes reported under the
OPPS. Addenda B and D1 are available via the internet on the CMS
website.
32. Hospital Outpatient Clinic Visit for Assessment and Management of a
Patient (G0463)
In 2014, CMS established HCPCS code G0463 to describe the service
associated with a hospital outpatient clinic visit for assessment and
management of a patient. In the CY 2014 OPPS/ASC final rule with
comment period (78 FR 75042), we stated that the code is applicable for
hospital use only representing any clinic visit under the OPPS. We
further stated that HCPCS code G0463 replaces evaluation and management
(E&M) CPT codes 99201-99205 (new patient) and 99211-99215 (established
patient), thereby eliminating the distinction between new and
established clinic visits.
Comment: We received two comments requesting CMS revise the
definition of HCPCS code G0463 (Hospital Outpatient Clinic Visit for
Assessment and Management of a Patient), and issue guidance for the
correct use of this code, or alternatively create a new HCPCS code that
describes a hospital outpatient department assessment. Both commenters
assert that commercial payers are processing institutional claims from
hospitals which include HCPCS code G0463 and have implemented billing
policies which inappropriately conflate HCPCS code G0463 as a
professional Evaluation and Management (E/M) code. The commenters state
that the misuse of HCPCS code G0463 does not support orderly,
consistent, and standardized hospital outpatient coding and billing for
outpatient visits, and it is CMS's responsibility to ensure that the
code is used correctly.
Response: HCPCS code G0463 was established for use under Medicare's
hospital OPPS. We reiterate that HCPCS code G0463 is used to describe
hospital outpatient clinic services, not professional services. As part
of the Health Insurance Portability and Accountability Act (HIPAA) code
set, third-party payers may use any HCPCS code, including HCPCS codes
established by CMS, to implement their policies, however, CMS does not
establish third-party payer payment policies. Because the request to
modify the descriptor is to implement third-party payer payment
policies, we disagree that CMS should be responsible for providing
instructions for how the code should be reported on non-Medicare
claims. Third-party payers routinely provide coding guidance for how
providers should report services and items for payment under their
specific policies. If the commenters have concerns with the
instructions provided by the third-party payers, we recommend the
commenters reach out to the third-party payer that provided the
guidance. We note that under the OPPS, HCPCS code G0463 is used to
report clinic visits and enable Medicare to pay appropriately for those
visits. For more information on the history of HCPCS code G0463, refer
to the CY 2014 OPPS/ASC final rule with comment period.
33. Imaging of Retina for Detection or Monitoring of Disease (CPT Code
92229) (APC 5733)
CPT code 92229 (Imaging of retina for detection or monitoring of
disease; point-of-care autonomous analysis and report, unilateral or
bilateral) is performed to screen patients with diabetes for signs of
diabetic retinopathy and other eye diseases. The code was established
in January 2021 and assigned to APC 5733 (Level 3 Minor Procedures).
The code was assigned to Level 3 Minor Procedures because the service
had clinical and resource similarity to long-established CPT code 92227
(Imaging of retina for detection or monitoring of disease; with remote
clinical staff review and report, unilateral or bilateral) which also
is assigned to Level 3 Minor Procedures.
In CY 2022, there were 174 claims for CPT code 92229 and the
geometric mean for the service was $34.53. The cost of the procedure
was substantially closer to the payment rate for APC 5732 (Level 2
Minor Procedures) with a payment rate of $34.53 than to the payment
rate for APC 5733 of $58.79. Based on these data, we proposed assigning
CPT code 92229 to APC 5732 for CY 2024.
Comment: Multiple commenters requested that we continue to assign
CPT code 92229 to APC 5733 for CY 2024. The commenters asserted that
there had not been enough claims data to accurately determine the cost
of the procedure. Also, the commenters noted that the procedure
described by CPT code 92229 had clinical and resource similarities to
other procedures that had been assigned to either Level 3 Minor
Procedures (APC 5733) or Level 4 Minor Procedures (APC 5734). Finally,
the commenters also expressed concerns that assigning CPT code 92229 to
APC 5732 would reduce access to retinal screenings for people with
diabetes or at risk for eye diseases, especially for patients who are
either poor or members of minority populations.
Response: We note that CMS recognizes that software-based
technologies are rapidly evolving, like the procedure described by CPT
code 92229. In line with our comment solicitation on payment policy for
software as a service (SaaS) procedures in the CY 2023 OPPS final rule
(87 FR 72035 and 72036), CMS is considering, for future rulemaking,
whether or not specific adjustments to payment policies and rate
calculations are necessary in order to more accurately and
appropriately pay for these products and services across settings of
care. CMS remains open to feedback on these issues and welcomes
engagement from interested parties, including from manufacturers,
providers, and beneficiaries. We agree with the commenters that for CPT
code 92229 we should wait for more claims data to be available before
adjusting the current payment rates for these services.
After consideration of the public comments we received, we are
implementing our proposal with modification by maintaining the current
assignment for CPT code 92229 in APC 5733 (Level 3 Minor Procedures).
Table 73 shows the finalized status indicator and APC assignment for
CPT code 92229 for CY 2024. We refer readers to Addendum B of this
final rule with comment period for the payment rates for all codes
reportable under the OPPS. Addendum B is available via the internet on
the CMS website.
[[Page 81692]]
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34. Imagio[supreg] Breast Imaging Service (APC 5522)
Effective October 1, 2023, based on a New Technology application
received by CMS for the Imagio[supreg] Breast Imaging System, CMS
established HCPCS code C9788 (Opto-acoustic imaging, breast (including
axilla when performed), unilateral, with image documentation, analysis
and report, obtained with ultrasound examination) and assigned it to
APC 5521 (Level 1 Imaging without Contrast). For CY 2024, CMS proposed
to continue to assign HCPCS code C9788 to APC 5521. Additionally, the
AMA established a new Category III code to describe the same service,
which will be effective January 1, 2024. For CY 2024, CMS also proposed
to assign CPT placeholder code X183T (Opto-acoustic imaging, breast,
unilateral, including axilla when performed, real-time with image
documentation, augmentative analysis and report (List separately in
addition to code for primary procedure)) to APC 5521, the same APC to
which HCPCS code C9788 is assigned. Since the release of the proposed
rule, CPT placeholder code X183T has been finalized as CPT code 0857T.
We note that because both HCPCS code C9788 and CPT code 0857T describe
the same service, effective January 1, 2024, CMS will delete HCPCS code
C9788 and only CPT code 0857T will be used to bill for the service. For
clarity, we will refer only to CPT code 0857T throughout this
discussion regarding the final payment policy for the service for CY
2024.
Comment: We received a comment from the manufacturer stating that
the initial assignment to APC 5521 is inappropriately low to cover
hospital costs to furnish the service. Based on resource costs, the
commenter requested that CMS reassign CPT code 0857T from APC 5521 to
APC 5523 (Level 3 Imaging without Contrast) with a proposed CY 2024
payment rate of $236.31. Specifically, the commenter provided a
breakdown of the per-use device cost by dividing the price of the
capital equipment, the Imagio[supreg] Breast Imaging System, by its
useful life of 5 years and further dividing it by an estimated total
use per year. The commenter noted that the cost breakdown was provided
based on figures that had been updated since the time of their New
Technology APC application in December 2022. Based on the calculations
of the per-use device cost, as well as the procedure costs for
equipment, labor, and supply, the commenter stated that the proposed
payment rate for APC 5523 was a more appropriate APC assignment for the
service.
Response: We thank the commenter for their comment. We note that,
in a budget neutral environment, payments may not fully cover
hospitals' costs in a particular circumstance, including those for the
purchase and maintenance of capital equipment, like that of the
Imagio[supreg] Breast Imaging System. We believe that our payment rates
reflect the costs that are associated with providing care to Medicare
beneficiaries and are adequate to ensure access to services (80 FR
70374). Therefore, we rely on hospitals to make their decisions
regarding the acquisition of high-cost equipment with the understanding
that the Medicare program must be careful to establish its initial
payment rates for new services that lack hospital claims data based on
realistic Medicare utilization projections for all such services
delivered in cost-efficient hospital outpatient settings.
With that said, based on the comment received, including the cost
information provided, and further review of the service, we agree that
the proposed APC assignment for CPT code 0857T to APC 5521 is not
appropriate. However, we also do not believe that Medicare should pay
for the entire cost of capital equipment as provided by the
manufacturer when hospitals will furnish the service using the same
equipment for both Medicare and non-Medicare beneficiaries. Therefore,
we believe that an APC assignment to APC 5522 (Level 2 Imaging without
Contrast) with a proposed payment rate of $106.04 would be more
resource appropriate.
Comment: The commenter requested CMS's feedback on what cost data
or cost analysis are accepted by CMS when products are new to the
market. Specifically, when there are few claims submitted for a new
device, the commenter asked whether CMS would be open to accepting
invoices provided by the company or other documentation to ensure an
appropriate initial APC assignment rather than having to go through
multiple rounds of reassignment requests through multiple rulemaking
cycles.
Response: We appreciate the comment. We generally assign new CPT
codes to an APC based on input from a variety of sources, including,
but not limited to, review of the resource costs and clinical
similarity of the service to existing procedures; input from CMS
medical advisors; information from interested specialty societies; and
review of all other information available to us. We also believe
continued engagement with interested parties through notice and comment
rulemaking is a fundamental piece of the OPPS and allows for CMS to
gather additional information. Regarding invoice pricing, CMS considers
invoices provided by commenters or manufacturers, as well as other
available cost information when assigning services to clinical APCs.
However, invoice pricing is not the only piece of information that we
consider, and therefore, we may appropriately assign a service to a
clinical APC based on clinical and resource similarities, with a
payment rate that nevertheless may not match the initial invoice costs
provided exactly.
After consideration of the public comment, we are finalizing the
assignment of CPT code 0857T to APC 5522. The final CY 2024 payment
rate for the code can be found in Addendum B to this final rule with
comment period. We also refer readers to
[[Page 81693]]
Addendum D1 of this final rule with comment period for the SI meanings
for all codes reported under the OPPS. Addenda B and D1 are available
via the internet on the CMS website.
35. InSpace Subacromial Tissue Spacer Procedure (APC 5115)
For 2024, we proposed to continue to assign HCPCS code C9781
Arthroscopy, shoulder, surgical; with implantation of subacromial
spacer (e.g., balloon), includes debridement (e.g., limited or
extensive), subacromial decompression acromioplasty, and biceps
tenodesis when performed) to APC 5115 (Level 5 Musculoskeletal
Procedures) with a proposed payment rate of $13,269.40.
Comment: We received several comments that endorsed the proposed
APC assignment. Commenters expressed strong support for CMS's proposed
increase to the payment rates associated with the InSpace balloon
placement procedure described by HCPCS code C9781. They stated that the
payment rates ensure that both patients and healthcare providers are
able to fully leverage the benefits this technology offers.
Response: We appreciate the commenters' support of our proposal.
Based on our review of claims data available for this final rule with
comment period, we believe an assignment to APC 5115 for CPT code C9781
is appropriate for CY 2024.
In summary, after consideration of the public comments, we are
finalizing our proposal without modification and assigning CPT code
C9781 to APC 5115 for CY 2024. The final CY 2024 OPPS payment rate for
the code can be found in Addendum B to this final rule with comment
period.
36. Integrated Neurostimulation Services for Bladder Dysfunction (APCs
5461 and 5464)
For CY 2024, the CPT Editorial Panel established four new Category
III CPT codes, specifically, CPT codes 0816T, 0817T, 0818T and 0819T to
describe integrated neurostimulation services for bladder dysfunction,
effective January 1, 2024. CPT code 0816T is associated with the eCoin
System. Because the final CY 2024 CPT code numbers were not available
when we published the proposed rule, the codes were listed as
placeholder codes X129T, X130T, X131T and X132T in the OPPS Addendum B
of the CY 2024 OPPS/ASC proposed rule.
0816T: Open insertion or replacement of integrated
neurostimulation system for bladder dysfunction including electrode(s)
(e.g., array or leadless), and pulse generator or receiver, including
analysis, programming, and imaging guidance, when performed, posterior
tibial nerve; subcutaneous
0817T: Open insertion or replacement of integrated
neurostimulation system for bladder dysfunction including electrode(s)
(e.g., array or leadless), and pulse generator or receiver, including
analysis, programming, and imaging guidance, when performed, posterior
tibial nerve; subfascial
0818T: Revision or removal of integrated neurostimulation
system for bladder dysfunction, including analysis, programming, and
imaging, when performed, posterior tibial nerve; subcutaneous
0819T: Revision or removal of integrated neurostimulation
system for bladder dysfunction, including analysis, programming, and
imaging, when performed, posterior tibial nerve; subfascial
In the 2024 OPPS/ASC proposed rule, we proposed to assign CPT codes
0816T and 0817T to APC 5464 (Level 4 Neurostimulator and Related
Procedures) with a proposed payment rate of $21,376.53 based on
clinical and resource similarity to CPT code 64590 (Insertion or
replacement of peripheral or gastric neurostimulator pulse generator or
receiver, direct or inductive coupling). In addition, we proposed to
assign CPT codes 0818T and 0819T to APC 5461 (Level 1 Neurostimulator
and Related Procedures) with a proposed payment rate of $3,364.67 based
on clinical and resource similarity to CPT code 64595 (Revision or
removal of peripheral or gastric neurostimulator pulse generator or
receiver).
Comment: Most commenters endorsed the assignment of CPT code 0816T
to APC 5464. They were appreciative that CMS recognizes through this
APC assignment the importance of advancing healthcare options for
Medicare beneficiaries and the need for continued accessibility of new
technologies, like the eCoin system procedure, into sites of service
that best serve the complexities of treating some Medicare
beneficiaries. One commenter stated that they believe the decision by
CMS appropriately aligns the proposed payment level with the intended
purpose and clinical complexity of the eCoin system described by CPT
code 0816T. In doing so, the commenter stated, CMS continues to empower
appropriate medical decision-making by providers for Medicare
beneficiaries that will best align with each patient's unique
healthcare needs. Another commenter expressed that they were very
pleased with our decision to assign implantable tibial generator codes
0816T and 0817T to Level 4 APC 5464 and revision/removal generator
codes 0818T and 0819T to Level 1 APC 5461. This commenter stated that
this decision creates resource and clinical parity with CPT code 64590
(Insertion or replacement of peripheral or gastric neurostimulator
pulse generator or receiver, direct or inductive coupling) which
describes sacral neuromodulation (SNM) generator implant and CPT code
64595 (Revision or removal of peripheral or gastric neurostimulator
pulse generator or receiver) which describes revision/removal
procedures which have the same Level 4 APC and Level 1 APC categories,
respectively. This supports the fact that implantable tibial procedures
require similar resources and support as SNM including pre-op time,
recovery, fluoroscopy, patient follow-up, monitoring and anesthesia.
Response: We appreciate the commenters' feedback on these new
Category III CPT codes. We agree with commenters' recommendations to
finalize the proposed APC assignments.
In summary, after reviewing the public comments for the proposal,
we are finalizing our proposal without modification to assign CPT codes
0816T and 0817T to APC 5464 and to assign CPT codes 0818T and 0819T to
APC 5461. The final CY 2024 payment rates for these codes can be found
in Addendum B to this final rule with comment period. In addition, we
refer readers to Addendum D1 of this final rule with comment period for
the status indicator meanings for all codes reported under the OPPS.
Addenda B and D1 are available via the internet on the CMS website.
For additional discussion regarding the commenters' request to
increase the device offset of CPT codes 0816T and 0817T refer to
section IV.B. of this final rule with comment period.
37. LimFlow TADV Procedure CPT Code 0620T (APC 1578)
The LimFlow TADV procedure which is described by CPT code 0620T
(Endovascular venous arterialization, tibial or peroneal vein, with
transcatheter placement of intravascular stent graft(s) and closure by
any method, including percutaneous or open vascular access, ultrasound
guidance for vascular access when performed, all catheterization(s) and
intraprocedural roadmapping and imaging guidance necessary to complete
the intervention, all associated radiological supervision and
interpretation, when performed) is a new endovascular procedure that is
used to treat patients with chronic limb-
[[Page 81694]]
threatening ischemia. According to the developer, these patients are no
longer eligible for conventional endovascular or open bypass surgery to
treat their artery blockage, and without this procedure, they are
likely to face limb amputation.
According to the developer, the LimFlow TADV procedure received
full FDA PMA approval on September 11, 2023. Previously, the procedure
could be performed through a Category B IDE study. CPT code 0620T,
which describes the LimFlow TADV procedure was established in January
of 2021 and was assigned to APC 5194 (Level 4 Endovascular Procedures)
with a payment rate of around $17,400, which is the highest-paying APC
for endovascular procedures. For the CY 2024 proposed rule, we proposed
to continue to assign CPT code 0266T to APC 5194.
Comment: The HOP Panel and two commenters, including the developer
of LimFlow TADV procedure, requested that CPT code 0620T be reassigned
to a New Technology APC that better reflects the cost of the procedure.
Commenters were concerned that if CPT code 0620T continued to be
assigned to APC 5194, the low payment for the procedure would
discourage providers from performing the procedure and deny access to
LimFlow TADV to vulnerable and underserved populations.
Response: We agree with the HOP Panel and commenters that CPT code
0620T should be reassigned to a New Technology APC that better reflect
the costs of the procedure. Because there are only 15 claims for the
procedure for CY 2021 and CY 2022, the LimFlow TADV procedure is
subject to our new technology procedure low-volume policy. An analysis
of the median, arithmetic mean, and geometric mean of CPT code 0620T
found that the median was $25,801.85, the arithmetic mean was
$28,628.62, and the geometric mean was $26,716.31. Based on our policy,
we estimate the cost of the LimFlow TADV procedure to be $28,628.62 as
the arithmetic mean has the highest value of the three cost statistics.
Therefore, we plan to reassign CPT code 0620T to New Technology APC
1578 (New Technology--Level 41 ($25,001-$30,000)) with a payment rate
of around $27,500.
After consideration of the public comments we received, we are
implementing our proposal with modification for CPT code 0620T as we
will update its APC assignment to APC 1578 (New Technology--Level 41
($25,001-$30,000)). Table 74 shows the finalized status indicator and
APC assignment for all of the procedure codes. We refer readers to
Addendum B of this final rule with comment period for the payment rates
for all codes reportable under the OPPS. Addendum B is available via
the internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.096
38. Lixelle Apheresis
Lixelle [beta]2-microglobulin Apheresis Column is indicated for use
in the treatment of dialysis[hyphen]related amyloidosis (DRA), a
disease that affects people with end-stage renal disease (ESRD). DRA is
a metabolic disorder from the failure of the kidney to filter and
remove [beta]2-microglobulin, typically from chronic hemodialysis
(typically 5 years or longer). The Lixelle device is used in an
apheresis procedure that selectively removes [beta]2-microglobulin from
circulating blood and used pursuant to a physician prescription in
conjunction with hemodialysis. It is intended to be used at each
hemodialysis session (that is, frequency of treatment is expected to be
3 times per week). In March 2015, FDA approved LIXELLE[supreg] as a
Class III Humanitarian Use Device (HUD) with an approved Humanitarian
Device Exemption (HDE). There are currently no specific HCPCS or CPT
code that represent the Lixelle service.
Comment: A commenter urged CMS to provide reimbursement for Lixelle
to benefit patients with DRA. Another commenter requested separate
payment under the Medicare ESRD PPS. This same commenter stated that if
separate payment does not apply under the ESRD PPS, the service should
be paid separately under the OPPS when furnished in the HOPD facility.
Specifically, the commenter requested that CMS provide separate payment
under the OPPS, and offered the following options:
(1) establish a new HCPCS C code or G code for the Lixelle
apheresis procedure and assign the code to APC 5242 (Level 2 Blood
Product Exchange and Related Services); or
(2) pay separately for the apheresis procedure used with the
Lixelle device through CPT code 36516 (Therapeutic apheresis with
extracorporeal immunoadsorption, selective adsorption or selective
filtration and plasma
[[Page 81695]]
reinfusion), proposed to be assigned to APC 5243 (Level 3 Blood Product
Exchange and Related Services) for CY 2024, and require the use of a
modifier or add-on code when the Lixelle apheresis procedure is billed
to reduce the payment for the procedure to the payment rate for APC
5242 (Level 2 Blood Product Exchange and Related Services); or
(3) allow separate payment for the dialysis performed as part of
Lixelle apheresis procedure through HCPCS code G0257 (Unscheduled or
emergency dialysis treatment for an ESRD patient in a hospital
outpatient department that is not certified as an ESRD facility), which
is assigned to APC 5401 (Dialysis) for CY 2024, and require the use of
a modifier or add-on code to provide additional payment beyond that
provided for APC 5401
Response: We appreciate the recommendations and will consider them
for future rulemaking. We note this complex, ongoing issue is still
under consideration and a thorough evaluation is necessary to ensure
the appropriate Medicare benefit category and payment for the service.
39. Meibomian Gland Repair (MGR) (APC 5733)
For 2020, the AMA's Editorial Panel established CPT code 0563T
(Evacuation of meibomian glands, using heat delivered through wearable,
open-eye eyelid treatment devices and manual gland expression,
bilateral), effective January 1, 2020, to describe the treatment
associated meibomian gland dysfunction (MGD) and dry eye disease (DED).
For CY 2023, we assigned the code to APC 5733 (Level 3 Minor
Procedures) with a payment rate of $57.48. For CY 2024, we proposed to
continue with the assignment to APC 5733 with a payment of $58.13.
Comment: A commenter disagreed with proposed assignment to APC 5733
and stated that the proposed payment for CPT code 0563T does not
reflect the time, intensity, clinical resources, and technology
required to provide the service. The commenter indicated that the time
and resources required to perform the service is significantly greater
than the proposed reimbursement for APC 5733. The commenter further
stated that based on the clinical complexity of the service, CPT code
0563T would be more appropriately placed in APC 5502 (Level 2
Extraocular, Repair, and Plastic Eye Procedures) with a payment of
$991.30, based on its clinical similarity to the procedures in the APC,
and urged CMS to revise the assignment to APC 5502.
Response: We reviewed our claims data for this final rule with
comment period. We note that the CY 2024 OPPS payment rates are based
on claims submitted between January 1, 2022, and December 31, 2022,
processed through June 30, 2023. Based on our evaluation of the claims
data for this final rule with comment period, we found no claims data
for the code. Due to the lack of claims data, we believe that we should
continue to assign the code to APC 5733. Once we have adequate claims
data, we will review and determine whether a change in the APC
assignment is necessary.
In summary, after consideration of the public comment, we are
finalizing our proposal without modification, and assigning CPT code
0563T to APC 5733 for CY 2024. As we do every year, we will reevaluate
the APC assignment for the code in the next rulemaking cycle. We note
that we review, on an annual basis, the APC assignments for all items
and services paid under the OPPS. The final CY 2024 OPPS payment rate
for all the codes payable under the OPPS can be found in Addendum B to
this final rule with comment period. In addition, we refer readers to
Addendum D1 of this final rule with comment period for the SI meanings
for all codes reported under the OPPS. Addendum D1 is available via the
internet on the CMS website.
40. MindMotion[supreg] GO Neurorehabilitative Remote Therapy Service
(APC 5741)
Effective July 1, 2022, the CPT Editorial Panel created CPT codes
0733T (Remote real-time, motion capture-based neurorehabilitative
therapy ordered by a physician or other qualified health care
professional; supply and technical support, per 30 days) and 0734T
(Remote real-time, motion capture-based neurorehabilitative therapy
ordered by a physician or other qualified health care professional;
treatment management services by a physician or other qualified
healthcare professional, per calendar month) to describe the clinician
services associated with patient use of MindMotion[supreg] GO, a
rehabilitative at home therapy program, remotely monitored by a
therapist, for patients who have suffered certain neurological
conditions. For CY 2024, CMS proposed to continue to assign CPT code
0733T to APC 5741 (Level 1 Electronic Analysis of Devices) with a
proposed payment rate of $36.79. CMS also proposed to continue to
assign status indicator ``B'' to CPT code 0734T for CY 2024.
Comment: We received a comment from the manufacturer requesting
that we assign CPT code 0733T to a more clinically and resource
appropriate APC for CY 2024. The commenter stated that the proposed APC
assignment to APC 5741 for CPT code 0733T was not resource appropriate
because it did not cover the cost of several items and capital
equipment, including a mini-PC to run the treatment software, 3D
motion-tracking camera to track patient movement, camera to enable
certain hand rehabilitative exercises, and a pressure-sensitive
peripheral to measure hand grip for different hand rehab exercises. The
commenter did not provide invoice costs or estimated costs for these
components. Additionally, the commenter stated that they believed APC
5741 is not clinically appropriate for CPT code 0733T because the APC
contains several monitoring services, and, per the commenter, CPT code
0733T performs remote monitoring subsequent to its ability to provide
treatment. Finally, the commenter pointed to CPT code 0693T
(Comprehensive full body computer-based markerless 3D kinematic and
kinetic motion analysis and report), which describes the service
involving the DARI Motion Procedure and has a proposed APC assignment
to New Technology APC 1505 (New Technology--Level 5 ($301-$400)) for CY
2024, as a clinically similar service.
Response: We thank the commenter for their input regarding the
proposed CY 2024 APC assignment for CPT 0733T. First, because the code
was first made effective on July 1, 2022, and is relatively new, we do
not have any claims data at this time. However, we note that as is our
policy for new codes for which we lack pricing information, we assign
the service to an existing APC based on input from a variety of
sources, including, but not limited to, review of the clinical
similarity of the service to existing procedures, input from CMS
medical advisors, and review of all other information available to us.
Based on our understanding of the service and input from our medical
advisors, we do not agree that CPT code 0733T is dissimilar to other
services in APC 5741 such that it should be assigned to a different
APC. We believe that CPT code 0733T is more similar to services in APC
5741 than services in other APCs, including CPT code 0693T, which is
currently assigned to New Technology APC. We note that the long
descriptor for CPT code 0733T describes a remote service similar to
other codes with remote components in APC 5741, including CPT code
98976. Based on the
[[Page 81696]]
nature of the procedure and the information available to us, we
continue to believe that CPT code 0733T is appropriate for assignment
to APC 5741 for CY 2024.
Comment: The manufacturer also commented to support the
reassignment of the status indicator for CPT code 0734T from status
indicator ``B'' to status indicator ``S,'' based on a public
presentation at the Advisory Panel on Outpatient Payment (HOP Panel) on
August 22, 2023, recommending that the status indicator assignment of
CPT code 0734T and other remote monitoring codes change from ``B'' to
``S'' and be assigned to APC 5741.
Response: We first note that CMS did not propose to change the
status indicator of CPT code 0734T from ``B'' to ``S'' for CY 2024. CPT
code 0734T describes a professional service, specifically treatment
management services by a physician or other qualified healthcare
professional. Therefore, CPT code 0734T is not payable under the OPPS
and would not be appropriate for separate payment as indicated by
status indicator ``S.'' For CY 2024, we believe it is appropriate to
finalize the status indicator for CPT 0734T as proposed.
After consideration of the public comment, we are finalizing our
proposal to continue to assign CPT code 0733T to APC 5741 as proposed.
We are also finalizing our proposal to continue to assign status
indicator ``B'' to CPT code 0734T. The final CY 2024 payment rate for
CPT code 0733T can be found in Addendum B to this final rule with
comment period. We also refer readers to Addendum D1 of this final rule
with comment period for the SI meanings for all codes reported under
the OPPS. Addenda B and D1 are available via the internet on the CMS
website.
41. Minimally Invasive Glaucoma Surgery (MIGS) (APC 5493)
CPT code 0671T (Insertion of anterior segment aqueous drainage
device into the trabecular meshwork, without external reservoir, and
without concomitant cataract removal, one or more) was effective
January 1, 2022. For CY 2023, we assigned CPT code 0671T to APC 5491
(Level 1 Intraocular Procedures) with a payment rate of $2,159.44. For
CY 2024, as listed in OPPS Addendum B that was released with the CY
2024 OPPS/ASC proposed rule, we proposed to reassign the code to APC
5492 (Level 2 Intraocular Procedures), with a payment rate of
$3,970.62. We received some comments related to the proposal.
Comment: Several commenters agreed with our proposal and requested
that we finalize the assignment to APC 5492. However, other commenters
disagreed with the assignment to APC 5492, and instead suggested
assignment to APC 5493 (Level 3 Intraocular Procedures), with a payment
rate of $5,110.58. These commenters reported that CPT code 0671T is one
of three MIG codes that the CPT Editorial Panel established effective
January 1, 2022, and noted that the other two MIG codes (66989 and
66991) are proposed for assignment to APC 5493. Because of its
similarity to CPT codes 66989 and 66991, the commenters suggested
reassignment to APC 5493 for CPT code 0671T.
Response: We reviewed our claims data for this final rule with
comment period. The CY 2024 OPPS payment rates are based on claims
submitted between January 1, 2022, and December 31, 2022, processed
through June 30, 2023. We note that CY 2024 is the first year that we
have claims data for the code. Based on our analysis of the claims data
for this final rule, the resource costs related to CPT code 0671T seems
more appropriately in APC 5493 rather than APC 5492. Specifically, our
claims data shows a geometric mean cost of about $5,610 for CPT code
0671T based on 79 single claims (out of 79 total claims), which is
consistent with the geometric mean cost of approximately $5,118 for APC
5493, rather than the geometric mean cost of approximately $3,982 for
APC 5492. Based on the resource costs to furnish the service associated
with CPT code 0671T, which are consistent with APC 5493, we believe
that reassignment to APC 5493 is appropriate. Therefore, we are
revising the assignment for CPT code 0671T, to APC 5493 for CY 2024.
With regard to the other two MIG codes mentioned by the commenter,
specifically, CPT codes 66989 and 66991, refer to section III.C. of
this final rule with comment period for the discussion related to the
payment for the codes.
In summary, after consideration of the public comments, we are
finalizing the APC assignment for CPT code 0671T with modification.
Specifically, we are revising the APC assignment for CPT code 0671T to
APC 5493 for CY 2024. The final CY 2024 OPPS payment rate for this code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the SI meanings for all codes reported under the
OPPS. Addendum D1 is available via the internet on the CMS website.
42. Musculoskeletal Procedures (APCs 5111 Through 5116)
Prior to the CY 2016 OPPS, payment for musculoskeletal procedures
was primarily divided according to anatomy and the type of
musculoskeletal procedure. As part of the CY 2016 reorganization to
better structure the OPPS payments to utilize prospective payment
packages, we consolidated these individual APCs so that they became a
general Musculoskeletal APC series (80 FR 70397 and 70398).
In the CY 2018 OPPS/ASC final rule with comment period (82 FR
59300), we continued to apply a six-level structure for the
Musculoskeletal APCs because doing so provided an appropriate
distinction for resource costs at each level and provided clinical
homogeneity. However, we indicated that we would continue to review the
structure of these APCs to determine whether additional granularity
would be necessary. In the CY 2019 OPPS proposed rule (83 FR 37096), we
recognized that commenters had previously expressed concerns regarding
the granularity of the current APC levels and, therefore, requested
comment on the establishment of additional levels. Specifically, we
solicited comments on the creation of a new APC level between the
current Level 5 and Level 6 within the Musculoskeletal APC series.
While some commenters suggested APC reconfigurations and requested
changes to APC assignments, many commenters requested that we maintain
the current six-level structure and continue to monitor the claims data
as they become available. Therefore, in the CY 2019 OPPS/ASC final rule
with comment period, we maintained the six-level APC structure for the
Musculoskeletal Procedures APCs (83 FR 58920 and 58921).
For CY 2024, based on the claims data available for the CY 2024
OPPS/ASC proposed rule, we continued to believe that the six-level APC
structure for the Musculoskeletal Procedures APC series is appropriate
and we proposed to maintain it for the CY 2024 OPPS update.
Comment: One commenter requested that CMS reassign CPT code 23472
(Arthroplasty, glenohumeral joint; total shoulder) from APC 5115to APC
5116 (Level 6 Musculoskeletal Procedures). According to the commenter,
the requested assignment would more closely track hospital resources
used in performing these procedures and appropriately align with other
clinically similar procedures. The commenter stated that with regard to
cost, according
[[Page 81697]]
to CMS's 2 Times Listing document released with the proposed rule, the
geometric mean cost (GMC) of claims reporting total shoulder CPT 23472
is $17,423.52, which represents the highest cost ``significant''
procedure within APC 5115. In fact, the GMC of CPT code 23472 exceeds
the GMC of four ``significant'' procedures that CMS proposes to assign
to APC 5116:
CPT 22867 (Insertion of interlaminar/interspinous process
stabilization/distraction device, without fusion, including image
guidance when performed, with open decompression, lumbar; single
level)--GMC of $14,803.74
CPT 27279 (Arthrodesis, sacroiliac joint, percutaneous or
minimally invasive (indirect visualization), with image guidance,
includes obtaining bone graft when performed, and placement of
transfixing device)--GMC of $15,788.69
CPT 22856 (Total disc arthroplasty (artificial disc),
anterior approach, including discectomy with end plate preparation
(includes osteophytectomy for nerve root or spinal cord decompression
and microdissection); single interspace, cervical)--GMC of $16,078.32
CPT 22612 (Arthrodesis, posterior or posterolateral
technique, single interspace; lumbar (with lateral transverse
technique, when performed))--GMC of $16,870.82
This commenter stated that the GMC of CPT code 23472 is about
$500.00 closer to the GMC of APC 5116 ($20,928.08) than APC 5115
($13,420.64), reinforcing that APC 5116 is a more appropriate
assignment for CPT 23472 and furthermore, this payment misalignment--
resulting in a $4,000 opportunity cost to hospitals performing this
procedure on average--threatens the availability of this procedure on
an outpatient basis.
The commenter also provided clinical information, stating that
shoulder replacement and reverse shoulder replacement procedures
represented by CPT code 23472 are very complex, involving three bones
and limited access space due to the muscles, ligaments, and tendons
surrounding the joint. These procedures are clinically comparable to
other procedures assigned to APC 5116, such as total elbow arthroplasty
(TEA) CPT code 24363. TEA and TSA procedures involve similar complexity
and are typically performed by specialized, fellowship- or
subspecialty-trained shoulder and elbow orthopaedic surgeons.
Response: We appreciate the commenter's recommendation. Based on
our analysis of the latest CY 2022 claims data available for CY 2024
OPPS ratesetting, the geometric mean cost associated with CPT code
23472 is $17,370.78 based on 51,120 single claims (out of 51,506 total
claims), which is consistent with the geometric mean cost of $18,250.77
for APC 5116. We also note that the APC 5115 has a range of HCPCS
geometric mean costs for cost significant codes from $10,641.75 to
$16,292.97with the geometric mean cost of CPT code 23472 being at the
higher end of the cost range. The geometric mean cost for APC 5115 is
$12,889.60.
Based on the data, we believe that APC 5116 is the more appropriate
assignment rather than APC 5115 for CPT code 23472. Therefore, we agree
with the commenter and are reassigning CPT code 23472 from APC 5115 to
APC 5116 for CY 2024. The final CY 2024 OPPS payment rates for the
codes can be found in Addendum B to this final rule with comment
period.
After consideration of the public comments, we are finalizing our
proposal to maintain the six-level Musculoskeletal Procedures APC
structure. We are also finalizing an assignment of CPT code 23472 to
APC 5116, rather than APC 5115, for the CY 2024 OPPS.
43. Noncontact Near-infrared (NIR) Spectroscopy (APC 5732)
In July 2021, the AMA's CPT Editorial Panel established three new
codes to describe the service related to noncontact near-infrared
spectroscopy. For CY 2024, the CPT Editorial Panel made several changes
to the codes to accurately describe the services currently performed in
the medical setting for noncontact near-infrared spectroscopy.
Specifically, the CPT Editorial Panel took the following actions for CY
2024:
deleted CPT code 0641T and 0642T, effective December 31,
2023;
revised the descriptor for existing CPT code 0640T to
include the services previously described in CPT codes 0641T and 0642T;
and
established two new codes, specifically, CPT code 0859T,
which was listed as placeholder code X1914T in the CY 2024 OPPS/ASC
proposed rule, and CPT code 0860T, which was listed as placeholder code
X171T, effective January 1, 2024.
The complete long descriptors for the codes are listed below in
Table 75, along with the CY 2023 and proposed CY 2024 OPPS status
indicator and APC assignments (where applicable).
[[Page 81698]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.097
Based on the code changes, we proposed to take the following
actions for CY 2024:
CPT code 0640T: With the revised descriptor to include the
descriptions that were listed in CPT codes 0641T and 0642T, we proposed
to revise the status indicator for CPT code 0640T from ``M''
(professional-only service) to ``T'' and assigned the code to APC 5732
(Level 2 Minor Procedures), with a payment $ 37.05. Under the OPPS, the
predecessor code for CPT code 0640T is CPT code 0641T.
CPT code 0641T: We proposed to assign the code to status
indicator ``D'' to indicate that the code would be deleted at the end
of the year, and crosswalked the separate payment status indicator of
``T'' and assignment of APC 5732 to CPT code 0640T.
[[Page 81699]]
CPT code 0642T: We proposed to assign the code to status
indicator ``D'' to indicate that the code would be deleted at the end
of the year. Because the code was assigned to status indicator ``M''
(professional-only service), we did not crosswalk this code to any
payable indicators or APC.
CPT code 0859T: Because the code describes an add-on
service to CPT code 0640T, and must always be reported on the same day
with CPT code 0640T, we proposed to assign the code to status indicator
``N'' to indicate that the code is packaged and payment is included in
the primary service. Under the OPPS, most add-on codes are packaged, as
specified in 42 CFR 419.2(b)(18).
CPT code 0860T: We proposed to assign this code to status
indicator ``E1'' to indicate that the code is not covered or payable by
Medicare for CY 2024.
We received several comments related to our proposals. Below are
the comments and our responses.
Comment: Many commenters requested separate payment for CPT code
0860T and indicated that Medicare beneficiaries would benefit from
essential screening for peripheral arterial disease (PAD). Some
commenters clarified that one-third of patients over age 65 with
diabetes or a history of smoking have PAD, and with the increased risk
of death and other cardiovascular complications, including heart attack
and stroke, the commenters believe that it is essential to diagnose and
treat PAD as early as possible. The commenters urged CMS to make
available PAD screening options to the Medicare population and
requested separate payment for the service.
Response: CPT code 0860T describes a screening for peripheral
arterial disease (PAD). Currently, Medicare has not established
coverage for screening for PAD. Specifically, this screening code does
not qualify for Medicare coverage since there is no national coverage
determination (NCD) for PAD screening. Consequently, we proposed to
assign the code to status indicator ``E1'' to indicate that the code is
not payable by Medicare when submitted on outpatient claims (any
outpatient bill type) because the service associated with the code is
either not covered by any Medicare outpatient benefit category,
statutorily excluded by Medicare, or not reasonable and necessary.
We note that on August 7, 2013, CMS published a Federal Register
notice (78 FR 48164 through 48169), updating the process used for
opening, deciding or reconsidering national coverage determinations
(NCDs). If the commenter would like to request Medicare coverage for
PAD screening, we strongly recommend submitting an application to CMS.
New screening and preventive tests coverage are added through the
National Coverage Determination (NCD) process. Information on the
Medicare coverage determination process, the application process, as
well how to request a new NCD, or revision to an existing NCD, can be
found on the CMS website, specifically, at https://www.cms.gov/medicare/coverage/determination-process/request.
Comment: Several commenters requested separate payment for CPT code
0640T, and suggested reassignment to status indicator ``S'' (Procedure
or Service, Not Discounted When Multiple. Paid under OPPS; separate APC
payment.), and APC 5722 (Level 2 Diagnostic Tests; proposed payment of
$304.35). The commenters reported that the NIR technology described by
CPT code 0640T is similar to the technology described with CPT code
0598T, which is assigned to status indicator ``S'' and APC 5722.
Specifically, CPT code 0598T describes a hand-held device that detects
bacteria in a wound through fluorescence color, while CPT code 0640T
and CPT code 0859T describes a hand-held device that detect a wound's
blood oxygen level at the point of care. Because of its similarity to
CPT code 0598T, the commenters recommended reassignment to APC 5722 for
CPT code 0640T.
Response: Prior to the descriptor revision for CPT code 0640T, the
technical service associated with noncontact near-infrared spectroscopy
was described by CPT code 0641T, which was assigned to APC 5732 for CY
2023. Under the OPPS, the predecessor code for CPT code 0640T is CPT
code 0641T. We note that the CY 2024 OPPS payment rates are based on
claims submitted between January 1, 2022, and December 31, 2022,
processed through June 30, 2023. Based on our analysis of the claims
data for this final rule with comment period, we found a geometric mean
cost of about $14 for predecessor CPT code 0641T based on 46 single
claims (out of 266 total claims). In contrast, we found a geometric
mean cost of approximately $239 for CPT code 0598T based on 529 single
claims (out of 1,317 total claims). Based on the data, the resource
cost associated with noncontact real-time fluorescence imaging (CPT
code 0598T), is significantly higher compared to noncontact near-
infrared (NIR) spectroscopy (CPT code 0640T/0641T). While both
technologies may have the same indication, we disagree that the
resource cost for noncontact near-infrared (NIR) spectroscopy is
similar to noncontact real-time fluorescence imaging. Therefore, we do
not agree that both technologies should be placed in the same APC. We
believe that the code describing noncontact near-infrared (NIR)
spectroscopy, specifically, CPT code 0640T, is appropriately placed in
APC 5732.
Comment: Many commenters requested separate payment for CPT code
0859T, and suggested assignment to status indicator ``S'' and APC 5722.
Response: Under the OPPS, CPT code 0859T is assigned to status
indicator ``N'' to indicate that the payment is packaged in the primary
code. The phrase ``list separately in addition to code for primary
procedure'' is included in the long descriptor for CPT code 0859T to
indicate that that the code is considered an ``add-on'' to another
primary code and cannot be reported independently. Add-on codes must
always be reported with another primary code on the same day. The AMA
states in the CPT 2024 Professional Edition (page xviii) that ``add-on
codes are always performed in addition to the primary service or
procedure and must never be reported as a stand-alone code.'' In most
cases, add-on codes are typically ancillary and supportive to a primary
diagnostic or therapeutic modality and are an integral part of the
primary service they support. As specified under regulation 42 CFR
419.2(b)(18), add-on codes are packaged under the OPPS, and payment for
the codes are bundled with the primary codes. Consequently, CPT code
0859T is not paid separately under the OPPS, but instead, the payment
is packaged into the primary code. In this instance, the primary code
for CPT code 0859T is CPT code 0640T.
In summary, after consideration of the public comments, we are
finalizing the status indicators and APC assignment, without
modification, for CPT codes 0640T, 0641T, 0642T, 0859T, and 0860T.
Table 76 below list the final CY 2024 OPPS SI and APC assignment for
the codes. As we do every year, we will reevaluate the APC assignment
for the codes in the next rulemaking cycle. We note that we review, on
an annual basis, the APC assignments for all items and services paid
under the OPPS. The final CY 2024 OPPS payment rate for all the codes
payable under the OPPS can be found in Addendum B to this final rule
with comment period. In addition, we refer readers to Addendum D1 of
this final rule with comment period for the SI meanings for all codes
reported under the OPPS. Addendum D1 is available via the internet on
the CMS website.
[[Page 81700]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.098
44. Optilume Benign Prostatic Hyperplasia (BPH) Procedure (APC 5376)
On February 5, 2020, CMS approved for Medicare coverage the
Category B Investigational Device Exemption (IDE) study associated with
Urotronic's BPH Catheter System (Study Title: A Clinical Study to
Evaluate the Safety and Efficacy of the OptilumeTM BPH
Catheter System in Men With Symptomatic BPH (PINNACLE); NCT number
NCT04131907; IDE number G190217). In July 2020, AMA's CPT Editorial
Panel established CPT code 0619T (Cystourethroscopy with transurethral
anterior prostate commissurotomy and drug delivery, including
transrectal ultrasound and fluoroscopy, when performed), effective July
1, 2020, to describe the surgery related to the BPH Catheter System.
For 2023, we assigned CPT code 0619T to APC 5375 (Level 5 Urology
and Related Procedures) with a payment rate of $4,702.18. For 2024, as
listed in OPPS Addendum B that was released with the CY 2024 OPPS/ASC
proposed rule, we proposed to maintain the assignment to APC 5375 with
a payment of $4,959.89.
Comment: A commenter made some requests related to CPT code 0619T.
First, the commenter explained that the surgery associated with the
code involves a $5,700 Optilume BPH Catheter System Kit that contains
two balloon catheters, one that is drug-coated, and another that is
non-drug coated. The commenter indicated that the estimate for the
total surgery cost, which includes the cost of the device, is
approximately $12,109. Based on their estimate for the total surgery
cost, the commenter requested a reassignment from APC 5375 to APC 5377
(Level 7 Urology and Related Procedures, proposed payment of
$12,568.91), which would include the cost of both the procedure and the
device kit. Secondly, as an alternative, if CMS is unable to reassign
the code to APC 5377, the commenter requested the approval of their New
Technology Procedure/Service application, and the establishment of a
new HCPCS C-code to describe the procedure whose payment is assigned to
New Technology APC 1575 with a payment of $12,500.50. In addition, the
commenter clarified that the 2 claims for CPT code 0619T do not apply
to the Optilume BPH procedure since the device received FDA Premarket
Approval (PMA) just recently in June 2023.
Response: First, with regards to the New Technology APC application
submitted to CMS, in general, New Technology APC application
determinations are not made via rulemaking. We note that in this
specific case, the application is pending review and still under
consideration. Therefore, we are unable to respond to the APC request
for the New Technology APC application in this final rule with comment
period.
Secondly, we note that the CY 2024 OPPS payment rates are based on
claims
[[Page 81701]]
submitted between January 1, 2022, and December 31, 2022, processed
through June 30, 2023. We reviewed the claims data for this final rule,
and based on our review, we found the geometric mean cost of
approximately $6,218 for CPT code 0619T based on 3 single claims (out
of 3 total claims). Although one commenter suggested that the 2 claims
we have for the CY 2024 ratesetting are not valid because the device
received FDA PMA approval in June 2023 and could not represent the
Optilume BPH device, we note that Medicare approved coverage of the
Category B IDE study that involves the use of this device in February
2020. Although the Optilume BPH device received FDA approval in June
2023, because the Category B IDE study was approved much earlier in
February 2020, HOPD facilities may have reported the device on Medicare
claims by using an unlisted device code (for example, C1889) or device
revenue code (for example, 027X).
Based on the comments received, evaluation of the procedure, and
our assessment of the request, we believe that CPT code 0619T is most
similar to CPT code 0421T (Transurethral waterjet ablation of prostate,
including control of post-operative bleeding, including ultrasound
guidance, complete (vasectomy, meatotomy, cystourethroscopy, urethral
calibration and/or dilation, and internal urethrotomy are included when
performed)), which is assigned to APC 5376 with a proposed payment rate
of $8,847.08. We note that APC 5376 contains several BPH-related
procedures, which include the following:
0421T: Transurethral waterjet ablation of prostate,
including control of post-operative bleeding, including ultrasound
guidance, complete (vasectomy, meatotomy, cystourethroscopy, urethral
calibration and/or dilation, and internal urethrotomy are included when
performed)
55873: Cryosurgical ablation of the prostate (includes
ultrasonic guidance and monitoring
55880: Ablation of malignant prostate tissue, transrectal,
with high intensity-focused ultrasound (hifu), including ultrasound
guidance), and
C9740: Cystourethroscopy, with insertion of transprostatic
implant; 4 or more implants
Based on the similarity to CPT code 0421T and the other BPH-related
procedures in APC 5376, we believe that assigning CPT code 0619T to APC
5376 is the best approach at this time. We reiterate that we review our
claims data on an annual basis to establish the OPPS payment rates.
Once we have data, we will evaluate and, if necessary, reassign the
code to an appropriate APC based on the latest claims data.
Finally, we remind the commenter that under the OPPS, one of our
goals is to make payments that are appropriate for the services that
are necessary for the treatment of Medicare beneficiaries. The OPPS,
like other Medicare payment systems, is budget neutral and increases
are limited to the annual hospital market basket increase reduced by
the productivity adjustment. We note that, in a budget-neutral system,
payments may not fully cover hospitals' costs in a particular
circumstance, including those for the purchase and maintenance of
capital equipment. We rely on hospitals to make their decisions
regarding the acquisition of high-cost equipment with the understanding
that the Medicare program must be careful to establish its initial
payment rates. For new procedures and items, we get many requests from
manufacturers to increase the reimbursement for the code associated
with their procedures and items. These requests, and their accompanying
estimates for expected total patient utilization, often reflect very
low rates of patient use of expensive equipment, resulting in high per-
use costs for which requesters believe Medicare should make full
payment. Medicare does not, and we believe should not, assume
responsibility for more than its share of the costs of procedures based
on projected utilization for Medicare beneficiaries and does not set
its payment rates based on initial projections of low utilization for
services that require expensive capital equipment. On balance, we
believe that our payment rates reflect the costs that are associated
with providing care to Medicare beneficiaries and are adequate to
ensure access to services (80 FR 70374).
In summary, after consideration of the public comment that we
received, we are finalizing our proposal, with modification.
Specifically, we are finalizing our proposal and assigning CPT code
0619T to APC 5376 for CY 2024. The final payment rate for the code can
be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the status indicator (SI) meanings for all codes
reported under the OPPS. Addenda B and D1 are available via the
internet on the CMS website.
45. Optilume Urethral Stricture Procedure (APC 5375)
Effective January 1, 2018, the AMA's CPT Editorial Panel
established Category III CPT code 0499T (Cystourethroscopy, with
mechanical dilation and urethral therapeutic drug delivery for urethral
stricture or stenosis, including fluoroscopy, when performed) to
describe the procedure related to the Optilume Urethral Stricture
Device System. For 2024, AMA is deleting the Category III CPT code on
December 31, 2023, and replacing it with a Category I CPT code,
specifically, CPT code 52284 (Cystourethroscopy, with mechanical
urethral dilation and urethral therapeutic drug delivery by drug-coated
balloon catheter for urethral stricture or stenosis, male, including
fluoroscopy, when performed), effective January 1, 2024. We note that
CPT code 52284 was listed as placeholder code 5X000 in OPPS Addendum B
and Addendum O that was released with the CY 2024 OPPS/ASC proposed
rule with comment period. Because we had not received the final CPT
code numbers from AMA for the new codes that would be effective January
1, 2024, in time for the publication of the proposed rule, we listed
the new CPT codes with their respective placeholder codes in OPPS
Addendum B and Addendum O.
For CY 2023, we assigned CPT code 0499T to APC 5374 (Level 4
Urology and Related Services) with a payment rate of $4,702.18. Because
CPT code 0499T was scheduled for deletion on December 31, 2023, and
replaced with CPT code 52284 effective January 1, 2024, we proposed
some changes to the codes for CY 2024. Specifically, for CY 2024, as
listed in the OPPS Addendum B that was released with the CY 2024 OPPS/
ASC proposed rule, we proposed to:
Assign CPT code 0499T to status indicator ``D'' to
indicate that the code would be deleted at the end of the year; and
Crosswalk the replacement code, specifically, CPT 52284,
to APC 5374 with a payment rate of $3,337.81
We note that at the August 21, 2023, HOP Panel Meeting, a
presentation was made requesting the reassignment to APC 5375 for CPT
code 52284 (placeholder code 5X000). Based on the information presented
at the meeting, the Panel made no recommendation on the APC assignment
for the code.
Comment: Several commenters requested the reassignment for CPT code
52284 from APC 5374 to APC 5375 (Level 5 Urology and Related Services),
with a payment rate of $4,959.89. They indicated that the procedure
involves
[[Page 81702]]
the use of a single-use device whose cost is $2,395, and they believe
that the payment amount of approximately $3,338 for APC 5374 is
insufficient to cover the total cost of the procedure. These commenters
suggested the reassignment of CPT code 52284 to APC 5375. One commenter
clarified that the Optilume Urethral Stricture device was commercially
available in January 2022, however, prior to this date, the device was
provided free of charge for clinical trials. This same commenter noted
that the claims data in the CY 2024 OPPS/ASC proposed rule shows an
increase in claims volume for predecessor CPT code 0499T, as well as an
increase in the geometric mean cost, that they believe warrants a
change in the assignment from APC 5374 to APC 5375.
Response: The CY 2024 OPPS payment rates are based on claims
submitted between January 1, 2022, and December 31, 2022, processed
through June 30, 2023. We reviewed the claims data for this final rule,
and based on our analysis, we found the geometric mean cost of
approximately $4,489 for (predecessor code) CPT 0499T based on 77
single claims (out of 79 total claims), which is consistent with the
geometric mean cost of about $5,067 for APC 5375, rather than the
geometric mean cost of approximately $3,414 for APC 5374. Based on our
evaluation, we believe that the resource costs of furnishing the
service associated with CPT code 52284 are higher than the resource
costs associated with APC 5374. Consequently, we believe that CPT code
52284 fits accurately in APC 5375 based on its clinical and resource
homogeneity to the procedures in the APC.
In summary, after consideration of the public comments, we are
finalizing the APC assignment for CPT code 52284 with modification.
Specifically, we are revising the APC assignment for CPT code 52284 to
APC 5375 for CY 2024. The final CY 2024 OPPS payment rate for this code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the SI meanings for all codes reported under the
OPPS. Addendum D1 is available via the internet on the CMS website.
46. Payment for Procedures Using an Amniotic Membrane (APCs 5502 and
5503)
CPT code 65426 (Excision or transposition of pterygium; with graft)
describes a surgical ocular procedure that requires the use of graft
tissue. This procedure can be performed either with the patient's own
tissue (a graft from the patient's eye) or with an amniotic membrane
tissue product that is purchased by the provider. CPT code 65778
(Placement of amniotic membrane on the ocular surface; without sutures)
describes the placement of an amniotic membrane on the ocular surface.
For the CY 2024 OPPS proposed rule, we proposed to assign CPT code
65426 to APC 5503 (Level 3 Extraocular, Repair, and Plastic Eye
Procedures) and we proposed to assign CPT code 65778 to APC 5502 (Level
2 Extraocular, Repair, and Plastic Eye Procedures).
Comment: One commenter, a manufacturer of the amniotic membrane
used in both CPT codes 65426 and 65778, requested that payment for CPT
code 65426 be increased from APC 5503 with a payment rate of around
$2,300 to APC 5504 (Level 4 Extraocular, Repair, and Plastic Eye
Procedures) with a payment rate of around $3,800. Likewise, the
commenter requested that the payment for CPT code 65778 be increased
from APC 5502 with a payment rate of around $1,000 to APC 5503 with a
payment rate of around $2,300. The commenter requested the payment
increases because the offset amounts for the amniotic membrane devices
used in these procedures was substantially lower than the expected cost
of the device. The commenter believes the cause of the low device
percentage for these services is that many hospitals are not reporting
the cost of the amniotic device, and an increased payment would ensure
that providers receive a payment that recognizes the cost of the
amniotic device.
Response: We disagree with the request of the commenter. Reporting
service charges and appropriately coding expenditures on claims is the
responsibility of the provider, and we do not adjust service payments
to remedy potential coding errors. The commenter believes there is some
type of systemic coding error that is leading to the low device offsets
for CPT codes 65426 and 65778. We encourage the commenter to engage in
provider education to encourage more thorough reporting of the device
costs of these procedures. The commenter may also choose to work with
the MACs to develop approaches to ensure the cost of the amniotic
membrane device is included more regularly with these procedures.
After consideration of the public comments we received, we are
implementing our proposal without modification for CPT codes 65426 and
65778. Table 77 shows the finalized status indicator and APC assignment
for all of the procedure codes. We refer readers to Addendum B of this
final rule with comment period for the payment rates for all codes
reportable under the OPPS. Addendum B is available via the internet on
the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.099
[[Page 81703]]
47. Peroral Endoscopic Myotomy (POEM) CPT Code 43497 (APC 5331)
According to interested parties, the POEM (Peroral Endoscopic
Myotomy) procedure is a newer technique for the management of achalasia
and is similar to laparoscopic Heller Myotomy performed by both
advanced gastroenterologists and endoscopic surgeons. Achalasia is a
disease that occurs due to the inability of the lower esophageal
sphincter to relax and is also associated with loss of peristalsis in
the esophagus. This procedure is described by CPT code 43497 (Lower
esophageal myotomy, transoral (i.e., peroral endoscopic myotomy
[poem])), which has a geometric mean cost for CY 2024 of around $6,736.
For the CY 2024 OPPS proposed rule, we proposed to assign the procedure
to APC 5303 (Level 3 Upper GI Procedures) with a payment rate of around
$3,803. APC 5303 is the highest-paying APC in the Upper GI Procedures
APC series. CPT code 43497 is a significant procedure that contributes
to the establishment of the overall payment rate for APC 5303.
Comment: Two commenters requested that we assign CPT code 43497 to
APC 5331 (Complex GI Procedures) to resolve a 2 times rule violation
with the procedure. The commenters noted that the geometric mean cost
of CPT code 43497, which is around $6,736 is more than twice the cost
of the lowest-cost significant procedure (CPT code 43260), which is
around $6,454. Also, the geometric mean cost of CPT code 43497 is
nearly $3,000 more than the payment rate for APC 5303.
Response: We agree with the request of the commenters that CPT code
43497 should be reassigned from APC 5303 to APC 5331 not only because
of the 2 times rule violation and the substantial difference between
the cost of CPT code 43497 and the payment rate for APC 5303, but in
addition, we determined that the procedure described by CPT code 43497
has clinical and resource similarities with the other procedures of
similar cost that are assigned to APC 5313.
After consideration of the public comments we received, we are
implementing our proposal with modification for CPT code 43497 as we
will update its APC assignment to APC 5331 (Complex GI Procedures).
Table 78 shows the finalized status indicator and APC assignment for
all of the procedure codes. We refer readers to Addendum B of this
final rule with comment period for the payment rates for all codes
reportable under the OPPS. Addendum B is available via the internet on
the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.100
48. Transluminal Mechanical Thrombectomy, Noncoronary, Non-
intracranial, Arterial or Arterial Bypass Graft, Including Fluoroscopic
Guidance and Intraprocedural Pharmacological Thrombolytic Injection(s);
Initial Vessel (APC 5194)
For 2024, we proposed to move CPT code 37184 (Primary percutaneous
transluminal mechanical thrombectomy, noncoronary, non-intracranial,
arterial or arterial bypass graft, including fluoroscopic guidance and
intraprocedural pharmacological thrombolytic injection(s); initial
vessel) from APC 5193 (Level 3 Endovascular Procedures) with a proposed
payment rate of $10,602.57 to APC 5194 (Level 4 Endovascular
Procedures) with a proposed payment rate of $17,195.36.
Comment: One commenter supported our proposal to move CPT code
37184 to APC 5194, stating that this APC assignment more accurately
reflects the costs and resources associated with these procedures.
Response: We thank the commenter for the support of the CMS'
proposal. Based on our examination of the latest claims data for this
final rule with comment period, we believe that the assignment of CPT
code 37184 to APC 5194 is appropriate for CY 2024.
In summary, after consideration of the public comment, we are
finalizing our proposal without modification and assigning CPT code
37184 to APC 5194. The final CY 2024 OPPS payment rates for this code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the SI meanings for all codes reported under the
OPPS. Addenda B and D1 are available via the internet on the CMS
website.
49. ProSense Cryoablation Procedure (APC 5091)
For CY 2023, we assigned CPT code 0581T (Ablation, malignant breast
tumor(s), percutaneous, cryotherapy, including imaging guidance when
performed, unilateral) to APC 5091 (Level 1 Breast/Lymphatic Surgery
and Related Procedures) with a payment rate of $3,437.80. For CY 2024,
as listed in OPPS Addendum B that was released with the CY 2024 OPPS/
ASC proposed rule, we proposed to maintain the assignment to the same
APC with a payment rate of $3,652.27.
Comment: A commenter disagreed with the assignment to APC 5091 for
CPT code 0581T and requested a revision to APC 5092 (Level 2 Breast/
Lymphatic Surgery and Related Procedures), with a payment rate
$6,241.92. The commenter clarified that the procedure described by the
code involves the use of a single-use device that cost $2,200. With the
device cost, the commenter estimated the total procedure cost to be
$7,019.79. This estimate was derived from the CY 2023 Medicare
Physician Fee Schedule Final Rule CMS Public Use File, which include
cost estimates for labor, equipment, time, and supply. The commenter
indicated that the proposed payment rate of $3,652.27 for APC 5091 is
insufficient to cover the total procedure cost, and believes the
proposed payment of $6,241.92 for APC 5092 is more appropriate. This
same commenter explained that in CY 2022, CPT code was assigned to
``E1,'' to indicate that the code was not
[[Page 81704]]
separately payable under the OPPS. To address the lack of claims data
for CY 2022, the commenter performed their own data analysis that
included claims for two procedures (0581T and 19105) as billed to
Medicare and private payers. Based on the dataset, they found an
average provider charge of $9,450 and with a maximum charge amount of
$24,294 for CPT code 0581T (N=8 private payer, N=1 Medicare) based on
fully paid claims for CY 2022 and the first half of 2023. The commenter
further noted that CPT code 0581T violates the 2 times rule in APC
5091, and therefore, should be reassigned to APC 5092 to correct the
violation.
Response: First, APC 5091 does not violate the 2 times rule. As
specified in section III.B (OPPS Changes--Variations Within APCs) of
this final rule with comment period, we consider only those HCPCS codes
that are significant based on the number of claims to determine the
APCs with2 times rule violation. For APC 5091, the geometric mean cost
for the significant procedures range between approximately $2,745 (for
CPT code 19120) and $4,807 (for CPT code 19371). Based on this range,
APC 5091 does not violate the 2 times rule. Secondly, although CPT code
0581T was not separately payable under the OPPS during CY 2022, some
HOPDs submitted CPT code 0581T on Medicare claims. For this final rule
we are using claims that were submitted for services between January 1,
2022, and December 31, 2022, processed through June 30, 2023. This
includes claims that potentially had different policies and SI and APC
assignments applied to them in the claims year. Our ratesetting process
takes those claims and simulates the prospective OPPS payment, in which
we observed a geometric mean cost of approximately $4,357 for CPT code
0581T based on 37 single claims (out of 37 total claims) for this code.
Based on this information, we believe that we should maintain CPT code
0581T in APC 5091 since the observed geometric mean cost of $4,357 is
consistent with the geometric mean cost of approximately $3,733 for APC
5091, rather than the geometric mean cost of about $6,386 for APC 5092.
As we do every year, we will reevaluate the APC assignment for CPT code
0581T for the CY 2025 rulemaking cycle. We remind the commenter, that
we review, on an annual basis, the APC assignments for all services and
items paid under the OPPS.
In summary, after consideration of the public comment, we are
finalizing our proposal, without modification, to assign CPT code 0581T
to APC 5091 for CY 2024. The final CY 2024 payment rate for the code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the SI meanings for all codes reported under the
OPPS. Addenda B and D1 are available via the internet on the CMS
website.
50. Radiofrequency Ablation Procedures--CPT Codes 32998, 47382, and
50592 (APC 5361)
For CY 2023, we assigned certain radiofrequency ablation
procedures, specifically, CPT codes 32998, 47382, and 50592 to APC 5361
(Level 1 Laparoscopy and Related Services), with a payment rate of
$5,212.15. For CY 2024, as listed in OPPS Addendum B that was released
with the CY 2024 OPPS/ASC proposed rule, we proposed to continue the
assignment to APC 5361, with a payment rate of $5,544.60. Below are the
long descriptors for CPT codes 32998, 47382, and 50592:
32998: Ablation therapy for reduction or eradication of 1
or more pulmonary tumor(s) including pleura or chest wall when involved
by tumor extension, percutaneous, including imaging guidance when
performed, unilateral; radiofrequency
47382: Ablation, 1 or more liver tumor(s), percutaneous,
radiofrequency
50592: Ablation, 1 or more renal tumor(s), percutaneous,
unilateral, radiofrequency
Comment: A commenter disagreed with the proposed assignment to APC
5361 and requested a revision to APC 5362 (Level 2 Laparoscopy and
Related Services), with a payment rate of $9,871.90, based on clinical
and resource homogeneity to the codes in the APC. The commenter
indicated that CPT codes 32998, 47382, and 50592 are very similar to
certain procedures in APC 5362, specifically, the laparoscopic ablation
procedures described by CPT codes 47370, 47371, and 50542, and the
percutaneous cryoablation procedures described by CPT codes 47383,
50593, and 32994.
Response: We note the CY 2024 OPPS payment rates are based on
claims submitted between January 1, 2022, and December 31, 2022,
processed through June 30, 2023. We analyzed our data, and below in
Table 79 are the claims data for this final rule with comment period
for the codes mentioned by the commenter.
[[Page 81705]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.101
As illustrated in Table 79, the resource costs associated with the
laparoscopic ablation procedures and the percutaneous cryoablation
procedures are higher than the resource costs associated with the
radiofrequency ablation procedures. In particular, we found the
geometric mean cost for CPT codes 32998, 47382, and 50592 ranged
between approximately $6,538 and $7,141, which is consistent with the
geometric mean cost of about $5,651 for APC 5361. We do not agree that
the resource costs to perform these procedures are similar to those of
the laparoscopic ablation procedures described by CPT codes 47370,
47371, and 50542, whose geometric mean cost range between $9,467 to
$13,120, or the percutaneous cryoablation procedures described by CPT
codes 47383, 50593, and 32994, whose geometric mean cost range between
$8,189 and $9,269. We believe the resource costs related to the
laparoscopic ablation procedures and percutaneous cryoablation
procedures are appropriately reflected in APC 5362, whose geometric
mean cost is approximately $10,081. Based on our analysis, we do not
agree that the resource costs of the radiofrequency ablation procedures
are similar to those of the laparoscopic ablation procedures or the
percutaneous cryoablation procedures, which are in APC 5362. Therefore,
we believe that CPT codes 32998, 47382, and 50592 should be maintained
in APC 5361 based on clinical coherence and resource cost homogeneity.
In summary, after consideration of the public comment, we are
finalizing our proposal, without modification, to assign CPT codes
32998, 47382, and 50592 to APC 5361 for CY 2024. The final CY 2024
payment rate for the code can be found in Addendum B to this final rule
with comment period. In addition, we refer readers to Addendum D1 of
this final rule with comment period for the SI meanings for all codes
reported under the OPPS. Addenda B and D1 are available via the
internet on the CMS website.
51. Radiofrequency Ablation, Posterior Nasal Nerve CPT Code 31242 (APC
5165)
For the CY 2024 OPPS final rule, we proposed that CPT code 31242
(placeholder code 3X016) (Nasal/sinus endoscopy, surgical; with
destruction by radiofrequency ablation, posterior nasal nerve) be
assigned to APC 5165 (Level 5 ENT Procedures) with a payment rate of
around $5,647. There are currently no claims data available for the
procedure.
Comment: Two commenters expressed their support of our assignment
of CPT code 31242/3X016 to APC 5165.
Response: We appreciate the support of the commenters for payment
rate proposal.
After consideration of the public comments we received, we are
finalizing our proposal without modification for CPT code 31242 (listed
as placeholder code 3X016 in the CY 2024 OPPS/ASC proposed rule with
comment period) to continue to assign the procedure to APC 5165 (Level
5 ENT Procedures). Table 80 shows the finalized status indicator and
APC assignment for all of the procedure codes. We refer readers to
Addendum B of this final rule with comment period for the payment rates
for all codes reportable under the OPPS. Addendum B is available via
the internet on the CMS website.
[[Page 81706]]
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52. Remote Physiological Monitoring Services
For CY 2024, we proposed to continue to assign CPT codes 99457
(Remote physiologic monitoring treatment management services, clinical
staff/physician/other qualified health care professional time in a
calendar month requiring interactive communication with the patient/
caregiver during the month; first 20 minutes) and 99458 (Remote
physiologic monitoring treatment management services, clinical staff/
physician/other qualified health care professional time in a calendar
month requiring interactive communication with the patient/caregiver
during the month; each additional 20 minutes (list separately in
addition to code for primary procedure) to status indicator ``B.''
At the August 21, 2023, HOP Panel Meeting, a presenter advised the
Panel to request that CMS reassign CPT code 99457 to APC 5741 (Level 1
Electronic Data Analysis) with a proposed payment rate of $36.79 and
CPT code 99458 is reassigned to status indicator ``N.''
Based on the information presented at the meeting, the Panel
recommended that CMS considered changing the SI for CPT codes 99457 and
99458 to make them separately payable under the OPPS such that the
services can be bundled with clinical visits in the month in which they
occur and separately payable when no clinical visit with the
appropriate supervising clinician occurs in the same month as the
service.
Comment: We received one public comment, and the commenter
requested a separate payment under OPPS for RPM treatment management
services CPT codes 99457 and 99458. The commenter stated that separate
payment under the OPPS for 99457 and 99458 is appropriate because they
closely mirror the time-based chronic care management (CCM), described
by CPT code 99490 (Chronic care management services with the following
required elements: multiple (two or more) chronic conditions expected
to last at least 12 months, or until the death of the patient, chronic
conditions that place the patient at significant risk of death, acute
exacerbation/decompensation, or functional decline, comprehensive care
plan established, implemented, revised, or monitored; first 20 minutes
of clinical staff time directed by a physician or other qualified
health care professional, per calendar month), which is assigned to
status indicator ``S'' and APC 5822 (Level 2 Health and Behavior
Services) with a proposed payment rate of $86.86.
Response: We continue to believe that, since CPT code 99457
primarily describes the work associated with the billing of
professional services, which would not be paid separately under the
OPPS, and CPT code 99458 describes an add-on service to CPT code 99457,
neither service is appropriate for separate payment under the OPPS.
Therefore, we will continue to assign these codes to status indicator
``B'' for CY 2024.
In summary, after consideration of the public comment, we are
finalizing our proposal without modification. Specifically, we are
continuing to assign HCPCS codes 99457 and 99458 to status indicator
``B'' for CY 2024. We refer readers to Addendum D1 of this final rule
with comment period for the status indicator (SI) meanings for all
codes reported under the OPPS. Addendum D1 is available via the
internet on the CMS website.
53. Remote Therapeutic Monitoring Treatment Management Services
For CY 2024, we proposed to change the status indicator for CPT
codes 98980 (Remote therapeutic monitoring treatment management
services, physician or other qualified health care professional time in
a calendar month requiring at least one interactive communication with
the patient or caregiver during the calendar month; first 20 minutes)
and 98981 (Remote therapeutic monitoring treatment management services,
physician or other qualified health care professional time in a
calendar month requiring at least one interactive communication with
the patient or caregiver during the calendar month; each additional 20
minutes (list separately in addition to code for primary procedure)
from status indicator ``M'' to status indicator ``B'' since these
services describe work associated with billing for professional
services.
At the August 21, 2023, HOP Panel Meeting, a presenter advised the
Panel to request that CMS reassign CPT code 98980 to APC 5741 (Level 1
Electronic Data Analysis) with a proposed payment rate of $36.79 and
CPT code 98981 is reassigned to status indicator ``N.''
Based on the information presented at the meeting, the Panel
recommended that CMS considered changing the SI for CPT code 98980 to
``S'' and assign the code to APC 5741 (Level 1 Electronic Analysis of
Devices) and changed the status indicator for CPT code 98981 to ``N''
per OPPS policy.
Comment: We received one comment and the commenter requested
assigning a relative value unit (RVU) value for CPT codes 98980 and
98981 and removing status indicator ``B.''
Response: We thank the commenter for the input but note that the
comment related to an assignment of the RVU value is out of scope for
the purposes of this OPPS/ASC final rule with comment period as RVUs
are used to value services paid under the PFS. We continue to believe
that, since CPT code 98980 primarily describes the work associated with
the billing of professional services, which would not be paid
separately under the OPPS, and CPT code 98981 describes an add-on
service to CPT code 98980, neither service is appropriate for payment
under the OPPS. Therefore, we will continue to assign these codes to
status indicator ``B'' to indicate that the codes are not paid under
OPPS and that alternate codes that are recognized by OPPS may be
available.
In summary, after consideration of the public comment, we are
finalizing our proposal without modification. Specifically, we are
continuing to assign HCPCS codes 98980 and 98981 to status indicator
``B'' for CY 2024. We will
[[Page 81707]]
review these codes again for future rulemaking. We refer readers to
Addendum D1 of this final rule with comment period for the status
indicator (SI) meanings for all codes reported under the OPPS. Addendum
D1 is available via the internet on the CMS website.
54. RNS Neurostimulator Surgical Service (APCs 5113 and 5464)
For CY 2024, the AMA CPT Editorial Board created three new CPT
codes to describe the services associated with the RNS System, a skull-
mounted cranial neurostimulator and treatment option for persons with
medically intractable epilepsy. Specifically, effective January 1,
2024, the three new CPT codes are:
61889 (placeholder code 619X1)--Insertion of skull-mounted
cranial neurostimulator pulse generator or receiver, including
craniectomy or craniotomy, when performed, with direct or inductive
coupling, with connection to depth and/or cortical strip electrode
array(s).
61891 (placeholder code 619X2)--Revision or replacement of
skull-mounted cranial neurostimulator pulse generator or receiver with
connection to depth and/or cortical strip electrode array(s).
61892 (placeholder code 619X3)--Removal of skull-mounted
cranial neurostimulator pulse generator or receiver with cranioplasty,
when performed.
Because 61889 is only performed in the inpatient setting, CMS
proposed to assign the code to status indicator ``C'' for CY 2024 and,
therefore, did not assign the code to an APC. For CY 2024, CMS proposed
to assign 61891 to APC 5463 (Level 3 Neurostimulator and Related
Procedures) with a proposed payment rate of $13,899.52 and 61892 to APC
5113 (Level 3 Musculoskeletal Procedures) with a proposed payment rate
of $3111.88. We note that CPT codes 61889, 61891, and 61892 were listed
as placeholder codes 619X1, 619X2, and 619X3, respectively, in OPPS
Addendum B and Addendum O that were released with the CY 2024 OPPS/ASC
proposed rule with comment period. Because we had not received the
final CPT code numbers from AMA for the new codes that would be
effective January 1, 2024, in time for the publication of the proposed
rule, we listed the new CPT codes with their respective placeholder
codes in OPPS Addendum B and Addendum O.
Comment: We received several comments, including one from the
manufacturer, requesting that we reassign CPT codes 61891 and 61892 to
higher paying APCs based on cost concerns. The commenters requested
that, for CY 2024, CMS assign CPT code 61891 to APC 5465 (Level 5
Neurostimulator and Related Procedures) with a proposed payment rate of
$30,354.65 and CPT code 61892 to APC 5463 (Level 3 Neurostimulator and
Related Procedures) with a proposed payment rate of $13,899.52. One
commenter stated that the proposed APC assignments for CPT codes 61891
and 61892 would result in a 54 percent and a 78 percent reduction,
respectively, in hospital outpatient payment, which they stated would
impact Medicare beneficiary access. To support their requested APC
changes, the commenter referred to two codes that are currently used to
describe the services as predecessor codes for CPT codes 61891 and
61892. The commenter stated that for purposes of APC assignment, CMS
should consider CPT code 61886 (Insertion or replacement of cranial
neurostimulator pulse generator or receiver, direct or inductive
coupling; with connection to 2 or more electrode arrays) as the
predecessor code for 61891 and CPT code 61888 (Revision or removal of
cranial neurostimulator pulse generator or receiver) as the predecessor
code for 61892.
The commenter noted the change in the code descriptions of the new
CPT codes (61891, 61892) compared to the code descriptors of the
existing codes (61886, 61888) as related to revision procedures. The
commenter stated that it was unknown to them why the new CPT codes
included revision and replacement in the same code (61891) compared to
the existing CPT codes where replacement is a separate code (61886) and
removal and revision procedures are included in the same code (61888).
However, the commenter pointed out that revisions of the RNS
neurostimulator are exceedingly rare and that they expect the vast
majority, if not all, of the procedures reported with 61891 to be a
replacement of the RNS neurostimulator, rather than a revision, where
no neurostimulator device is implanted. Finally, the commenter provided
their own analyses comparing epilepsy vs non-epilepsy-related claims
for CPT codes 61886 and 61888 to demonstrate that epilepsy related
claims for both codes, for which the RNS neurostimulator surgical
service would be used, had higher geometric mean costs than non-
epilepsy related claims.
Response: We thank the commenters for their input on our proposal.
First, we disagree with the commenter's assertion that we should use
CPT code 61886 as the predecessor code for CPT code 61891 because the
long descriptors for each code are substantially different.
Specifically, while CPT code 61886 describes the insertion or
replacement of a neurostimulator, where a neurostimulator device will
be implanted each time the service is billed, CPT code 61891 describes
the revision or replacement of the neurostimulator, where a
neurostimulator device may or may not be implanted when the service is
billed. While we appreciate the additional feedback from commenters
explaining that revision procedures are extremely rare, we have an
obligation to set APC assignments according to the long descriptor
provided by the AMA. Because we believe the resource costs for a
service where a high-cost neurostimulator device may or may not be
implanted are lower than the resource costs for a service where a high-
cost neurostimulator device is implanted each time, we disagree that
CPT code 61891 should be assigned to the same APC as CPT code 61886.
However, in light of the comments provided regarding the rarity of
revision procedures and based on clinical similarities between CPT code
61891 and other cranial neurostimulator codes currently assigned to APC
5464 (Level 4 Neurostimulators), we believe that assigning CPT code
61891 to APC 5464 would be clinically and resource appropriate.
Regarding the assignment for CPT code 61892, we also disagree with
the comments recommending that we use CPT code 61888 as the predecessor
code for CPT code 61892. While CPT code 61888 may describe a removal of
the neurostimulator or a revision, CPT code 61892 only describes the
removal procedure. Therefore, we do not believe that CPT code 61892
should be assigned to the same APC as CPT code 61888 because the codes
are different in terms of resource and clinical considerations based on
the disparity between the codes' long descriptors. After review of the
comments provided and further analysis from our medical advisors, we
believe that the removal procedure described by CPT code 61892 is
similar to the service described by CPT 69727 (Removal, entire
osseointegrated implant, skull; with magnetic transcutaneous attachment
to external speech processor, within the mastoid and/or involving a
bony defect less than 100 sq mm surface area of bone deep to the outer
cranial cortex), and should be assigned to the same clinical APC.
Therefore, we continue to believe that an assignment to APC 5113 (Level
3 Musculoskeletal Procedures) is
[[Page 81708]]
clinically and resource appropriate for CPT code 61892.
After consideration of the public comments, we are finalizing the
assignment of CPT code 61891 to APC 5464. Additionally, we are
finalizing the assignment of CPT code 61892 to APC 5113. The final CY
2024 payment rate for both codes can be found in Addendum B to this
final rule with comment period. We also refer readers to Addendum D1 of
this final rule with comment period for the SI meanings for all codes
reported under the OPPS. Addenda B and D1 are available via the
internet on the CMS website.
55. Scleral Reinforcement (APC 5492)
For CY 2023, we assigned CPT code 67255 (Scleral reinforcement
(separate procedure); with graft) to APC 5491 (Level 1 Intraocular
Procedures) with a payment rate of $2,159.44. For CY 2024, as listed in
OPPS Addendum B that was released with the CY 2024 OPPS/ASC proposed
rule, we proposed to maintain assignment to APC 5491 (Level 1
Intraocular Procedures) with a payment rate of $2,255.61.
Comment: A commenter disagreed with the assignment to APC 5491 and
suggested reassignment to APC 5492 (Level 2 Intraocular Procedures),
with a payment rate of $3,970.62, based on the latest claims data.
Response: We reviewed our claims data for this final rule with
comment period. We note the CY 2024 OPPS payment rates are based on
claims submitted between January 1, 2022, and December 31, 2022,
processed through June 30, 2023. Based on our examination of the claims
data, we found the geometric mean cost of approximately $3,990 for CPT
code 67255 based on 111 single claims (out of 111 total claims), which
is consistent with the geometric mean cost of about $3,982 for APC
5492. We believe that the resource costs related to CPT code 67255 are
higher compared to that of APC 5491, whose geometric mean cost is
approximately $2,282, and more comparable to APC 5492. Therefore, we
believe that we should reassign CPT code 67255 to APC 5492, since the
procedure fits more appropriately in this APC based on clinical
similarity and resource homogeneity.
In summary, after consideration of the public comment, we are
finalizing the APC assignment for CPT code 67255 with modification.
Specifically, we are revising the APC assignment from APC 5491 to APC
5492 for CPT code 67255 for CY 2024. The final CY 2024 OPPS payment
rate for this code can be found in Addendum B to this final rule with
comment period. In addition, we refer readers to Addendum D1 of this
final rule with comment period for the SI meanings for all codes
reported under the OPPS. Addendum D1 is available via the internet on
the CMS website.
56. SpaceOAR Hydrogel Procedure (APC 5375)
CPT code 55874 (Transperineal placement of biodegradable material,
peri-prostatic, single or multiple injection(s), including image
guidance, when performed) describes the procedure associated with the
SpaceOAR Hydrogel, a perirectal spacer made of gel-like material that
temporarily creates a space between the prostate and rectum in prostate
patients undergoing radiation therapy. For CY 2023, we assigned the
code to APC 5375 (Level 5 Urology and Related Services), with a payment
rate of $4,702.18. For CY 2024, as listed in OPPS Addendum B that was
released with the CY 2024 OPPS/ASC proposed rule, we proposed to
continue the assignment to APC 5376 (Level 6 Urology and Related
Services) with a payment rate of $4,959.89.
Comment: Several commenters requested a reassignment to APC 5376
based on the claims data for the CY 2024 update.
Response: The CY 2024 OPPS payment rates are based on claims
submitted between January 1, 2022, and December 31, 2022, processed
through June 30, 2023. We reviewed the claims data for this final rule,
and based on our analysis, we found the geometric mean cost of
approximately $6,634 for CPT code 55874 based on 9,361 single claims
(out of 9,470 total claims), is consistent with the geometric mean cost
of about $5,067 for APC 5375, rather than the geometric mean cost of
approximately $9,022 for APC 5376. Based on the resource costs, we
believe that CPT code 55874 fits more appropriately in APC 5375 based
on its clinical similarity and resource homogeneity to the procedures
in the APC. We note that we review, on an annual basis, the APC
assignments for all services and items paid under the OPPS based on our
analysis of the latest claims data.
In summary, after consideration of the public comment, we are
finalizing our proposal, without modification, to assign CPT code 55874
to APC 5375 for CY 2024. The final CY 2024 payment rate for the code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the SI meanings for all codes reported under the
OPPS. Addenda B and D1 are available via the internet on the CMS
website.
57. Spinal Injection Service (APC 5115)
For CY 2024, we proposed to assign CPT codes 0627T (Percutaneous
injection of allogeneic cellular and/or tissue-based product,
intervertebral disc, unilateral or bilateral injection, with
fluoroscopic guidance, lumbar; first level) and 0629T (Percutaneous
injection of allogeneic cellular and/or tissue-based product,
intervertebral disc, unilateral or bilateral injection, with ct
guidance, lumbar; first level) to APC 5115 (Level 5 Musculoskeletal
Procedures) with a proposed payment rate of $13,269.40.
Comment: We received a comment supporting our proposal to assign
CPT codes 0627T and 0629T to APC 5115 (Level 5 Musculoskeletal
Procedures).
Response: We thank the commenter for support of our proposal to
assign CPT codes to APC 5115.
After consideration of the public comment received, we are
finalizing our proposal without modification. The final CY 2024 payment
rate for these codes can be found in Addendum B to this final rule with
comment period. In addition, we refer readers to Addendum D1 of this
final rule with comment period for the SI meanings for all codes
reported under the OPPS. Addenda B and D1 are available via the
internet on the CMS website.
58. Synchronized Diaphragmatic Stimulation (SDS) System for
Augmentation of Cardiac Function
For the 2022 update, the CPT Editorial Panel established 12 new
codes, specifically, CPT codes 0674T through 0685T, to describe the
various services related to the synchronized diaphragmatic stimulation
(SDS) system that is used to treat certain patients with chronic heart
failure. The codes were effective January 1, 2022, and describe the
implanting, revising, removing and replacing the implantable stimulator
and leads, as well as interrogation and programming of the SDS system.
The complete long descriptors for the 12 codes are listed in Table 81
below. For the 2022 and 2023 update, we assigned the codes to status
indicator ``E1'' to indicate that they are not payable by Medicare when
submitted on outpatient claims (any outpatient bill type) because the
services associated with these codes are either not covered by any
Medicare outpatient benefit category, statutorily excluded by Medicare,
or not reasonable and necessary. For CY 2024, we proposed to continue
to assign the codes to status indicator ``E1.''
Comment: A device manufacturer reported that the device associated
with the codes received Breakthrough Device
[[Page 81709]]
Designation from the FDA and is scheduled to start a Category B
Investigational Device Exemption (IDE) clinical trial in early 2024. In
anticipation of the clinical trial and to ensure that hospitals receive
Medicare reimbursement for the clinical trial, the manufacturer
requested a reassignment in the status indicator, and suggested
specific APCs and status indicator assignments for the 12 codes. In
particular, the commenter suggested specific APC assignments for nine
of the 12 codes, and recommended the assignment of status indicator
``N'' (packaged) for the three add-on codes. The manufacturer indicated
that once they receive approval from the FDA for the IDE study, they
intend to submit an application to CMS for Medicare coverage of their
IDE clinical trial.
Response: Because the IDE study protocol has not received FDA
approval, and has not been approved for Medicare coverage, we believe
that we should continue to assign CPT codes 0674T through 0685T to
status indicator ``E1'' for CY 2024. If this technology later meets
CMS' standards for coverage, we will reassess the status indicator and
APC assignments in a future quarterly update and/or rulemaking cycle.
In summary, after consideration of the public comment received, we
are finalizing our proposal, without modification, to assign status
indicator ``E1'' to CPT codes 0674T through 0685T. The final status
indicator assignment for the codes is listed in Table 81. We refer
readers to Addendum D1 of this final rule with comment period for the
complete list of the OPPS payment status indicators and their
definitions for CY 2024. Addendum D1 is available via the internet on
the CMS website.
BILLING CODE 4150-28-P
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[[Page 81710]]
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BILLING CODE 4150-28-C
59. Transcatheter Renal Sympathetic Denervation Procedure (APC 5192)
For CY 2023, we assigned CPT code 0338T and 0339T to APC 5192
(Level 2 Endovascular Procedures), with a payment rate of $5,215.40.
For CY 2024, as listed in OPPS Addendum B that was released with the CY
2024 OPPS/ASC proposed rule, we proposed to continue the assignment to
APC 5192 with a payment rate of $5,500.17. Below are the long
descriptors for the codes:
0338T: Transcatheter renal sympathetic denervation,
percutaneous approach including arterial puncture, selective catheter
placement(s) renal artery(ies), fluoroscopy, contrast injection(s),
intraprocedural roadmapping and radiological supervision and
interpretation, including pressure gradient measurements, flush
aortogram and
[[Page 81711]]
diagnostic renal angiography when performed; unilateral
0339T: Transcatheter renal sympathetic denervation,
percutaneous approach including arterial puncture, selective catheter
placement(s) renal artery(ies), fluoroscopy, contrast injection(s),
intraprocedural roadmapping and radiological supervision and
interpretation, including pressure gradient measurements, flush
aortogram and diagnostic renal angiography when performed; bilateral
Comment: A commenter requested a reassignment to APC 5193 (Level 3
Endovascular Procedures, with a payment rate of $10,602.57, based on
clinical similarity to the procedures in the APC.
Response: The CY 2024 OPPS payment rates are based on claims
submitted between January 1, 2022, and December 31, 2022, processed
through June 30, 2023. We evaluated the claims data for this final
rule, and based on our review, we found no claims for CPT code 0338T.
We also reviewed our historical claims data for the last 5 years,
specifically, the cost statistics data that was released with the CY
2019 through CY 2023 OPPS/ASC final rules, and found that we have no
claims data for CPT code 0338T. In contrast, we found some data for CPT
code 0339T. For this final rule with comment period, our claims data
show a geometric mean cost of about $16,423 for CPT code 0339T based on
1 single claim (out of 1 total claim). Similar to CPT code 0338T, we
reviewed our historical claims data for the last 5 years and found
inconsistent cost information. Specifically, our claims data show a
geometric mean cost that has ranged between $651 and $1,081, based on 1
and 9 single claims. Based on the historical and current claims data
for this final rule with comment period, we believe that both codes
should be maintained in APC 5192.
In summary, after consideration of the public comment, we are
finalizing our proposal, without modification, to assign CPT code 0338T
and 0339T to APC 5192 for CY 2024. The final CY 2024 payment rate for
the code can be found in Addendum B to this final rule with comment
period. In addition, we refer readers to Addendum D1 of this final rule
with comment period for the SI meanings for all codes reported under
the OPPS. Addenda B and D1 are available via the internet on the CMS
website.
60. Transnasal EGD CPT Codes 0652T-0654T (APCs 5302 and 5303)
For the CY 2024 OPPS final rule, we proposed to assign CPT code
0652T (Esophagogastroduodenoscopy, flexible, transnasal; diagnostic,
including collection of specimen(s) by brushing or washing, when
performed (separate procedure)) with no claims data for CY 2024 and CPT
code 0653T (Esophagogastroduodenoscopy, flexible, transnasal; with
biopsy, single or multiple) with a geometric mean cost of around $3,987
to APC 5302 (Level 2 Upper GI Procedures) with a payment rate of around
$1,854. In addition, we proposed to assign CPT code 0654T
(Esophagogastroduodenoscopy, flexible, transnasal; with insertion of
intraluminal tube or catheter) with a geometric mean cost of around
$2,057 to APC 5303 (Level 3 Upper GI Procedures) with a payment rate of
$3,803.
Comment: One commenter supported our decision to assign CPT codes
0652T and 0653T to APC 5302. The commenter also supported our decision
to assign CPT code 0654T to APC 5303.
Response: We appreciate the commenter's support for our proposals.
After consideration of the public comments we received, we are
finalizing our proposal without modification to continue to assign CPT
codes 0652T and 0653T to APC 5302 (Level 2 Upper GI Procedures). We
also are finalizing our proposal without modification to continue to
assign CPT code 0654T to APC 5303 (Level 3 Upper GI Procedures). Table
82 shows the finalized status indicator and APC assignment for all of
the procedure codes. We refer readers to Addendum B of this final rule
with comment period for the payment rates for all codes reportable
under the OPPS. Addendum B is available via the internet on the CMS
website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.105
61. Upper GI Tract Endoscopy Bile and Pancreatic Ducts (APC 5302)
CPT code 43275 (Endoscopic retrograde cholangiopancreatography
(ERCP); with removal of foreign body(s) or stent(s) from biliary/
pancreatic duct(s)) describes an endoscopy procedure that is performed
to treat medical issues with the bile and pancreatic ducts. CPT code
43275 has a geometric mean cost of around $2,725 for CY 2024. In the CY
2024 OPPS proposed rule, we assigned CPT code 43275 to APC 5302 (Level
2 Upper GI
[[Page 81712]]
Procedures) with a payment rate of around $1,854.
Comment: One commenter requested that CPT code 43275 be reassigned
to APC 5303 (Level 3 Upper GI Procedures) with a payment rate of around
$3,803. The commenter states that performing endoscopic retrograde
cholangiopancreatography (ERCP) requires more training and experience
for gastrointestinal endoscopists as compared to other gastrointestinal
endoscopic procedures leading to higher cost for the procedure
described by CPT code 43275. The commenter also notes that CPT code was
assigned to APC 5202 for CY 2023 where it is the lowest-cost
significant procedure. Moving CPT code 43275 to APC 5302 would increase
the 2 times rule threshold in APC 5303, which according to the
commenter, may reduce the procedure code combinations that would be
eligible for complexity adjustments. The commenter also notes that CPT
code 43275 while in APC 5302 is less than $300 away from a 2 times rule
violation in that APC. Finally, the commenter believes that there no
significant financial impact whether CPT code 43275 is assigned to
either APC 5302 or APC 5303.
Response: We appreciate the request of the commenter. We note that
while CPT code 43275 would be one of the higher-paid procedures in APC
5302, the procedure will be underpaid by less than $900 and there are
several other procedures in APC 5302 with similar geometric costs as
CPT code 43275. Assigning CPT code 43275 to APC 5303 would make the
procedure the second lowest-paid procedure in APC 5303. In addition,
the payment rate of APC 5303 would be around $1,000 more than the
geometric mean cost of CPT code 43275.
After consideration of the public comments we received, we are
finalizing our proposal without modification for CPT code 43275 to
continue to assign the procedure to APC 5302 (Level 2 Upper GI
Procedures). Table 83 shows the finalized status indicator and APC
assignment for all of the procedure codes. We refer readers to Addendum
B of this final rule with comment period for the payment rates for all
codes reportable under the OPPS. Addendum B is available via the
internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR22NO23.106
62. Xen Glaucoma Treatment Procedure (APC 5493)
For 2017, the AMA's Editorial Panel established two new codes,
specifically, CPT code 0449T and 0450T, effective January 1, 2017, to
describe the surgical procedure associated with the Xen Glaucoma
Treatment System. The complete long descriptors for the codes, are
listed below:
0449T (Insertion of aqueous drainage device, without
extraocular reservoir, internal approach, into the subconjunctival
space; initial device)
0450T (Insertion of aqueous drainage device, without
extraocular reservoir, internal approach, into the subconjunctival
space; each additional device (list separately in addition to code for
primary procedure))
For CY 2023, CPT code 0449T is assigned to APC 5492 (Level 2
Intraocular Procedures) with a payment of $3,995.58. In addition, we
assigned CPT code 0450T to status indicator ``N'' to indicate that the
code is packaged, and payment for the service is included in the
primary code. For CY 2024, we proposed to continue the assignment to
APC 5492 for CPT code 0449T. Similarly, we proposed to maintain the
assignment of status indicator ``N'' (packaged) for CPT code 0450T.
Comment: A commenter reported that the proposed reassignment for
CPT 66991, which is one of the existing MIG codes, from APC 1563 (New
Technology--Level 26 ($4001-$4500)) to APC 5493 (Level 3 Intraocular
Procedures), seems appropriate. However, the commenter indicated that
the geometric mean cost for CPT code 0449T is higher than the cost of
CPT code 66991, yet CPT code 0449T has been proposed to continue to be
assigned to APC 5492. In addition, the commenter suggested that the
work associated with CPT code 0449T is significantly more complex than
that of CPT code 66991. Based on the claims data and the clinical
complexity of the work associated with the service described by CPT
code 0449T, the commenter urged CMS to reassign CPT code 0449T to APC
5493, which is the same APC proposed for CPT code 66991.
Response: We reviewed our claims data for this final rule with
comment period. The CY 2024 OPPS payment rates are based on claims
submitted between January 1, 2022, and December 31, 2022, processed
through June 30, 2023. Based on our evaluation of the claims data for
this final rule with comment period, we agree that the geometric mean
cost for CPT code 0449T is higher compared to the geometric mean cost
for CPT code 66991. Specifically, our claims data show a geometric mean
cost of approximately $4,995 for CPT code 0449T based on 415 single
claims (out of 421), which is higher than the geometric mean cost of
about $4,943 for CPT code 66991 based on 6,011 single claims (out of
6,069) total claims. We agree that CPT code 0449T should be reassigned
to APC 5493 based on clinical and resource homogeneity with the
procedures assigned to APC 5493. We believe the resource costs
associated with CPT code 0449T are similar to those procedures in APC
5493, rather than APC 5492. Therefore, we are revising the assignment
for CPT code 0449T to APC 5493 for CY 2024.
With regard to CPT code 66991 (MIG code) mentioned by the
commenter, we refer readers to section III.C (New Technology APCs) of
this final rule with comment period for the discussion
[[Page 81713]]
related to the CY 2024 payment for the code.
In summary, after consideration of the public comments, we are
finalizing the APC assignment for CPT code 0449T with modification.
Specifically, we are revising the APC assignment from APC 5492 to APC
5493 for CPT code 0449T for CY 2024. We note we did not receive any
comment for CPT code 0450T, therefore, we are finalizing the proposed
status indicator. The final CY 2024 OPPS payment rate for all the codes
payable under the OPPS can be found in Addendum B to this final rule
with comment period. In addition, we refer readers to Addendum D1 of
this final rule with comment period for the SI meanings for all codes
reported under the OPPS. Addendum D1 is available via the internet on
the CMS website.
63. XV Lung Ventilation Analysis Software (APC 5722)
Effective July 1, 2023, the CPT Editorial Panel created CPT codes
0807T (Pulmonary tissue ventilation analysis using software-based
processing of data from separately captured cinefluorograph images; in
combination with previously acquired computed tomography (CT) images,
including data preparation and transmission, quantification of
pulmonary tissue ventilation, data review, interpretation and report)
and 0808T (Pulmonary tissue ventilation analysis using software-based
processing of data from separately captured cinefluorograph images; in
combination with computed tomography (CT) images taken for the purpose
of pulmonary tissue ventilation analysis, including data preparation
and transmission, quantification of pulmonary tissue ventilation, data
review, interpretation and report). Both CPT codes 0807T and 0808T are
used with the XV Lung Ventilation Analysis Software, which is a
respiratory imaging platform to identify respiratory deficiencies. The
difference between the two codes is that CPT code 0808T includes a CT
scan during the service, and CPT code 0807T does not. For CY 2024, we
proposed to assign CPT code 0807T to APC 5721 (Level 1 Diagnostic Tests
and Related Services) with a proposed payment rate of $151 and CPT code
0808T to APC 5722 (Level 2 Diagnostic Tests and Related Services) with
a proposed payment rate of $304.
Comment: We received a comment from the manufacturer of the XV Lung
Ventilation Analysis Software expressing support for the proposed APC
assignment for 0808T.
Response: We thank the commenter for their support for the APC
assignment for CPT code 0808T and agree that the proposed APC
assignment for CPT code 0808T accurately captures the costs associated
with the service. Therefore, we are finalizing the APC assignment for
CPT code 0808T as proposed.
Comment: The manufacturer also commented on the proposed APC
assignment for CPT code 0807T. The commenter stated that the proposed
APC assignment for CPT code 0807T does not properly account for the
costs associated with the required fluoroscopy imaging that is a part
of the service. The commenter provided the CY 2024 proposed rule
geometric mean costs for two fluoroscopy codes: CPT code 76000
(Fluoroscopy (separate procedure), up to 1 hour physician or other
qualified health care professional time) with a proposed geometric mean
cost of $262, and CPT code 76496 (Unlisted fluoroscopic procedure (eg,
diagnostic, interventional) with a proposed geometric mean cost of
$133, and explained that the proposed APC assignment for CPT code 0807T
would not cover the costs of the fluoroscopy based on the proposed
geometric mean costs of the two fluoroscopy codes. To account for the
costs of the fluoroscopy that is performed as part of the service, the
commenter requested that CMS assign CPT code 0807T to APC 5722 for CY
2024.
Response: After further evaluation of CPT code 0807T, the resources
required to perform the procedure, and input from our medical advisors,
we believe it is appropriate to reassign CPT code 0807T to APC 5722.
Based on our evaluation of the additional information provided to CMS
as well as the claims data for existing fluoroscopy codes, we believe
that the resource costs associated with CPT code 0807T are higher than
those associated with the code's proposed APC assignment. Therefore, we
are revising the APC assignment for CPT code 0807T for CY 2024.
After consideration of the public comment, we are finalizing our
proposal without modification to assign CPT code 0808T to APC 5722 for
CY 2024. We are also finalizing the reassignment of CPT code 0807T to
APC 5722 for CY 2024. The final CY 2024 payment rate for these codes
can be found in Addendum B to this final rule with comment period. We
also refer readers to Addendum D1 of this final rule with comment
period for the SI meanings for all codes reported under the OPPS.
Addenda B and D1 are available via the internet on the CMS website. In
addition, we note that CMS recognizes that software-based technologies
are rapidly evolving, like the product used for HCPCS code C9786. In
line with our comment solicitation on payment policy for software as a
service (SaaS) procedures in the CY 2023 OPPS final rule (87 FR 72035
and 72036), CMS is considering, for future rulemaking, whether or not
specific adjustments to payment policies and rate calculations are
necessary in order to more accurately and appropriately pay for these
products and services across settings of care. CMS remains open to
feedback on these issues and welcomes engagement from interested
parties, including from manufacturers, providers, and beneficiaries.
64. New Technology Applications Submitted to CMS
Comment: We received comments regarding three pending New
Technology APC applications, for the TriNavTM Infusion
System, Trabeculocanalicular Outflow Restoration, and Optilume Benign
Prostatic Hyperplasia (BPH) services.
Response: We note that pending New Technology APC applications are
reviewed via a sub-regulatory process, and therefore, application
determinations are not made via rulemaking. As a result, we did not
propose to create new codes for any of these services or assign them to
New Technology APCs in the CY 2024 OPPS/ASC proposed rule. These New
Technology APC applications are currently being reviewed and applicants
will be notified of CMS's decision through our normal process.
IV. OPPS Payment for Devices
A. Pass-Through Payment for Devices
1. Beginning Eligibility Date for Device Pass-Through Status and
Quarterly Expiration of Device Pass-Through Payments
a. Background
The intent of transitional device pass-through payment, as
implemented at Sec. 419.66, is to facilitate access for beneficiaries
to the advantages of new and truly innovative devices by allowing for
adequate payment for these new devices while the necessary cost data is
collected to incorporate the costs for these devices into the procedure
APC rate (66 FR 55861). Under section 1833(t)(6)(B)(iii) of the Act,
the period for which a device category eligible for transitional pass-
through payments under the OPPS can be in effect is at least 2 years
but not more than 3 years. Prior to CY 2017, our regulation at Sec.
419.66(g) provided that this pass-through payment eligibility period
began on the date CMS established a
[[Page 81714]]
particular transitional pass-through category of devices, and we based
the pass-through status expiration date for a device category on the
date on which pass-through payment was effective for the category. In
the CY 2017 OPPS/ASC final rule with comment period (81 FR 79654), in
accordance with section 1833(t)(6)(B)(iii)(II) of the Act, we amended
Sec. 419.66(g) to provide that the pass-through eligibility period for
a device category begins on the first date on which pass-through
payment is made under the OPPS for any medical device described by such
category.
In addition, prior to CY 2017, our policy was to propose and
finalize the dates for expiration of pass-through status for device
categories as part of the OPPS annual update. This means that device
pass-through status would expire at the end of a calendar year when at
least 2 years of pass-through payments had been made, regardless of the
quarter in which the device was approved. In the CY 2017 OPPS/ASC final
rule with comment period (81 FR 79655), we changed our policy to allow
for quarterly expiration of pass-through payment status for devices,
beginning with pass-through devices approved in CY 2017 and subsequent
calendar years, to afford a pass-through payment period that is as
close to a full 3 years as possible for all pass-through payment
devices. We also have an established policy to package the costs of the
devices that are no longer eligible for pass-through payments into the
costs of the procedures with which the devices are reported in the
claims data used to set the payment rates (67 FR 66763).
We refer readers to the CY 2017 OPPS/ASC final rule with comment
period (81 FR 79648 through 79661) for a full discussion of the current
device pass-through payment policy.\14\
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\14\ To apply for OPPS transitional device pass-through status,
applicants complete an application that is subject to the Paperwork
Reduction Act of 1995 (PRA) (44 U.S.C. 3501 et seq.). This
information collection (CMS-10052) is currently approved under OMB
control number 0938-0857 and has an expiration date of November 30,
2025.
---------------------------------------------------------------------------
In the CY 2023 OPPS/ASC final rule with comment period, we
finalized our policy to publicly post online OPPS device pass-through
applications received on or after March 1, 2023, beginning with the
issuance of the CY 2025 proposed rule and for each OPPS rulemaking
thereafter. We refer readers to the CY 2023 OPPS/ASC final rule with
comment period (87 FR 71934 through 71938) for a full discussion of the
policy to publicly post OPPS device pass-through applications.
b. Expiration of Transitional Pass-Through Payments for Certain Devices
As stated earlier, section 1833(t)(6)(B)(iii) of the Act requires
that, under the OPPS, a category of devices be eligible for
transitional pass-through payments for at least 2 years, but not more
than 3 years. Currently, there are 15 device categories eligible for
pass-through payment. These devices are listed in Table 84 of this
final rule with comment where we detail the expiration dates of pass-
through payment status for each of the 15 devices currently receiving
device pass-through payment.
In the CY 2022 OPPS/ASC final rule with comment period we used CY
2019 claims data, rather than CY 2020 claims data, to inform CY 2022
ratesetting (86 FR 63755). As a result, we utilized our equitable
adjustment authority at section 1833(t)(2)(E) of the Act to provide up
to four quarters of separate payment for 27 drugs and biologicals and
one device category whose pass-through payment status expired between
December 31, 2021 and September 30, 2022 to mimic continued pass-
through payment, promote adequate access to innovative therapies for
Medicare beneficiaries, and gather sufficient data for purposes of
assigning these devices to clinical APCs (86 FR 63755). A full
discussion of this final policy is included in section X.F of the CY
2022 OPPS/ASC final rule with comment (86 FR 63755).
Section 4141(a)(2) of the Consolidated Appropriations Act, 2023
(CAA, 2023) (Pub. L. 117-328) amended section 1833(t)(6) by adding a
new subparagraph (K), which extended the device pass-through status
under paragraph (6) for a 1-year period beginning January 1, 2023, for
device categories whose period of pass-through status would have ended
on December 31, 2022. There are five device categories for which pass-
through status would have ended on December 31, 2022, but which will
now end on December 31, 2023. Pass-through status began for these
device categories on January 1, 2020.
BILLING CODE 4150-28-P
[[Page 81715]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.107
[[Page 81716]]
BILLING CODE 4150-28-C
2. New Device Pass-Through Applications for CY 2024
a. Background
Section 1833(t)(6) of the Act provides for pass-through payments
for devices, and section 1833(t)(6)(B) of the Act requires CMS to use
categories in determining the eligibility of devices for pass-through
payments. As part of implementing the statute through regulations, we
have continued to believe that it is important for hospitals to receive
pass-through payments for devices that offer substantial clinical
improvement in the treatment of Medicare beneficiaries to facilitate
access by beneficiaries to the advantages of the new technology.
Conversely, we have noted that the need for additional payments for
devices that offer little or no clinical improvement over previously
existing devices is less apparent. In such cases, these devices can
still be used by hospitals, and hospitals will be paid for them through
appropriate APC payment. Moreover, a goal is to target pass-through
payments for those devices where cost considerations are most likely to
interfere with patient access (66 FR 55852; 67 FR 66782; and 70 FR
68629).
As specified in regulations at Sec. 419.66(b)(1) through (3), to
be eligible for transitional pass-through payment under the OPPS, a
device must meet the following criteria:
If required by FDA, the device must have received FDA
approval or clearance and FDA marketing authorization (except for a
device that has received an FDA investigational device exemption (IDE)
and has been classified as a Category B device by FDA), or meet another
appropriate FDA exemption; and the pass-through payment application
must be submitted within 3 years from the date of the initial FDA
marketing authorization, if required, unless there is a documented,
verifiable delay in U.S. market availability after FDA marketing
authorization is granted, in which case CMS will consider the pass-
through payment application if it is submitted within 3 years from the
date of market availability;
The device is determined to be reasonable and necessary
for the diagnosis or treatment of an illness or injury or to improve
the functioning of a malformed body part, as required by section
1862(a)(1)(A) of the Act; and
The device is an integral part of the service furnished,
is used for one patient only, comes in contact with human tissue, and
is surgically implanted or inserted (either permanently or
temporarily), or applied in or on a wound or other skin lesion.
In addition, according to Sec. 419.66(b)(4), a device is not
eligible to be considered for device pass-through payment if it is any
of the following: (1) equipment, an instrument, apparatus, implement,
or item of this type for which depreciation and financing expenses are
recovered as depreciation assets as defined in Chapter 1 of the
Medicare Provider Reimbursement Manual (CMS Pub. 15-1); or (2) a
material or supply furnished incident to a service (for example, a
suture, customized surgical kit, or clip, other than a radiological
site marker).
Separately, we use the following criteria, as set forth under Sec.
419.66(c), to determine whether a new category of pass-through payment
devices should be established. The device to be included in the new
category must--
Not be appropriately described by an existing category or
by any category previously in effect established for transitional pass-
through payments, and was not being paid for as an outpatient service
as of December 31, 1996;
Have an average cost that is not ``insignificant''
relative to the payment amount for the procedure or service with which
the device is associated as determined under Sec. 419.66(d) by
demonstrating: (1) the estimated average reasonable cost of devices in
the category exceeds 25 percent of the applicable APC payment amount
for the service related to the category of devices; (2) the estimated
average reasonable cost of the devices in the category exceeds the cost
of the device-related portion of the APC payment amount for the related
service by at least 25 percent; and (3) the difference between the
estimated average reasonable cost of the devices in the category and
the portion of the APC payment amount for the device exceeds 10 percent
of the APC payment amount for the related service (with the exception
of brachytherapy and temperature-monitored cryoablation, which are
exempt from the cost requirements as specified at Sec. 419.66(c)(3)
and (e)); and
Demonstrate a substantial clinical improvement, that is,
substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part compared to
the benefits of a device or devices in a previously established
category or other available treatment, or, for devices for which pass-
through payment status will begin on or after January 1, 2020, as an
alternative pathway to demonstrating substantial clinical improvement,
a device is part of the FDA's Breakthrough Devices Program and has
received marketing authorization for the indication covered by the
Breakthrough Device designation.
Beginning in CY 2016, we changed our device pass-through evaluation
and determination process. Device pass-through applications are still
submitted to CMS through the quarterly sub-regulatory process, but the
applications are subject to notice and comment rulemaking in the next
applicable OPPS annual rulemaking cycle. Under this process, all
applications that are preliminarily approved upon quarterly review will
automatically be included in the next applicable OPPS annual rulemaking
cycle, while submitters of applications that are not approved upon
quarterly review will have the option of being included in the next
applicable OPPS annual rulemaking cycle or withdrawing their
application from consideration. Under this notice-and-comment process,
applicants may submit new evidence, such as clinical trial results
published in a peer-reviewed journal or other materials, for
consideration during the public comment process for the proposed rule.
This process allows those applications that we are able to determine
meet all of the criteria for device pass-through payment under the
quarterly review process to receive timely pass-through payment status,
while still allowing for a transparent, public review process for all
applications (80 FR 70417 and 70418).
In the CY 2020 annual rulemaking process, we finalized an
alternative pathway for devices that are granted a Breakthrough Device
designation (84 FR 61295) and receive FDA marketing authorization for
the indication covered by the Breakthrough Device designation. Under
this alternative pathway, devices that are granted an FDA Breakthrough
Device designation are not evaluated in terms of the current
substantial clinical improvement criterion at Sec. 419.66(c)(2) for
the purposes of determining device pass-through payment status, but do
need to meet the other requirements for pass-through payment status in
our regulation at Sec. 419.66. Devices that are part of the
Breakthrough Devices Program, have received FDA marketing authorization
for the indication covered by the Breakthrough Devices designation, and
meet the other criteria in the regulation can be approved through the
quarterly process and announced through that process (81 FR 79655).
Proposals regarding these devices and whether pass-through payment
status should continue to apply are included in the next applicable
OPPS rulemaking cycle. This
[[Page 81717]]
process promotes timely pass-through payment status for innovative
devices, while also recognizing that such devices may not have a
sufficient evidence base to demonstrate substantial clinical
improvement at the time of FDA marketing authorization.
More details on the requirements for device pass-through payment
applications are included on the CMS website in the application form
itself at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/passthrough_payment.html, in the
``Downloads'' section. In addition, CMS is amenable to meeting with
applicants or potential applicants to facilitate information sharing to
support the evaluation of an OPPS device pass-through payment
application or discuss general application criteria, including the
substantial clinical improvement criterion.
b. Applications Received for Device Pass-Through Status for CY 2024
We received six complete applications by the March 1, 2023,
quarterly deadline, which was the last quarterly deadline for
applications to be received in time to be included in this rule. We
received three of the applications in the second quarter of 2022, one
of the applications in the third quarter of 2022, no applications in
the fourth quarter of 2022, and two of the applications in the first
quarter of 2023. One of the applications was approved for device pass-
through status during the quarterly review process: MY01 Continuous
Compartmental Pressure Monitor, which was submitted on May 31, 2022,
and conditionally approved as HCPCS code C1834 on October 1, 2022.
However, after further review, we determined that the conditional
approval was in error, and consequently, we deleted code C1834 on March
31, 2023.
Applications received for the later deadlines for the remaining
2023 quarters (the quarters beginning June 1, September 1, and December
1 of 2023), if any, will be discussed in the CY 2025 OPPS/ASC proposed
rule. We note that the quarterly application process and requirements
have not changed because of the addition of rulemaking review. Detailed
instructions on submission of a quarterly device pass-through payment
application are included on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Downloads/catapp.pdf.
Discussions of the applications we received by the March 1, 2023,
deadline are included below.
(1) Alternative Pathway Device Pass-Through Applications
We received two device pass-through applications by the March 2023
quarterly application deadline for devices that have received
Breakthrough Device designation from FDA and FDA marketing
authorization for the indication for which they have a Breakthrough
Device designation, and therefore are eligible to apply under the
alternative pathway.
(a) CavaClear Inferior Vena Cava (IVC) Filter Removal Laser Sheath
Phillips North America, LLC submitted an application for a new
device category for transitional pass-through payment status for
CavaClear Inferior Vena Cava (IVC) Filter Removal Laser Sheath
(CavaClear) for CY 2024. Per the applicant, CavaClear is a breakthrough
device intended for tissue ablation in the removal of embedded IVC
filters that have failed a previous retrieval method. IVC filters are
used to capture blood clots and prevent them from moving to the lungs
in patients with venous thromboembolism. Per the applicant, research
has shown that IVC filters may have long-term complications, including
device migration, filter fracture, and IVC occlusion; as a result, FDA
issued a safety notice that recommends that physicians remove
retrievable IVC filters as soon as they are no longer needed. The
applicant stated that CavaClear facilitates the detachment of firmly
adherent IVC filters using ultraviolet laser energy. The applicant
explained that CavaClear uses circumferential tissue ablation that can
aid in capturing the filter within seconds of laser activation, which
can help increase physician efficiency, and may help lower costs by
reducing the number of retrieval attempts to remove an embedded IVC
filter.
According to the applicant, CavaClear is a 14F or 16F laser
catheter used for the intra-operative removal of IVC filters. The
applicant further explained that CavaClear consists of optical fibers
arranged in a circle, sandwiched between inner and outer polymer
tubing. The fibers terminate at the distal end within a polished tip
and at the proximal end within a coupler that mates with the excimer
laser. According to the applicant, inner and outer stainless-steel
bands, which form a radiopaque marker, protect the optical fibers at
the distal tip. The applicant also stated that CavaClear was designed
to slide through an introducer sheath with an inner lumen to allow an
appropriate traction platform to pass through it. Per the applicant,
the device facilitates detachment of IVC filters from the IVC wall
using ultraviolet laser energy and subsequent collapse of the filter,
partially within the laser sheath and entirely within the introducer
sheath. The laser sheath was designed for use with the CVX-300[supreg]
Excimer Laser or Philips Laser System (PLS), which allows the
multifiber laser sheaths to transmit ultraviolet energy to the tissue
at the distal tip of the device. The applicant further explained that,
when activated, the laser ablates the tissue and frees the IVC filter
from overgrowth in a controllable fashion. The applicant stated that by
using cool ultraviolet laser energy around the embedded IVC filter,
CavaClear can assist in fast filter capture with low force.
As stated previously, to be eligible for transitional pass-through
payment under the OPPS, a device must meet the criteria at Sec.
419.66(b)(1) through (4). With respect to the newness criterion at
Sec. 419.66(b)(1), CavaClear received FDA Breakthrough Device
designation effective April 23, 2021, for the ablation of tissue in the
removal of IVC filters that have failed a previous retrieval method.
FDA granted the applicant De Novo classification for CavaClear (laser-
powered IVC filter retrieval catheter) on December 21, 2021, for the
same indication as the one covered by the Breakthrough Device
designation. We received the application for a new device category for
transitional pass-through payment status for CavaClear on May 30, 2022,
which is within 3 years of the date of the initial FDA marketing
authorization.
We solicited public comment on whether CavaClear meets the newness
criterion at Sec. 419.66(b)(1).
Comment: The applicant submitted a comment reiterating that
CavaClear meets the newness criterion at 42 CFR 419.66(b)(1), stating
that CMS received the application for a new device category for
transitional pass-through payment status for CavaClear on May 30, 2022,
which is within 3 years of the date of the initial FDA marketing
authorization.
Response: We appreciate the commenter's input and agree that
because we received the application for CavaClear on May 30, 2022,
which is within 3 years of FDA approval on April 23, 2021, that
CavaClear meets the newness criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
according to the applicant, CavaClear is integral to the service
provided, is used for one patient only, comes in contact with human
tissue, and is surgically implanted or
[[Page 81718]]
inserted into the patient through the insertion of a laser catheter
temporarily for the interoperative removal of IVC filters as required
at Sec. 419.66(b)(3).
We invited public comment on whether CavaClear meets the
eligibility criterion at Sec. 419.66(b)(3).
Comment: The applicant submitted a comment reiterating that
CavaClear satisfies the eligibility criterion at 42 CFR 419.66(b)(3)
because the device is integral to the service provided, is used for one
patient only, comes in contact with human tissue, and is surgically
implanted or inserted into the patient through the insertion of a laser
catheter temporarily for the interoperative removal of IVC filters.
Response: We appreciate the commenter's input. Based on the
information we have received and our review of the application, we
agree with the applicant that CavaClear is integral to the service
provided, used for one patient only, comes in contact with human
tissue, and is surgically implanted or inserted. Therefore, we have
determined that CavaClear meets the eligibility criteria at Sec.
419.66(b)(3).
With respect to the exclusion criterion at Sec. 419.66(b)(4), the
applicant also claimed that CavaClear meets the criterion because it is
not equipment, an instrument, apparatus, implement, or item of this
type for which depreciation and financing expenses are recovered, and
it is not a supply or material furnished incident to a service.
We invited public comment on whether CavaClear meets the exclusion
criterion at Sec. 419.66(b)(4).
Comment: The applicant submitted a comment reiterating that
CavaClear satisfies the exclusion criterion at 42 CFR 419.66(b)(4)
because it is not equipment, an instrument, apparatus, implement, or
item of this type for which depreciation and financing expenses are
recovered, and it is not a supply or material furnished incident to a
service.
Response: We appreciate the commenter's input. Based on the
information we have received and our review of the application, we
agree with the applicant that CavaClear meets the device eligibility
requirements of Sec. 419.66(b)(4) because it is not a piece of
equipment, instrument, apparatus, implement, or item for which
depreciation and financing expenses are recovered, and it is not a
supply or material furnished incident to a service. We have therefore
determined that CavaClear meets the device eligibility requirements of
Sec. 419.66(b)(4).
In addition to the criteria at Sec. 419.66(b)(1) through (4), the
criteria for establishing new device categories are specified at Sec.
419.66(c). The first criterion, at Sec. 419.66(c)(1), provides that
CMS determines that a device to be included in the category is not
appropriately described by any of the existing categories or by any
category previously in effect, and was not being paid for as an
outpatient service as of December 31, 1996. The applicant described
CavaClear as an IVC filter removal device that uses a laser to ablate
tissue and is intended to facilitate detaching and removing indwelling
IVC filters. Per the applicant, CavaClear is the first and only FDA-
cleared solution for advanced IVC filter removal, and the applicant
claimed that no previous device categories for pass-through payment
appropriately describe CavaClear. Per the applicant, the possible
existing pass-through code, HCPCS code C2629 (Introducer/sheath, other
than guiding, other than intracardiac electrophysiological, laser),
does not appropriately describe CavaClear because CavaClear uses a
unique laser mechanism of action, unlike the snag, snare, and forceps
method to remove IVC filters. Per the applicant, CavaClear is not
intended to remove pacemaker and defibrillator leads like the products
described by C2629, and CavaClear impacts different anatomy than the
products described by C2629. Specifically, the applicant asserted that
C2629 includes devices that are indicated to remove implanted pacemaker
and defibrillator leads and devices via a catheter inserted into the
vascular system. In addition, the applicant noted that FDA granted
CavaClear De Novo classification, reflecting that there is no legally
marketed predicate device for CavaClear.
In the proposed rule, we noted, based on the description the
applicant provided, that CavaClear is a laser sheath intended for use
in the IVC, which is not intracardiac, and thus could be encompassed by
the descriptor of C2629. We also noted that another existing pass-
through payment category may appropriately describe CavaClear.
Specifically, we stated that we believed that C1773 (Retrieval device,
insertable (used to retrieve fractured medical devices)) may
appropriately describe CavaClear. Pass-through payment category C1773
is a broad category descriptor for a device that retrieves another
device within a patient's vascular system. Based on the description the
applicant provided, CavaClear is a device (a laser-powered sheath that
uses a laser to ablate tissue in the IVC) used to retrieve another
medical device (an IVC filter device), which is consistent with the
descriptor for C1773. In this context, we believe CavaClear may be
similar to the devices currently described by C2629 and C1773, and
therefore, CavaClear may also be appropriately described by C2629 and
C1773.
We invited public comment on whether CavaClear meets the device
category criterion at Sec. 419.66(c)(1).
Comment: In response to our concerns that CavaClear may be
appropriately described by C2629 or C1773, the applicant and several
commenters commented that CavaClear meets eligibility requirements of
Sec. 419.66(c)(1), stating that CavaClear can be distinguished from
the devices currently described by HCPCS codes C2629 and C1773 and, as
such, meets the device category criterion. Specifically, the commenters
asserted that CavaClear differs from devices described in C2629 and
C1773 by mechanism of action, clinical use, impacted anatomy, and FDA
clearance pathway.
All commenters addressing the device category criterion offered
support for approval of the application. Commenters stated that
CavaClear's mechanism of action is unique because it uses laser energy
to ablate scar tissue to facilitate the safe detachment and removal of
indwelling IVC filters. Commenters also noted that CavaClear's
photothermal laser tissue ablation is administered with individualized
tools and a unique traction platform different from other devices. One
commenter stated that there is no other device that uses excimer laser
technology to ablate the scar tissue that embeds IVC filter struts.
Finally, the applicant and multiple commenters provided that CavaClear
is also the only device to address the unmet medical need identified by
FDA safety communications on IVC retrievals.
Multiple commenters also noted that CavaClear was granted De Novo
classification by FDA, reflecting FDA's determination that there is no
legally marketed predicate device for CavaClear. In addition, the
applicant stated that CavaClear received Breakthrough Device
designation from FDA, which they believe implies that CavaClear is the
first device of its kind to address the condition for which it is
designed and is the only FDA-cleared treatment option for advanced IVC
filter removal.
With respect to our concern that CavaClear may be appropriately
described by C2629, the applicant stated that CavaClear differs
significantly from devices described in the C2629 category (Introducer/
sheath, other than guiding, other than intracardiac
[[Page 81719]]
electrophysiological, laser). First, the applicant asserted, and
multiple commenters agreed, that the devices described by C2629 are
used to remove pacemaker and defibrillator leads from the superior vena
cava (SVC) while CavaClear removes IVC filters from the inferior vena
cava. Specifically, the applicant stated that CavaClear removes a
different implant (IVC filter), as compared to other devices in need of
removal (pacemaker and defibrillator leads). In addition, the impacted
anatomy is different than that of the other products. The applicant
explained that the IVC filter is placed in the IVC and the cardiac
leads are placed via the SVC.
The applicant also sought to clarify how, in comparison to the
devices described in the C2629 category, CavaClear's mechanism of
action is unique. The applicant asserted that CavaClear's mechanism of
action is different and is based on four components: vessel access,
traction platform, tissue separation, and physical removal of the
implanted device. The applicant stated that the vessel access site for
CavaClear is via internal jugular or femoral vein, as opposed to the
subclavian vein for the other laser sheath devices. The applicant also
asserted that CavaClear's traction platform is different than the other
laser sheath products, with no additional rail required for traction
other than a snare, and the tools used to perform extraction are
specific to the CavaClear device. Further, the applicant and a few
commenters provided that the photothermal cool tissue ablation cannot
be administered without the individualized tools and traction platform.
Finally, the applicant provided clarification regarding the
physical removal of the implanted device using CavaClear. The applicant
stated that to remove the IVC filter the CavaClear device interacts to
collapse the filter in combination with the application of energy. By
contrast, for other devices, there is no such interaction to physically
alter the explanted device.
With respect to our concern that CavaClear may be appropriately
described by C1773, the applicant asserted that CavaClear differs
significantly from devices described in C1773 (Retrieval device,
insertable (used to retrieve fractured medical devices)).
As with devices in the C2629 category, the applicant sought to
clarify how, in comparison to the devices described in the C1773
category, CavaClear's mechanism of action is unique. The applicant
reiterated that CavaClear's mechanism of action is different and is
based on four components: vessel access, traction platform, tissue
separation, and physical removal of the implanted device through
photothermal cool tissue laser ablation.
Commenters asserted that CavaClear can be distinguished from the
devices broadly described in C1773 because those described devices
represent mechanical (non[hyphen]laser) or more rudimentary approaches
to retrieval as compared to CavaClear. Specifically, the applicant
provided that for the devices described in C1773 that retrieve IVC
filters (for example, endovascular snares, goose neck snares), the
mechanism of action relies on the device to capture the apical hook of
the filter (often embedded in the wall of the IVC or encapsulated). If
accessible, the snare requires straight pulling, sometimes
substantially, of the filter into a sheath with equal and opposite
traction/countertraction applied to the snare and sheath to disengage
the filter from the IVC wall. The applicant asserted that excessive
pull forces have a higher risk of vasculature injury, filter breakage
and fragmentation, and a potential for fragment embolization to the
heart and/or lungs.
The applicant also clarified that devices in C1773 that do not
retrieve IVC filters but are used for lead extraction (for example,
Tightrail), generally feature a stainless steel cutting tool to
mechanically dilate tissue surrounding a pacemaker or defibrillator
lead. The device's stainless steel cutting tool features a handle,
trigger, and drive mechanism that allows trigger pulls of the device to
be converted into torque for mechanical dilation of tissue on the
distal end. By contrast, CavaClear features fiberoptics for
transmission of ultraviolet light to ablate tissue surrounding an IVC
filter. Finally, the applicant noted that retrieval devices included in
C1773 that are used to remove pacemaker and/or defibrillator cardiac
implantable electronic devices are not indicated for and should not be
used for retrieving IVC filters; the physician specialty performing
lead extractions are electrophysiologists and cardiac surgeons, as
compared to interventional radiologists and vascular surgeons who
perform IVC filter removals; and the access site for these devices is
different from CavaClear as the device is typically inserted into the
subclavian vein as opposed to the jugular or femoral vein for
CavaClear.
Response: We appreciate the input provided by these commenters. We
have taken this information into consideration in making our final
determination of the device category criterion, discussed below.
Comment: Along with the applicant, commenters urged CMS to
establish a new pass-through payment category that describes CavaClear.
The applicant asserted that CMS has set past precedent that would allow
establishment of a narrower device category to account for new
innovative technologies that were not contemplated when categories were
first established. For example, CMS has established narrower device
pass-through categories describing neurostimulators and transluminal
angioplasty catheters to facilitate pass-through status for new
technologies. Commenters asserted that these examples illustrate that
CMS has, in the past, exercised flexibility in establishing new device
categories that involve new technologies that appear to be described by
existing broad categories. In doing so, the applicant asserted, CMS
recognized that historical overly broad device categories may not
necessarily be appropriate for new technologies that were not
contemplated when the categories were established. The applicant urged
CMS to exercise similar flexibility in evaluating CavaClear and
creating a narrower device category to accurately describe the new
technology. Several other commenters agreed with the applicant's
assertion that CMS has the flexibility to create new device categories
from existing broad categories to recognize technological advances
within a device class.
Response: We appreciate the commenters' input. We agree with the
applicant and commenters that CMS has the flexibility to create new
device categories when we recognize that the existing device categories
do not accurately describe the new proposed technology. However, we
note that we must clearly establish that a proposed device is not
described by existing device categories prior to exercising that
flexibility. After consideration of the public comments we received, we
agree there is no existing pass-through payment category that
appropriately describes CavaClear because no current category
appropriately describes an insertable introducer/sheath retrieval
device that utilizes a photothermal cool laser to ablate caval tissue
and retrieve intact IVC filters that are no longer clinically
indicated. Neither pass-through category C2629 nor C1773 fully
describes CavaClear and its complex mechanism of action. Based on this
information, we have determined that CavaClear meets the first
eligibility criterion at Sec. 419.66(c)(1).
We received additional public comments regarding Sec. 419.66(c)(1)
that
[[Page 81720]]
did not impact our decision on whether or not CavaClear meets the Sec.
419.66(c)(1) criterion, however we address these comments below.
Comment: The applicant stated that they believe CMS is adopting an
overly restrictive interpretation of the device category requirements,
particularly as they relate to devices with FDA Breakthrough Device
designation. The applicant asserted that CMS' interpretation of the
criteria for a new device category for CavaClear suggests that any new
technology that could be aligned to an existing category that was
created more than 20 years ago, despite unique characteristics that
differentiate it from other devices in the category, would
automatically fail to meet the threshold for a new device category. The
applicant further stated that both categories CMS identifies as
potentially describing CavaClear (C2629 and C1773) were established
over two decades ago and use very broad language to describe existing
technologies and technology development at the time; however,
technologies have advanced significantly since then, and thus, these
broad categories may be unnecessarily restricting pass-through status
for technologies that are indeed novel.
Response: We appreciate the commenter's feedback; however, we
disagree that our current interpretation of the device category
requirements suggests that any new technology that could be aligned to
a previous or existing device category would automatically fail to meet
the threshold for a new device category. To the contrary, as the
commenters noted, CMS has historically established device codes for new
and innovative technologies when it has been determined that the
proposed category is not appropriately described by any of the existing
categories or by any category previously in effect. Device pass-through
applications in no way automatically fail to meet the threshold for a
new device category, rather, CMS' goal is to evaluate each application
to clearly ascertain whether the proposed device is described by any of
the existing categories or by any category previously in effect in
order to determine if a new device category should be established.
Comment: The applicant expressed concern that CMS' interpretation
of the device category requirement will result in inappropriate limits
upon the use of the Alternative Pathway for device pass-through and
encouraged CMS to consider the totality of evidence when assessing
whether a device falls into an existing device category. Specifically,
the applicant encouraged CMS to consider factors such as different
mechanisms of action, unmet medical need, and differentiated clinical
use when evaluating a new category.
Response: We appreciate the commenters' feedback. We disagree that
our current interpretation of the device category requirement will
result in inappropriate limits upon the use of the Alternative Pathway
for device pass-through. CMS has established an evaluation process that
ensures that we have the information we need to evaluate applications
and make determinations based on the totality of the evidence; part of
that evaluation is determining if a previous or existing device code
appropriately describes the proposed device. We appreciate the
suggestions made by the commenters regarding the factors CMS should use
to evaluate the device category requirement and appreciate their
support to our current process.
Comment: The applicant requested that CMS modify the device pass-
through criteria to automatically consider devices with FDA
Breakthrough Device designation to not be appropriately described by
any of the existing or previous device categories, and therefore, meet
the Sec. 419.66(c)(1) criterion. The applicant noted that when CMS
established an alternative pathway for Breakthrough Devices seeking new
technology add-on payment in the inpatient hospital setting, CMS
stated, ``if a medical device is part of FDA's Breakthrough Devices
Program and received FDA marketing authorization, it would be
considered new and not substantially similar to an existing technology
for purposes of the new technology add-on payment.'' The applicant
argued that to ensure consistency in policy across payment systems, CMS
should deem CavaClear new for the purpose of device pass-through, and
not described by an existing or past category.
Response: We appreciate the commenters' feedback. Under the IPPS,
beginning with applications for FY 2021, a medical device designated
under FDA's Breakthrough Devices Program that has received marketing
authorization as a Breakthrough Device, for the indication covered by
the Breakthrough Device designation, may qualify for the new technology
add-on payment under an alternative pathway. Under an alternative
pathway, a technology will be considered not substantially similar to
an existing technology for purposes of the new technology add-on
payment under the IPPS and will not need to meet the requirement that
it represents an advance that substantially improves, relative to
technologies previously available, the diagnosis or treatment of
Medicare beneficiaries. These technologies must still be within the 2-
to 3-year newness period to be considered ``new'' and must also still
meet the cost criterion (88 FR 58919).
When we adopted the alternative pathway for device pass-through
payments under the OPPS, we stated that applications for devices that
have received FDA marketing authorization and are part of the FDA
Breakthrough Devices Program would not be evaluated in terms of the
current substantial clinical improvement criterion at Sec.
419.66(c)(2) for purposes of determining device pass-through payment
status, but would continue to need to meet the other requirements for
pass-through payment status in our regulations at Sec. 419.66(c)(1)
(84 FR 61295). The commenter is correct that under the alternative
pathway for device pass-through status under the OPPS, a device must
still meet the device category criterion at Sec. 419.66(c)(1),
consistent with the policy we adopted beginning in CY 2020. We
recognize that this feature of the OPPS alternative pathway for
Breakthrough Devices differs from the IPPS alternative pathway because
Breakthrough Devices do not need to meet the substantial similarity
requirement. Nonetheless, we do not believe that the current policy
creates a barrier to devices with Breakthrough Device designation and
note that we have previously granted OPPS device pass-through status
for Breakthrough Devices that have applied for the alternative pathway,
including the devices discussed in this final rule with comment period,
because these devices have not been described by existing device
categories or those previously in effect.
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines either of the following: (i)
that a device is included in the category that has demonstrated that it
will substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body party compared to
the benefits of a device or devices in a previously established
category or other available treatment; or (ii) for devices for which
pass-through status will begin on or after January 1, 2020, as an
alternative to the substantial clinical improvement criterion, the
device is part of FDA's Breakthrough Devices Program and has received
FDA marketing authorization for the indication covered by the
Breakthrough Device designation. We explained in the proposed rule that
CavaClear has a Breakthrough Device designation and
[[Page 81721]]
marketing authorization from FDA for the indication covered by the
Breakthrough Device designation, and therefore, appears to meet the
criterion at Sec. 419.66(c)(2)(ii) and is not evaluated for
substantial clinical improvement.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine if the cost of the device is not
insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of cost
significance requirements. The applicant stated that CavaClear would be
reported with HCPCS code listed in Table 85.
[GRAPHIC] [TIFF OMITTED] TR22NO23.108
To meet the cost criterion for device pass-through payment status,
a device must pass all three tests of the cost criterion for at least
one APC. As we explained in the CY 2005 OPPS final rule with comment
period (69 FR 65775), we generally use the lowest APC payment rate
applicable for use with the nominated device when we assess whether a
device meets the cost significance criterion, thus increasing the
probability the device will pass the cost significance test. For our
calculations, we used APC 5183, which had a CY 2022 payment rate of
$2,923.63 at the time the application was received. Beginning in CY
2017, we calculate the device offset amount at the HCPCS/CPT code level
instead of the APC level (81 FR 79657). HCPCS code 37193 had a device
offset amount of $762.48 at the time the application was received.\15\
According to the applicant, the cost of CavaClear is $3,165.00.
---------------------------------------------------------------------------
\15\ We noted that the applicant selected a value of $537.36 for
the device offset amount. However, the value selected is
inconsistent with the device offset amount related to HCPCS 37193 in
APC 5183 found in Addendum P to the CY 2022 OPPS/ASC final rule with
comment period, as corrected in the 2022 Correction Notification
OPPS Addendum (87 FR 2060). We selected the value of $762.48, which
we believe is the accurate value. Based on our initial assessment
for the proposed rule, using the device offset amount of $762.48
would result in CavaClear meeting the cost significance requirement.
---------------------------------------------------------------------------
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $3,165.00 for CavaClear is 108.26 percent of
the applicable APC payment amount for the service related to the
category of devices of $2,923.63 (($3,165.00/$2,923.63) x 100 = 108.26
percent). Therefore, we stated that we believed CavaClear meets the
first cost significance requirement.
The second cost significance requirement, at Sec. 419.66(d)(2),
provides that the estimated average reasonable cost of the devices in
the category must exceed the cost of the device-related portion of the
APC payment amount for the related service by at least 25 percent,
which means that the device cost needs to be at least 125 percent of
the offset amount (the device-related portion of the APC found on the
offset list). The estimated average reasonable cost of $3,165 for
CavaClear is 415.09 percent of the cost of the device-related portion
of the APC payment amount for the related service of $762.48
(($3,165.00/$762.48) x 100 = 415.09 percent). Therefore, we stated that
we believed CavaClear meets the second cost significance requirement.
The third cost significance requirement, at Sec. 419.66(d)(3),
provides that the difference between the estimated average reasonable
cost of the devices in the category and the portion of the APC payment
amount for the device must exceed 10 percent of the APC payment amount
for the related service. The difference between the estimated average
reasonable cost of $3,165.00 for CavaClear and the portion of the APC
payment amount for the device of $762.48 is 82.18 percent of the APC
payment amount for the related service of $2,923.63 ((($3,165.00 -
762.48)/$2,923.63) x 100 = 82.18 percent). Therefore, we stated that we
believed that CavaClear meets the third cost significance requirement.
We invited public comment on whether CavaClear meets the device
pass-through payment criteria discussed in this section, including the
cost criterion for device pass-through payment status.
Comment: The applicant reiterated that it believes it satisfies the
criterion at 42 CFR 419.66(c)(3) and that the cost of the device is not
insignificant as determined by CMS' analysis of the three cost
significance criteria for CavaClear.
Response: We appreciate the commenter's input. Based on our
findings from the first, second, and third cost significant tests, we
believe that CavaClear meets the cost significance criteria specified
at Sec. 419.66(d).
We invited public comment on whether CavaClear meets the device
pass-through payment criteria discussed in this section.
Comment: Several commenters, including the applicant, submitted
comments in support of pass-through payment approval for CavaClear. A
few commenters underlined that pass-through payment approval for
CavaClear will help increase Medicare beneficiary access to
technological advancements in treatment. Several commenters also stated
that CavaClear addresses an unmet medical need and provides the ability
to remove IVC filters that otherwise would remain in place, leaving
patients with significant symptoms. They further asserted that
CavaClear will have an impact on reducing complications from IVC filter
removals, time spent on IVC filter removals, and associated healthcare
costs.
Response: We appreciate the commenters' input on the potential
impact on Medicare beneficiary access, safety, and associated
healthcare costs.
After our review of the device pass-through application and
consideration of the public comments we received, we have determined
that CavaClear meets
[[Page 81722]]
the requirements for device pass-through status described at Sec.
419.66. As stated previously, devices that are granted an FDA
Breakthrough Device designation are not evaluated in terms of the
current substantial clinical improvement criterion at Sec.
419.66(c)(2)(i) for the purposes of determining device pass-through
payment status but must meet the other criteria for device pass-through
status. We believe CavaClear meets those other criteria, and therefore,
effective beginning January 1, 2024, we are finalizing approval for
device pass-through payment status for CavaClear under the alternative
pathway for devices that have an FDA Breakthrough Device designation
and have received FDA marketing authorization for the indication
covered by the Breakthrough Device designation.
(b) CERAMENT[supreg] G
BONESUPPORT AB submitted an application for a new device category
for transitional pass-through payment status for CERAMENT[supreg] G for
CY 2024. Per the applicant, CERAMENT[supreg] G is a single-use
implantable bone void filler combination device/drug that remodels into
bone and elutes gentamicin. The applicant further explained that
CERAMENT[supreg] G is an adjunct to systematic antibiotic therapy as
part of the surgical treatment of osteomyelitis (that is, bone
infection) in the extremities and is used where there is a need for
supplemental bone void filler material. The applicant asserted that
CERAMENT[supreg] G can reduce the recurrence of chronic osteomyelitis
from gentamicin-sensitive microorganisms to protect bone healing and
augment provisional hardware to help support bone fragments during the
surgical procedure. The applicant stated that CERAMENT[supreg] G is the
first on-label solution for a one-stage surgical approach to treating
bone infections with its unique dual mode of action: (1) promote bone
healing (bone remodeling), and (2) protect bone healing (elution of a
local broad-spectrum antibiotic). According to the applicant, once
implanted, CERAMENT[supreg] G resorbs overtime and remodels into bone
in 6 to 12 months.
Per the applicant, CERAMENT[supreg] G is comprised of three key
compounds: (1) hydroxyapatite (HA), (2) calcium sulfate (CaS), and (3)
gentamicin sulfate. According to the applicant, by combining calcium
sulfate and hydroxyapatite, a balance is achieved between implant
resorption rate and bone remodeling rate. The applicant further
explained that the CaS acts as a resorbable carrier for HA. The
applicant described that HA has a slow resorption rate and high
osteoconductivity promoting bone remodeling and thus gives long-term
structural support to the newly-formed bone. The gentamicin sulfate is
a broad-spectrum aminoglycoside antibiotic that is sensitive to a
spectrum of aerobic bacteria, particularly gram-negative bacilli, as
well as aerobic gram-positive cocci, in particular Staphylococcus
aureus, some coagulase negative staphylococci (CoNS) (for example,
Staphylococcus epidermidis), and some strains of streptococci.
According to the applicant, the gentamicin sulfate is present in the
bone void filler to prevent colonization from gentamicin-sensitive
microorganisms to protect bone healing.
Per the applicant, CERAMENT[supreg] G is comprised of eight
components (these components contain the three key compounds as well as
other parts for the successful application of CERAMENT[supreg] G): (1)
CERAMENT[supreg] CMI, a closed mixing injection system pre-packed with
ceramic bone substitute (CBS), is a mixture of the CaS (60 wt percent)
and HA (40 wt percent). The applicant further explained that the mixing
device is comprised of a 60 mL syringe, which in its proximal part is
equipped with a movable combined plunger and mixing paddle, and in its
distal part with a luer-lock connection. The movable mixing paddle
allows effective mixing of the material inside the syringe. Calcium
Sulfate and Hydroxyapatite (CSH) are the setting component of the bone
void filler, and per the applicant, this component will react to
calcium sulfate dihydrate (CSD) and will be resorbed over time, giving
place for natural bone to grow into the bone graft. The applicant
described that CSD is added as a seeding agent to accelerate the
setting reaction of CSH to CSD, and that HA is an osteoconductive
mineral similar to natural bone (this part of the bone graft substitute
will not be resorbed and does not need to be surgically removed). The
applicant stated that CSH and CSD conform to specifications based on
the monograph Calcium Sulfate Dihydrate 0982, European Pharmacopoeia
(EP) and the Official Monograph for Calcium Sulfate U.S. Pharmacopoeia/
National Formulary (USP) as well as internal requirements; (2)
CERAMENT[supreg] ID, an injection device used to inject the paste into
the bone void or gap; (3) Valve, a needleless valve needed for the
transfer of the ceramic paste from the CERAMENT[supreg] CMI to the
CERAMENT[supreg] ID; (4) Tip Extenders, which are sterile, plastic
needles with an inner diameter of 2.55 mm and two lengths (50 and 100
mm), that are connected to the CERAMENT[supreg] ID to facilitate
placement of the paste at the debridement site; (5) CERAMENT[supreg]
GENTAMICIN, the gentamicin sulfate in a glass vial equipped with a
stopper and a cap. The gentamicin sulfate subcomponent has a potency
equivalent to >=590[mu]g gentamicin/mg (anhydrous substance) and is
dissolved in the 0.9 percent sterile sodium chloride solution and mixed
with the CBS powder. Per the applicant, the prepared paste sets to a
calcium sulfate dihydrate matrix with embedded hydroxyapatite
particles, and gentamicin sulfate. The applicant further explained that
it delivers 17.5 mg gentamicin per mL paste. Per the applicant, the
gentamicin sulfate subcomponent complies with the EP monograph for
gentamicin sulfate; (6) CERAMENT[supreg] MIXING LIQUID, a sterile
sodium chloride, (NaCl) solution, 9 mg per mL in a glass vial. Per the
applicant, it is the liquid component of CERAMENT[supreg] G. This
component contains water which is needed for the calcium sulfate
reaction to occur. The liquid meets requirements of the compendial
excipient of USP/EP grade and is also registered in the inactive
ingredient database; (7) BONESUPPORT DP, which includes two ventilated
dispensing pins to facilitate easy handling when preparing the
gentamicin solution; and (8) BONESUPPORT SYRINGE, a single packed,
sterile 10 mL syringe with a male/female rotator assembly, and is used
when preparing the gentamicin solution.
According to the applicant, after the surgical site has been
prepared and any dead bone is debrided (that is, removed), the
CERAMENT[supreg] G paste is prepared by the surgeon or surgical
technician by: (1) mixing the gentamicin powder with the provided
saline to make a gentamicin liquid; (2) adding the gentamicin liquid to
the powder in the CERAMENT[supreg] CMI syringe and mixing the
gentamicin liquid and powder; and (3) transferring the resulting paste
to a smaller delivery syringe. Four minutes after the start of mixing,
the paste is ready to be used as a bone void filler. Per the applicant,
it can be injected using the tip extenders provided in the kit or by
attaching a needle to the delivery syringe, or it can be placed into a
bead mold to form beads. Fifteen minutes after the start of mixing,
CERAMENT[supreg] G can be drilled into, if required. At 20 minutes, it
is fully set, at which time the wound can be closed.
As stated previously, to be eligible for transitional pass-through
payment under the OPPS, a device must meet the criteria at Sec.
419.66(b)(1) through (4).
[[Page 81723]]
With respect to the newness criterion at Sec. 419.66(b)(1),
CERAMENT[supreg] G received FDA Breakthrough Device designation
effective March 12, 2020, as a resorbable, gentamicin-eluting ceramic
bone graft substitute intended for use as a bone void filler as an
adjunct to systemic antibiotic therapy and surgical debridement
(standard treatment approach to a bone infection) as part of the
surgical treatment of osteomyelitis. By eluting gentamicin,
CERAMENT[supreg] G can inhibit the colonization of gentamicin-sensitive
microorganisms to protect bone healing. CERAMENT[supreg] G can augment
provisional hardware to help support bone fragments during the surgical
procedure and is resorbed and replaced by bone during the healing
process. FDA granted the applicant De Novo classification for
CERAMENT[supreg] G under the generic name, ``Resorbable calcium salt
bone void filler containing a single approved aminoglycoside
antibacterial substance'' on May 17, 2022, for the same indication as
the one covered by the Breakthrough Device designation. We received the
application for a new device category for transitional pass-through
payment status for CERAMENT[supreg] G on May 31, 2022, which is within
3 years of the date of the initial FDA marketing authorization.
We invited public comment on whether CERAMENT[supreg] G meets the
newness criterion at Sec. 419.6C6(b)(1).
We did not receive public comments regarding whether
CERAMENT[supreg] G meets the newness criterion at Sec. 419.66(b)(1).
We received the application for a new device category for transitional
pass-through payment status for CERAMENT[supreg] G on May 31, 2022,
which is within 3 years of FDA Breakthrough Device designation
effective March 12, 2020, and the FDA De Novo classification on May 17,
2022. As such we have concluded that CERAMENT[supreg] G meets the
newness criterion.
With respect to the integral part of the service criterion at Sec.
419.66(b)(3), the applicant did not indicate whether CERAMENT[supreg] G
is integral to the service provided. However, per the applicant,
CERAMENT[supreg] G is used for one patient only, comes in contact with
human tissue, and is surgically implanted or inserted into the patient
as required at Sec. 419.66(b)(3).
We invited public comment on whether CERAMENT[supreg] G meets the
eligibility criterion at Sec. 419.66(b)(3).
We did not receive public comments regarding whether
CERAMENT[supreg] G meets the eligibility requirements at Sec.
419.66(b)(3). Based on the information we have received and our review
of the application, we determined that CERAMENT[supreg] G is integral
to the service provided, used for one patient only, comes in contact
with human tissue, and is surgically implanted or inserted. Therefore,
based on our review of the application, we have determined that
CERAMENT[supreg] G meets the eligibility criteria at Sec.
419.66(b)(3).
With respect to the exclusion criterion at Sec. 419.66(b)(4), the
applicant did not address whether CERAMENT[supreg] G is equipment, an
instrument, apparatus, implement, or item of this type for which
depreciation and financing expenses are recovered, or if
CERAMENT[supreg] G is a supply or material furnished incident to a
service.
We invited public comment on whether CERAMENT[supreg] G meets the
exclusion criterion at Sec. 419.66(b)(4).
We did not receive public comments regarding whether
CERAMENT[supreg] G meets the eligibility requirements at Sec.
419.66(b)(4). Based on the information we have received and our review
of the application, we determined that CERAMENT[supreg] G is not a
piece of equipment, instrument, apparatus, implement, or item for which
depreciation and financing expenses are recovered, and it is not a
supply or material furnished incident to a service. Therefore, based on
our review of the application, we have determined that CERAMENT[supreg]
G meets the eligibility criteria at Sec. 419.66(b)(4).
In addition to the criteria at Sec. 419.66(b)(1) through (4), the
criteria for establishing new device categories are specified at Sec.
419.66(c). The first criterion, at Sec. 419.66(c)(1), provides that
CMS determines that a device to be included in the category is not
appropriately described by any of the existing categories or by any
category previously in effect, and was not being paid for as an
outpatient service as of December 31, 1996. The applicant described
CERAMENT[supreg] G as a single-use implantable bone void filler
combination device/drug that remodels into bone and elutes gentamicin.
The applicant asserted that there are no existing bone void filler
devices cleared or approved for use in the U.S. for single stage
surgical reconstruction of bone defects that provide stability, promote
bone formation, and effectively support the surgical treatment of
infection by antibiotic elution. However, for comparison purposes, the
applicant listed HCPCS code C1734 (Orthopedic/device/drug matrix for
opposing bone-to-bone or soft-tissue-to-bone (implantable), as a device
category that it considers similar to CERAMENT[supreg] G's device
category.\16\
---------------------------------------------------------------------------
\16\ HCPCS code C1734 is a device category for which pass-
through status was extended for a 1-year period beginning January 1,
2023, by section (a)(2) of the Consolidated Appropriations Act, 2023
(CAA, 2023) (Pub. L. 117-328), titled ``Extension of Pass-Through
Status Under the Medicare Program for Certain Devices Impacted by
COVID-19.'' https://www.cms.gov/files/document/r11801cp.pdf.
---------------------------------------------------------------------------
The applicant stated that CERAMENT[supreg] G differs from the bone
substitutes AUGMENT[supreg] and AUGMENT[supreg] Injectable \17\
(devices described by HCPCS code C1734). We noted that CMS approved an
application for AUGMENT[supreg] Bone Graft as a new device category for
transitional pass-through payment status and established HCPCS code
C1734 as a new device category beginning in CY 2020. We referred
readers to the CY 2019 OPPS/ASC final rule with comment period (84 FR
61292 through 61294) for a full discussion of the AUGMENT[supreg] Bone
Graft application and decision.\18\ The applicant asserted that
CERAMENT[supreg] G and AUGMENT[supreg] differ in terms of the product
composition and mechanism of action or intended use. In addition, the
applicant asserted that the products are intended for different groups
of patients. With respect to composition, per the applicant,
CERAMENT[supreg] G consists of HA, CaS, and gentamicin sulfate. In
contrast, the applicant stated that AUGMENT[supreg] consists of beta-
tricalcium phosphate ([beta]-TCP) and recombinant human platelet-
derived growth factor (rhPDGF-BB), and AUGMENT[supreg] Injectable
consists of [beta]-TCP, rhPDGF-BB, and a collagen matrix. With respect
to the mechanism of action, the applicant stated that CaS in
CERAMENT[supreg] G acts as a resorbable carrier for HA, which has a
slow resorption rate and high osteoconductivity, providing a scaffold
for new bone generation. The applicant further explained that by
combining CaS and HA, a gentamicin, CERAMENT[supreg] G can reduce the
recurrence of chronic osteomyelitis from gentamicin-sensitive
microorganisms to protect bone healing. In contrast, according to the
applicant, the rhPDGF-BB in AUGMENT[supreg] acts as
[[Page 81724]]
a chemo-attractant and mitogen for cells involved in wound healing and
promotes angiogenesis at the site of healing, and the [beta]-TCP acts
as a bone void filler to prevent soft tissue from collapsing into the
void.
---------------------------------------------------------------------------
\17\ The applicant differentiates itself from AUGMENT[supreg]
and AUGMENT[supreg] Injectable, but does not use the term
``AUGMENT[supreg] Bone Graft'' in the application. However, the link
provided in the application goes to the AUGMENT[supreg] web page
that describes AUGMENT[supreg] Regenerative Solutions,
AUGMENT[supreg] Bone Graft and AUGMENT[supreg] Injectable. We use
the term ``AUGMENT[supreg]'' to collectively refer to the
AUGMENT[supreg] products described herein and those listed on the
AUGMENT[supreg] website. The applicant provided web page (in
footnote): AUGMENT BONE GRAFT website: http://www.augmentbonegraft.com/healthcare-professionals/.
\18\ https://www.govinfo.gov/content/pkg/FR-2019-11-12/pdf/2019-24138.pdf.
---------------------------------------------------------------------------
Per the applicant, CERAMENT[supreg] G is indicated for use as a
bone void filler in skeletally mature patients as an adjunct to
systemic antibiotic therapy and surgical debridement (standard
treatment approach to a bone infection) as part of the surgical
treatment of osteomyelitis in defects in the extremities. In contrast,
per the applicant, AUGMENT[supreg] and AUGMENT[supreg] Injectable are
indicated for use as an alternative to autograft in arthrodesis in
patients who require a bone fusion, such as patients who have
arthritis, avascular necrosis, joint instability or deformity, or
require joint arthroplasty of the ankle and/or hindfoot. Further, the
applicant asserted that AUGMENT[supreg] cannot be used in the patients
for whom CERAMENT[supreg] G is indicated because AUGMENT[supreg] is
specifically contraindicated in patients with an active infection at
the operative site.
We noted that, based on the description of the device provided by
the applicant, CERAMENT[supreg] G and AUGMENT[supreg] differ in terms
of composition and intended use, but also noted that device categories
are not intended to be device-specific. Rather, device categories are
intended to encompass any device that can be appropriately described by
the category. As such, when we evaluate a potential pass-through device
to determine whether it meets the device category criterion at Sec.
419.66(c)(1), we compare the subject device to the device category
descriptor rather than to the specific device for which the device
category was created. Specifically, C1734 describes any device that
meets the following descriptor: Orthopedic/device/drug matrix for
opposing bone-to-bone or soft-tissue-to-bone (implantable), and per the
applicant, CERAMENT[supreg] G is described as an implantable device/
drug matrix that, with its intended use, will oppose soft-tissue-to-
bone. In this context, we stated that we believe CERAMENT[supreg] G may
be similar to the devices currently described by C1734, and therefore
CERAMENT[supreg] G may also be appropriately described by C1734.
We invited public comment on whether CERAMENT[supreg] G meets the
device category criterion at Sec. 419.66(c)(1).
Comment: In response to our concerns that CERAMENT[supreg] G may be
appropriately described by C1734, the applicant commented that
CERAMENT[supreg] G meets eligibility requirements of Sec.
419.66(c)(1), stating that CERAMENT[supreg] G can be distinguished from
the device currently described by HCPCS code C1734 and, as such, meets
the device category criterion. Specifically, the applicant asserted
that CERAMENT[supreg] G differs from the device described in C1734 by
composition, mechanisms of action, indication for use, intended patient
population, associated treatment cases and procedures, and by FDA
designation and classification.
All commenters addressing the CERAMENT[supreg] G transitional pass-
through application offered support for approval of the application and
creation of a new device category. The applicant provided that
CERAMENT[supreg] G was granted Breakthrough Device designation by FDA
as a class II device with the following indication for use:
CERAMENT[supreg] G is a resorbable, gentamicin-eluting ceramic bone
void filler intended for use as a bone void filler in skeletally mature
patients as an adjunct to systemic antibiotic therapy and surgical
debridement (standard treatment approach to a bone infection) as part
of the surgical treatment of osteomyelitis in defects in the
extremities. The applicant further commented that one of the
requirements of FDA class II designation was to assure that there is no
risk of antimicrobial resistance from using the product, and that the
antimicrobial properties of CERAMENT[supreg] G are unique, and robust
clinical evidence demonstrates that recurrence of infection is reduced
with the use of CERAMENT[supreg] G in the management of bone infection.
With respect to our concern that CERAMENT[supreg] G may be
appropriately described by C1734, the applicant stated that
CERAMENT[supreg] G differs significantly from the device,
AUGMENT[supreg], described in the C1734 category (Orthopedic/device/
drug matrix for opposing bone-to-bone or soft-tissue-to-bone
(implantable)). The applicant asserted that the most important
fundamental differences between CERAMENT[supreg] G and AUGMENT[supreg]
is their composition and their intended patient population.
Specifically, the applicant asserted, and all commenters agreed, that
the antimicrobial properties in the CERAMENT[supreg] G composition are
unique. Further, the applicant reiterated that CERAMENT[supreg] G is
intended for patients with bone infection as an adjunct to systemic
antibiotic therapy and surgical debridement (standard treatment
approach to a bone infection) as part of the surgical treatment of
osteomyelitis in defects in the extremities, with all commenters
stating that CERAMENT[supreg] G is the only approved bone void filler
that does this. The only device described by C1734, AUGMENT[supreg],
does not contain an antimicrobial agent, is intended for patients
requiring ankle and foot bone fusion due to arthritis-related
conditions, avascular necrosis and/or joint instability, is not
intended for use in patients with bone infection, and is
contraindicated to local infection at the site of implantation.
The applicant also sought to clarify how, in comparison to the
device described in C1734 category, CERAMENT[supreg] G's mechanism of
action is unique. Commenters stated that CERAMENT[supreg] G's mechanism
of action is unique, in that it is the only approved bone void filler
that elutes antibiotics directly into the site of infection and bone.
Some commenters also noted that this unique mechanism of action allows
for single-stage procedures in the outpatient setting for a patient
with osteomyelitis compared to treatment that consists of six weeks or
more of intravenous antibiotics that can lead to adverse events such as
acute kidney injury and the development of multidrug resistant
bacteria. The applicant reiterated that CERAMENT[supreg] G's unique
mechanism of action is that it elutes gentamicin (the antimicrobial
agent) to protect against gentamicin-sensitive microorganisms.
Specifically, while both CERAMENT[supreg] G's and AUGMENT[supreg]'s
mechanisms of action include providing an osteoconductive scaffold for
new bone generation, CERAMENT[supreg] G also elutes gentamicin to
protect against microorganisms, which AUGMENT[supreg] does not. The
applicant further clarified that CERAMENT[supreg] G augments
provisional hardware to help support bone fragments during the surgical
procedure and acts only as a temporary support media and is not
intended to provide structural support during the healing process. One
commenter noted that having predictable and sustained release of
gentamicin with CERAMENT[supreg] G is a major differentiator which
contributes to successful clinical outcomes, and that CERAMENT[supreg]
G's antimicrobial property is important to protect bone healing and in
turn, prevent the recurrence of infection.
The applicant also asserted that CERAMENT[supreg] G can be
distinguished from the only device described in C1734, AUGMENT[supreg],
based on their associated treatment cases and procedures. The applicant
reiterated that CERAMENT[supreg] G's associated treatment cases are
those addressing patients with a bone infection, whereas
[[Page 81725]]
AUGMENT[supreg]'s associated treatment cases are those addressing
patients who require ankle and foot bone fusion. Further, the applicant
clarified that CERAMENT[supreg] G's associated procedures (CPT codes)
are in Musculoskeletal Procedure Levels 2, 3, and 4, which correspond
to APC 5112, 5113, and 5114. In contrast, the procedures indicated for
AUGMENT[supreg] are for Musculoskeletal Procedures Levels 5 and 6,
which correspond to APC 5115 and 5116. The applicant noted that this
results in distinct APC payment ranges for CERAMENT[supreg] G and
AUGMENT[supreg]. Specifically, based on the corresponding APC for each
device, the Medicare payment range for CERAMENT[supreg] G would be
$1,535.85 to $6,895.06, and for AUGMENT[supreg] it is $13,269.40 to
$20,692.25.
Response: We appreciate the input provided by these commenters. We
have taken this information into consideration in making our final
determination of whether to establish a new device category for
CERAMENT[supreg] G, discussed below.
Comment: Along with the applicant, commenters urged CMS to
establish a new device category that describes CERAMENT[supreg] G's
unique composition and mechanism of action. The applicant asserted that
CMS has set past precedent that would allow establishment of a new
device category to account for new-technology antimicrobial products.
For example, per the applicant, CMS has routinely recognized the
diversity of physician-administered drugs and biologicals within its
policy for granting transitional pass-through payment status and has
not lumped all drugs and biologicals into a single category. The
applicant asserted this unique antimicrobial composition and mechanism
of action of CERAMENT[supreg] G merits a new and different device
category than that described by C1734, and that a new category should
acknowledge the antimicrobial properties of CERAMENT[supreg] G. The
applicant urged CMS to exercise similar flexibility in evaluating
CERAMENT[supreg] G and to create a new device category to accurately
describe the new technology, in this case a new device/drug
antimicrobial technology.
Response: We appreciate the commenters' input. We agree with
commenters that CMS has a precedent of establishing new device
categories to account for new and innovative technologies not described
by existing device categories. While the evaluation of physician-
administered drugs and biologicals provided as an example by the
applicant is not applicable to our determination of whether to grant
transitional pass-through payment status for a particular device, we
nevertheless agree with the applicant and commenters that there are
circumstances where a new device category must be created because the
existing device categories do not describe a new technology.
After consideration of the public comments we received, we agree
there is no existing pass-through payment device category that
appropriately describes CERAMENT[supreg] G because no current category
appropriately describes bone void filler devices cleared or approved
for use for single stage surgical reconstruction of bone defects that
provide stability, promote bone formation, and support the surgical
treatment of infection by antibiotic elution antimicrobial agent. Based
on this information, we have determined that CERAMENT[supreg] G meets
the first eligibility criterion at Sec. 419.66(c)(1).
We received additional public comments regarding Sec. 419.66(c)(1)
that did not impact our decision on whether or not CERAMENT[supreg] G
meets the Sec. 419.66(c)(1) criterion, however we address these
comments below.
Comment: The applicant commented that antimicrobial products should
receive equal benefits in the outpatient setting as they do in the
inpatient setting. The applicant suggested that CMS should acknowledge
the importance of preventing antimicrobial resistance and promoting
antibiotic stewardship in the hospital outpatient setting by creating
new device categories for device pass-through payment that
differentiate antimicrobial products from non-antimicrobial products.
Specifically, the applicant proposed that CMS adopt an initiative
similar to the alternative technology add-on payment pathway for
Qualified Infectious Disease Products (QIDPs) established in the FY
2020 IPPS/LTCH PPS final rule.\19\ The applicant urged CMS to grant new
device categories to technologies that promote CMS goal of confronting
antimicrobial resistance, asserting that separating these technologies
acknowledges the fact that products with antimicrobial fighting
properties can be more expensive and ensures that companies are
adequately reimbursed for their products while avoiding excessive
reimbursement of less expensive non-antimicrobial devices.
---------------------------------------------------------------------------
\19\ We refer readers to the FY 2020 IPPS/LTCH PPS final rule
with comment period (84 FR 42294 through 42297) for a full
discussion of the Qualified Infectious Disease Products (QIDPs)
policy.
---------------------------------------------------------------------------
The applicant requested that CMS take the antimicrobial performance
of CERAMENT[supreg] G into account when considering approval of the
device pass-through payment application. Specifically, the applicant
further stated that the antimicrobial properties in CERAMENT[supreg] G
effectively reduce the recurrence of infection. Citing McNally et
al.,\20\ the applicant stated that mid- to long-term clinical outcomes
of CERAMENT[supreg] G in a single-stage protocol show high levels of
effectiveness where 94 percent of patients were infection-free after a
mean follow-up of 6.05 years, and that in patients with recurrent
infection, no cultures identified new resistance to gentamicin.
---------------------------------------------------------------------------
\20\ McNally, M.A., Ferguson, J.Y., Scarborough, M., Ramsden,
A., Stubbs, D.A., and Atkins, B.L. (2022) Mid- to long-term results
of single-stage surgery for patients with chronic osteomyelitis
using a bioabsorbable loaded ceramic carrier. The bone & joint
journal, 104.B(9), 1095-1100.
---------------------------------------------------------------------------
Response: We appreciate the commenters' feedback. Regarding the
request to develop an alternative pathway for device pass-through
payments for other special designations (other than those that are part
of the FDA's Breakthrough Device program and have received marketing
authorization for the indication covered by the Breakthrough Device
designation, as previously discussed), we recognize that the goal of
facilitating access to new technologies for Medicare beneficiaries
could also apply to other designations, and we will keep these
suggestions in mind for consideration in future rulemaking.
With respect to the applicant's request that CMS take the
antimicrobial performance of CERAMENT[supreg] G into account when
considering approval of the device pass-through payment application, we
appreciate the input provided by these commenters. We have taken this
information into consideration in making our final determination of
whether to establish a new device category for CERAMENT[supreg] G,
discussed below.
Comment: The applicant, and all commenters, asserted that without a
new device category, CERAMENT[supreg] G will not be accessible in the
outpatient setting because the reimbursement without a transitional
pass-through payment would not cover the cost of outpatient surgery
with CERAMENT[supreg] G. Specifically, the applicant reiterated the
information in their application that the average cost per case treated
with CERAMENT[supreg] G of $7,567 is much greater than the Medicare
payment rates for the assigned APCs. The applicant further asserted
that several doctors have expressed their concerns about being able to
access and provide
[[Page 81726]]
CERAMENT[supreg] G to patients in the hospital outpatient setting
without the additional transitional pass-through payment available to
supplement the existing APC payment rates. Commenters noted that access
to CERAMENT[supreg] G in the outpatient setting is in the interest of
Medicare beneficiaries to allow for outpatient surgeries that are
otherwise moved to inpatient care.
Response: We appreciate the commenters' feedback and acknowledge
the cost concerns related to the utilization of CERAMENT[supreg] G in
the outpatient setting. The third criterion for establishing a device
category at Sec. 419.66(c)(3), requires us to determine that the cost
of the device is not insignificant, as described in Sec. 419.66(d).
Section 419.66(d) includes three cost significance criteria that must
each be met. We address the cost of the CERAMENT[supreg] G and the cost
significance criteria below.
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines either of the following: (i)
that a device to be included in the category has demonstrated that it
will substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part compared to
the benefits of a device or devices in a previously established
category or other available treatment; or (ii) for devices for which
pass-through status will begin on or after January 1, 2020, as an
alternative to the substantial clinical improvement criterion, the
device is part of the FDA's Breakthrough Devices Program and has
received FDA marketing authorization for the indication covered by the
Breakthrough Device designation. CERAMENT[supreg] G has a Breakthrough
Device designation and marketing authorization from FDA for the
indication covered by the Breakthrough Device designation (as explained
in more detail in the discussion of the newness criterion) and
therefore appears to meet the criterion at Sec. 419.66(c)(2)(ii) and
is not evaluated for substantial clinical improvement.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. The applicant stated that CERAMENT[supreg] G
would be reported with HCPCS codes listed in Table 86.
BILLING CODE 4150-28-P
[[Page 81727]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.109
[[Page 81728]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.110
BILLING CODE 4150-28-C
To meet the cost criterion for device pass-through payment status,
a device must pass all three tests of the cost criterion for at least
one APC. As we explained in the CY 2005 OPPS final rule with comment
period (69 FR 65775), we generally use the lowest APC payment rate
applicable for use with the nominated device when we assess whether a
device meets the cost significance criterion, thus increasing the
probability the device will pass the cost significance test. For our
calculations, we used APC 5112, which had a CY 2022 payment rate of
$1,422.51 at the time the application was received. Beginning in CY
2017, we calculate the device offset amount at the HCPCS/CPT code level
instead of the APC level (81 FR 79657). HCPCS code 23035 had a device
offset amount of $217.36 at the time the application was received. We
noted that the applicant submitted cost information for two different
device sizes (5 ml and 10 ml) for CERAMENT[supreg] G. Per the
applicant, the average patient will require approximately 10 ml per
procedure, with a weighted cost of $7,567.00 per patient.
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $7,567.00 for CERAMENT[supreg] G is 531.95
percent of the applicable APC payment amount for the service related to
the category of devices of $1,422.51 (($7,567.00/$1,422.51) x 100 =
531.95 percent). Therefore, we stated that we believe CERAMENT[supreg]
G meets the first cost significance requirement.
The second cost significance requirement, at Sec. 419.66(d)(2),
provides that the estimated average reasonable cost of the devices in
the category must exceed the cost of the device-related portion of the
APC payment amount for the related service by at least 25 percent,
which means that the device cost needs to be at least 125 percent of
the offset amount (the device-related portion of the APC found on the
offset list). The estimated average reasonable cost of $7,567.00 for
CERAMENT[supreg] G is 3,481.32 percent of the cost of the device-
related portion of the APC payment amount for the related service of
$217.36 (($7,567.00/$217.36) x 100 = 3,481.32 percent). Therefore, we
stated that we believe CERAMENT[supreg] G meets the second cost
significance requirement.
The third cost significance requirement, at Sec. 419.66(d)(3),
provides that the difference between the estimated average reasonable
cost of the devices in the category and the portion of the APC payment
amount for the device must exceed 10 percent of the APC payment amount
for the related service. The difference between the estimated average
reasonable cost of $7,567.00 for CERAMENT[supreg] G and the portion of
the APC payment amount for the device of $217.36 is 516.67 percent of
the APC payment amount for the related service of $1,422.51
((($7,567.00
[[Page 81729]]
- $217.36)/$1,422.51) x 100 = 516.67 percent). Therefore, we stated
that we believe CERAMENT[supreg] G meets the third cost significance
requirement.
We invited public comment on whether the CERAMENT[supreg] G meets
the device pass-through payment criteria discussed in this section,
including the cost criterion for device pass-through payment status.
We did not receive public comments regarding whether
CERAMENT[supreg] G meets the cost criteria at Sec. 419.66(d)(1)
through (3). Based on the information we have received, we have
determined that CERAMENT[supreg] G meets the cost criterion for device
pass-through payment status.
After consideration of the public comments we received, and our
review of the device pass-through application, we have determined that
CERAMENT[supreg] G meets the requirements for device pass-through
status described at Sec. 419.66. As stated previously, devices that
are granted an FDA Breakthrough Device designation and have marketing
authorization for the indication covered by the Breakthrough Device
designation are not evaluated in terms of the current substantial
clinical improvement criterion at Sec. 419.66(c)(2)(i) for the
purposes of determining device pass-through payment status but must
meet the other criteria for device pass-through status. We believe
CERAMENT[supreg] G meets the criteria at Sec. 419.66, and therefore,
effective beginning January 1, 2024, we are finalizing approval for
device pass-through payment status for CERAMENT[supreg] G under the
alternative pathway for devices that have an FDA Breakthrough Device
designation and have received FDA marketing authorization for the
indication covered by the Breakthrough Device designation.
(2) Traditional Device Pass-Through Applications
(a) Ambu[supreg] aScope\TM\ 5 Broncho HD
Ambu Inc. submitted an application for a new device category for
transitional pass- through payment status for the Ambu[supreg]
aScope\TM\ 5 Broncho HD for CY 2024. Per the applicant, the
Ambu[supreg] aScope\TM\ 5 Broncho HD is one component of the
Ambu[supreg] aScope\TM\ 5 Broncho HD System which consists of: (1) the
Ambu[supreg] aScope\TM\ 5 Broncho HD (5.0/2.2 or 5.6/2.8), a sterile,
single-use, disposable flexible/rigid bronchoscope; and (2)
Ambu[supreg] aBox\TM\ 2, a compatible, reusable display unit. The
applicant is only seeking a new device category for transitional pass
through payment status for the Ambu[supreg] aScope\TM\ 5 Broncho HD
component.
Per the applicant, the Ambu[supreg] aScope\TM\ 5 Broncho HD,
consists of: (1) a handle, to hold the scope (designed for left or
right hand); (2) a control lever, to move the distal tip up or down in
a single plane; (3) a working channel and working channel port, for
instillation of fluids and insertion of endotherapy instruments; (4) a
biopsy valve, to be attached to the working channel port, for insertion
of endotherapy instruments or attachment of a syringe; (5) a suction
connector, for connection of suction tubing; (6) a suction button, to
activate suction when pressed; (7) endoscope buttons 1 and 2 (depending
on settings in display unit, the two remote switches allow for direct
activation on handle of four different functionalities such as image
and video capturing, initiate advanced red contrast (ARC), and zoom);
(8) a rotation control ring, for rotation of the insertion cord during
procedure; (9) a tube connection, for fixation of tubes with standard
connector during procedure; (10) an insertion cord and insertion
portion, flexible airway insertion cord; (11) bending section,
maneuverable part; (12) distal tip, which contains the camera, light
source (two light-emitting diodes (LEDs)), and the working channel
exit; (13) display unit connector, to connect to the port on the
Ambu[supreg] aBox\TM\ 2 display unit; (14) a cable, to transmit the
image signal to the Ambu[supreg] aBox\TM\ 2 display unit; (15) a
protective handle cover, to protect the control lever during transport
and storage; (16) a protective pipe, to protect the insertion cord
during transport and storage; and (17) an introducer, to facilitate
introduction of luer lock syringes.
The applicant stated that the Ambu[supreg] aScope\TM\ 5 Broncho HD
is an imaging/illumination bronchoscope device that uses an integrated
camera module and built-in dual LED illumination to provide access to,
and imaging of, the lungs for diagnostic and therapeutic purposes for
patients with pulmonary pathology. The device is intended for endoscopy
and endoscopic surgery within the lungs, also known as bronchoscopy.
According to the applicant, the Ambu[supreg] aScope\TM\ 5 Broncho HD
was designed to perform a wide array of diagnostic and interventional
pulmonology procedures. The applicant noted that the Ambu[supreg]
aScope\TM\ 5 Broncho HD is a single-use bronchoscope designed to be
used with the Ambu[supreg] aBox\TM\ 2 display unit, endotherapy
instruments and other ancillary equipment for bronchoscopic procedures,
and examination within the airways and the tracheobronchial tree. It is
intended to provide visualization via the compatible display unit, the
Ambu[supreg] aBox\TM\ 2, and to allow passage of endotherapy
instruments via its working channel.
Per the applicant, the Ambu[supreg] aScope\TM\ 5 Broncho HD
bronchoscope is inserted into the patient airway through either the
mouth, nose, or via a tracheostomy, if present. The applicant explained
that when the Ambu[supreg] aScope\TM\ 5 Broncho HD bronchoscope has
reached the correct position, endotherapy instruments can be inserted
into the working channel system of the bronchoscope. Per the applicant,
an introducer supplied with the bronchoscope can be attached to the
working channel port via a luer lock adaptor while the bronchoscope is
in use. The applicant noted that the suction system may be used to
remove blood, saliva, and mucus from the airway. The applicant
indicated that a bronchoscope operator monitors the field of view via
the integrated camera of the Ambu[supreg] aScope\TM\ 5 Broncho HD
bronchoscope and the procedure is finished when the device is pulled
out completely.
As stated previously, to be eligible for transitional pass-through
payment under the OPPS, a device must meet the criteria at Sec.
419.66(b)(1) through (4). With respect to the newness criterion at
Sec. 419.66(b)(1), on July 25, 2022, the applicant received 510(k)
clearance from FDA for the Ambu[supreg] aScope\TM\ 5 Broncho HD as a
device to be used for endoscopic procedures and examination within the
airways and tracheobronchial tree. We received the application for a
new device category for transitional pass-through payment status for
the Ambu[supreg] aScope\TM\ 5 Broncho HD on February 28, 2023, which is
within 3 years of the date of the initial FDA marketing authorization.
We invited public comment on whether the Ambu[supreg] aScope\TM\ 5
Broncho HD meets the newness criterion at Sec. 419.66(b)(1).
We did not receive public comments regarding whether the
Ambu[supreg] aScope\TM\ 5 Broncho HD meets the newness criterion at
Sec. 419.66(b)(1). We received the application for a new device
category for transitional pass-through payment status for Ambu[supreg]
aScope\TM\ 5 Broncho HD on February 28, 2023, which is within 3 years
of July 25, 2022, the date of FDA 510(k) approval to market the
Ambu[supreg] aScope\TM\ 5 Broncho HD, and as such we have concluded
that the Ambu[supreg] aScope\TM\ 5 Broncho HD meets the newness
criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
according to the
[[Page 81730]]
applicant, the Ambu[supreg] aScope\TM\ 5 Broncho HD is integral to the
service provided, is used for one patient only, comes in contact with
human tissue, and is surgically inserted as required by Sec.
4189.66(b)(3).
We invited public comment on whether the Ambu[supreg] aScope \TM\ 5
Broncho HD meets the criterion at Sec. 419.66(b)(3).
We did not receive any comments on whether the Ambu[supreg] aScope
\TM\ 5 Broncho HD meets the eligibility criteria at Sec. 419.66(b)(3).
Based on the information we have received and our review of the
application, we agree with the applicant that Ambu[supreg] aScope \TM\
5 Broncho HD is integral to the service provided, used for one patient
only, comes in contact with human tissue, and is surgically implanted
or inserted. Therefore, we have determined that Ambu[supreg] aScope
\TM\ 5 Broncho HD meets the eligibility criterion at Sec.
419.66(b)(3).
With respect to the exclusion criterion at Sec. 419.66(b)(4), the
applicant did not address whether the Ambu[supreg] aScope \TM\ 5
Broncho HD is equipment, an instrument, apparatus, implement, or item
of this type for which depreciation and financing expenses are
recovered, or if the Ambu[supreg] aScope \TM\ 5 Broncho HD is a supply
or material furnished incident to a service.
We invited public comment on whether the Ambu[supreg] aScope\TM\ 5
Broncho HD meets the exclusion criterion at Sec. 419.66(b)(4).
Comment: The applicant asserted that the Ambu[supreg] aScope\TM\ 5
Broncho HD meets the eligibility requirements at Sec. 419.66(b)(4).
The applicant clarified that the device is not equipment, an
instrument, apparatus, implement, or item for which depreciation and
financing are recovered. The applicant indicated that the device is not
a material or supply furnished incident to a service. The applicant
stated that the device is purely an operating cost and is not subject
to capitalization or a depreciation schedule.
Response: We appreciate the applicant's input. Based on the
information we have received and our review of the application, we
agree with the applicant that the Ambu[supreg] aScope\TM\ 5 Broncho HD
meets the device eligibility requirements of Sec. 419.66(b)(4) because
it is not a piece of equipment, instrument, apparatus, implement, or
item for which depreciation and financing expenses are recovered, and
it is not a supply or material furnished incident to a service.
Therefore, we have determined that the Ambu[supreg] aScope\TM\ 5
Broncho HD meets the eligibility criterion at Sec. 419.66 (b)(4).
In addition to the criteria at Sec. 419.66(b)(1) through (4), the
criteria for establishing new device categories are specified at Sec.
419.66(c). The first criterion, at Sec. 419.66(c)(1), provides that
CMS determines that a device to be included in the category is not
appropriately described by any of the existing categories or by any
category previously in effect, and was not being paid for as an
outpatient service as of December 31, 1996. The applicant described the
Ambu[supreg] aScope\TM\ 5 Broncho HD as a single-use, disposable,
digital flexible/rigid bronchoscope that is used in pulmonary
procedures (bronchoscopy) to diagnose and treat conditions of the
lungs, including tumors or bronchial cancer, airway blockage
(obstruction), narrowed areas in airways (strictures), inflammation,
and infections such as tuberculosis (TB), pneumonia, fungal or
parasitic lung infections, interstitial pulmonary disease, causes of
persistent cough, causes of coughing up blood, spots seen on chest X-
rays, and vocal cord paralysis. The applicant claimed that the
Ambu[supreg] aScope\TM\ 5 Broncho HD is different from other endoscopes
because it is a single-use endoscope indicated for use in the
respiratory system, the device records snapshots or video of images,
and the device is temporarily inserted into the patient airway to
diagnose and treat lung problems. According to the applicant, there are
two possible existing pass-through device categories, represented by
the following codes: C1748 (Endoscope, single-use (that is,
disposable), upper gastrointestinal tract (GI), imaging/illumination
device (insertable)); and C1747 (Endoscope, single-use (that is,
disposable), urinary tract, imaging/illumination device (insertable)).
The applicant noted that while these two codes are for single-use
endoscopic devices, they are only appropriate for GI and urinary tract
imaging, respectively. Therefore, the applicant asserted that these two
codes would not apply to a single-use, disposable, bronchoscope for use
in pulmonary procedures. We noted that while C1748 and C1747 are
intended to be used in different anatomical areas of the patient, the
codes for both device categories describe devices that are single use
and have imaging capabilities.
We invited public comment on whether the Ambu[supreg] aScope\TM\ 5
Broncho HD meets the device category criterion at Sec. 419.66(c)(1).
Comment: The applicant reiterated that the device is not
appropriately described by any existing device categories. The
applicant noted that although HCPCS codes C1747 and C1748 do describe
single-use endoscopes and have imaging capabilities, they are intended
to be used in different anatomical areas, specifically the urinary
tract and the upper GI tract, respectively. The applicant asserted that
the device is used in pulmonary procedures and meets the device
category criterion. Another commenter referenced an FDA guidance \21\
on the 510(k) Program issued on July 28, 2014, to support the
applicant's assertion by stating that the device was cleared for
marketing under 21 CFR 874.4680, and therefore the device cannot be
legally labeled for use or otherwise promoted for GI/urology use.
---------------------------------------------------------------------------
\21\ FDA Guidance July 28, 2014. ``The 510(k) Program:
Evaluating Substantial Equivalence in Premarket Notification
[510(k)]: Guidance for Industry and Food and Drug Administration
Staff''.
---------------------------------------------------------------------------
Response: We appreciate the applicant and commenter's input. Based
on the information we have received and our review of the application,
we agree there is no existing pass-through payment category that
appropriately describes the Ambu[supreg] aScope\TM\ 5 Broncho HD
because no current or previously in effect category describes a single-
use endoscope indicated for use in the respiratory system. Based on
this information, we have determined that the Ambu[supreg] aScope\TM\ 5
Broncho HD meets the eligibility criterion at Sec. 419.66(c)(1).
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines either of the following: (i)
that a device to be included in the category has demonstrated that it
will substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part compared to
the benefits of a device or devices in a previously established
category or other available treatment; or (ii) for devices for which
pass-through status will begin on or after January 1, 2020, as an
alternative to the substantial clinical improvement criterion, the
device is part of the FDA's Breakthrough Devices Program and has
received FDA marketing authorization for the indication covered by the
Breakthrough Device designation. The applicant claimed that the
Ambu[supreg] aScope\TM\ 5 Broncho HD represents a substantial clinical
improvement over existing technologies by: (1) eliminating complex
cleaning/reprocessing procedures, (2) reducing microbial transmission
and infection since it is single-use, (3) eliminating the need for
continuous training of reprocessing staff, (4) minimizing the risk of
patient
[[Page 81731]]
cross-contamination, (5) assuring that a sterilized scope will be used
each time, and (6) assuring that there will be no biofilm from
endoscope channels. The applicant provided four articles, an FDA
guidance letter, and an FDA safety notice specifically for the purpose
of addressing the substantial clinical improvement criterion.
In support of its claim that the use of the Ambu[supreg] aScope\TM\
5 Broncho HD eliminates complex cleaning/reprocessing procedures
because it is a single-use device, the applicant referenced an FDA
Reprocessing Final Guidance document \22\ issued March 17, 2015. This
FDA document provides guidance to medical device manufacturers on the
complex activities involved in crafting and validating reprocessing
instructions that ensure that the device can be used safely and for the
purpose for which it is intended. The guidance document is limited to
reusable medical devices and single-use medical devices that are
initially supplied as non-sterile to the user and require the user to
process the device prior to its use. In this guidance document, the FDA
identifies a subset of reusable medical devices (including
bronchoscopes and accessories) that pose a greater likelihood of
microbial transmission and represent a high risk of infection
(subclinical or clinical) if they are not adequately reprocessed and
indicates design features which may pose a challenge to adequate
reprocessing for arthroscopes, laparoscopic instruments, and
electrosurgical instruments, and their respective accessories. However,
the FDA guidance does not mention sterile, single-use medical devices
in this document.
---------------------------------------------------------------------------
\22\ FDA Guidance March 17, 2015. ``Reprocessing Medical Devices
in Health Care Settings: Validation Methods and Labeling: Guidance
for Industry and Food and Drug Administration Staff''. https://www.fda.gov/downloads/medicaldevices/deviceregulationandguidance/guidancedocuments/ucm253010.pdf.
---------------------------------------------------------------------------
In support of its claim that the use of the Ambu[supreg] aScope\TM\
5 Broncho HD reduces microbial transmission and infection because it is
single use, the applicant referenced an FDA safety notice \23\ issued
on September 17, 2015 (2015 FDA safety notice). The FDA notice
discussed the findings of an investigation into infections associated
with reprocessed reusable medical devices, including an analysis of
Medical Device Reports (MDRs) submitted to FDA from manufacturers and
health care facilities. The notice provided that between January 2010
and June 2015, FDA received 109 MDRs concerning infections or device
contamination associated with flexible bronchoscopes. However, FDA
noted that, when compared to the number of bronchoscopy procedures
performed in the U.S. each year, this is considered a small number of
MDRs. In 2014, FDA received 50 MDRs that mentioned infections or device
contamination associated with reprocessed flexible bronchoscopes, which
prompted additional investigation of this issue. FDA indicated that a
small number of the reported infections were from persistent device
contamination despite following the manufacturer's reprocessing
instructions, however, most of the infections were the result of the
failure to meticulously follow manufacturer instructions for
reprocessing, or the continued use of devices despite integrity,
maintenance, and mechanical issues. FDA provided additional
recommendations for health care facilities and staff that reprocess
flexible bronchoscopes, and for patients considering bronchoscopy
procedures, but did not reference single-use bronchoscopes in the
notice.
---------------------------------------------------------------------------
\23\ FDA Safety Communications, Infections Associated with
Reprocessed Flexible Bronchoscopes: FDA Safety Communication, issued
September 17, 2015. https://www.fdanews.com/ext/resources/files/09-15/092115-safety-notice.pdf?1442508647.
---------------------------------------------------------------------------
In support of its claim that the use of the Ambu[supreg] aScope\TM\
5 Broncho HD eliminates the need for continuous training of
reprocessing staff, the applicant referenced a study by
Ch[acirc]teauvieux et al.,\24\ which assessed the organizational and
economic impacts of the introduction of a single[hyphen]use flexible
bronchoscope (FB) (Ambu[supreg] aScopeTM, versions 2 and 3)
in comparison with a reusable FB (Pentax[supreg]) at the hospital
level. The study took place between May 2016 and October 2016 in the
Georges Pompidou European Hospital, an 800-bed university hospital in
France. Ch[acirc]teauvieux et al. noted that the introduction of
single-use FBs led to a more simplified process, less stress for
medical and paramedical staff in emergency situations, teaching
benefits, and easier management of transport, in comparison with
reusable FBs. However, the authors recommended limiting the use of
single use FBs to specific situations, and to prioritize the use of
reusable devices for most of the bronchoscopies for cost savings.
---------------------------------------------------------------------------
\24\ Ch[acirc]teauvieux, C., Farah, L., Gu[eacute]rot, E.,
Wermert, D., Pineau, J., Prognon, P., Borget, I., & Martelli, N.
(2018). Single-use flexible bronchoscopes compared with reusable
bronchoscopes: Positive organizational impact but a costly solution.
Journal of evaluation in clinical practice, 24(3), 528-535. https://doi.org/10.1111/jep.12904.
---------------------------------------------------------------------------
The applicant referred to a meta study by Barron and Kennedy \25\
to support its claim that the use of Ambu[supreg] aScope\TM\ 5 Broncho
HD minimizes the risk of patient cross-contamination, ensuring that
health care providers have taken optimal steps to safeguard their
patients. Barron and Kennedy summarized the major advantages of single-
use FBs over the standard reusable FBs in clinical scenarios. The
authors noted that single-use FBs offer a safer alternative to standard
reusable FBs in specific scenarios where reduced risk of cross
infection was critical in the immunocompromised patient and in rare
cases of prior contamination due to transmissible spongiform
encephalopathies.
---------------------------------------------------------------------------
\25\ Barron, S.P., & Kennedy, M.P. (2020). Single-use
(disposable) flexible bronchoscopes: the future of bronchoscopy?
Advances in therapy, 37(11), 4538-4548. https://doi.org/10.1007/s12325-020-01495-8.
---------------------------------------------------------------------------
The applicant referred to a self-sponsored study \26\ by Ofstead et
al.\27\ in 2019, in support of its claim that the use of the
Ambu[supreg] aScope\TM\ 5 Broncho HD ensures a sterilized scope is
available for each procedure while reusable endoscopes may not be
sterile even if manufacturers' cleaning protocols are followed. The
study first referenced Ofstead et al.'s 2017 \28\ evaluation of the
effectiveness of bronchoscope processing in three large hospitals where
every bronchoscope had visible defects, protein was detected on 100
percent of high-level disinfected bronchoscopes, and bacteria or mold
was found on 58 percent of the patient-ready bronchoscopes. Then, in
2019, Ofstead et al. conducted a study to determine the time and cost
of acquiring, maintaining, and reprocessing bronchoscopes in four
hospitals (two in the Midwest and two in the West Coast). Three
hospitals had obtained single-use Ambu[supreg] bronchoscopes (2018,
version unspecified) for procedures done in certain departments, after
hours, or in emergency situations. Per Ofstead et al.
[[Page 81732]]
(2019), the cost for procedures with reusable bronchoscopes ($281 to
$803) were comparable or higher than the cost of single-use
bronchoscopes ($220 to $315), due to acquisition and maintenance of
large inventories of bronchoscopes to ensure real-time availability for
various hospital departments. Ofstead et al. (2019) suggested the use
of single-use bronchoscopes and accessories for after hours and
emergency situations and any procedures that do not require advanced
bronchoscopy capabilities. Ofstead et al. (2019) summarized the steps
that can be taken to reduce risks related to bronchoscope contamination
and to focus on implementing quality management systems to improve
personnel competence, bronchoscope inventory management, maintenance,
reprocessing effectiveness, and storage. In addition to following
manufacturer's steps for reprocessing the devices, Ofstead et al.
(2019) suggest the use of single-use bronchoscopes and accessories for
after hours and emergency situations and any procedures that do not
require advanced bronchoscopy capabilities, which are currently
available in the list of recommendations.
---------------------------------------------------------------------------
\26\ Ofstead et al. acknowledged that this study was supported
by an unrestricted research grant from Ambu Inc. The study sponsor
did not participate in designing the study, identifying sites,
collecting data, compiling results, interpreting the findings, or
writing this article.
\27\ Ofstead, C.L., Hopkins, K.M., Eiland, J.E., & Wetzler, H.P.
Managing bronchoscope quality and cost: results of a real-world
study. https://www.ambu.com/Files/Files/Ambu/Investor/News/English/2019/Managing%20Bronchoscope%20cost%20a%20real%20world%20study.pdf.
\28\ Ofstead C.L., Quick M.R., Wetzler H.P., et al. (2018)
Effectiveness of reprocessing for flexible bronchoscopes and
endobronchial ultrasound bronchoscopes. Chest, 154(5):1024-34.
---------------------------------------------------------------------------
The applicant referenced a review article by Kovaleva et al.\29\ in
support of its claim that the Ambu[supreg] aScope\TM\ 5 Broncho HD's
single-use feature is free of biofilm from endoscope channels since
routine cleaning procedures do not remove biofilm reliably from
endoscope channels. This review presents an overview of the infections
and cross-contaminations related to flexible gastrointestinal endoscopy
and bronchoscopy and illustrates the impact of biofilm on endoscope
reprocessing and post-endoscopic infection. Kovaleva et al. noted that
the use of antibiofilm-oxidizing agents with an antimicrobial coating
inside washer disinfectors could reduce biofilm build-up inside
endoscopes and automated endoscope re-processors and decrease the risk
of transmitting infections.\30\ Per Kovaleva et al. while sterilization
can be helpful to destroy microorganisms within biofilms, ethylene
oxide sterilization may fail in the presence of organic debris after an
inadequate cleaning procedure before reprocessing of flexible
endoscopes. There was no mention of single-use bronchoscopes in the
study.
---------------------------------------------------------------------------
\29\ Kovaleva, J., Peters, F.T., van der Mei, H.C., & Degener,
J.E. (2013). Transmission of infection by flexible gastrointestinal
endoscopy and bronchoscopy. Clinical microbiology reviews, 26(2),
231-254. https://doi.org/10.1128/CMR.00085-12.
\30\ Ibid.
---------------------------------------------------------------------------
The applicant cited a self-sponsored, laboratory study by Kurman et
al.,\31\ in general support of its application. Kurman et al. evaluated
and assessed four different manufacturers' single-use flexible
bronchoscopes (SFB), including the nominated device and its prior
model, against their reusable flexible bronchoscopes (RFB) on a cadaver
(that is, corpse) model, benchtop fixturing, and an artificial plastic
lung model. The study compared the Ambu[supreg] aScope\TM\ 5 Broncho HD
with four devices: (1) Olympus H-SteriScope; (2) Verathon BFLEX; (3)
Boston Scientific Exalt-B; and (4) Ambu[supreg] aScopeTM 4
Broncho (the prior model of the nominated device). The study concluded
that the Ambu[supreg] aScope\TM\ 5 Broncho HD has the highest overall
performance, the highest overall rating for sampling, and highest
maneuverability in difficult segmental airways among the comparator
devices.
---------------------------------------------------------------------------
\31\ Kurman, J., Wagh, A., Benn, B., & Islam, S., (2023). A
comparison of single-use bronchoscopes and reusable bronchoscopes
for interventional pulmonology applications. Confidential. Ambu
Inc., funded evaluation and testing.
---------------------------------------------------------------------------
The applicant indicated that the Ambu[supreg] aScope\TM\ 5 Broncho
HD differs from these comparator devices as it is the only device that
is compatible with argon gas plasma coagulation, cryotherapy, and
laser, with an HD (1200x800) chip, has more degrees of articulation
with tools, and provides image and video capture from the scope handle
with multiple programmable functions including capture photo, start/end
video, enable zoom, and initiate ARC. In addition, the applicant stated
that the nominated device is superior to its earlier legally marketed
device in terms of maneuverability into difficult segmental airways,
overall performance, and overall sampling assessment. The applicant
asserted that the nominated device differs from the predicate device
due to a rotation mechanism on the handle and its superior
articulation, which allow for more complicated procedures to be
performed such as cryotherapy and coagulation. The applicant stated
that the nominated device is equipped with an HD image chip and
increased depth-of-field and field-of-view, which allow interventional
pulmonologists to perform inspections, biopsies, and debulking. The
applicant also stated that the nominated device's programmable buttons
allow for superior documentation than the earlier bronchoscope device.
We noted that the nominated device was determined to be
substantially equivalent to the earlier device that the applicant had
previously legally marketed. The FDA 510(k) summary indicated that both
devices share similar technological characteristics including the
optical system, bending section, diameter of insertion cord and distal
end, and insertion portion length. Furthermore, the 510(k) summary
indicated that both have the same technical characteristics, which
include a maneuverable tip controlled by the user, flexible insertion
cord, camera and a LED light source at the distal tip. Both are
sterilized by ethylene oxide, are single-use devices, and have the
ability to aspirate and collect samples in bronchoalveolar lavage and
bronchial wash procedures.
We noted that in its application, the applicant provided a
comparison of certain devices or device categories that it believed are
most closely related or similar to the Ambu[supreg] aScope\TM\ 5
Broncho HD. The applicant identified six reusable devices that it
believed are most closely related: (1) Olympus Evis Exera Iii
Bronchovideoscope Bf-h190; (2) Pentax EB-J10 Video Bronchoscope; (3)
Fujifilm EB-580S Video Bronchoscope; (4) Olympus BF-Q190; (5) Olympus
BF-1TH190; and (6) Olympus BF-XT190. According to the applicant, these
devices are used during the same specific procedure(s) and/or services
with which the Ambu[supreg] aScope\TM\ 5 Broncho HD is used. The
applicant stated that the Ambu[supreg] aScope\TM\ 5 Broncho HD's
single-use feature is unique among the comparators. According to the
applicant, the single-use feature eliminates bronchoscope reprocessing.
The applicant further submitted several articles reporting results on
the prevalence of infection due to incomplete or inadequate processing
for reusable bronchoscopes, which we summarize as follows. An article
by Shimizu et al.\32\ concluded that patients with larger lesions,
endobronchial lesions, histology of small-cell lung cancer, and
advanced-disease stage tended to develop pulmonary infectious
complications more often than other patients. A 2020 systematic
literature review and meta-analysis by Travis et al.\33\ reported an
estimated average reusable FB cross-contamination rate of 8.69 percent
1.86 (standard division [SD]) (95 percent confidence
interval [CI]: 5.06-12.33 percent) among eight
[[Page 81733]]
studies from the U.S. and four European countries. Travis et al.\34\
attributed the infection rate to the differences in the study design
and sampling methods, geography, low number of data points, clinical
settings, and an aversion towards publishing negative findings among
the eight studies. Furthermore, the applicant submitted a 2019
systematic review and cost-effective analysis by Mouritsen et al.,\35\
which reported an average 2.8 percent cross-contamination rate from
reusable, flexible bronchoscopes among 16 studies from the United
Kingdom, U.S., France, Spain, Australia, and Taiwan. Mouristen et al.
identified that the single-use flexible bronchoscopes were cost
effective and associated with a reduction of infection risk of
approximately 1.71-4.07 percent compared with reusable flexible
bronchoscopes. Lastly, the applicant again cited the meta study by
Barron and Kennedy \36\ referencing the findings from Ofstead et
al.,\37\ the review by Mouristen et al., and the Emergency Care
Research Institute's (ECRI's) report.\38\ Of note, ECRI highlighted the
recontamination of flexible endoscopes due to mishandling or improper
storage as one of the top 10 health technology hazards.
---------------------------------------------------------------------------
\32\ Shimizu, T., Okachi, S., Imai, N., Hase, T., Morise, M.,
Hashimoto, N., Sato, M., & Hasegawa, Y. (2020). Risk factors for
pulmonary infection after diagnostic bronchoscopy in patients with
lung cancer. Nagoya journal of medical science, 82(1), 69-77.
https://doi.org/10.18999/nagjms.82.1.69.
\33\ Travis, H.S., Russell, R.V., & Kovaleva, J. (2023). Cross-
contamination rate of reusable flexible bronchoscopes: A systematic
literature review and meta-analysis. Journal of infection
prevention, 17571774231158203.
\34\ Ibid.
\35\ Mouritsen, J.M., Ehlers, L., Kovaleva, J., Ahmad, I., & El-
Boghdadly, K. (2020). A systematic review and cost effectiveness
analysis of reusable vs. single-use flexible bronchoscopes.
Anaesthesia, 75(4), 529-540.
\36\ Barron, S.P., & Kennedy, M.P. (2020). Single-use
(disposable) flexible bronchoscopes: the future of bronchoscopy?
Advances in therapy, 37(11), 4538-4548. https://doi.org/10.1007/s12325-020-01495-8.
\37\ Ofstead C.L., Quick M.R., Wetzler H.P., et al. (2018)
Effectiveness of reprocessing for flexible bronchoscopes and
endobronchial ultrasound bronchoscopes. Chest, 154(5):1024-34.
\38\ ECRI. Top 10 health technology hazards. Executive brief.
Pennsylvania: ECRI Institute, Health devices; 2019. p. 2019.
---------------------------------------------------------------------------
Based on the evidence submitted with the application, we noted the
following concerns: We noted concern about whether the Ambu[supreg]
aScope\TM\ 5 Broncho HD can be distinguished from similar devices on
the market and the earlier versions of the nominated device on the
market sufficiently to demonstrate substantial clinical improvement.
Four of the studies the applicant submitted, Ch[acirc]teauvieux et
al.,\39\ Barron and Kennedy, Kurman et al., and Ofstead et al.,
investigated and provided data on the applicant's earlier models of the
device, but did not provide comparisons to the nominated device. In
addition, we noted that the studies provided also did not compare the
nominated device to an appropriate comparator such as a single-use
bronchoscope from a different manufacturer or a standard reusable
bronchoscope, in a clinical setting. In addition, we noted that the
applicant's self-sponsored study by Kurman, et al. was conducted in the
laboratory (that is, on cadaver, benchtop fixturing, and artificial
plastic lung) and not in the clinical setting. In order to demonstrate
substantial clinical improvement over currently available treatments,
we consider supporting evidence, preferably published peer-reviewed
clinical trials, that shows improved clinical outcomes, such as
reduction in mortality, complications, subsequent interventions, future
hospitalizations, recovery time, pain, or a more rapid beneficial
resolution of the disease process compared to the standard of care.
---------------------------------------------------------------------------
\39\ Ch[acirc]teauvieux, C., Farah, L., Gu[eacute]rot, E.,
Wermert, D., Pineau, J., Prognon, P., Borget, I., & Martelli, N.
(2018). Single-use flexible bronchoscopes compared with reusable
bronchoscopes: Positive organizational impact but a costly solution.
Journal of evaluation in clinical practice, 24(3), 528-535. https://doi.org/10.1111/jep.12904.
---------------------------------------------------------------------------
Furthermore, we noted that the Ch[acirc]teauvieux et al.\40\ and
Barron and Kennedy \41\ studies suggested limiting the use of single-
use bronchoscope device to specific situations (that is, after hours or
emergency), immunocompromised patients, and in rare cases of preventing
prior contamination in the inpatient setting. We believed that further
investigation with comparators in these specified cases would be
particularly helpful to determine whether the device demonstrates a
substantial clinical improvement over currently available treatment
options in the clinical setting where it is most likely to be used.
---------------------------------------------------------------------------
\40\ Ibid.
\41\ Barron, S.P., & Kennedy, M.P. (2020). Single-use
(disposable) flexible bronchoscopes: the future of bronchoscopy?
Advances in therapy, 37(11), 4538-4548. https://doi.org/10.1007/s12325-020-01495-8.
---------------------------------------------------------------------------
We noted concern that the application and all the articles
submitted as evidence of substantial clinical improvement discuss
potential adverse events from reusable bronchoscope procedures, but do
not directly show any clinical improvement that results from the use of
the Ambu[supreg] aScope\TM\ 5 Broncho HD. We noted that Shimizu et
al.,\42\ Travis et al.,\43\ Barron and Kennedy,\44\ and Ofstead et
al.\45\ provided information about the risks associated with
reprocessing reusable devices and reported mixed results.
---------------------------------------------------------------------------
\42\ Shimizu, T., Okachi, S., Imai, N., Hase, T., Morise, M.,
Hashimoto, N., Sato, M., & Hasegawa, Y. (2020). Risk factors for
pulmonary infection after diagnostic bronchoscopy in patients with
lung cancer. Nagoya journal of medical science, 82(1), 69-77.
https://doi.org/10.18999/nagjms.82.1.69.
\43\ Travis, H.S., Russell, R.V., & Kovaleva, J. (2023). Cross-
contamination rate of reusable flexible bronchoscopes: A systematic
literature review and meta-analysis. Journal of infection
prevention, 17571774231158203.
\44\ Barron, S.P., & Kennedy, M.P. (2020). Single-use
(disposable) flexible bronchoscopes: the future of bronchoscopy?
Advances in therapy, 37(11), 4538-4548. https://doi.org/10.1007/s12325-020-01495-8.
\45\ Ofstead, C.L., Hopkins, K.M., Eiland, J.E., & Wetzler, H.P.
Managing bronchoscope quality and cost: results of a real-world
study. https://www.ambu.com/Files/Files/Ambu/Investor/News/English/2019/Managing%20Bronchoscope%20cost%20a%20real%20world%20study.pdf.
---------------------------------------------------------------------------
We also noted that the 2015 FDA safety notice \46\ provided
preliminary information regarding infections associated with the use of
reprocessed flexible bronchoscopes, but did not discuss or recommend
the use of disposable, single-use devices in the notice. Furthermore,
we noted the following concerns about studies on the prevalence of
infection due to incomplete/inadequate reprocessing of reusable
bronchoscopes. The studies authored by Ch[acirc]teauvieux et al.,\47\
Shimizu et al.,\48\ Travis et al.,\49\ and Mouritsen et al.\50\ have
small sample sizes. Furthermore, the Barron and Kennedy,\51\ Travis et
al.,\52\ and Mouritsen et al.\53\ studies used different
[[Page 81734]]
study designs and sampling methodologies or were performed in various
clinical settings other than outpatient, which may affect the quality
and reliability of the data provided in support of the applicant's
assertions. We did not believe that we had sufficient information on
the prevalence of infection to evaluate the applicant's substantial
clinical improvement claims for the nominated device. We sought
comments on the prevalence of infection due to incomplete/inadequate
processing for bronchoscopes in the U.S. and whether single-use
bronchoscopes reduce the infection rate in patients to identify the
extent of the problem with existing technologies.
---------------------------------------------------------------------------
\46\ FDA Safety Communications, Infections Associated with
Reprocessed Flexible Bronchoscopes: FDA Safety Communication, issued
September 17, 2015. https://www.fdanews.com/ext/resources/files/09-15/092115-safety-notice.pdf?1442508647.
\47\ Ch[acirc]teauvieux, C., Farah, L., Gu[eacute]rot, E.,
Wermert, D., Pineau, J., Prognon, P., Borget, I., & Martelli, N.
(2018). Single-use flexible bronchoscopes compared with reusable
bronchoscopes: Positive organizational impact but a costly solution.
Journal of evaluation in clinical practice, 24(3), 528-535. https://doi.org/10.1111/jep.12904.
\48\ Shimizu, T., Okachi, S., Imai, N., Hase, T., Morise, M.,
Hashimoto, N., Sato, M., & Hasegawa, Y. (2020). Risk factors for
pulmonary infection after diagnostic bronchoscopy in patients with
lung cancer. Nagoya journal of medical science, 82(1), 69-77.
https://doi.org/10.18999/nagjms.82.1.69.
\49\ Travis, H.S., Russell, R.V., & Kovaleva, J. (2023). Cross-
contamination rate of reusable flexible bronchoscopes: A systematic
literature review and meta-analysis. Journal of Infection
Prevention, 17571774231158203.
\50\ Mouritsen, J.M., Ehlers, L., Kovaleva, J., Ahmad, I., & El-
Boghdadly, K. (2020). A systematic review and cost effectiveness
analysis of reusable vs. single-use flexible bronchoscopes.
Anaesthesia, 75(4), 529-540.
\51\ Barron, S.P., & Kennedy, M.P. (2020). Single-use
(disposable) flexible bronchoscopes: the future of bronchoscopy?
Advances in therapy, 37(11), 4538-4548. https://doi.org/10.1007/s12325-020-01495-8.
\52\ Travis, H.S., Russell, R.V., & Kovaleva, J. (2023). Cross-
contamination rate of reusable flexible bronchoscopes: A systematic
literature review and meta-analysis. Journal of Infection
Prevention, 17571774231158203.
\53\ Mouritsen, J.M., Ehlers, L., Kovaleva, J., Ahmad, I., & El-
Boghdadly, K. (2020). A systematic review and cost effectiveness
analysis of reusable vs. single-use flexible bronchoscopes.
Anaesthesia, 75(4), 529-540.
---------------------------------------------------------------------------
The applicant provided evidence which seemed to rely on indirect
inferences from other sources of data. We questioned the relevance of
the 2015 FDA safety notice \54\ to the nominated device because as
stated above, the guidance applies to reprocessed flexible
bronchoscopes broadly, but not to disposable, single-use devices
comparable to the nominated device. We expressed concern that many of
the applicant's substantial clinical improvement claims rely on an
assumption that inadequate reprocessing of reusable bronchoscopes is
positively correlated with heightened risk of infection. We expressed
concern that the applicant provided studies with small sample sizes and
other limitations, as described above, as their only support. We noted
that the applicant provided background information on the established
reprocessing guidelines \55\ for reusable devices; however, the
existence of reprocessing guidelines does not provide evidence on the
prevalence of infection rates, establish a relationship between
infection risk and reprocessing procedures, or substantiate that
single-use disposable scopes, or the nominated device specifically,
would be a substantial clinical improvement over currently available
treatments.
---------------------------------------------------------------------------
\54\ FDA Safety Communications, Infections Associated with
Reprocessed Flexible Bronchoscopes: FDA Safety Communication, issued
September 17, 2015. https://www.fdanews.com/ext/resources/files/09-15/092115-safety-notice.pdf?1442508647.
\55\ FDA Guidance March 17, 2015 ``Reprocessing Medical Devices
in Health Care Settings: Validation Methods and Labeling: Guidance
for Industry and Food and Drug Administration Staff''.
---------------------------------------------------------------------------
We invited public comment on whether the Ambu[supreg] aScope\TM\ 5
Broncho HD meets the substantial clinical improvement criterion at
Sec. 419.66(c)(2)(i).
Comment: The applicant and several commenters responded to our
concern about whether the Ambu[supreg] aScopeTM 5 Broncho HD could be
distinguished from similar devices on the market and the earlier
versions of the nominated device on the market sufficiently to
demonstrate substantial clinical improvement and that four of the
studies the applicant submitted, Ch[acirc]teauvieux et al., Barron and
Kennedy, Kurman et al.,\56\ and Ofstead et al., investigated and
provided data on the applicant's earlier models of the device, but did
not provide comparisons to the nominated device. The applicant and
commenters provided feedback that Ambu[supreg] aScope\TM\ 5 Broncho HD
improves clinical applications and reduces cross-contamination compared
to other single-use and reusable bronchoscopes, including its predicate
device. Several commenters stated that the device can perform advanced
bronchoscopy procedures, without concern for contamination, infection,
and scope damage. One commenter stated that they have witnessed the
usage of this bronchoscope for advanced procedures without incident,
noting that it is the preferred device in their clinical practice for
valve placement, rigid bronchoscopy, and all cases outside of the
endoscopy suite. Another commenter noted that reusable bronchoscopes
have a complex design with variable disinfection/sterilization
requirements which leads to issues with reprocessing. Multiple
commenters stated that single-use bronchoscopes create an assurance
that a sterilized scope will be used each time, reduce the risk of
patient cross-contamination in the ICUs, and allow improved patient
access and room turnover compared with reusable scopes. One commenter
asserted that the nominated device is superior to other devices in
specific patient populations needing interventional pulmonology
procedures.
---------------------------------------------------------------------------
\56\ Kurman, J., Wagh, A., Benn, B., & Islam, S. (2023). A
comparison of single-use bronchoscopes and reusable bronchoscopes
for interventional pulmonology applications. Confidential. Ambu
Inc., funded evaluation and testing.
---------------------------------------------------------------------------
Commenters cited personal experience with Ambu[supreg] aScope\TM\ 5
Broncho HD, asserting that transitioning to the nominated device
several months ago has eliminated iatrogenic bronchoscopy-related
transmission of infection in their health care facility and
Ambu[supreg] aScope\TM\ 5 Broncho HD has directly led to clinical
improvement in cases of endobronchial valve insertion in their
facility, as more patients can be treated with endobronchial valve
insertion for bronchoscopic lung volume reduction. The applicant
provided that after being commercially available for one year in
Europe, the USA, Canada, Australia, New Zealand, and Japan, they
observed that more than 80 percent of users have adopted the nominated
device into their bronchoscopy suites for advanced procedures,
including but not limited to tumor debulking, endobronchial valve
placement, cryobiopsy, as well as endobronchial and transbronchial
biopsies, which single-use bronchoscopes were previously unable to
perform. The applicant reiterated that the device is the only single-
use flexible bronchoscopy (FB) capable of performing advanced
bronchoscopy as it has superior bending angles, an HD imaging chip, and
is compatible with argon gas plasma coagulation, cryotherapy, and
laser. The applicant also asserted that early clinical feedback
suggests that the device is a viable alternative to reusable
bronchoscopes due to its superior angulation range and flexibility.
Further, the applicant clarified that the Kurman et al.\57\ study did
provide data on the nominated device, including table providing a side-
by-side comparison of the technical specs of the Ambu[supreg]
aScope\TM\ 5 Broncho HD and its comparators which showed that the
nominated device had better flexion and extension without tools
compared to the reusable scope, the nominated device had the most
degrees of flexion and extension with all accessory tools compared to
other single-use scopes and the reusable scope, the nominated the
device was able to reach the same anatomical location with biopsy
forceps in the right-upper lobe segment, and the nominated device rated
similar to the reusable scope and better than the other single-use
scopes in image sharpness and near and far field resolutions.
---------------------------------------------------------------------------
\57\ Ibid.
---------------------------------------------------------------------------
Finally, the applicant asserted that while there are similarities
between Ambu[supreg] aScope\TM\ 5 Broncho HD and the predicate devices,
the Ambu[supreg] aScope\TM\ 5 Broncho HD can be distinguished from the
predicate devices because its technical characteristics, such as a
rotation mechanism on the handle and superior articulation, which allow
it to perform more complex bronchoscopy procedures, are unique to the
Ambu[supreg] aScope\TM\ 5 Broncho HD.
Response: We appreciate the commenters' examples supporting the
superiority of the Ambu[supreg] aScope\TM\ 5 Broncho HD. In addition,
we appreciate the clarification on the Kurman et al.\58\
[[Page 81735]]
study along with the table providing a side-by-side comparison of the
technical specs of the Ambu[supreg] aScope\TM\ 5 Broncho HD and its
comparators. After reviewing the information provided in the public
comment and clarifications from the applicant on the Kurman et al.\59\
study that directly compare the nominated device with other single-use
scopes, we agree with the commenters' and the applicant's statements
that the device can be distinguished from similar devices on the market
and the earlier versions of the nominated device on the market
sufficiently to demonstrate substantial clinical improvement.
---------------------------------------------------------------------------
\58\ Ibid.
\59\ Ibid.
---------------------------------------------------------------------------
Comment: In response to our concern that the nominated device was
determined to be substantially equivalent to the earlier device that
the applicant had previously legally marketed, and the FDA 510(k)
summary indicated that both devices have the same technical
characteristics, the applicant along with a few commenters expressed
their belief that the FDA 510K term ``substantially equivalent'' does
not imply the device is the same as its predicate device. Rather, the
applicant asserted that the 510(k) term ``substantially equivalent''
indicates that a nominated device is as safe and effective as its
predicate device. One commenter noted that as defined in 21 CFR part
807,\60\ every 510(k)-cleared medical device has been found
substantially equivalent to one or more predicate devices. One
commenter suggested that the regulatory substantial equivalence cannot
be used to conclude the inability to demonstrate substantial clinical
improvement in the context of CFR 419.66(c)(2).
---------------------------------------------------------------------------
\60\ 21 CFR part 807, subpart E.
---------------------------------------------------------------------------
Response: We appreciate the comments regarding the FDA 510K term
``substantially equivalent'' and the reference to 21 CFR part 807.\61\
We agree that FDA determination of substantial equivalence cannot alone
be used to conclude that a device cannot to demonstrate substantial
clinical improvement as required by the regulation at 42 CFR
419.66(c)(2). However, we note that the FDA 510(k) summary provided by
the applicant indicated that both nominated and predicate devices share
similar technological characteristics such as optical system, bending
section, diameter of insertion cord and distal end, and insertion
portion length. We expressed concern in the proposed rule regarding the
language in the FDA 510(k) summary because we could not determine,
based on the information available to us at the time, whether the
Ambu[supreg] aScope\TM\ 5 Broncho HD could be distinguished from
similar devices on the market and the earlier versions of the nominated
device on the market sufficiently to demonstrate substantial clinical
improvement. Neither could we determine exactly how the nominated
device is superior to its earlier legally marketed device, as per the
applicant's assertion. As noted above, after reviewing the information
provided in the public comment, particularly the Kurman et al.\62\
study, we agree with the commenters' and the applicant's statements
that the device can be distinguished from similar devices on the market
and the earlier versions of the nominated device on the market
sufficiently to demonstrate substantial clinical improvement.
---------------------------------------------------------------------------
\61\ Ibid.
\62\ Kurman, J., Wagh, A., Benn, B., & Islam, S. (2023). A
comparison of single-use bronchoscopes and reusable bronchoscopes
for interventional pulmonology applications. Confidential. Ambu
Inc., funded evaluation and testing.
---------------------------------------------------------------------------
Comment: In response to the concern that the applicant's self-
sponsored study by Kurman et al.\63\ may not be sufficient to show
improved clinical outcomes because it was conducted in the laboratory
(that is, on cadaver, benchtop fixturing, and artificial plastic lung)
and not in the clinical setting, the applicant asserted that the
benchtop studies in this category are considered the industry standard
and have been well accepted as the best way to compare single use and
reusable bronchoscopes. In support of this assertion, the applicant
provided six studies 64 65 66 67 68 69 as examples and
indicated that there is no feasible way to accurately measure the
flexion and deflection angles of a tool in vivo. Commenters supported
the applicant's assertion and indicated that benchtop studies are
standard and commonly utilized throughout the medical community. The
applicant referenced results of one benchtop study (among the six
examples referenced earlier) by Ho et al.,\70\ published prior to the
device's release. The study reviewed the published evidence on the
applications of single-use (SU) and reusable bronchoscopes in
bronchoscopy suites and intensive care units, and concluded that the
portability, immediate availability, and theoretical reduced risk of
clinically relevant infections confer an advantage of using SUFB over
reusable FB in certain scenarios in the bronchoscopy and intensive care
units. The applicant stated that improvements in maneuverability, angle
tip deflection, and image quality are critical for a broader adoption
of single-use FBs in more complex procedures.
---------------------------------------------------------------------------
\63\ Ibid.
\64\ Liu, L., Wahidi, M., Mahmood, K., Giovacchini, C., Shofer,
S., Cheng, G. (2020) Operator perception of a single-use flexible
bronchoscope: comparison with current standard bronchoscopes.
Respiratory care, 65(11):1655-1662. Doi: 10.4187/respcare.07574.
Epub 2020 Jun 2. PMID: 32487752.
\65\ Darrell, N., Grant, S., Abdurrahman, H., Matthew, N.,
Russell, M., et al. (2022). Operator perception of the performance
of multiple single-use bronchoscopes compared to standard re-usable
bronchoscope. Am J Biomed Sci & Res, 17(2). AJBSR.MS.ID: 002333,
DOI: 10.34297/AJBSR.2022.17.002333.
\66\ Lamb, C.R., Yavarovich, E., Kang, V. et al. (2022).
Performance of a new single-use bronchoscope versus a marketed
single-use comparator: a bench study. BMC Pulm Med 22, 189).
Retrieved from: https://bmcpulmmed.biomedcentral.com/articles/10.1186/s12890-022-01982-4.
\67\ Ho, E., Wagh, A., Hogarth, K., Murgu, S. (2022). Single-use
and reusable flexible bronchoscopes in pulmonary and critical care
medicine. Diagnostics, 12(1):174. Retrieved from: https://doi.org/10.3390/diagnostics12010174.
\68\ Liang, Z., Zhou, G., Li, Y. et al. (2022). Evaluation of a
new developed disposable and portable bronchoscopy system. BMC
PulmMed 22, 136. https://doi.org/10.1186/s12890-022-01933-z.
\69\ Deasy, K.F., Sweeney, A.M., Danish, H., O'Reilly, E.,
Ibrahim, H., Kennedy, M.P. (2023). Single use or disposable flexible
bronchoscopes: bench top and preclinical comparison of currently
available devices. J Intensive Care Med, 38(6):519-528. Doi:10.1177/
08850666221148645. Epub 2023 Jan 7. PMID: 36609193; PMCID:
PMC10114257.
\70\ Ho, E., Wagh, A., Hogarth, K., Murgu, S. (2022). Single-use
and reusable flexible bronchoscopes in pulmonary and critical care
medicine. Diagnostics, 12(1):174. Retrieved from: https://doi.org/10.3390/diagnostics12010174.
---------------------------------------------------------------------------
Response: We thank the commenters for their input. While we
maintain our belief that data which indicates that a device
demonstrates substantial clinical improvements over currently available
treatments in the clinical setting where it is most likely to be used
is beneficial, we recognize that obtaining such data is not always
feasible. After reviewing the information provided in the public
comment, including clarifications from the applicant on the Kurman et
al.\71\ study, the additional six benchtop studies (as referenced
above) supplied by the applicant, and the comments supporting the
applicant's assertion that benchtop studies for bronchoscopes are
considered to be the industry standard and have been well accepted as
the best way to compare single-use and reusable bronchoscopes, we agree
that the applicant's self-sponsored study by Kurman et al.\72\ is
sufficient to show improved clinical outcomes.
---------------------------------------------------------------------------
\71\ Kurman, J., Wagh, A., Benn, B., & Islam, S. (2023). A
comparison of single-use bronchoscopes and reusable bronchoscopes
for interventional pulmonology applications. Confidential. Ambu
Inc., funded evaluation and testing.
\72\ Ibid.
---------------------------------------------------------------------------
Comment: In response to our concern that the submitted evidence of
substantial clinical improvement
[[Page 81736]]
discussed potential adverse events from reusable bronchoscope
procedures, but did not directly show any clinical improvement that
resulted from the use of the Ambu[supreg] aScope\TM\ 5 Broncho HD, the
applicant reiterated that the single use nature of the Ambu[supreg]
aScope\TM\ 5 Broncho HD avoids the adverse issues and risk associated
with reprocessing detailed in the articles referenced in its
application as there is no reprocessing or reuse of the bronchoscope.
The applicant noted that, the successful Uretero 1 device pass-through
application included the Bozzini et al. study which does not include
the nominated device as the comparator. The applicant stated that, in
the same fashion as the Uretero 1 device pass-through application, the
Ambu[supreg] aScope\TM\ 5 Broncho HD application is using the
transitive property to highlight that because clinical benefits can be
seen with single-use endoscopes and the nominated device is single-use,
the nominated device is therefore an improvement over reusable
endoscopes. Another commenter referenced the CY 2023 OPPS/ASC final
rule with comment period, wherein CMS approved the Uretero 1 device
pass-through application and established device pass-through code HCPCS
C1747 (Endoscope, single-use (that is, disposable), urinary tract,
imaging/illumination device (insertable)). Specifically, the commenter
pointed out that CMS stated that we agreed that the evidence
demonstrating the improved patient outcomes and reduced patient risk
associated with the disposable device in comparison with reusable
devices represents substantial clinical improvement. This commenter
suggested that this conclusion should also apply to single-use
bronchoscopes as well. The commenters believed that single-use scopes
reduce reprocessing-related bronchoscope infection risk, and that this
risk reduction is a substantial clinical improvement.
Response: We appreciate the commenters' input. As the applicant and
commenter indicated, CMS approved Uretero1 \73\ for transitional pass-
through payment status in the CY 2023 OPPS/ASC final rule with comment
period. We note that we expressed similar concerns relating to the lack
of comparative studies between the single-use Uretero1 device and other
disposable devices and indicated that, while we ultimately agreed that
the totality of evidence demonstrated improved patient outcomes and
reduced patient risk associated with the disposable device in
comparison with reusable devices represents substantial clinical
improvement, it would have been helpful to see comparative studies. The
applicant and the commenter seem to suggest that because we determined
that the Uretero 1 device demonstrated substantial clinical improvement
despite providing a study which does not include the nominated device
as a comparator, that we should similarly determine that the type of
evidence submitted by Ambu[supreg] aScope\TM\ 5 Broncho HD represents
substantial clinical improvement. We note that we do not believe that
this implied approach to application evaluation is appropriate. Rather,
we continue to believe that our current process wherein we evaluate all
evidence submitted for each device pass-through application as it
applies to the nominated device is appropriate. Due to inherent
differences in the devices themselves and the supporting documentation
submitted, CMS may have different concerns as they relate to the
nominated device. In addition, we are not precluded from evaluating
evidence and expressing concerns regarding evidence submitted in
support of an application simply because that type of evidence has been
submitted in support of a previous application. While we encourage
applicants to read the application summaries presented in previous
OPPS/ASC rules as they can help applicants determine the types of
documentation that have been submitted and assess areas of potential
concern with their technology, we caution applicants not to rely solely
on the presumption that previously submitted types of evidence,
evaluated for a different device, either need not be submitted or need
not be fully addressed as it relates to their technology. Further, we
encourage applicants to submit all relevant supporting evidence with
their device pass-through application to allow us to adequately
evaluate and include the data in the notice of proposed rulemaking.
---------------------------------------------------------------------------
\73\ In the CY 2023 OPPS/ASC final rule with comment period CMS
approved Uretero1 as a new device category for transitional pass-
through payment status and established HCPCS code C1747 as a new
device category beginning in January 2023 (87 FR 7129 through 71934)
effective January 1, 2023.
---------------------------------------------------------------------------
With regard to our concern that the submitted evidence of
substantial clinical improvement discussed potential adverse events
from reusable bronchoscope procedures but did not directly show any
clinical improvement that resulted from the use of the Ambu[supreg]
aScope\TM\ 5 Broncho HD, we indicated that it would be helpful to see
published peer-reviewed comparative studies between the single-use
Ambu[supreg] aScope\TM\ 5 Broncho HD device and other disposable
devices. After reviewing the information provided in the public
comment, specifically the 2021 FDA safety notice,\74\ the Ho et al.\75\
study that supported the increased risks associated with using reusable
devices, and the Kurman et al. study which distinguished the device
from similar devices on the market and the earlier versions of the
nominated device on the market, we agree that the evidence demonstrates
there are improved patient outcomes and reduced patient risk associated
with the single-use Ambu[supreg] aScope\TM\ 5 Broncho HD device in
comparison with reusable devices.
---------------------------------------------------------------------------
\74\ FDA Safety Communications, Flexible Bronchoscopes and
Updated Recommendations for Reprocessing: FDA Safety Communication,
issued June 25, 2021. https://www.fda.gov/medical-devices/safety-communications/flexible-bronchoscopes-and-updated-recommendations-reprocessing-fda-safety-communication.
\75\ Ho, E., Wagh, A., Hogarth, K., Murgu, S. (2022). Single-use
and reusable flexible bronchoscopes in pulmonary and critical
caremedicine. Diagnostics, 12(1):174. Retrieved from: https://doi.org/10.3390/diagnostics12010174.
---------------------------------------------------------------------------
Comment: In response to the concern regarding the relevance of the
2015 FDA safety notice to the nominated device, specifically that the
guidance appeared to apply to reprocessed flexible bronchoscopes
broadly, not to disposable, single-use devices comparable to the
nominated device, and that many of the applicant's substantial clinical
improvement claims rely on an assumption that inadequate reprocessing
of reusable bronchoscopes is positively correlated with heightened risk
of infection, the applicant submitted a 2021 FDA safety notice \76\
showing FDA's analysis of Medical Device Reports (MDRs) related to
infections or device contamination associated with reusable flexible
bronchoscopes from 2015-2021. The document states that between January
2010 and June 2015, the FDA received 109 MDRs related to infections or
device contamination associated with reusable flexible bronchoscopes,
and between July 2015 and January 2021, the FDA received 867 additional
MDRs. Of the 867 reports received between July 2015 and January 2021,
there were seven reports of deaths. Since 2015, the number of MDRs
relevant to infection or contamination submitted to the FDA has
increased from under 100 per year to between 100-200 per year. In
addition, the applicant noted that FDA received at
[[Page 81737]]
least 226 bronchoscope-related MDRs from July 2021 to July 2023. The
applicant asserted that the latest MDR numbers highlight the sustained
increase of these MDRs. The applicant also noted that the MDR system is
a passive surveillance system and may undercount the true number of
bronchoscope infections and/or contaminations.
---------------------------------------------------------------------------
\76\ FDA Safety Communications, Flexible Bronchoscopes and
Updated Recommendations for Reprocessing: FDA Safety Communication,
issued June 25, 2021. https://www.fda.gov/medical-devices/safety-communications/flexible-bronchoscopes-and-updated-recommendations-reprocessing-fda-safety-communication.
---------------------------------------------------------------------------
In reference to CMS's concern regarding the relevance of the 2015
FDA safety notice, the applicant stated that CMS determined that a
similar communication (FDA advisory notice) was sufficient to
demonstrate substantial clinical improvement for Uretero 1 in CY 2023.
The applicant further provided that compared to ureteroscopes, which
received 450 reports from 2017-2021 (from roughly 600,000 cases per
year), reusable bronchoscopes received 867 from 2015-2021 (out of
roughly 500,000 cases per year). The applicant asserted that given CMS'
previous acceptance of FDA guidance documents as evidence of
substantial clinical improvement and the increased incidents of MDRs
for bronchoscopes when compared to ureteroscopes, the bronchoscope MDR
data provided must also be considered sufficient evidence.
A few commenters, including the applicant, pointed out that the
supplemental update \77\ issued on June 25, 2021, directly addresses
the omission of single-use medical devices from the FDA safety
communication \78\ originally dated September 17, 2015, regarding
infections associated with reprocessed flexible bronchoscopes. The
commenters stated that the supplemental update urges health care
providers to consider using single-use bronchoscopes in situations
where there is an increased risk of spreading infection and recommends
the use of sterilization instead of high-level disinfection for all
flexible bronchoscope reprocessing. One commenter clarified that some
reusable flexible bronchoscopes are physically incompatible with some
or all sterilization methods, while others may be capable of
withstanding the sterilization process, but the manufacturers have not
provided a validated sterilization process in the 510(k) cleared device
labeling. Another commenter stated that the single-use flexible
bronchoscopes minimize the risk of patient cross-contamination and
agreed with the applicant's assertation that reusable bronchoscopes
frequently lead to issues of cross-contamination and infection because
of complex designs and issues with reprocessing, especially for
patients who are immunocompromised.
---------------------------------------------------------------------------
\77\ Ibid.
\78\ FDA Safety Communications, Infections Associated with
Reprocessed Flexible Bronchoscopes: FDA Safety Communication, issued
September 17, 2015. https://www.fdanews.com/ext/resources/files/09-15/092115-safety-notice.pdf?1442508647.
---------------------------------------------------------------------------
A few commenters also provided additional data on the prevalence of
inadequately reprocessed bronchoscopes posing an increased risk of
remaining contaminated and cross-infecting patients with multidrug-
resistant organisms. One commenter cited a recently published peer-
reviewed article by Mehta and Muscarella (2020),\79\ which provides
evidence both for the significance of this application and the
prevalence of infection due to, among other risk factors, the
inadequate reprocessing of reusable bronchoscopes. The primary
objectives of the study were to investigate the risk of bronchoscopes
transmitting infections of carbapenem-resistant Enterobacteriaceae
(CRE) and related multidrug-resistant organisms (MDROs). This study's
findings suggest that bronchoscopes may pose an under-recognized
potential for transmission of CRE and related MDROs, warranting greater
public awareness, enhanced preventive measures, and updated
reprocessing guidance. Per the commenter, this study's data suggests
that the cleaning and high-level disinfection of bronchoscopes
performed in accordance with published guidelines and manufacturer
instructions may not always be sufficiently effective to eliminate this
risk. The study concluded that inadequate reprocessing of reusable
bronchoscopes is positively correlated with heightened risk of
infection. Another commenter indicated that while it is important for
hospitals to improve reprocessing practices in general, a clean
reusable scope will never be as clean as a sterile, single-use scope,
even following the most rigorous cleaning protocols. The commenter
stated that while CMS highlighted the low number of reported infections
given the number of bronchoscopies that occur each year, unlike many
other types of endoscopes that enter a sterile or otherwise clean
anatomy (ureter), patients who need a bronchoscopy often require such
procedures due to potential infection which could mask bronchoscope-
mediated transmission of infectious agents.
---------------------------------------------------------------------------
\79\ Mehta, A.C., Muscarella, L.F. (2020). Bronchoscope-related
``superbug'' infections. Chest, 157(2):454-469.
---------------------------------------------------------------------------
Response: We appreciate the applicant's and the commenters'
responses and additional evidence. We found the data contained in the
updated 2021 FDA safety notice \80\ compelling. While FDA noted in the
2015 FDA safety notice submitted as part of the application that when
compared to the number of bronchoscopy procedures performed in the U.S.
each year this is considered a small number of MDRs, we agree with the
applicant's assertion that the latest MDR numbers provided in the 2021
FDA safety notice \81\ highlight the sustained increase of these MDRs.
While we acknowledge some of the data limitations, after reviewing the
information provided in the public comment and the 2021 FDA safety
notice,\82\ we agree with the commenters that reusable bronchoscopes
present a risk of cross-infection due to contamination. We understand
that despite strictly adhering to the manufacturers' recommendations
for reprocessing, some bronchoscopes still show evidence of biofilms,
which are a source of cross-contamination. The applicant and other
commenters provided sources: Mehta and Muscarella (2020) \83\ and the
2021 FDA safety notice,\84\ that demonstrate that even ``properly'' re-
processed bronchoscopes have positive microbial growth via reusable
bronchoscopes which is mitigated by single-use bronchoscopes like Ambu
aScopeTM 5 Broncho HD sufficiently to demonstrate
substantial clinical improvement in situations where there is an
increased risk of spreading infection. After consideration of the
public comments received, we believe that commenters have addressed our
concerns regarding whether the Ambu[supreg] aScope\TM\ 5 Broncho HD
meets the substantial clinical improvement criterion and that the
Ambu[supreg] aScope\TM\ 5 Broncho HD represents a substantial clinical
improvement over existing technologies due to compelling evidence from
the applicant and other commenters as discussed above,
[[Page 81738]]
specifically the 2021 FDA safety notice \85\ and Ho et al.\86\ study
that demonstrated the increased risks associated with using reusable
devices
---------------------------------------------------------------------------
\80\ FDA Safety Communications, Flexible Bronchoscopes and
Updated Recommendations for Reprocessing: FDA Safety Communication,
issued June 25, 2021. https://www.fda.gov/medical-devices/safety-communications/flexible-bronchoscopes-and-updated-recommendations-reprocessing-fda-safety-communication.
\81\ Ibid.
\82\ Ibid.
\83\ Mehta, A.C., Muscarella, L.F. (2020). Bronchoscope-related
``superbug'' infections. Chest, 157(2):454-469.
\84\ FDA Safety Communications, Flexible Bronchoscopes and
Updated Recommendations for Reprocessing: FDA Safety Communication,
issued June 25, 2021. https://www.fda.gov/medical-devices/safety-communications/flexible-bronchoscopes-and-updated-recommendations-reprocessing-fda-safety-communication.
\85\ Ibid.
\86\ Ho, E., Wagh, A., Hogarth, K., Murgu, S. (2022). Single-use
and reusable flexible bronchoscopes in pulmonary and critical
caremedicine. Diagnostics, 12(1):174. Retrieved from: https://doi.org/10.3390/diagnostics12010174.
---------------------------------------------------------------------------
In response to the applicant's comments comparing the Uretero 1
application summary included in the CY 2023 OPPS/ASC final rule with
comment period with the application summary for the nominated device
included in this final rule with comment period, we note that we
expressed a similar concern in the Uretero 1 application summary that
the FDA advisory letter regarding ureteroscopes did not mention single-
use devices and it was not clear how the recommendations in the letter
supported the applicant's claims of substantial clinical improvement
related to Uretero1. While we ultimately determined that evidence was
sufficient to demonstrate substantial clinical improvement, we would
like to reiterate that we evaluate all evidence submitted for each
device pass-through application as it applies to the nominated device.
While we agree that data provided regarding the increased incidents of
MDRs for bronchoscopes and the nominated devices' impact of mitigating
infection risk, we do not agree that CMS' previous acceptance of FDA
guidance documents must be considered sufficient evidence of
substantial clinical improvement for the nominated device. The ultimate
determination of whether evidence demonstrates substantial clinical
improvement for one application, while taken into consideration as
appropriate, is not controlling on future determinations. Again, due to
inherent differences in the devices themselves and the supporting
documentation submitted, CMS may have different concerns as they relate
to the nominated device. In addition, we are not precluded from
evaluating evidence and expressing concerns regarding types of evidence
submitted in support of an application simply because that type of
evidence has been submitted in support of a previous application. As we
stated previously, while we encourage applicants to read the
application summaries presented in previous OPPS/ASC rules as they can
help applicants determine the types of documentation that have been
submitted and assess areas of potential concern with their technology,
we caution applicants from relying solely on the presumption that
previously submitted types of evidence, evaluated for a different
device, either need not be submitted or need not be fully addressed as
it relates to their technology. We encourage applicants to submit all
relevant supporting evidence with their device pass-through application
to allow us to adequately evaluate and include the data in the notice
of proposed rulemaking.
Comment: In response to our concern that the Ch[acirc]teauvieux et
al.\87\ and Barron and Kennedy \88\ studies suggested limiting the use
of single-use bronchoscope devices to specific situations (that is,
after hours or emergency), immunocompromised patients, and in rare
cases of preventing prior contamination in the inpatient setting, the
applicant asserted that this recommendation was made due to the
potential cost burdens of reusable scopes referenced in the study. The
applicant further asserted that if cost was not a barrier and
facilities widely adopted single-use bronchoscopes, such as the
Ambu[supreg] aScope\TM\ 5 Broncho HD, the benefits of advanced
bronchoscopy procedures would be more accessible. One commenter,
writing in support of approval of the nominated device for pass-through
payment, expressed concern that the cost of Ambu[supreg] aScope\TM\ 5
Broncho HD created a barrier to utilization, and agreed with the
applicant that Ch[acirc]teauvieux et al.\89\ and Barron and Kennedy
\90\ suggest limiting single-use scopes to specific case types because
of cost. However, this commenter noted that studies by Maerkedahl et
al., Mouritsen et al., and Kurman et al. all found that single-use
scopes are economically advantageous relative to reusable scopes. This
commenter stated that despite these findings, cost does admittedly
remain a major barrier to broader adoption of single-use scopes. This
commenter noted that improving reimbursement would help mitigate this
barrier and allow more physicians to use the device for advanced
bronchoscopy cases where it is now the preferred option. The applicant,
in response to this comment indicated that, as this section (the
substantial clinical improvement section under which the comment was
submitted) is not about cost, it is not relevant to whether the
Ambu[supreg] aScope\TM\ 5 Broncho HD can provide a substantial clinical
improvement.
---------------------------------------------------------------------------
\87\ Ch[acirc]teauvieux, C., Farah, L., Gu[eacute]rot, E.,
Wermert, D., Pineau, J., Prognon, P., Borget, I., & Martelli, N.
(2018). Single-use flexible bronchoscopes compared with reusable
bronchoscopes: Positive organizational impact but a costly solution.
Journal of evaluation in clinical practice, 24(3), 528-535. https://doi.org/10.1111/jep.12904.
\88\ Barron, S.P., & Kennedy, M.P. (2020). Single-use
(disposable) flexible bronchoscopes: the future of bronchoscopy?
Advances in therapy, 37(11), 4538-4548. https://doi.org/10.1007/s12325-020-01495-8.
\89\ Ch[acirc]teauvieux, C., Farah, L., Gu[eacute]rot, E.,
Wermert, D., Pineau, J., Prognon, P., Borget, I., & Martelli, N.
(2018). Single-use flexible bronchoscopes compared with reusable
bronchoscopes: Positive organizational impact but a costly solution.
Journal of evaluation in clinical practice, 24(3), 528-535. https://doi.org/10.1111/jep.12904.
\90\ Barron, S.P., & Kennedy, M.P. (2020). Single-use
(disposable) flexible bronchoscopes: the future of bronchoscopy?
Advances in therapy, 37(11), 4538-4548. https://doi.org/10.1007/s12325-020-01495-8.
---------------------------------------------------------------------------
Response: We appreciate the commenters' input. While the applicant
did not provide in its application additional information about
situations where use of single-use bronchoscopes would be optimal, we
appreciate the insight provided from the applicant and several
commenters who gave specific examples for how the device allows for
advanced bronchoscopy procedures to be performed with a single-use
scope, without concern for contamination, specifically for procedures
that include but are not limited to: transbronchial biopsy, airway
inspection for high-risk/immunocompromised patients, and procedures
with high-frequency tools.
While we maintain our belief that further investigation with
comparators in these specified cases would more directly establish
whether the device demonstrates a substantial clinical improvement over
currently available treatment options in the clinical setting where it
is most likely to be used, we understand that this data may not be
available. We agree with the commenters that Ch[acirc]teauvieux et
al.\91\ and Barron and Kennedy \92\ studies suggested limiting the use
of single-use bronchoscope device to specific situations, in part, due
to cost considerations. After consideration of the public comments
received, we agree that the evidence demonstrates that the device is a
substantial clinical improvement over currently available treatment
options in the clinical setting.
---------------------------------------------------------------------------
\91\ Ch[acirc]teauvieux, C., Farah, L., Gu[eacute]rot, E.,
Wermert, D., Pineau, J., Prognon, P., Borget, I., & Martelli, N.
(2018). Single-use flexible bronchoscopes compared with reusable
bronchoscopes: Positive organizational impact but a costly solution.
Journal of evaluation in clinical practice, 24(3), 528-535. https://doi.org/10.1111/jep.12904.
\92\ Barron, S.P., & Kennedy, M.P. (2020). Single-use
(disposable) flexible bronchoscopes: the future of bronchoscopy?
Advances in therapy, 37(11), 4538-4548. https://doi.org/10.1007/s12325-020-01495-8.
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In addition, we thank the commenter for their input on how approval
would impact existing barriers to broader adoption of single-use
scopes. While the
[[Page 81739]]
applicant is correct that we do not assess cost in Sec. 419.66(c)(2),
CMS recognizes the importance of addressing cost as a barrier to
utilization, and as stated in section 2.a., a goal of transitional
pass-through is to target pass-through payments for those devices where
cost considerations are most likely to interfere with patient access
(66 FR 55852; 67 FR 66782; and 70 FR 68629). We address the cost of
Ambu[supreg] aScope\TM\ 5 Broncho HD and the cost significance criteria
below.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must be met. The
applicant provided the following information in support of the cost
significance requirements. The applicant stated that the Ambu[supreg]
aScope\TM\ 5 Broncho HD would be reported with HCPCS codes listed in
Table 87.
BILLING CODE 4150-28-P
[[Page 81740]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.111
[[Page 81741]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.112
[[Page 81742]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.113
BILLING CODE 4150-28-C
To meet the cost criterion for device pass-through payment status,
a device must pass all three tests of the cost criterion for at least
one APC. As we explained in the CY 2005 OPPS final rule with comment
period (69 FR 65775), we generally use the lowest APC payment rate
applicable for use with the nominated device when we assess whether a
device meets the cost significance criterion, thus increasing the
probability the device will pass the cost significance test. For our
calculations, we used APC 5152, which had a CY 2022 payment rate of
$383.33 at the time the application was received. Beginning in CY 2017,
we calculate the device offset amount at the HCPCS/CPT code level
instead of the APC level (81 FR 79657). We noted that the HCPCS code
31646 identified by the applicant had a device offset amount of $0.00
at the time the application was received. Accordingly, we are
evaluating the cost significance requirements using $0.00 as the
appropriate device offset amount. According to the applicant, the cost
of the Ambu[supreg] aScope\TM\ 5 Broncho HD is $799.00.
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $799.00 for the Ambu[supreg] aScope\TM\ 5
Broncho HD is 208.44 percent of the applicable APC payment amount for
the service related to the category of devices of $383.33 (($799.00/
$383.33) x 100 = 208.44 percent). Therefore, we stated that we believe
the Ambu[supreg] aScope\TM\ 5 Broncho HD meets the first cost
significance requirement.
The second cost significance requirement, at Sec. 419.66(d)(2),
provides that the estimated average reasonable cost of the devices in
the category must exceed the cost of the device-related portion of the
APC payment amount for the related service by at least 25 percent,
which means that the device cost needs to be at least 125 percent of
the offset amount (the device-related portion of the APC found on the
offset list). Given that there are no device-related costs in the APC
payment amount, and the Ambu[supreg] aScope\TM\ 5 Broncho HD has an
estimated average reasonable cost of $799.00, we stated that we believe
the Ambu[supreg] aScope\TM\ 5 Broncho HD meets the second cost
significance requirement.
The third cost significance requirement, at Sec. 419.66(d)(3),
provides that the difference between the estimated average reasonable
cost of the devices in the category and the portion of the APC payment
amount for the device must exceed 10 percent of the APC payment amount
for the related service. The difference between the estimated average
reasonable cost of $799.00 for the Ambu[supreg] aScope\TM\ 5 Broncho HD
and the portion of the APC payment amount for the device of $0.00
exceeds the APC payment amount for the related service of $799.00 by
208.44 percent ((($799.00-$0.00)/$383.33) x 100 = 208.44 percent).
Therefore, we stated that we believe the Ambu aScope\TM\ 5 Broncho HD
meets the third cost significance requirement.
We invited public comment on whether the Ambu[supreg] aScope\TM\ 5
Broncho HD meets the device pass-through payment criteria discussed in
this section, including the cost criterion for device pass-through
payment status.
We did not receive any comments with regard to any of the cost
significance requirements specified at Sec. 419.66(d). Based on our
findings from the first, second, and third cost significant tests, we
believe that the Ambu[supreg] aScopeTM 5 Broncho HD device
[[Page 81743]]
meets the cost significance criterion specified at Sec. 419.66(d).
After consideration of the public comments we received and our
review of the device pass-through application, we have determined that
the Ambu[supreg] aScope\TM\ 5 Broncho HD meets the criteria for device
pass-through status. We are approving this application because the
documentation (namely the FDA document and additional studies) that
were submitted in response to the proposed rule address our concerns
and provide evidence of substantial clinical improvement that is
required. Therefore, we are approving the Ambu[supreg] aScope\TM\ 5
Broncho HD for transitional pass-through payment status beginning
January 1, 2024.
(b) Praxis Medical CytoCore
Praxis Medical, LLC submitted an application for a new device
category for transitional pass-through payment status for Praxis
Medical CytoCore (CytoCore) for CY 2024. Per the applicant, CytoCore is
a single-use disposable biopsy instrument. Per the applicant, at the
time of biopsy, the motorized CytoCore device contains gears and an
internal motor that spins a minimally invasive needle to increase
cellular yields in fewer passes. The applicant further explained that
CytoCore is vacuum-assisted and can easily be operated using one hand.
According to the applicant, the primary use is for biopsy of any
suspicious thyroid nodule.
The applicant stated that the CytoCore Biopsy Instrument device
package includes: (1) a single CytoCore biopsy instrument, powered by
an alkaline type battery; (2) three luer adaptors; (3) a 5ml syringe;
and (4) an instructions for use (IFU) booklet. Per the applicant, the
CytoCore is compatible with disposable needles of 22-to-25-gauge and 4-
to-10-cm length that are intended for soft tissue biopsy procedures
(needles are not included in the device package). The applicant further
explained that only the CytoCore luer adapters and syringes provided by
Praxis can be used on CytoCore and that the CytoCore luer adapters can
only be used with the CytoCore Biopsy Instrument.
Per the applicant, the operator of CytoCore can direct the needle
and draw back the plunger with only one hand, thereby diminishing the
need to move the needle in an in-and-out motion to harvest cells. As
with other types of biopsies, the sample collected can help make a
diagnosis or rule out conditions such as cancer. The applicant claimed
that CytoCore enables the physician to collect more cellular material
in fewer passes and reduce the number of repeat biopsies and surgeries
resulting from inadequate cellular samples obtained using standard fine
needle aspiration (FNA). According to the applicant, CytoCore is
designed to collect enough DNA for pathology to definitively rule in or
out cancer and inform subsequent treatment at the time of the first
biopsy. Per the applicant, studies report nondiagnostic rates for
biopsies to be as high as 30 to 50 percent using FNA biopsy.\93\
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\93\ CMS made minor edits to the device description in this
final rule with public comment to improve clarity.
---------------------------------------------------------------------------
As stated previously, to be eligible for transitional pass-through
payment under the OPPS, a device must meet the criteria at Sec.
419.66(b)(1) through (4). With respect to the newness criterion at
Sec. 419.66(b)(1), on March 31, 2020, the applicant received 510(k)
clearance from FDA for CytoCore for use as a device to hold a syringe
for performing a biopsy of an identified mass with one hand. We
received the application for a new device category for transitional
pass-through payment status for CytoCore on August 31, 2022, which is
within 3 years from the date of the initial FDA marketing
authorization.
We invited public comments on whether CytoCore meets the newness
criterion at Sec. 419.66(b)(1).
We did not receive public comments regarding whether CytoCore meets
the newness criterion at Sec. 419.66(b)(1). We received the
application for a new device category for transitional pass-through
payment status for CytoCore on August 31, 2022, which is within 3 years
of the initial FDA marketing authorization on March 31, 2020, and as
such, we have concluded that CytoCore meets the newness criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
the applicant did not assert whether CytoCore is integral to the
service provided. According to the applicant, CytoCore is used for one
patient only. Per the applicant, CytoCore comes into contact with human
tissue and is surgically inserted via the syringe attached to the
motorized CytoCore device. Per the applicant, CytoCore is used with a
22-to-25-gauge standard fine needle (not included in the device
package), which is inserted into human tissue to collect cellular
samples. The applicant stated that the fine needle is attached to
CytoCore, inserted into the nodule, and cellular material is collected
through the needle into the syringe. The applicant further explained
that the cellular material is visible in the hub of the needle or the
luer adapter. However, we noted that the motorized CytoCore device
itself is not surgically implanted or inserted (either permanently or
temporarily) or applied in or on a wound or other skin lesion, as
required at Sec. 419.66(b)(3). Further, we noted that according to the
FDA 510(k) Summary and Indication for Use, CytoCore is a device to hold
a syringe for performing a biopsy of an identified mass with one hand
and that the device never comes in contact with the patient.
With respect to the exclusion criterion at Sec. 419.66(b)(4), the
applicant did not address whether CytoCore is equipment, an instrument,
apparatus, implement, or item of this type for which depreciation and
financing expenses are recovered as depreciable assets. The applicant
also did not address whether CytoCore is a supply or material furnished
incident to a service or whether the device is surgically implanted or
inserted (either permanently or temporarily) or applied in or on a
wound or other skin lesion, as required by Sec. 419.66(b)(3). However,
in the CY 2000 OPPS interim final rule with comment period (65 FR 67804
and 67805), we explained how we interpret the exclusion criterion at
Sec. 419.66(b)(3). We stated that we consider a device to be
surgically implanted or inserted if it is surgically inserted or
implanted via a natural or surgically created orifice or inserted or
implanted via a surgically created incision. We also stated that we do
not consider an item used to cut or otherwise create a surgical opening
to be a device that is surgically implanted or inserted. We consider
items used to create incisions, such as scalpels, electrocautery units,
biopsy apparatuses, or other commonly used operating room instruments,
to be supplies or capital equipment not eligible for transitional pass-
through payments. We stated that we believe the function of these items
is different and distinct from that of devices that are used for
surgical implantation or insertion. Finally, we stated that, generally,
we would expect that surgical implantation or insertion of a device
occurs after the surgeon uses certain primary tools, supplies, or
instruments to create the surgical path or site for implanting the
device. In the CY 2006 OPPS final rule with comment period (70 FR
68516, 70 FR 68629 and 68630), we adopted as final our interpretation
that the surgical insertion or implantation criterion can be met by
devices that are surgically inserted or implanted via a natural or
surgically created orifice, as well as those devices that are inserted
or implanted via a surgically created incision. We reiterated that we
maintain all of the other criteria in Sec. 419.66 of the
[[Page 81744]]
regulations, namely, that we do not consider an item used to cut or
otherwise create a surgical opening to be a device that is surgically
implanted or inserted.
We invited public comments on whether CytoCore meets the exclusion
criteria at Sec. 419.66(b)(3) and (4).
Comment: The applicant asserted that CytoCore meets the eligibility
requirements at Sec. 419.66(b)(3) and (4). In response to our concerns
that the motorized CytoCore device itself is not surgically implanted
or inserted (either permanently or temporarily) or applied in or on a
wound or other skin lesion, as required at Sec. 419.66(b)(3), the
applicant asserted that CytoCore is integral to the service provided
for Fine Needle Aspiration (FNA) of suspicious thyroid nodules because
the CytoCore motorized device is an essential component, offering
precise control with a needle that is attached to the device, and
CytoCore is adaptable for various lesion characteristics. Further, the
applicant explained that, using ultrasound guidance, the needle is
advanced through the patient's skin into the nodule, ensuring
collection of adequate material.
In response to our concerns that Cytocore may be considered a
supply or material furnished incident to a service as described in
Sec. 419.66(b)(4), the applicant stated that CytoCore does not
function as a surgical tool. In support of this assertion, the
applicant referenced the FDA definition of a manual surgical instrument
(21 CFR 878.4800). The applicant stated that, because CytoCore is
powered and non-resuable, it does not meet the definition of a
``surgical instrument'' per the FDA definition.
Response: We appreciate the commenter's input regarding whether
CytoCore meets the eligibility criteria at Sec. 419.66(b)(4). However,
we do not believe that CytoCore meets the eligibility criteria
described at Sec. 419.66(b)(4).
With respect to the eligibility criterion at Sec. 419.66(b)(4),
while we appreciate the assertion that CytoCore may not be defined as a
``surgical instrument'' according to the FDA definition (21 CFR
878.4800), we note that FDA and CMS utilize different definitions for
many terms. In this instance, CMS has established a clear definition
for a supply or material furnished incident to a service for the
purposes of determining OPPS device pass-through payment eligibility.
In the proposed rule, we reiterated that for the criteria at Sec.
419.66, CMS adopted the interpretation of Sec. 419.66(b)(4) in the CY
2006 OPPS final rule with comment period (70 FR 68629 and 68630).
Specifically, we stated that CMS does not consider an item used to cut
or otherwise create a surgical opening to be a device that is
surgically implanted or inserted. CMS considers a device to be
surgically implanted or inserted if it is surgically inserted or
implanted via a natural or surgically created orifice or inserted or
implanted via a surgically created incision. Further, we provided that
CMS considers items used to create incisions, such as scalpels,
electrocautery units, biopsy apparatuses, or other commonly used
operating room instruments, to be supplies or capital equipment not
eligible for transitional pass-through payments. The function of these
items is different and distinct from surgical implantation or insertion
and CMS expects that surgical implantation or insertion of a device
occurs after the surgeon uses certain primary tools, supplies, or
instruments to create the surgical path or site for implanting the
device.
With respect to the eligibility criterion at Sec. 419.66(b)(4),
based on the information we received in the application and the public
comments as well as discussion of the criterion in Sec. 419.66(b)(4)
that we adopted in the CY 2006 OPPS final rule with comment period (70
FR 68629 and 68630), we have determined that CytoCore is a biopsy
apparatus and, as such, is a material or supply furnished incident to a
service, in accordance with the device eligibility requirements in the
proposed rule and, as such, does not meet the eligibility criteria at
Sec. 419.66(b)(4).
CytoCore does not meet the eligibility criteria to be considered a
device for transitional pass-through payment. Therefore, we did not
evaluate whether the product meets the other criteria required for
transitional pass-through payment for devices, including whether it is
described by existing or previous categories, whether it is a
substantial clinical improvement, or whether it meets the cost
criteria. We are not approving CytoCore for transitional pass-through
payment status for CY 2024 because the product does not meet the
eligibility criteria at Sec. 419.66(b)(4).
We note that we received public comments with regard to the
substantial clinical improvement criterion for this device, but because
we have determined that the device does not meet the eligibility
criteria and therefore, is not eligible for approval for transitional
pass-through payment status for CY 2024, we are not summarizing
comments received or making a determination on that criterion in this
final rule.
(c) EchoTip[supreg]
Cook Medical submitted an application for a new device category for
transitional pass-through payment status for the EchoTip[supreg]
Insight Portosystemic Pressure Gradient Measurement System[supreg]
(EchoTip[supreg]) for CY 2024. According to the applicant,
EchoTip[supreg] is used in the diagnosis and management of patient
populations with chronic liver diseases (CLDs), and especially with
non-alcoholic fatty liver Disease (NAFLD). The applicant stated that
EchoTip[supreg] directly measures pressures in the hepatic and portal
venous vasculatures and is used in conjunction with an ultrasound
endoscope. A curvilinear array echoendoscope is advanced to the
stomach, and the portal and hepatic veins are visualized under
ultrasound guidance. A 25-gauge needle (which is prepared prior to the
endoscopy by attaching it to connection tubing and a disposable
transducer) is advanced through the echoendoscope which then punctures
the hepatic vein through the liver parenchyma, and a pressure
measurement is obtained. Per the applicant, a total of three
measurements are obtained, after which the needle is retracted into the
echoendoscope which is then repositioned for portal vein access. The
needle is then advanced to the portal vein where another set of three
pressure measurements is obtained. The portosystemic pressure gradient
is calculated by determining the difference between the two averaged
measurements.
According to the applicant, EchoTip[supreg] is a single-use,
disposable device comprised of the EchoTip[supreg] Insight Needle, a
connecting tube, and a Compass CT transducer. EchoTip[supreg] is
supplied with a 10 ml syringe. Once assembled, EchoTip[supreg] is used
with an ultrasound endoscope and directly measures pressures in the
hepatic and portal venous vasculatures. The EchoTip[supreg] Insight
Needle is stainless steel, has a handle and protective outer sheath,
and attaches to the accessory channel of the endoscope. The
polyethylene connecting tube consists of a 90 cm tube, a female luer
fitting, a male luer fitting, and a stopcock. The connecting tube is
used to attach the transducer to the needle handle. The stopcock is
used to aid priming of the assembled components. The Compass CT
transducer is a self-calibrating disposable pressure transducer with
integrated digital display. EchoTip[supreg] is intended for direct
measurement and monitoring of physiological pressure,
[[Page 81745]]
including during the infusion of fluids and therapeutic and diagnostic
agents.\94\
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\94\ CMS made minor edits to the device description in this
final rule with public comment to improve clarity.
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As stated previously, to be eligible for transitional pass-through
payment under the OPPS, a device must meet the criteria at Sec.
419.66(b)(1) through (4).
We invited public comment on whether EchoTip[supreg] meets the
newness criterion at Sec. 419.66(b)(1).
Comment: With respect to the newness criterion at Sec.
419.66(b)(1), the applicant reiterated their belief that
EchoTip[supreg] meets the newness criterion. The applicant stated that
the FDA granted de Novo authorization on November 20, 2019, therefore
meeting the criteria at Sec. 419.66(b)(1) because the application is
within 3 years of the date of the initial FDA marketing authorization
on November 20, 2019.
Response: We appreciate the commenter's input and agree that
because we received the application for EchoTip[supreg] on June 29,
2022, which is within 3 years of FDA approval on November 20, 2019,
EchoTip[supreg] meets the newness criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
the applicant stated that EchoTip[supreg] is integral to the service
provided, is used for one patient only, comes in contact with human
skin, and is applied in or on a wound or other skin lesion. According
to the applicant, the hepatic vein and portal vein are punctured
through the liver parenchyma to obtain pressure measurements.
We invited public comment on whether EchoTip[supreg] meets the
integral part of the service criterion at Sec. 419.66(b)(3).
Comment: The applicant asserted that EchoTip[supreg] meets the
eligibility requirements at Sec. 419.66(b)(3), stating that
EchoTip[supreg] is a prescription, single-use device consisting of the
EchoTip[supreg] Insight Needle, a connecting tube, and a Compass CT
transducer that is integral to the service provided.
Response: After consideration of the public comments we received,
we agree that the applicant meets the eligibility criterion at Sec.
419.66(b)(3) because it is integral to the service provided, is used
for one patient only, and punctures the hepatic vein and portal vein
through the liver parenchyma to obtain pressure measurements.
With respect to the exclusion criterion at Sec. 419.66(b)(4), the
applicant claimed that EchoTip[supreg] meets the device eligibility
requirements because it is not equipment, an instrument, apparatus,
implement, or item of this type for which depreciation and financing
expenses are recovered, and it is not a supply or material furnished
incident to a service.
We invited public comment on whether EchoTip[supreg] meets the
exclusion criterion at Sec. 419.66(b)(4).
Comment: The applicant asserted that EchoTip[supreg] meets the
device eligibility requirements because it is not equipment, an
instrument, apparatus, implement, or item of this type for which
depreciation and financing expenses are recovered, and it is not a
supply or material furnished incident to a service.
Response: We appreciate the commenter's input. We agree with the
applicant that EchoTip[supreg] meets the device eligibility
requirements at Sec. 419.66(b)(4) because it is not a piece of
equipment, instrument, apparatus, implement, or item for which
depreciation and financing expenses are recovered, and it is not a
supply or material furnished incident to a service. Therefore, based on
the public comments we have received and our review of the application,
we have determined that EchoTip[supreg] meets the eligibility criteria
at Sec. 419.66(b)(4).
In addition to the criteria at Sec. 419.66(b)(1) through (4), the
criteria for establishing new device categories are specified at Sec.
419.66(c). The first criterion, at Sec. 419.66(c)(1), provides that
CMS determines that a device to be included in the category is not
appropriately described by any of the existing categories or by any
category previously in effect, and was not being paid for as an
outpatient service as of December 31, 1996. The applicant described
EchoTip[supreg] as the only device authorized by the FDA with an
indication to directly access and measure pressure in the hepatic and
portal venous vasculatures in conjunction with an ultrasound endoscope.
Per the applicant, FDA established that there is no recognized
predicate product, or other similar approved device with a similar
mechanism of action. Per the applicant, no previous device categories
for pass-through payment have encompassed EchoTip[supreg] and there are
no similar device categories. We stated in the CY 2024 OPPS/ASC
proposed rule that, upon review, it does not appear that there are any
existing pass-through payment categories that might apply to
EchoTip[supreg].
We invited public comment on whether EchoTip[supreg] meets the
device category criterion at Sec. 419.66(c)(1).
Comment: Regarding the eligibility criterion at Sec. 419.66(c)(1),
the applicant reiterated that there is no comparable existing pass-
through payment category that describes EchoTip[supreg].
Response: We appreciate the commenter's input. After consideration
of the public comments we received, we continue to believe that there
is not an existing pass-through payment category that describes
EchoTip[supreg], and therefore, EchoTip[supreg] meets the device
category eligibility criterion at Sec. 419.66(c)(1).
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines either of the following: (i)
that a device to be included in the category has demonstrated that it
will substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part compared to
the benefits of a device or devices in a previously established
category or other available treatment; or (ii) for devices for which
pass-through status will begin on or after January 1, 2020, as an
alternative to the substantial clinical improvement criterion, the
device is part of the FDA's Breakthrough Devices Program and has
received FDA marketing authorization for the indication covered by the
Breakthrough Device designation. The applicant claimed that
EchoTip[supreg] represents a substantial clinical improvement over
existing technologies in the diagnosis and management of chronic liver
disease because: (1) Endoscopic ultra-sound-guided direct portal-
systemic pressure gradient measurement (EUS-PPG)-guided measurement is
clinically safer and more accurate than the current standard
transjugular endovascular indirect measurement, referred to as the
hepatic venous pressure gradient (HVPG); (2) EUS-PPG is technically
feasible and superior to HVPG; (3) EUS-PPG has benefits in non-
cirrhotic patients; and (4) EUS-PPG has utility in the evaluation of
ESRD patients and kidney transplant candidacy. The applicant provided
four articles specifically for the purpose of addressing the
substantial clinical improvement criterion claims. The applicant also
included one background article that discussed social determinants of
health and disparities in liver disease.\95\
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\95\ Kardashian, A., Wilder, J., Terrault, N. Price, J. (2021).
Addressing social determinants of liver disease during the COVID-19
pandemic and beyond: A call to action. Hepatology, 73(2): 811-820.
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[[Page 81746]]
In support of the first claim, the applicant submitted an article
on a prospective, single-armed, single-academic center study.\96\
Patients with suspected liver disease or cirrhosis were enrolled
prospectively from 2020 to 2021. EUS-PPG was measured by calculating
the difference between the mean portal pressure and the mean hepatic
vein pressure. PH was defined as PPG >5 mm Hg and clinically
significant PH as PPG<10 mm Hg. The primary outcomes were procedural
technical success rate and correlation of EUS-PPG with fibrosis stage
obtained from concurrent EUS-guided liver biopsy sampling and the
correlation of EUS-PPG with patients' imaging, clinical, and laboratory
findings. The secondary outcome was occurrence of procedural adverse
events. EUS-PPG measurement was successful in 23 patients, leading to a
technical success rate of 96 percent. The authors reported that there
was no statistically significant correlation between the fibrosis stage
on histology and measured PPG (P=.559). According to the authors, this
did not change after excluding three patients without established
chronic liver disease from the analysis. The authors reported that one
patient experienced a mild adverse event with postprocedural abdominal
pain resulting in an emergency department visit. The authors also
reported that five patients (28 percent) received oral acetaminophen in
the post anesthesia care unit for mild abdominal pain after the
procedure, which resolved in all cases before discharge without the
need for further pharmacotherapy.
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\96\ Hajifathalian, K., Westerveld, D., Kaplan, A. et al.
(2022). Simultaneous EUS-guided portosystemic pressure measurement
and liver biopsy sampling correlate with clinically meaningful
outcomes. Gastrointestinal endoscopy 95(4): 703-710.
---------------------------------------------------------------------------
In support of its second claim, the applicant submitted a single-
center retrospective study on patients with various CLDs undergoing
EUS-PPG and EUS-guided liver biopsy (EUS-bx) to assess correlation with
histological hepatic fibrosis stage and various clinical, laboratory,
endoscopic and imaging variables indicative of advanced liver
disease.\97\ Cases with EUS-PPG were identified at the University of
California Irvine, a tertiary endoscopy center, between January 2014
and March 2020. Three different ways of evaluating the EUS-PPG outcomes
were assessed: (1) success rate of the EUS-PPG measurement; (2)
performance; and (3) safety profile. The primary outcome evaluated was
the association between EUS-PPG and the presence of histologic liver
fibrosis, stage >= 3. EUS-PPG procedures were successfully completed in
all 64 cases. On multivariate analysis, EUS-PPG >= 5 mmHg was
significantly associated with fibrosis stage >= 3 on EUG-liver biopsy
(LR 27.0, 95 percent CI = 1.653-360.597, p = 0.004), independent from
C-cirrhosis, clinical portal hypertension, thrombocytopenia,
splenomegaly, aspartate aminotransferase to platelet ration index score
> 2, and fibrosis-4 score > 3.25. There were six complications in
total, including abdominal pain (n = 3) and sore throat (n = 3). The
authors reported that there were no subjects who had post-EUS-PPG
emergency room (ER) visits or hospital admissions.
---------------------------------------------------------------------------
\97\ Choi, A., Chang, K., Samaransena, J. et al. (2022).
Endoscopic ultrasound-guided porto-systemic pressure gradient
measurement correlates with histological hepatic fibrosis. Digestive
Diseases and Sciences. https://doi.org/10.1007/s10620-022-07418-7.
---------------------------------------------------------------------------
In support of its third claim, the applicant submitted a review of
endoscopic ultrasound guided interventions. The article \98\ discussed
the diagnosis and treatment of portal hypertension and treatment of
gastric varices (GV) and compared liver biopsy, HVPG, and EUS-PPG. With
respect to the utility of HVPG, the authors explained that in the
absence of fibrosis/nodules (that is, cirrhosis) the pressure equalizes
throughout the interconnected sinusoidal network, and results in
minimal gradient (that is, normal; up to 4 mmHg). Thus, according to
the authors, HVPG does not provide useful information regarding
prehepatic or presinusoidal portal hypertension (PH) (that is, non-
cirrhotic causes of PH). In comparison, EUS-guided portal pressure
gradient (PPG) measurements employ a direct sampling technique. Thus,
the study authors found direct measurement of the portal vein pressure
could be considered the gold standard because it is not an estimate of
sinusoidal pressure as is HVPG. The difference in the mean measurement
of these pressures is termed the PPG which is analogous to the HVPG,
with the caveat that direct portal vein measurement also allows for the
assessment of prehepatic/presinusoidal PH; a limitation of the
transjugular approach. The study authors cited a study by Huang et
al.\99\ that used a porcine animal model with a novel EUS-guided system
which included a manometer attached to a 25-gauge fine needle
aspiration (FNA) needle for directly measuring pressures in the hepatic
and portal veins. The purpose of this animal study was to assess
clinical feasibility and assess correlation with the standard of care:
HVPG measurement through transjugular approach. The study authors
further cited a pilot study involving 28 patients between the age of
18-75 years with a history of liver disease or suspected cirrhosis that
underwent EUS-PPG measurements using the technique and equipment in the
animal study. The portal vein and hepatic vein were targeted via a
transgastric-transduodenal approach (inferior vena cava (IVC) was
substituted for hepatic vein when not technically feasible). The
technical success rate of EUS-PPG measurement was 100 percent without
any adverse events. The study authors concluded that EUS-PPG
measurement was a safe and feasible alternative to HVPG measurement.
---------------------------------------------------------------------------
\98\ Rudnick, S., Conway, J., Russo, M. (2021). Current state of
endohepatology: Diagnosis and treatment of portal hypertension and
its complications with endoscopic ultrasound. World Journal of
Hepatology, 13(8): 887-895.
\99\ Huang, J.Y., Samarasena, J.B., Tsujino, T., Chang, K.J.
(2016). EUS-guided portal pressure gradient measurement with a novel
25-gauge needle device versus standard transjugular approach: A
comparison animal study. Gastrointest Endosc, 84: 358-362 [PMID:
26945557 DOI: 10.1016/j.gie.2016.02.032].
---------------------------------------------------------------------------
In support of its fourth claim, the applicant submitted a letter in
which the author described a retrospective, single-center study to
determine feasibility, safety, and utility of EUS-PPG using EUS-liver
biopsy as comparison in patients with end stage renal disease (ESRD)
and suspected portal hypertension.\100\ According to the letter author,
the purpose of the study was to investigate the use of EUS-PPG to
assess pressure and the recommendation to decide between kidney
transplant (KT) or combined liver KT. According to the letter author,
the study suggested that new endoscopic and EUS findings were
discovered with successful/reproducible EUS-PPG in 10 out of 11 (91
percent) subjects. The author stated there were no significant adverse
events such as bleeding related to venous punctures, transfusions, or
EUS-PPG-related hospitalizations. The author referenced conclusions
from the study citing the need for further studies correlating EUS-PPG
with wedged hepatic vein pressure gradient (WHVPG), assessing patient
experience, and analyzing cost/benefit of one-stop versus piecemeal
procedures. It is also noted in the letter that WHVPG may not always be
feasible in ESRD patients due to catheter-related suprapubic
thromboses. We noted that
[[Page 81747]]
this source did not include the original retrospective study, only a
letter referencing it and highlighting its potential value to further
research.
---------------------------------------------------------------------------
\100\ Rubin, R, Mehta, M., Rossi, A., Joeslon, D., Shrestha, R.
(2021). Letter to the Editor: Endoscopic ultrasound guided portal-
systemic pressure gradient measurement to determine candidacy for
kidney transplant alone versus combined liver kidney transplant in
patients with advanced fibrosis or cirrhosis. Transplant
International 2021(34): 2903-2904.
---------------------------------------------------------------------------
Based on the evidence submitted with the application, we noted the
following concerns: a lack of direct comparison of EUS-PPG with HVPG
and non-invasive methods, a lack of consistent correlation with liver
biopsy, the reliance on non-peer reviewed studies, and small sample
sizes.
In the first two claims, the applicant asserted EUS-PPG is
clinically safer and more accurate than HVPG and technically superior
to HVPG. However, the applicant did not directly compare EUS-PPG and
HVPG. The Hajifathalian et al. study,\101\ which was submitted in
support of the first claim, stated EUS-PPG offers an alternative and
potentially superior methodology to measure PPG regardless of liver
disease etiology, without showing evidence of a direct comparison
between EUS-PPG and HVPG. The Choi et al. study,\102\ which was
submitted in support of the second claim, directly compared EUS-PPG
with EUS-liver biopsy, but it did not compare EUS-PPG with HVPG. The
authors cited the lack of direct comparison between EUS-PPG and HVPG as
a limitation in the study. Further these two studies had small sample
sizes and were conducted at a single site; the Hajifathalian et al.
study included 24 patients while the Choi et al. study included 64
patients.
---------------------------------------------------------------------------
\101\ Hajifathalian, K., Westerveld, D., Kaplan, A. et al.
(2022). Simultaneous EUS-guided portosystemic pressure measurement
and liver biopsy sampling correlate with clinically meaningful
outcomes. Gastrointestinal Endoscopy 95(4): 703-710.
\102\ Choi, A., Chang, K., Samaransena, J. et al. (2022).
Endoscopic ultrasound-guided porto-systemic pressure gradient
measurement correlates with histological hepatic fibrosis. Digestive
Diseases and Sciences. P.7. https://doi.org/10.1007/s10620-022-07418-7.
---------------------------------------------------------------------------
In addition, we noted that the Hajifathalian et al. study results
did not demonstrate correlation with fibrosis stage obtained from
concurrent EUS-guided liver biopsy sampling. According to the authors,
there was no statistically significant correlation between the fibrosis
stage on histology and measured PPG (P=.559). We expressed concern that
the lack of correlation would not support the claim that EUS-guided PPG
measurement is more accurate than the current method using an indirect
measurement with the use of HVPG.
In support of its fourth claim, we noted that the applicant relied
on a letter to the editor that provides a study description rather than
submitting the study directly as evidence for its claim.\103\ In the
enclosed letter, the author also noted that future studies are needed
to correlate EUS-PPG with WHVPG. Lastly, the article the applicant
provided in support of social determinants of health and disparities
did not directly discuss the device. Additional supporting evidence,
preferably published peer-reviewed clinical trials that show improved
clinical outcomes would help with our assessment of whether
EchoTip[supreg] demonstrates substantial clinical improvement over
existing technologies.
---------------------------------------------------------------------------
\103\ Rubin, R, Mehta, M., Rossi, A., Joeslon, D., Shrestha, R.
(2021). Letter to the Editor: Endoscopic ultrasound guided portal-
systemic pressure gradient measurement to determine candidacy for
kidney transplant alone versus combined liver kidney transplant in
patients with advanced fibrosis or cirrhosis. Transplant
International 2021(34): 2903-2904.
---------------------------------------------------------------------------
We invited public comment on whether EchoTip[supreg] meets the
substantial clinical improvement criterion at Sec. 419.66(c)(2)(i).
Comment: In response to our concern that the applicant has not
demonstrated the endoscopic ultra-sound-guided direct portal-systemic
pressure gradient measurement (EUS-PPG) is clinically safer and more
accurate than hepatic venous pressure gradient (HVPG) and technically
superior to HVPG without directly comparing EUS-PPG and HVPG, we
received comments from the applicant reiterating that the Huang et
al.\104\ studies compared EchoTip[supreg] direct EUS-PPG with the
indirect HVPG method in a swine model using rapid dextran infusion to
create transient portal hypertension and confirmed EchoTip[supreg]
direct EUS-PPG matches pressures measured using a transjugular balloon
catheter. The applicant asserted that the findings comparing
preoperative EchoTip[supreg] direct EUS-PPG with HVPG in patients with
cirrhosis or suspected cirrhosis undergoing abdominal surgery showed
results that match findings from literature substantiating that direct
portal vein pressures (PVP) correlate to the indirect Wedged Hepatic
Vein Pressures (WHVP). The applicant commented that an additional
finding was that patients preferred the EchoTip[supreg] procedure to
the transjugular HVPG.
---------------------------------------------------------------------------
\104\ Huang, J.Y., Samarasena, J.B., Tsujino, T., et al. (2016).
EUS-guided portal pressure gradient measurement with a novel 25-
gauge needle device versus standard transjugular approach: a
comparison animal study. Gastrointest Endosc 84(2); 358-362.
---------------------------------------------------------------------------
The applicant further summarized multiple historical documents from
the 1950s,105 106 1970s,107 108 109 1980s,\110\
and early 2000s 111 112 demonstrating the limitations of
HVPG especially in diabetic patients. The applicant, through these
historical studies, asserted that it has been well established that
direct measurement of portal venous pressure correlates with indirect
measurement of portal pressure using WHVP, and that the HVPG determined
using either direct PVP or indirect WHVP correlate with one another in
patients with sinusoidal portal hypertension.
---------------------------------------------------------------------------
\105\ Meyers, J.D., Taylor, J.W. (1951). An estimation of portal
venous pressure by occlusive catheterization on a hepatic venule. J
Clin Invest 30: 662.
\106\ Taylor, J.W., Myers, J.D. (1956). Occlusive hepatic venous
catheterization in the study of normal liver, cirrhosis of the
liver, and noncirrhotic portal hypertension. Circulation 13:368-379.
\107\ Reynolds, T.B., Ito, S., Iwatsuki, S. (1970). Measurement
of portal pressure and its clinical application. Am J Med 49: 649-
657.
\108\ Grozmann, R.J., Glickmann, M., Blei, A., et al. (1979).
Wedged and free hepatic venous pressure measured with a balloon
catheter. Gastroenterology 77: 253-258.
\109\ Viallet, A., Joly, J.G., Marleau, D., Lavoie, P. (1970).
Comparison of free portal venous pressure and wedged hepatic venous
pressure in patients with cirrhosis of the liver. Gastroenterology,
59:372-5.
\110\ Marleau, D., Cote, J., et al. (1985). Presinusoidal portal
hypertension in nonalcoholic cirrhosis. Hepatology, 5: 415-8.
\111\ Keiding, S., Vilstrup, H. (2002). Intrahepatic
heterogeneity of hepatic venous pressure gradient in human
cirrhosis. Scand J Gastroenterol, 37: 960-4.
\112\ Thalheimer, U., Leandro, G., Samonakis, D.N., et.al.
(2005). Assessment of the agreement between wedge hepatic vein
pressure and portal vein pressure in cirrhotic patients. Digestive
and Liver Disease, 37:601-608.
---------------------------------------------------------------------------
The applicant asserted that direct measurement with EchoTip[supreg]
addresses known limitations of the transjugular HVPG and non-invasive
assessment. The applicant asserted HVPG with the indirect method can
provide erroneous results. According to the applicant, Tandon et al.
has shown good interobserver agreement between appropriately performed
transjugular HVPG, but that adherence to specific techniques is
critical for accurate measurement.\113\ However, because of the variety
of complicated portal hemodynamics and because the procedure is so
complicated, the HVPG may not always reflect the substantial severity
of portal hypertension in over 16 percent of patients with sinusoidal
portal hypertension. The applicant also submitted preliminary findings
from the Lim, et al. study comparing preoperative EchoTip[supreg]
direct EUS-PPG with HVPG
[[Page 81748]]
in patients with cirrhosis or suspected cirrhosis undergoing abdominal
surgery. The applicant stated that the study showed the median pressure
gradient was similar between the EUS-PPG measurements and transjugular
HVPG measurements, with a high correlation coefficient between the two
techniques (r = 0.972; P = 0.006). The applicant stated that while only
six patients were included, the results match findings from the
considerable literature substantiating that direct portal vein
pressures (PVP) correlate to the indirect Wedged Hepatic Vein Pressures
(WHVP). The applicant stated that an additional finding was that
patients preferred the EchoTip[supreg] procedure to the transjugular
HVPG.
---------------------------------------------------------------------------
\113\ Tandon, P., Ripoll, C., Assis, D., et. al. (2016). The
interpretation of hepatic venous pressure gradient tracings--
excellent interobserver agreement unrelated to experience. Liver
Int, 36(8): 1160-6.
---------------------------------------------------------------------------
Response: We thank the applicant for their comments. However, we
maintain the concerns we articulated in the proposed rule. While we
agree that the limitations of HVPG for obtaining clinical information
are well established, the additional literature provided does not
address our concern about the lack of data comparing EUS-PPG to HVPG.
The additional literature is based on patient data that is several
decades out of date that may not be comparable to more recent patient
data or clinical practices and does not rely on direct comparison
between HVPG and other measurements, and rather only cites the
limitations of HVPG in certain patient populations. The applicant
restated its references to the Huang, et al. study, which offers the
only direct comparison between EchoTip[supreg] and HVPG and provided
new references to the Lim et al. study, in which the human patient
model only included six study participants. We do not agree that data
from animal studies is sufficient to extrapolate to human populations
for the purposes of demonstrating substantial clinical improvement.
Furthermore, we cited concerns about small sample sizes specifically in
the Hajifathalian et al. and the Choi et al. studies, which included 24
and 64 patients respectively, while the applicant's more recently
submitted data in the Lim et al. study includes even fewer patients.
Comment: In response to our concern that the Hajifathalian et al.
study results did not achieve correlation with fibrosis stage obtained
from concurrent EUS-guided liver biopsy sampling, the applicant
asserted that the lack of correlation was due to a small heterogenous
sample, but offered that the authors noted good correlation in true
negatives and true positives. The applicant further asserted that
direct comparison between EchoTip[supreg] PPG and HVPG and concurrent
liver biopsy during the same encounter could only be accomplished in a
highly specialized and controlled setting due to the need for
simultaneous endoscopic ultrasound and transjugular catheterization.
The applicant reiterated that in the Choi, et al. study included in
their application, EUS-PPG was significantly associated with fibrosis
stage >= 3 on EUG-liver biopsy (LR 27.0, 95 percent CI = 1.653-360.597,
p = 0.004).\114\
---------------------------------------------------------------------------
\114\ Choi, A., Chang, K., Samaransena, J. et al. (2022).
Endoscopic ultrasound-guided porto-systemic pressure gradient
measurement correlates with histological hepatic fibrosis. Digestive
Diseases and Sciences. https://doi.org/10.1007/s10620-022-07418-7.
---------------------------------------------------------------------------
Response: We thank the applicant for their comments and the
additional context. However, we maintain the concerns we articulated in
the proposed rule, specifically, as indicated by the applicant, that
the Hajifathalian et al. study is too small to show significant
clinical improvement. In addition, the comments do not address our
earlier concerns with the Hajifathalian et al. and Choi et al. studies
regarding the lack of direct comparison between HVPG and EUS-PPG.
Comment: In response to our concern that supporting evidence,
preferably published peer-reviewed clinical trials, that show improved
clinical outcomes would help inform our assessment of whether
EchoTip[supreg] demonstrates substantial clinical improvement over
existing technologies, the applicant submitted comments stating that
the goal for both the referring physician and general
gastroenterologist is to identify patients truly in need of specialized
care from the hepatology specialist. The applicant stated that most
gastroenterology practices have access to interventional
gastroenterologists who can perform the EchoTip[supreg] procedure and
can identify patients who need to be referred to the appropriate
practitioner for intervention to manage their disease. In addition,
EchoTip[supreg] fits into existing workflow in the endoscopy suite and
eliminates the concerns with the high false positive rates found with
non-invasive tests such as transient elastography and various risk
score calculations. The applicant stated that therefore,
EchoTip[supreg] does meet the criterion for substantial clinical
improvement by offering an efficient way to identify patients needing
specialty hepatology care, overcomes the issues with the traditional
transjugular HVPG in the population with metabolic associated
steatohepatitis (MASH) and metabolic dysfunction-associated steatotic
liver disease (MASLD), and prevents misclassification of disease
severity with non-invasive tests.
In support of the claim that direct portal vein pressure
measurement is more accurate for determining the presence of portal
hypertension in certain cases, the applicant submitted additional
literature on the use of EchoTip[supreg] in clinical care. The
applicant discussed the Jirapinyo et al. study,\115\ in which the
author found a significant reduction in PPG, with 79 percent of
patients experiencing a reduction of over 20 percent within 6 months
after use of EchoTip[supreg] during the endoscopic gastric plication
(EGP) procedure. The applicant also referenced a case study in which
EchoTip[supreg] was used to clear a patient for a successful EGP after
previous endoscopic findings showed esophageal varicosities.\116\ The
applicant also asserted that EchoTip[supreg] can be used by
gastroenterologists, in addition to hepatology specialists who may be
less accessible.
---------------------------------------------------------------------------
\115\ Jirapinyo, P., Thompson, C., Garcia-Tsao, L., et al.
(2023). Endoscopic gastric plication reduces portosystemic pressure
gradients in patients with nafld and compensated advanced chronic
liver disease. Endoscopy. DOI: 10.1055/a-2146-8857.
\116\ Krishnan, A., Shah-Khan, S.M., Hadi, Y., et al. (2023).
Convergence of endobariatrics and endohepatology for evaluation and
treatment of obesity and nonalcoholic fatty liver disease.
Endoscopy, 55: E841-E843. DOI 10.1055/a-2094-9794.
---------------------------------------------------------------------------
Response: We thank the applicant for their comments and additional
literature. However, while the literature discusses the limitations of
HVPG and the need for direct measurement, it did not provide peer-
reviewed literature on whether EchoTip[supreg] improves clinical
outcomes in comparison to HVPG. In addition, while the applicant
referenced the Jirapinyo et al. study and a case study to show a
significant reduction in PPG associated with a reduction in the risks
of variceal bleeding and death, the full studies were not included with
the submitted comments. We understand the applicant claims
EchoTip[supreg] may be more readily available in settings where
hepatologists are not easily accessible, however, the applicant has not
addressed our concern as to whether EchoTip[supreg] direct EUS-PPG is a
substantial clinical improvement over HVPG.
Comment: Several commenters stated support for EchoTip[supreg]'s
eligibility for transitional pass-through status, stating that
EchoTip[supreg] is helpful in the measurement of portal hypertension
and diagnosis of multiple conditions related to elevated pressures of
the liver.
One commenter asserted EchoTip[supreg] meets substantial clinical
improvement because EchoTip[supreg] identifies patients that need
intensive hepatology care
[[Page 81749]]
based on the gold standard of portal pressure measurement. According to
the commenter, it offers a solution to the inaccuracies in the current
standard of care (transjugular hepatic venous pressure gradient (HVPG))
in patients who have pre-sinusoidal conditions, such as nonalcoholic
steatohepatitis (NASH) and nonalcoholic fatty liver disease (NAFLD).
The commenter also asserted EchoTip[supreg] improves patient safety by
eliminating radiation exposure risks with HVPG.
A few commenters stated EchoTip[supreg] allows for a single
procedure in a single setting compared to other clinical options that
might require multiple visits across multiple specialties. In addition,
a few commenters stated their patients preferred EchoTip[supreg] to
other procedures. One commenter stated using EchoTip[supreg] was
particularly useful for patients with morbid obesity where other
options may not be available or as accurate, further stating that in
such cases PPG measurement has been invaluable because it has given
very good and accurate clinical information that could not be obtained
from other means such as CT scan, fibroscan, etc. The commenter also
stated that EchoTip[supreg] has significant clinical value because it
obviates the need for patient to go to two separate procedures--HVPG
measurement and then a separate session to get a percutaneous liver
biopsy. One commenter stated that EchoTip[supreg] has been very
beneficial by differentiating patients that have cirrhosis as a new
diagnosis and those that were mislabeled, leading to life-changing
consequences. One commenter stated that EchoTip[supreg] allows them to
determine which patients with liver disease are safe to undergo
surgery. Another commenter stated that EchoTip[supreg] has a unique yet
intuitive design that offers the capability to accurately measure
portal pressures and commented that a distinctive feature is its
echogenic tip. The commenter opined that this aspect of the device
dramatically enhances procedural accuracy, ensuring that the needle tip
is correctly positioned within the desired vein each time. The
commenter stated that additionally, the use of a 25-gauge needle
simplifies access to both the portal and hepatic veins, minimizing
tissue disruption and elevating the overall patient experience. The
commenter further praised the device's compact design, and integration
of a display with the system's self-calibrating transducer which
provides clear, real-time pressure readings to aid in making informed
clinical decisions. The commenter concluded that the device has
significantly enhanced diagnostic precision for cases indicating portal
hypertension, thereby assisting their team in treatment planning and
improved patient outcomes.
Response: We thank the commenters for their responses. We
appreciate that EchoTip[supreg] has changed the way some physicians
practice, but due to the concerns stated above concerning small sample
size and a lack of peer-reviewed direct comparison between
EchoTip[supreg] and HVPG, we do not believe there is enough data to
support the applicant's claims about significant clinical improvement
over existing methods for measurement of portal gradient pressures.
Further, despite the prognostic information measurement of portal
gradient pressure provides, given all other current and evolving non-
invasive technologies, it remains unclear whether obtaining this
measurement is the standard of care in the management of patients with
CLD. As noted by Rudnick et al., with the exception of intrahepatic
portosystemic shunts and trans-jugular liver biopsies, HVPG
measurements are not routinely obtained.\117\ Additionally, we were not
provided any literature to support the claim that EchoTip[supreg]
eliminates radiation exposure risks with HVPG.
---------------------------------------------------------------------------
\117\ Rudnick, S., Conway, J., Russo, M. (2021). Current state
of endohepatology: Diagnosis and treatment of portal hypertension
and its complications with endoscopic ultrasound. World Journal of
Hepatology, 13(8): 887-895.
---------------------------------------------------------------------------
After consideration of the public comments we received, we are not
approving EchoTip[supreg] for transitional pass-through payment status
in CY 2024 because the technology does not meet the substantial
clinical improvement criterion at Sec. 419.66(c)(2)(i). Because we
have determined that EchoTip[supreg] does not meet the substantial
clinical improvement criterion, we are not evaluating whether the
device meets the cost criterion.
We note that we received public comments with regard to the cost
criteria for EchoTip[supreg], but because we have determined that the
device does not meet the substantial clinical improvement eligibility
criterion and therefore, is not eligible for approval for transitional
pass-through payment status for CY 2024, we are not summarizing
comments received or making a determination on those criteria in this
final rule.
(d) FLEX Vessel PrepTM System
Venture Med Group, Inc. submitted an application for a new device
category for transitional pass-through payment status for FLEX Vessel
PrepTM System (FLEX VPTM) for CY 2024. Per the
applicant, FLEX VPTM is an endovascular, over-the-wire,
retractable, sheathed catheter with a three-strut treatment element at
the distal tip used to help resolve stenoses occluding vascular access
in patients with End-Stage Renal Disease (ESRD) on hemodialysis.
According to the applicant, FLEX VPTM is used with
percutaneous transluminal angioplasty (PTA) catheters to facilitate
dilation of stenoses and for the treatment of in-stent restenosis of
balloon expandable and self-expanding stents in the peripheral
vasculature. The applicant asserted that FLEX VPTM consists
of three integrated components: (1) control handle, which includes the
flush and guidewire ports and sheath and treatment element actuators;
(2) catheter shaft; and (3) treatment element, which includes three
proximally mounted micro-surgical blades on protective skids. The
struts are radially opposed, and the proximal portion of each strut
includes a micro-surgical blade. A radiopaque marker is located
distally to assist in the positioning of the catheter.
According to the applicant, when deployed, FLEX VPTM's
struts independently engage with neointimal hyperplastic stenoses
occluding an arteriovenous fistula or graft used for hemodialysis. As
the device is pulled back through the lesion, the blades create three
continuous, parallel micro-incisions, approximately 250 microns in
depth, along the lesion's entire length. The applicant provided that
this is a non-balloon-based device where the struts exert a consistent
force of approximately one atmosphere on the vessel wall. Per the
applicant, additional micro-incisions may be created by using several
passes of the device. According to the applicant, the device breaks the
lesion surface to facilitate the effectiveness of a percutaneous
transluminal balloon angioplasty, which immediately follows use of the
device in restoring patency to the vascular access.
The applicant asserted that the micro-incisions improve acute
luminal gain and vessel compliance by releasing circumferential tension
in the lesion. The applicant asserted that this preparation could help
reduce vessel trauma and complications (including severe dissection and
need for a bail-out stent) and the need for high pressure balloons
(which risk barotrauma). Per the applicant, the interventionalist
advances FLEX VPTM past the lesion, then unsheathes and
expands the treatment element and slowly draws the catheter back,
allowing each micro-surgical blade to simultaneously and independently
engage with the lesion.
[[Page 81750]]
This step produces three continuous, parallel micro-incisions along the
lesion's length. According to the applicant, this process may be
repeated several times; once the lesion is crossed on the first pass,
the treatment element is re-sheathed, advanced again through the
lesion, and rotated approximately 30 to 90 degrees. The treatment
element is then re-deployed and the process is repeated.\118\
---------------------------------------------------------------------------
\118\ CMS made minor edits to the device description in this
final rule with public comment to improve clarity.
---------------------------------------------------------------------------
As stated previously, to be eligible for transitional pass-through
payment under the OPPS, a device must meet the criteria at Sec.
419.66(b)(1) through (4). With respect to the newness criterion at
Sec. 419.66(b)(1), on September 11, 2020, the applicant received
510(k) clearance from FDA for FLEX VPTM for use with PTA
catheters to facilitate dilation of stenoses in the femoral and
popliteal arteries and treatment of obstructive lesions of native or
synthetic arteriovenous dialysis fistulae. The device is also indicated
for treatment of in-stent restenosis of balloon expandable and self-
expanding stents in the peripheral vasculature. We received the
application for a new device category for transitional pass-through
payment status for FLEX VPTM on February 28, 2023, which is
within 3 years of the date of the initial FDA marketing authorization.
We invited public comment on whether FLEX VPTM meets the
newness criterion at Sec. 419.66(b)(1).
Comment: With respect to the newness criterion at Sec.
419.66(b)(1), the applicant reiterated that FLEX VPTM
received 510(k) clearance from the FDA on September 11, 2020, and that
CMS received VentureMed Group's application for a new device category
on February 28, 2023, which is within 3 years of the date of FDA
clearance. Since CMS received the application within the required 3
years, the applicant stated that it is clear FLEX VPTM meets
the newness criterion.
Response: We appreciate the applicant's input and agree that
because we received the application for FLEX VPTM on
February 28, 2023, which is within 3 years of the FDA clearance date of
September 11, 2020, FLEX VPTM meets the newness criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
according to the applicant, FLEX VPTM is integral to the
service provided, is used for one patient only, comes in contact with
human skin, and is applied through an incision (for hemodialysis
patients, the incision is in the wrist or arm area). Prior to balloon
angioplasty, FLEX VPTM is inserted through an incision, over
an endovascular guidewire until the device is positioned distal to the
lesion to be treated.
We invited public comment on whether FLEX VPTM meets the
integral part of the service criterion at Sec. 419.66(b)(3).
Comment: With respect to the eligibility criterion at Sec.
419.66(b)(3), the applicant reiterated that FLEX VPTM is
integral to the service provided, is used for one patient only, comes
in contact with human skin, and is applied through an incision. Because
of these attributes the applicant stated it is clear that FLEX
VPTM meets the eligibility criteria at Sec. 419.66(b)(3).
Response: We appreciate the applicant's input. We agree with the
applicant and have determined that FLEX VPTM meets the
eligibility criterion at Sec. 419.66(b)(3).
With respect to the exclusion criterion at Sec. 419.66(b)(4), the
applicant claimed that FLEX VPTM meets the device
eligibility requirements of Sec. 419.66(b)(4) because it is not
equipment, an instrument, apparatus, implement, or item of this type
for which depreciation and financing expenses are recovered, and it is
not a supply or material furnished incident to a service.
We invited public comment on whether FLEX VPTM meets the
exclusion criterion at Sec. 419.66(b)(4).
Comment: With respect to the exclusion criterion at Sec.
419.66(b)(4), the applicant reiterated that FLEX VPTM is not
equipment, an instrument, apparatus, implement or item of this type for
which depreciation and financing expenses are recovered, and it is not
a supply or material furnished incident to a service. Accordingly, the
applicant stated it is clear that FLEX VPTM meets the
exclusion criterion at Sec. 419.66(b)(4).
Response: We appreciate the applicant's input. We agree with the
applicant and have determined that FLEX VPTM meets the
exclusion criterion at Sec. 419.66(b)(4).
In addition to the criteria at Sec. 419.66(b)(1) through (4), the
criteria for establishing new device categories are specified at Sec.
419.66(c). The first criterion, at Sec. 419.66(c)(1), provides that
CMS determines that a device to be included in the category is not
appropriately described by any of the existing categories or by any
category previously in effect, and was not being paid for as an
outpatient service as of December 31, 1996. The applicant described
FLEX VPTM as an endovascular, over-the-wire, retractable,
sheathed catheter with a three-strut treatment element at the distal
tip used to help resolve stenoses occluding vascular access in patients
with ESRD on hemodialysis. Per the applicant, no previous device
categories for pass-through payment have encompassed FLEX
VPTM and there are no similar device categories. Upon
review, it did not appear that there are any existing pass-through
payment categories that might apply to FLEX VPTM.
We invited public comment on whether FLEX VPTM meets the
device category criterion at Sec. 419.66(c)(1).
Comment: With respect to the new device category criterion at Sec.
419.66(c)(1), the applicant reiterated that no pass-through payment
categories now exist that might apply to the FLEX VPTM and,
therefore, the device meets the new device category criterion at Sec.
419.66(c)(1).
Response: We appreciate the applicant's input. We continue to
believe that there is not an existing pass-through payment category
that describes FLEX VPTM, and therefore, that FLEX
VPTM meets the device category eligibility criterion at
Sec. 419.66(c)(1).
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines either of the following: (i)
that a device to be included in the category has demonstrated that it
will substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part compared to
the benefits of a device or devices in a previously established
category or other available treatment; or (ii) for devices for which
pass-through status will begin on or after January 1, 2020, as an
alternative to the substantial clinical improvement criterion, the
device is part of FDA's Breakthrough Devices Program and has received
FDA marketing authorization for the indication covered by the
Breakthrough Device designation. The applicant stated that FLEX
VPTM represents a substantial clinical improvement over
existing technologies by: (1) improving clinical outcomes for the
hemodialysis patient population with dysfunctional arteriovenous (AV)
access; and (2) reducing the rate of device-related complications. The
applicant cited two studies describing the findings of a single
clinical trial specifically for the purpose of addressing the
substantial clinical improvement criterion.
The first study presented findings six months after patients were
treated with FLEX VPTM followed by balloon angioplasty
(Aruny et al.),\119\ and the
[[Page 81751]]
second study presented findings at 12 months post-treatment with FLEX
VPTM followed by balloon angioplasty (author not identified
in the manuscript for the 12-month follow up).\120\ Both studies
focused on results from methods used to show the durability of the
treatments of blocked vascular accesses with FLEX VPTM. The
trial was a prospective, observational controlled clinical trial. A
total of 148 lesions or blockages were treated with FLEX
VPTM prior to a PTA in 114 subjects (the population was 53.5
percent female; 65.8 percent Black or African American (B/AA)), treated
at eight clinical sites. All subjects were hemodialysis patients with
vascular blockages. Of the 114 subjects, 104 patients had prior
treatments to correct stenoses before enrolling in the trial. A primary
endpoint was anatomic success, defined as angiographic confirmation of
<30 percent residual stenosis post-procedure without adverse event.
Additional assessments included dialysis circuit primary patency or
vascular openness, clinical success and procedural success. The trial
also measured the target lesion primary patency (TLPP) and freedom from
target lesion restenosis (FFTLR) to determine if there is a decreased
rate of subsequent therapeutic interventions. The two studies of the
single clinical trial also examined the rate of device-related
complications. No serious adverse events were reported initially (Aruny
et al.), or in the 12-month follow-up (author not identified in the
manuscript for the 12-month follow-up). The studies looked at
differences in outcomes based on race and sex and found no significant
differences. Per the applicant, the results suggest that FLEX
VPTM followed by angioplasty can substantially reduce the
number and burden of maintenance procedures for hemodialysis patients
with arteriovenous fistula (AVF), arteriovenous graft (AVG), and AV
disfunctions that cause cephalic arch stenoses.
---------------------------------------------------------------------------
\119\ Aruny et al. Real-world results of a novel vessel
preparation device prior to balloon angioplasty for arteriovenous
access repair in diverse populations on dialysis, under review, JVA,
Feb. 2023.
\120\ Durability of arteriovenous access repair involving vessel
preparation by longitudinal micro-incisions before balloon
angioplasty, unpublished manuscript (no author identified).
---------------------------------------------------------------------------
In support of its first claim, that FLEX VPTM improves
clinical outcomes for the hemodialysis patient population with
dysfunctional AV access, the applicant asserted that FLEX
VPTM decreased both the rates of therapeutic interventions
and subsequent therapeutic interventions. The applicant provided the
following evidence from the clinical trial and two studies. FLEX
VPTM treatment prior to angioplasty benefits hemodialysis
patients by improving the level of openness of blocked (or stenosed)
arteriovenous access; a recurring issue that occurs because of the
fistulas created to facilitate hemodialysis. The use of FLEX
VPTM also allows the site with prior blockage (also known as
lesions) to stay open for a longer period of time, reducing the
frequency of future angioplasty procedures. The applicant discussed how
the initial study (Aruny et al.), found that patients treated with FLEX
VPTM prior to PTA (FLEX+PTA) had 6 months TLPP of 63.7
percent openness, versus the 15.6 percent to 50.5 percent rates of
vascular openness after PTA alone, observed in other publications. This
study also presented results for FFTLR, a calculation to determine an
average number of days of durability of the percentage of the patency
or lesion openness reported; for the overall hemodialysis population
studied it was 206.7 days. The applicant also described results for
patients with only AVFs or AVGs. For FLEX+PTA in AVF patients, TLPP was
70.6 percent and FFTLR was 219.7 days. For FLEX+PTA in AVG patients,
TLPP was 46.6 percent and FFTLR was 173.9 days. Confirmation of
reliability of the findings was shown by dialysis access circuit
primary patency: 54.3 percent (AVF 54.1 percent; AVG 47.4 percent).
According to the applicant, per the literature, the results of dialysis
access circuit primary patency with only angioplasty performed, ranged
from 0 percent to 48 percent. The applicant also presented results 12
months post-treatment (author not identified in the manuscript for the
12-month follow up) supporting the durability of the FLEX+PTA. Per the
applicant, results generally accord with Aruny et al.'s 6-month results
and exceed PTA-only results from the literature. Overall, TLPP was 45.7
percent (versus 62.2 percent at 6 months) and FFTLR was 250.9 days
(versus literature (PTA only), 131.4 days). Per the applicant, this
result suggests that compared to the durability of PTA only, FTA+PTA
would result in a lower frequency of treatments to remove stenosis in
hemodialysis patients overall. For AVFs, TLPP was 47.4 percent (versus
67.5 percent at 6 months); FFTLR was 258.5 days (versus literature,
156.9 days). For AVGs, TLPP was 43.8 percent (versus 52.4 percent at 6
months); FFTLR was 239.4 days (versus literature, 76.6 days). Overall,
12 months circuit primary patency was 36.5 percent (versus 54.3 percent
at 6 months).\121\
---------------------------------------------------------------------------
\121\ Ibid.
---------------------------------------------------------------------------
In further support of the applicant's first claim, the applicant
presented results from the clinical trial comparing B/AA patients to
non-B/AA patients. In support of FLEX VPTM prior to PTA
improving clinical outcomes for B/AA hemodialysis patient population
with dysfunctional AV access, the applicant discussed the initial Aruny
et al. study, in which B/AA patients had better results with FLEX
VPTM intervention than did non-B/AA patients. The B/AA
cohort (65.8 percent of sample) had TLPP of 63.76 percent versus 58.8
percent for the non-B/AA cohort after treatment with FLEX+PTA. FFTLR
was 207.8 days for B/AA versus 192.2 days for non-B/AA. For B/AA
patients with cephalic arch lesions, TLPP was 78.6 percent versus 58.3
percent for non-B/AA. The applicant asserted that these results were
achieved despite pre-existing disparities in patient's experience with
AV access care. B/AA patients had more years since they started
hemodialysis (p<0.01), suggesting a possibility of increased severity
or complexity of lesions in the B/AA patients.\122\ The applicant also
presented results 12 months post-treatment.\123\ In terms of B/AA
patient outcomes comparable to the overall sample, the B/AA cohort
(65.8 percent of sample) had TLPP of 45.9 percent versus 45.7 percent
overall patients and FFTLR was 257.8 days for B/AA versus 250.9 days
overall patients. In B/AA patients with cephalic arch lesions, TLPP was
71.8 percent versus 59.7 percent overall patients.
---------------------------------------------------------------------------
\122\ Aruny et al. Real-world results of a novel vessel
preparation device prior to balloon angioplasty for arteriovenous
access repair in diverse populations on dialysis, under review, JVA,
Feb. 2023.
\123\ Durability of arteriovenous access repair involving vessel
preparation by longitudinal micro-incisions before balloon
angioplasty, unpublished manuscript (no author identified).
---------------------------------------------------------------------------
Furthermore, in support of the applicant's first claim, the
applicant provided the following evidence from the clinical trial. In
support of FLEX VPTM improving clinical outcomes for a
female hemodialysis patient population with dysfunctional AV access,
the applicant stated that in the initial Aruny et al. study, females
differed from males significantly in their pre-existing experiences
with AV care. Female patients had more years since they started
hemodialysis (p<0.01) and since AV access creation (p<0.01); females
had more prior AV access interventions (p<0.05). According to the
applicant, this potentially suggests that female
[[Page 81752]]
patients are more prone to complexity of lesions or recurrence of
stenosis. However, no statistically significant differences in results
of TLPP and FFTLR measures at 6 months post treatment were observed
between females and males treated with FLX VPTM followed by
PTA. Therefore, females receiving a FLEX VPTM intervention
prior to PTA achieved results comparable to males, notwithstanding pre-
existing disparities.\124\
---------------------------------------------------------------------------
\124\ Aruny et al. Real-world results of a novel vessel
preparation device prior to balloon angioplasty for arteriovenous
access repair in diverse populations on dialysis, under review, JVA,
Feb. 2023.
---------------------------------------------------------------------------
In further support of the applicant's first claim, the applicant
explained that cephalic arch (CA) stenoses are notoriously difficult to
treat effectively and have some of the worst dialysis access and
frequency of recurrence results. The applicant explained that
complications are also high. In this sample, the target stenosis was in
the CA in 25/114 patients (21.9 percent). TLPP following FLEX+PTA at 6
months (Aruny et al.) was 70.6 percent overall patients, and 76.8
percent in the B/AA cohort. According to the applicant comparable
figures in the literature ranged from 0 percent to 51.6 percent. Access
dialysis circuit primary patency obtained from the literature for PTA
only was 66.4 percent for CA cases.\125\ The applicant also presented
results 12-month post-treatment (author not identified in the
manuscript for the 12-month follow up). TLPP for these patients
following FLEX+PTA at 12 months was 59.7 percent for overall patients
and 71.8 percent in the B/AA cohort. According to the applicant,
comparable figures in the clinical literature ranged from 0 percent to
33.9 percent and access dialysis circuit primary patency was 55.3
percent for CA cases.\126\
---------------------------------------------------------------------------
\125\ Ibid.
\126\ Durability of arteriovenous access repair involving vessel
preparation by longitudinal micro-incisions before balloon
angioplasty, unpublished manuscript (no author identified).
---------------------------------------------------------------------------
In support of the applicant's second claim, the applicant asserted
that no serious adverse events were reported from the initial study
(Aruny et al.). Five procedural complications and one dissection
related to the FLEX VPTM device were recorded. Three
dissections were associated with PTA.\127\ The applicant also presented
results 12 months post-treatment (author not identified in the
manuscript for the 12-month follow-up), noting that no serious adverse
events were reported during 12-month follow-up.
---------------------------------------------------------------------------
\127\ Aruny et al. Real-world results on a novel vessel
preparation device prior to balloon angioplasty for arteriovenous
access repair in diverse populations on dialysis, under review, JVA,
Feb. 2023.
---------------------------------------------------------------------------
According to the applicant, these findings confirm the safety
record for FLEX VPTM, which is better when compared to the
Journal of Vascular and Interventional Radiology (JVIR) Quality
Improvement Guidelines thresholds for AVF and AVG. According to the
applicant, in the literature, up to 15 percent cephalic arch lesions
result in vessel rupture and about 12 percent of PTAs in B/AA patients
are reported to result in major complications.\128\
---------------------------------------------------------------------------
\128\ Durability of arteriovenous access repair involving vessel
preparation by longitudinal micro-incisions before balloon
angioplasty, unpublished manuscript (no author identified).
---------------------------------------------------------------------------
Ultimately, the applicant concluded that FLEX VPTM is
safe and effective, notably in patients with AVGs and those with CA
stenoses, and furthermore, despite observed differences in time since
hemodialysis onset, clinical success was similar across sex and race,
suggesting an opportunity to enhance health equity.\129\ The applicant
also added that FLEX VPTM, when used with PTA, provides
sustained clinical improvement over existing technologies by increasing
the patency and time to reintervention of PTA procedures in AVFs and
AVGs at 12 months (author not identified in the manuscript for the 12-
month follow-up), while reducing the potential for serious
complications, such as perforations and vessel rupture. Favorable
results at 6 months for the B/AA cohort reported in Aruny et al.'s
article were sustained in the 12 month results. Further, according to
the applicant, the use of FLEX VPTM offers the prospect of
improved treatment of unresponsive or difficult to treat stenosis in
the cephalic arch.\130\
---------------------------------------------------------------------------
\129\ Aruny et al. Real-world results of a novel vessel
preparation device prior to balloon angioplasty for arteriovenous
access repair in diverse populations on dialysis, under review, JVA,
Feb. 2023.
\130\ Durability of arteriovenous access repair involving vessel
preparation by longitudinal micro-incisions before balloon
angioplasty, unpublished manuscript (no author identified).
---------------------------------------------------------------------------
Based on the evidence submitted in the application, we noted the
following concerns: The applicant presented two studies (Aruny et al.
[a 6-month follow up], and an unpublished manuscript which did not
identify an author [12-month follow up] submitted with the application
that are based on a single clinical trial of 114 patients followed for
12 months. Per the applicant, the results from the 6-months follow up
are not yet published, and the results from 12-months post-treatment
are also unpublished and only available at the FLEX VPTM
registry. Therefore, we noted that the evidence presented on benefits
to patients in hemodialysis is not peer-reviewed and this may reduce
the strength of the evidence presented and the opinion of peers on
study quality. In order to demonstrate substantial clinical improvement
over currently available treatments, we consider supporting evidence,
preferably published peer-reviewed clinical trials, that shows improved
clinical outcomes, such as reduction in mortality, complications,
subsequent interventions, future hospitalizations, recovery time, pain,
or a more rapid beneficial resolution of the disease process compared
to the standard of care. We also noted that, due to the clinical trial
design, there is insufficient data on the impact of angioplasty with
the drug-coated balloon option. The drug in these balloons may play a
role in the improvement of patency or openness durability and
additional studies to strengthen the initial observations presented by
the applicant would be helpful.
Lastly, we noted the applicant did not show a clear crosswalk of
findings or data in terms of device-related complications (including
dissection and embolectomy) observed in the trial and compared to those
referenced in literature. For example, procedural complications and
dissection were mentioned in the FLEX VPTM group while
rupture and major complications were mentioned in the literature. The
clinical trial results presented one dissection attributed to FLEX
VPTM after 148 lesions were treated with FLEX
VPTM plus PTA. Per the applicant, there are approximately
732,000 interventions per year in the U.S. to maintain lifesaving
arteriovenous access and FLEX VPTM could potentially be used
in a fraction of those; this increases the concern for frequency of
complications and therefore, additional studies may be needed to
strengthen the second substantial clinical improvement claim.
We invited public comment on whether FLEX VPTM meets the
substantial clinical improvement criterion at Sec. 419.66(c)(2)(i).
Comment: All commenters addressing the substantial clinical
improvement criterion offered support for approval of the FLEX
VPTM application. Commenters highlighted a number of added
benefits when FLEX VPTM was used prior to PTA in
hemodialysis patents, including: positive outcomes for a cephalic arch
and AV graft case; reduction on barotrauma associated with angioplasty;
and its effectiveness and easy usability, specifically during AV
interventions. A few commenters,
[[Page 81753]]
including the applicant, explained that reporting procedural
complications was based on the Society of Interventional Radiology
(SIR) typology and under this typology all complications reported in
the AV registry were minor. With zero major complications reported, all
commenters agreed on the safety of FLEX VPTM compared to
what is reported in the peer-reviewed literature. One commenter stated
that FLEX VPTM substantially reduced procedural
complications for patients by lowering the need for bail-out stenting.
Several commenters, including the applicant, stated that the use of
FLEX VPTM prior to PTA enables a longer and lasting patency
for AV procedures, thereby reducing the frequency of interventions as
patients treated using the device returned for access repair less often
than patients without the use of FLEX VPTM. A few
commenters, including the applicant, noted the FLEX VPTM
benefits for patient populations underserved and underrepresented in
trials as demonstrated through the studies submitted with the
application. One commenter stated that dialysis patients should have
every option available that will improve clinical outcomes for their AV
access and quality of care.
Response: We appreciate the input provided by these commenters. We
have taken this information into consideration in making our final
determination of whether FLEX VPTM meets the substantial
clinical improvement criterion, discussed below.
Comment: To address our concerns that the evidence presented with
the application regarding the benefits to patients on hemodialysis was
not peer-reviewed; the applicant and a commenter noted that the data in
the application is now published in three separate peer-reviewed
journals.131 132 133
---------------------------------------------------------------------------
\131\ Aruny, J., et al. (2023). Longitudinal micro-incision
creation prior to balloon angioplasty for treatment of arteriovenous
access dysfunction in a real-world patient population: 6-month
cohort analysis. Hemodialysis International 2023 Aug 17: 1-10.
(Online ahead of print) https://onlinelibrary.wiley.com/doi/10.1111/hdi.13111.
\132\ Aruny et al. (2023). Longitudinal micro-incision prior to
balloon angioplasty for treatment of arteriovenous access
dysfunction in a real-world patient population: 12-month cohort
analysis. Journal of Interventional Nephrology, 6(4): 88-97. https://www.openaccessjournals.com/articles/longitudinal-microincisions-prior-to-balloon-angioplasty-for-treatment-ofarteriovenous-access-dysfunction-in-a-realworld-patient-16713.htm.
\133\ Davis, O., et al. (2023). Novel device prior to balloon
angioplasty for dysfunctional arteriovenous access: Analysis of a
real-world registry by race and sex cohorts. Journal of
Interventional Nephrology, 6(4): 158-164. https://www.openaccessjournals.com/articles/novel-device-prior-to-balloon-angioplasty-for-dysfunctional-arteriovenousaccess-analysis-of-a-realworld-registry-by-race-and-sex-16852.html.
---------------------------------------------------------------------------
Response: We appreciate the applicant's and the commenter's
responses to our concern regarding publication of the data presented in
the application and for including the references. We agree with
commenters that the published peer-reviewed clinical data shows
improved clinical outcomes through the reduction in the frequency of
subsequent interventions to maintain patency in hemodialysis patients
with AV grafts.
Comment: To address our concerns that, due to the clinical trial
design, there was insufficient data on the impact of angioplasty with
drug coated balloons (DCBs), as presented by the applicant, and that
the drug in these balloons may play a role in the improvement of
patency or openness durability, the applicant commented that DCBs are
not the standard of care for AV access interventions, and that is the
reason for the low number of DCB interventions captured in the FLEX
VPTM Registry (also referred to as the AV Registry by
commenters). Additionally, the applicant discussed the results of a
meta-analysis suggesting that DCBs did not improve primary patency in
target lesions at six months and 12 months when compared to
conventional balloon angioplasty.\134\ A few commenters also stated
that DCBs are not the standard of care relative to angioplasty with
traditional balloons for AV access procedures. The applicant asserted
that DCBs are not approved for use with AV grafts in the United States.
In addition to the applicant, a few commenters noted that drug collated
balloons (DCBs) were infrequently included in the real-world registry
used on the studies presented in the application. A commenter stated
that although the body of positive evidence for DCBs is growing, debate
remains about their broad application to AV access procedures and
suggested that FLEX VPTM may enhance the benefits of DCBs.
---------------------------------------------------------------------------
\134\ Liao, M.T., et al. (2020). Drug-coated balloon versus
conventional balloon angioplasty of hemodialysis arteriovenous
fistula or graft: A systematic review and meta-analysis of
randomized controlled trials. PloS One, 15(4): e0231463. DOI:
10.1371/jounal.pone.0231463.
---------------------------------------------------------------------------
Response: We appreciate the applicant's and other commenters'
responses to our concern that there is insufficient data on the impact
of angioplasty with DCB. We have taken this information into
consideration in making our final determination of the substantial
clinical improvement criterion, discussed below.
Comment: To address our concerns that the applicant did not present
a clear crosswalk of findings or data in terms of device-related
complications (including dissection and embolectomy) observed in the
trial and compared to those referenced in the literature, the applicant
asserted that specific data was collected in the AV Registry related to
the following procedural complications: dissections, perforations, and
embolization. The applicant stated that the data collected in the AV
Registry on procedural complications would be considered minor
complications in the SIR typology. One commenter agreed with the
approach to use SIR typology to address complications. The applicant
stated that the AV Registry data shows zero major complications for
FLEX VPTM plus PTA in their studies. The applicant added
that a review of recent literature found that: ``The major complication
rates following PTA for failing AVFs ranged from 0 to 2.1 percent,
while for the AVGs ranged from 2.1 to 6 percent. Papers with mixed AVGs
and AVFs reported major complication rates of 3-5 percent.'' \135\
---------------------------------------------------------------------------
\135\ Raman, L., et al. (2023). Dialysis access maintenance:
Plain balloon angioplasty. Cardiovascular Interventional Radiology,
published online May 8, 2023. https://doi.org/10.1007/s00270-023-03441-x. Internal footnotes to the studies summarized are omitted in
this quotation. (``The most significant complications reported are
thrombosis, rupture and dissection requiring either stent graft
placement or surgical revision of the fistula.'')
---------------------------------------------------------------------------
Response: We appreciate the applicant's and commenter's responses
to our concerns that the applicant did not present a clear crosswalk of
findings or data in terms of device-related complications (including
dissection and embolectomy) observed in the trial and compared to those
referenced in the literature. We agree with the commenter's assertions,
including the applicant, that according to SIR typology, the data on
procedural complications using FLEX VPTM resulted in minor
complications only. We agree with the applicant's and commenter's
assertions that DCB interventions were infrequent in the AV Registry
because this procedure is not the standard of care for AV
interventions. We also agree with the suggestion from the applicant and
the commenters that FLEX VPTM could enhance the benefits of
DCBs. Finally, we agree with the applicant's and commenter's assertions
that the published peer-reviewed clinical data shows improved clinical
outcomes through the reduction in the frequency of subsequent
interventions to maintain patency. After consideration of the
[[Page 81754]]
applicant's response and the public comments received, we believe that
commenters have addressed our concerns regarding whether FLEX
VPTM meets the substantial clinical improvement criterion
and that FLEX VPTM represents a substantial clinical
improvement over existing technologies.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. The applicant stated that FLEX
VPTM would be reported with HCPCS codes listed in Table 88.
[GRAPHIC] [TIFF OMITTED] TR22NO23.114
To meet the cost criterion for device pass-through payment status,
a device must pass all three tests of the cost criterion for at least
one APC. As we explained in the CY 2005 OPPS final rule with comment
period (69 FR 65775), we generally use the lowest APC payment rate
applicable for use with the nominated device when we assess whether a
device meets the cost significance criterion, thus increasing the
probability the device will pass the cost significance test. For our
calculations, we used APC 5192, which had a CY 2022 payment rate of
$5,061.89 at the time the application was received. Beginning in CY
2017, we calculate the device offset amount at the HCPCS/CPT code level
instead of the APC level (81 FR 79657). HCPCS code 36902 had a device
offset amount of $1,271.04 at the time the application was
received.\136\ According to the applicant, the cost of FLEX
VPTM is $1,995.00.
---------------------------------------------------------------------------
\136\ We noted that the applicant selected a value of $1391.99
for the device offset amount. However, the value selected is
inconsistent with the device offset amount related to HCPCS 36902 in
APC 5192 found in Addendum P to the CY 2022 OPPS/ASC final rule with
comment period, as corrected in the 2022 Correction Notification
OPPS Addendum (87 FR 2060). We selected the value of $1271.04, which
we believe is the accurate value. Based on our initial assessment
for the proposed rule, using the device offset amount of $1271.04
would result in FLEX VPTM meeting the cost significance
requirement.
---------------------------------------------------------------------------
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $1,995.00 for FLEX VPTM is 39.41
percent of the applicable APC payment amount for the service related to
the category of devices of $5,061.89 (($1,995.00/$5,061.89) x 100 =
39.41 percent). Therefore, we stated that we believe FLEX
VPTM meets the first cost significance requirement.
The second cost significance requirement, at Sec. 419.66(d)(2),
provides that the estimated average reasonable cost of the devices in
the category must exceed the cost of the device-related portion of the
APC payment amount for the related service by at least 25 percent,
which means that the device cost needs to be at least 125 percent of
the offset amount (the device-related portion of the APC found on the
offset list). The estimated average reasonable cost of $1,995.00 for
FLEX VPTM is 156.96 percent of the cost of the device-
related portion of the APC payment amount for the related service of
$1,271.04 (($1,995.00/$1,271.04) x 100 = 156.96 percent). Therefore, we
stated that we believe that FLEX VPTM meets the second cost
significance requirement.
The third cost significance requirement, at Sec. 419.66(d)(3),
provides that the difference between the estimated average reasonable
cost of the devices in the category and the portion of the APC payment
amount for the device must exceed 10 percent of the APC payment amount
for the related service. The difference between the estimated average
reasonable cost of $1,995.00 for FLEX VPTM and the portion
of the APC payment amount for the device of $1,271.04 is 14.30 percent
of the APC payment amount for the related service of $5,061.89
((($1,995.00 - $1,271.04)/$5,061.89) x 100 = 14.30 percent). Therefore,
we stated that we believed that FLEX VPTM meets the third
cost significance requirement.
We invited public comment on whether FLEX VPTM meets the
device pass-through payment criteria discussed in this section,
including the cost criterion for device pass-through payment status.
Comment: With respect to cost significance criteria, the applicant
reiterated that FLEX VPTM meets all three of the cost
significance criteria.
Response: We appreciate the commenter's input. Based on our
findings from the first, second, and third cost significant tests, we
believe that FLEX VPTM meets the cost significance criteria
specified at Sec. 419.66(d).
Comment: A commenter expressed concerns on how the device offset
amounts are calculated and stated that CMS should calculate the device-
related portion of APCs for purposes of determining transitional pass-
through eligibility and the device offset using only the cost of the
devices replaced by the proposed transitional pass-through device
category. The commenter asserted that this approach results in adequate
reimbursement to facilities. The commenter recommended that CMS
[[Page 81755]]
apply this methodology to FLEX VPTM if applicable.
Response: We appreciate the commenter's input. As we have done in
prior years, CMS continues to evaluate the application of the device
offset amount on a case-by-case basis to ensure the appropriate payment
is made for a device on pass-through status. In cases where a device on
pass-through status replaces previously existing technologies, we
continue to believe it is appropriate to apply the device offset
amount. We have reviewed FLEX VPTM offset amounts and
confirm that the device offset amount is accurate.
After considering the public comments we received and consideration
of the cost criterion, we have determined that FLEX VP TM
meets the cost criterion for device pass-through status.
After considering the public comments we received and our review of
the device pass-through application, we have determined that FLEX VP
TM meets the criteria for device pass-through status.
Therefore, we are finalizing approval for device pass-through payment
status for FLEX VP TM effective beginning January 1, 2024.
B. Device-Intensive Procedures
1. Background
Under the OPPS, prior to CY 2017, device-intensive status for
procedures was determined at the APC level for APCs with a device
offset percentage greater than 40 percent (79 FR 66795). Beginning in
CY 2017, CMS began determining device-intensive status at the HCPCS
code level. In assigning device-intensive status to an APC prior to CY
2017, the device costs of all the procedures within the APC were
calculated and the geometric mean device offset of all of the
procedures had to exceed 40 percent. Almost all of the procedures
assigned to device-intensive APCs utilized devices, and the device
costs for the associated HCPCS codes exceeded the 40-percent threshold.
The no cost/full credit and partial credit device policy (79 FR 66872
and 66873) applies to device-intensive procedures and is discussed in
detail in section IV.B.4 of this final rule. A related device policy
was the requirement that certain procedures assigned to device-
intensive APCs require the reporting of a device code on the claim (80
FR 70422) and is discussed in detail in section IV.B.3 of this final
rule. For further background information on the device-intensive APC
policy, we refer readers to the CY 2016 OPPS/ASC final rule with
comment period (80 FR 70421 through 70426).
a. HCPCS Code-Level Device-Intensive Determination
As stated earlier, prior to CY 2017, under the device-intensive
methodology we assigned device-intensive status to all procedures
requiring the implantation of a device that were assigned to an APC
with a device offset greater than 40 percent and, beginning in CY 2015,
that met the three criteria listed below. Historically, the device-
intensive designation was at the APC level and applied to the
applicable procedures within that APC. In the CY 2017 OPPS/ASC final
rule with comment period (81 FR 79658), we changed our methodology to
assign device-intensive status at the individual HCPCS code level
rather than at the APC level. Under this policy, a procedure could be
assigned device-intensive status regardless of its APC assignment, and
device-intensive APC designations were no longer applied under the OPPS
or the ASC payment system.
We believe that a HCPCS code-level device offset is, in most cases,
a better representation of a procedure's device cost than an APC-wide
average device offset based on the average device offset of all of the
procedures assigned to an APC. Unlike a device offset calculated at the
APC level, which is a weighted average offset for all devices used in
all of the procedures assigned to an APC, a HCPCS code-level device
offset is calculated using only claims for a single HCPCS code. We
believe that this methodological change results in a more accurate
representation of the cost attributable to implantation of a high-cost
device, which ensures consistent device-intensive designation of
procedures with a significant device cost. Further, we believe a HCPCS
code-level device offset removes inappropriate device-intensive status
for procedures without a significant device cost that are granted such
status because of their APC assignment.
Under our existing policy, procedures that meet the criteria listed
in section IV.C.1.b of this final rule are identified as device-
intensive procedures and are subject to all the policies applicable to
procedures assigned device-intensive status under our established
methodology, including our policies on device edits and no cost/full
credit and partial credit devices discussed in sections IV.C.3 and
IV.C.4 of this final rule.
b. Use of the Three Criteria to Designate Device-Intensive Procedures
We clarified our established policy in the CY 2018 OPPS/ASC final
rule with comment period (82 FR 52474), where we explained that device-
intensive procedures require the implantation of a device and
additionally are subject to the following criteria:
All procedures must involve implantable devices that would
be reported if device insertion procedures were performed;
The required devices must be surgically inserted or
implanted devices that remain in the patient's body after the
conclusion of the procedure (at least temporarily); and
The device offset amount must be significant, which is
defined as exceeding 40 percent of the procedure's mean cost.
We changed our policy to apply these three criteria to determine
whether procedures qualify as device-intensive in the CY 2015 OPPS/ASC
final rule with comment period (79 FR 66926), where we stated that we
would apply the no cost/full credit and partial credit device policy--
which includes the three criteria listed previously--to all device-
intensive procedures beginning in CY 2015. We reiterated this position
in the CY 2016 OPPS/ASC final rule with comment period (80 FR 70424),
where we explained that we were finalizing our proposal to continue
using the three criteria established in the CY 2007 OPPS/ASC final rule
with comment period for determining the APCs to which the CY 2016
device intensive policy will apply. Under the policies we adopted in
CYs 2015, 2016, and 2017, all procedures that require the implantation
of a device and meet the previously described criteria are assigned
device-intensive status, regardless of their APC placement.
2. Device-Intensive Procedure Policy for CY 2019 and Subsequent Years
As part of our effort to better capture costs for procedures with
significant device costs, in the CY 2019 OPPS/ASC final rule with
comment period (83 FR 58944 through 58948), for CY 2019, we modified
our criteria for device-intensive procedures. We had heard from
interested parties that the criteria excluded some procedures that
interested parties believed should qualify as device-intensive
procedures. Specifically, we were persuaded by interested party
arguments that procedures requiring expensive surgically inserted or
implanted devices that are not capital equipment should qualify as
device-intensive procedures, regardless of whether the device remains
in the patient's body after the conclusion of the procedure. We agreed
that a broader definition of device-intensive procedures was warranted,
[[Page 81756]]
and made two modifications to the criteria for CY 2019 (83 FR 58948).
First, we allowed procedures that involve surgically inserted or
implanted single-use devices that meet the device offset percentage
threshold to qualify as device-intensive procedures, regardless of
whether the device remains in the patient's body after the conclusion
of the procedure. We established this policy because we no longer
believe that whether a device remains in the patient's body should
affect a procedure's designation as a device-intensive procedure, as
such devices could, nonetheless, comprise a large portion of the cost
of the applicable procedure. Second, we modified our criteria to lower
the device offset percentage threshold from 40 percent to 30 percent,
to allow a greater number of procedures to qualify as device intensive.
We stated that we believe allowing these additional procedures to
qualify for device-intensive status will help ensure these procedures
receive more appropriate payment in the ASC setting, which will help
encourage the provision of these services in the ASC setting. In
addition, we stated that this change would help to ensure that more
procedures containing relatively high-cost devices are subject to the
device edits, which leads to more correctly coded claims and greater
accuracy in our claims data. Specifically, for CY 2019 and subsequent
years, we finalized that device-intensive procedures will be subject to
the following criteria:
All procedures must involve implantable devices assigned a
CPT or HCPCS code;
The required devices (including single-use devices) must
be surgically inserted or implanted; and
The device offset amount must be significant, which is
defined as exceeding 30 percent of the procedure's mean cost (83 FR
58945).
In addition, to further align the device-intensive policy with the
criteria used for device pass-through payment status, we finalized, for
CY 2019 and subsequent years, that for purposes of satisfying the
device-intensive criteria, a device-intensive procedure must involve a
device that:
Has received FDA marketing authorization, has received an
FDA investigational device exemption (IDE), and has been classified as
a Category B device by FDA in accordance with Sec. Sec. 405.203
through 405.207 and 405.211 through 405.215, or meets another
appropriate FDA exemption from premarket review;
Is an integral part of the service furnished;
Is used for one patient only;
Comes in contact with human tissue;
Is surgically implanted or inserted (either permanently or
temporarily); and
Is not either of the following:
++ Equipment, an instrument, apparatus, implement, or item of the
type for which depreciation and financing expenses are recovered as
depreciable assets as defined in Chapter 1 of the Medicare Provider
Reimbursement Manual (CMS Pub. 15-1); or
++ A material or supply furnished incident to a service (for
example, a suture, customized surgical kit, scalpel, or clip, other
than a radiological site marker) (83 FR 58945).
In addition, for new HCPCS codes describing procedures requiring
the implantation of devices that do not yet have associated claims
data, in the CY 2017 OPPS/ASC final rule with comment period (81 FR
79658), we finalized a policy for CY 2017 to apply device-intensive
status with a default device offset set at 41 percent for new HCPCS
codes describing procedures requiring the implantation or insertion of
a device that did not yet have associated claims data until claims data
are available to establish the HCPCS code-level device offset for the
procedures. This default device offset amount of 41 percent was not
calculated from claims data; instead, it was applied as a default until
claims data were available upon which to calculate an actual device
offset for the new code. The purpose of applying the 41-percent default
device offset to new codes that describe procedures that implant or
insert devices was to ensure ASC access for new procedures until claims
data become available.
As discussed in the CY 2019 OPPS/ASC proposed rule and final rule
with comment period (83 FR 37108, 37109, 58945, and 58946,
respectively), in accordance with our policy stated previously to lower
the device offset percentage threshold for procedures to qualify as
device-intensive from greater than 40 percent to greater than 30
percent, for CY 2019 and subsequent years, we modified this policy to
apply a 31-percent default device offset to new HCPCS codes describing
procedures requiring the implantation of a device that do not yet have
associated claims data until claims data are available to establish the
HCPCS code-level device offset for the procedures. In conjunction with
the policy to lower the default device offset from 41 percent to 31
percent, we continued our current policy of, in certain rare instances
(for example, in the case of a very expensive implantable device),
temporarily assigning a higher offset percentage if warranted by
additional information such as pricing data from a device manufacturer
(81 FR 79658). Once claims data are available for a new procedure
requiring the implantation or insertion of a device, device-intensive
status is applied to the code if the HCPCS code-level device offset is
greater than 30 percent, according to our policy of determining device-
intensive status by calculating the HCPCS code-level device offset.
In addition, in the CY 2019 OPPS/ASC final rule with comment
period, we clarified that since the adoption of our policy in effect as
of CY 2018, the associated claims data used for purposes of determining
whether or not to apply the default device offset are the associated
claims data for either the new HCPCS code or any predecessor code, as
described by CPT coding guidance, for the new HCPCS code. Additionally,
for CY 2019 and subsequent years, in limited instances where a new
HCPCS code does not have a predecessor code as defined by CPT, but
describes a procedure that was previously described by an existing
code, we use clinical discretion to identify HCPCS codes that are
clinically related or similar to the new HCPCS code but are not
officially recognized as a predecessor code by CPT, and to use the
claims data of the clinically related or similar code(s) for purposes
of determining whether or not to apply the default device offset to the
new HCPCS code (83 FR 58946). Clinically related and similar procedures
for purposes of this policy are procedures that have few or no clinical
differences and use the same devices as the new HCPCS code. In
addition, clinically related and similar codes for purposes of this
policy are codes that either currently or previously describe the
procedure described by the new HCPCS code. Under this policy, claims
data from clinically related and similar codes are included as
associated claims data for a new code, and where an existing HCPCS code
is found to be clinically related or similar to a new HCPCS code, we
apply the device offset percentage derived from the existing clinically
related or similar HCPCS code's claims data to the new HCPCS code for
determining the device offset percentage. We stated that we believe
that claims data for HCPCS codes describing procedures that have minor
differences from the procedures described by new HCPCS codes will
provide an accurate depiction of the cost relationship between the
procedure and the device(s) that are used, and will be appropriate to
use to set a new code's
[[Page 81757]]
device offset percentage, in the same way that predecessor codes are
used. If a new HCPCS code has multiple predecessor codes, the claims
data for the predecessor code that has the highest individual HCPCS-
level device offset percentage is used to determine whether the new
HCPCS code qualifies for device-intensive status. Similarly, in the
event that a new HCPCS code does not have a predecessor code but has
multiple clinically related or similar codes, the claims data for the
clinically related or similar code that has the highest individual
HCPCS level device offset percentage is used to determine whether the
new HCPCS code qualifies for device-intensive status.
As we indicated in the CY 2019 OPPS/ASC proposed rule and final
rule with comment period, additional information for our consideration
of an offset percentage higher than the default of 31 percent for new
HCPCS codes describing procedures requiring the implantation (or, in
some cases, the insertion) of a device that do not yet have associated
claims data, such as pricing data or invoices from a device
manufacturer, should be directed to the Division of Outpatient Care,
Mail Stop C4-01-26, Centers for Medicare & Medicaid Services, 7500
Security Boulevard, Baltimore, MD 21244-1850, or electronically at
outpatientpps@ cms.hhs.gov. Additional information can be submitted
prior to issuance of an OPPS/ASC proposed rule or as a public comment
in response to an issued OPPS/ASC proposed rule. Device offset
percentages will be set in each year's final rule.
Comment: Commenters requested that we assign device-intensive
status to the following procedures:
CPT code 0581T (Ablation, malignant breast tumor(s),
percutaneous, cryotherapy, including imaging guidance when performed,
unilateral)
CPT code 31242 (Nasal/sinus endoscopy, surgical; with
destruction by radiofrequency ablation, posterior nasal nerve)
CPT code 52284 (Cystourethroscopy, with mechanical
urethral dilation and urethral therapeutic drug delivery by drug-coated
balloon catheter for urethral stricture or stenosis, male, including
fluoroscopy, when performed)
CPT code 53854 (Transurethral destruction of prostate
tissue; by radiofrequency generated water vapor thermotherapy)
HCPCS code C9757 (Laminotomy (hemilaminectomy), with
decompression of nerve root(s), including partial facetectomy,
foraminotomy and excision of herniated intervertebral disc, and repair
of annular defect with implantation of bone anchored annular closure
device, including annular defect measurement, alignment and sizing
assessment, and image guidance; 1 interspace, lumbar);
HCPCS code C9761 (Cystourethroscopy, with ureteroscopy
and/or pyeloscopy, with lithotripsy, and ureteral catheterization for
steerable vacuum aspiration of the kidney, collecting system, ureter,
bladder, and urethra if applicable (must use a steerable ureteral
catheter)
Response: Based on CY 2022 claims data available for this final
rule, the procedures requested by commenters do not have device offset
percentages that exceed the 30-percent threshold required for device-
intensive status under the OPPS or ASC payment system and, therefore,
are not eligible to be assigned device-intensive status. CPT codes
31242 and 52284 were issued after publication of the proposed rule and
have an effective date of January 1, 2024. CPT code 52284 is replacing
CPT code 0499T (Cystourethroscopy, with mechanical dilation and
urethral therapeutic drug delivery for urethral stricture or stenosis,
including fluoroscopy, when performed), which has a device offset
percentage of 25.33 percent based on the most recent claims data. Since
the predecessor code of CPT code 52284, CPT code 0499T, would not meet
our criteria for device-intensive status, we are not accepting the
commenter's recommendation to assign device-intensive status to CPT
code 52284 for CY 2024.
However, CPT code 31242 does not have claims data from a
predecessor code that may be used to determine a device offset
percentage. After reviewing the clinical description and
characteristics of the procedure, we agree with commenters that CPT
code 31242 meets our requirements to be assigned device-intensive
status. Therefore, for CY 2024, we are assigning CPT code 31242 device-
intensive with a default device offset percentage of 31 percent.
Comment: Two commenters requested that we assign the device offset
percentage for CPT codes 0816T (Open insertion or replacement of
integrated neurostimulation system for bladder dysfunction including
electrode(s) (eg, array or leadless), and pulse generator or receiver,
including analysis, programming, and imaging guidance, when performed,
posterior tibial nerve; subcutaneous) and 0817T (Open insertion or
replacement of integrated neurostimulation system for bladder
dysfunction including electrode(s) (eg, array or leadless), and pulse
generator or receiver, including analysis, programming, and imaging
guidance, when performed, posterior tibial nerve; subfascial) using
claims data from CPT code 64590 (Insertion or replacement of
peripheral, sacral, or gastric neurostimulator pulse generator or
receiver, direct or inductive coupling requiring pocket creation and
connection between electrode array and pulse generator or receiver)
rather than using the default 31 percent device offset percentage.
Commenters suggested claims data for CPT code 64590 would provide a
more accurate device offset amount.
Response: We are not accepting the commenters' recommendation.
While we may assign device-intensive status to new procedures that have
significant device costs, we generally assign the percentage of such
device costs at 31 percent of total procedure costs until claims data
become available. However, if there is available claims data from the
predecessor code of a new procedure or claims data from a clinically
similar procedure that uses the same device, our current policy allows
us to use this proxy claims data to establish a device offset
percentage in lieu of the default 31 percent. We do not agree that CPT
code 64590 was the predecessor code for either CPT code 0816T or 0817T
and believe that CPT code 64999 (Unlisted procedure, nervous system)
was the CPT code previously used when reporting the procedures
described by the new CPT codes 0816T and 0817T. CPT code 64999 does not
exceed our device-intensive threshold under the OPPS; and, since this
CPT code can be used for various types of unlisted procedures, we do
not believe this procedure would be an accurate reflection of the
device costs of CPT code 0816T or 0817T. Because 0816T and 0817T do not
have claims data from a predecessor code or a similar code that uses
the same device, we are finalizing our proposal to assign the default
31 percent device offset percentage to CPT codes 0816T and 0817T for CY
2024.
Comment: Two commenters requested that we increase the device
offset for CPT code 0629T (Percutaneous injection of allogeneic
cellular and/or tissue-based product, intervertebral disc, unilateral
or bilateral injection, with ct guidance, lumbar; first level) to be in
alignment with CPT code 0627T (Percutaneous injection of allogeneic
cellular and/or tissue-based product, intervertebral disc, unilateral
or bilateral injection, with fluoroscopic guidance, lumbar; first
level) as both procedures use the same device.
[[Page 81758]]
Response: We thank the commenters for their suggestion. We stated
in the CY 2023 OPPS/ASC final rule with comment period (87 FR 71941)
that we did not have any claims data for CPT code 0629T to determine a
device offset percentage. Under our current policy, we may assign an
alternative device offset percentage if we have claims data from a
clinically similar procedure code that uses the same device. We agreed
with commenters to apply the device offset percentage from claims data
for CPT code 0627T to CPT code 0629T for CY 2023 as the procedures are
clinically similar and utilize the same device. Similarly, for CY 2024,
because we do not have claims data to determine a device offset
percentage for CPT code 0629T, we are accepting the commenters'
recommendation and will continue to use the most recent claims data
from CPT code 0627T to assign the device offset percentage for CPT code
0629T.
Comment: One commenter requested that we reexamine the claims data
for CPT codes 31296, 31297, and 31298 and designate them as device-
intensive procedures.
Response: After examining the claims data for CPT codes 31296,
31297, and 31298, we have determined that the device offset percentages
for these procedures do not exceed the 30 percent device-intensive
threshold. Therefore, we are not assigning device-intensive status to
these procedures for CY 2024.
The full listing of the final CY 2024 device-intensive procedures
can be found in Addendum P to this final rule with comment period
(which is available via the internet on the CMS website). Further, our
claims accounting narrative contains a description of our device offset
percentage calculation. Our claims accounting narrative for this final
rule with comment period can be found under supporting documentation
for this CY 2024 OPPS/ASC final rule with comment period on our website
at: https://www.cms.gov/medicare/medicare-fee-for-service-payment/hospitaloutpatientpps.
3. Device Edit Policy
In the CY 2015 OPPS/ASC final rule with comment period (79 FR
66795), we finalized a policy and implemented claims processing edits
that require any of the device codes used in the previous device-to-
procedure edits to be present on the claim whenever a procedure code
assigned to any of the APCs listed in Table 5 of the CY 2015 OPPS/ASC
final rule with comment period (the CY 2015 device-dependent APCs) is
reported on the claim. In addition, in the CY 2016 OPPS/ASC final rule
with comment period (80 FR 70422), we modified our previously existing
policy and applied the device coding requirements exclusively to
procedures that require the implantation of a device assigned to a
device-intensive APC. In the CY 2016 OPPS/ASC final rule with comment
period, we also finalized our policy that the claims processing edits
are such that any device code, when reported on a claim with a
procedure assigned to a device-intensive APC (listed in Table 42 of the
CY 2016 OPPS/ASC final rule with comment period (80 FR 70422)) will
satisfy the edit.
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79658
through 79659), we changed our policy for CY 2017 and subsequent years
to apply the CY 2016 device coding requirements to the newly defined
device-intensive procedures. For CY 2017 and subsequent years, we also
specified that any device code, when reported on a claim with a device-
intensive procedure, will satisfy the edit. In addition, we created
HCPCS code C1889 to recognize devices furnished during a device-
intensive procedure that are not described by a specific Level II HCPCS
Category C-code. Reporting HCPCS code C1889 with a device-intensive
procedure will satisfy the edit requiring a device code to be reported
on a claim with a device-intensive procedure. In the CY 2019 OPPS/ASC
final rule with comment period, we revised the description of HCPCS
code C1889 to remove the specific applicability to device-intensive
procedures (83 FR 58950). For CY 2019 and subsequent years, the
description of HCPCS code C1889 is ``Implantable/insertable device, not
otherwise classified.'' In the CY 2023 OPPS/ASC final rule with comment
period (87 FR 71830), we described a commenter's concern about the
potentially inadequate payment rate for APC 5495 (Level 5 Intraocular
Procedures) and their recommendation that we use our equitable
adjustment authority to limit the potential reduction in the CY 2023
APC payment rate by applying a 10 percent cap on the reduction in
relative weights for Low Volume APCs in CY 2023. While we did not
accept the commenter's recommendation to limit a Low Volume APC's
decline in relative weight to no more than 10 percent, we stated we
would continue to monitor the costs and payment rates for procedures
assigned to Low Volume APCs to determine if additional changes or
refinements to our current policy are needed.
In our review of claims data for CPT code 0308T (Insertion of
ocular telescope prosthesis including removal of crystalline lens or
intraocular lens prosthesis), we noticed unusual coding, charge, and
cost data in the claims data from CY 2017, CY 2018, CY 2019, and CY
2021. Some claims did not report the correct device code--HCPCS code
C1840 (Lens, intraocular (telescopic))--and such claims had
substantially lower costs than claims that reported the correct device
code. In particular, claims that reported the correct device code had
an average device cost of $15,030.04, while claims that did not report
the correct device code had an average device cost of $430.72. The vast
majority of claims for CPT code 0308T in our 4-year analysis did report
the correct device code; however, the limited number of claims that
either reported the wrong procedure code or reported the wrong device
code had an outsized impact on the APC payment rate because of the very
low volume of claims for this APC. Because payment stability for this
Low Volume APC relies so critically on accurate reporting of the
procedure's associated costs, we believe this APC would benefit from a
procedure-to-device edit--a claims processing edit that requires a
certain device code to be included on the claim when hospitals report a
specific procedure code. The procedures associated with the Level 5
Intraocular APC, which we proposed to reassign to a new Level 6
Intraocular APC (APC 5496) in section III.E of the CY 2024 OPPS/ASC
proposed rule, describe the implantation of specific device codes:
CPT code 0308T (Insertion of ocular telescope prosthesis
including removal of crystalline lens or intraocular lens prosthesis)
describes the implantation of device HCPCS code C1840 (Lens,
intraocular (telescopic));
CPT code 0616T (Insertion of iris prosthesis, including
suture fixation and repair or removal of iris, when performed; without
removal of crystalline lens or intraocular lens, without insertion of
intraocular lens) describes the implantation of device HCPCS code C1839
(Iris prosthesis);
CPT code 0617T (Insertion of iris prosthesis, including
suture fixation and repair or removal of iris, when performed; with
removal of crystalline lens and insertion of intraocular lens)
describes the implantation of device HCPCS code C1839 (Iris
prosthesis); or
CPT code 0618T (Insertion of iris prosthesis, including
suture fixation and repair or removal of iris, when performed; with
secondary intraocular lens placement or intraocular lens exchange) also
describes the implantation of device HCPCS code C1839 (Iris
prosthesis).
[[Page 81759]]
We proposed to establish a procedure-to-device edit for the four
aforementioned procedures assigned to APC 5496 (Level 6 Intraocular
Procedures) and require hospitals to report the correct device HCPCS
codes when reporting any of the four procedures. While some interested
parties have previously recommended in past rulemaking that we
reestablish all of our previous procedure-to-device edits, we do not
expect to extend this policy beyond the procedures assigned to APC 5496
(Level 6 Intraocular Procedures). We explained that we continue to rely
on hospitals' accurate reporting and believe our current device edits
policy of requiring device-intensive procedures to be subject to an
additional device reporting edit has improved our ratesetting for
hospital outpatient department procedures without placing an undue
burden on hospitals. However, we noted that we believe this APC
represents a unique situation--the APC (which was the Level 5
Intraocular APC in previous years) has been a Low Volume APC (fewer
than 100 claims in a claims year) since we established our Low Volume
APC policy, the procedures associated with this APC have significant
procedure costs often greater than $15,000, and the procedures
associated with this APC require the implantation of a high-cost
intraocular device. We stated that we believe requiring a procedure-to-
device edit for procedures assigned to the APC 5496 (Level 6
Intraocular Procedures), would not be administratively burdensome to
hospitals given the low volume of services associated for this APC and
will have a meaningful and significant impact on the payment rate for
this APC and the stability of the payment rate in the future.
We solicited comments on our proposal to modify our device edits
policy to require a procedure-to-device edit for procedures assigned to
APC 5496 (Level 6 Intraocular Procedures) for CY 2024.
Comment: We received one comment in support of the proposed
procedure-to-device edit for CPT code 0308T. We also received one
comment in support of the proposed procedure-to-device edits for CPT
codes 0616T, 0617T, and 0618T.
Response: We thank the commenters for their support. After
consideration of the public comments we received, we are finalizing our
proposal to modify our device edits policy to require a procedure-to-
device edit for procedures assigned to APC 5496 (Level 6 Intraocular
Procedures) for CY 2024.
Comment: One commenter requested that CMS restore the device-to-
procedure and procedure-to-device edits. The commenter recommended that
we apply such edits to specific procedures, such as total hip
arthroplasty or total knee arthroplasty procedures, and require a
specific device code rather than any device code. We also received one
comment requesting that we create device-to-procedure edit for HCPCS
code C9761 and CPT code 0715T due to rejected claims.
Response: We are not accepting the commenters' recommendations and
do not believe additional device-to-procedure edits are warranted for
the situations the commenters described. We are finalizing our proposal
to reinstate device-to-procedure edits for procedures assigned APC 5496
(Level 6 Intraocular APC) to improve the payment structure for that APC
as well as the Intraocular APC family. The high cost, low-volume nature
of that APC represents a unique situation that we believe would benefit
from a device-to-procedure edit and place extremely little reporting
burden on providers. However, as we stated in the CY 2015 OPPS/ASC
final rule with comment period (79 FR 66794) and have reiterated in
subsequent rulemaking, we continue to believe that the elimination of
device-to-procedure edits and procedure-to-device edits is appropriate
due to the experience hospitals now have in coding and reporting these
claims fully. Under our current policy, hospitals are still expected to
adhere to the guidelines of correct coding and append the correct
device code to the claim when applicable. We believe our current device
edits policy, which requires that a device code be reported on a claim
for procedures that have significant device costs, continues to
accurately capture the device costs associated with device-intensive
procedures and provides the necessary flexibility to hospitals to code
claims accurately.
Comment: One commenter suggested that there is confusion among
hospitals as to whether to report a device code for certain procedures
in the HCPCS C-code range and urged CMS establish a device-to-procedure
edit for all C-code procedures to ensure appropriate device costs are
collected.
Response: We thank the commenter for the suggestion; however, we
believe our current policy already addresses the commenter's concern.
We are not aware of any provider confusion as to reporting device costs
for certain device-intensive procedures in the HCPCS C-code range.
However, if such procedures are assigned device-intensive status, then
they are subject to our device edits policy; and hospitals would
already be required to report a device code on the claim when billing
the procedure code.
4. Adjustment to OPPS Payment for No Cost/Full Credit and Partial
Credit Devices
a. Background
To ensure equitable OPPS payment when a hospital receives a device
without cost or with full credit, in CY 2007, we implemented a policy
to reduce the payment for specified device-dependent APCs by the
estimated portion of the APC payment attributable to device costs (that
is, the device offset) when the hospital receives a specified device at
no cost or with full credit (71 FR 68071 through 68077). Hospitals were
instructed to report no cost/full credit device cases on the claim
using the ``FB'' modifier on the line with the procedure code in which
the no cost/full credit device is used. In cases in which the device is
furnished without cost or with full credit, hospitals were instructed
to report a token device charge of less than $1.01. In cases in which
the device being inserted is an upgrade (either of the same type of
device or to a different type of device) with a full credit for the
device being replaced, hospitals were instructed to report as the
device charge the difference between the hospital's usual charge for
the device being implanted and the hospital's usual charge for the
device for which it received full credit. In CY 2008, we expanded this
payment adjustment policy to include cases in which hospitals receive
partial credit of 50 percent or more of the cost of a specified device.
Hospitals were instructed to append the ``FC'' modifier to the
procedure code that reports the service provided to furnish the device
when they receive a partial credit of 50 percent or more of the cost of
the new device. We refer readers to the CY 2008 OPPS/ASC final rule
with comment period for more background information on the ``FB'' and
``FC'' modifiers payment adjustment policies (72 FR 66743 through
66749).
In the CY 2014 OPPS/ASC final rule with comment period (78 FR 75005
through 75007), beginning in CY 2014, we modified our policy of
reducing OPPS payment for specified APCs when a hospital furnishes a
specified device without cost or with a full or partial credit. For CY
2013 and prior years, our policy had been to reduce OPPS payment by 100
percent of the device offset amount when a hospital furnishes
[[Page 81760]]
a specified device without cost or with a full credit and by 50 percent
of the device offset amount when the hospital receives partial credit
in the amount of 50 percent or more of the cost for the specified
device. For CY 2014, we reduced OPPS payment, for the applicable APCs,
by the full or partial credit a hospital receives for a replaced
device. Specifically, under this modified policy, hospitals are
required to report on the claim the amount of the credit in the amount
portion for value code ``FD'' (Credit Received from the Manufacturer
for a Replaced Device) when the hospital receives a credit for a
replaced device that is 50 percent or greater than the cost of the
device. For CY 2014, we also limited the OPPS payment deduction for the
applicable APCs to the total amount of the device offset when the
``FD'' value code appears on a claim. For CY 2015, we continued our
policy of reducing OPPS payment for specified APCs when a hospital
furnishes a specified device without cost or with a full or partial
credit and to use the three criteria established in the CY 2007 OPPS/
ASC final rule with comment period (71 FR 68072 through 68077) for
determining the APCs to which our CY 2015 policy will apply (79 FR
66872 and 66873). In the CY 2016 OPPS/ASC final rule with comment
period (80 FR 70424), we finalized our policy to no longer specify a
list of devices to which the OPPS payment adjustment for no cost/full
credit and partial credit devices would apply and instead apply this
APC payment adjustment to all replaced devices furnished in conjunction
with a procedure assigned to a device-intensive APC when the hospital
receives a credit for a replaced specified device that is 50 percent or
greater than the cost of the device.
b. Policy for No Cost/Full Credit and Partial Credit Devices
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79659
and 79660), for CY 2017 and subsequent years, we finalized a policy to
reduce OPPS payment for device-intensive procedures, by the full or
partial credit a provider receives for a replaced device, when a
hospital furnishes a specified device without cost or with a full or
partial credit. Under our current policy, hospitals continue to be
required to report on the claim the amount of the credit in the amount
portion for value code ``FD'' when the hospital receives a credit for a
replaced device that is 50 percent or greater than the cost of the
device.
In the CY 2014 OPPS/ASC final rule with comment period (78 FR 75005
through 75007), we adopted a policy of reducing OPPS payment for
specified APCs when a hospital furnishes a specified device without
cost or with a full or partial credit by the lesser of the device
offset amount for the APC or the amount of the credit. We adopted this
change in policy in the preamble of the CY 2014 OPPS/ASC final rule
with comment period and discussed it in sub-regulatory guidance,
including Chapter 4, Section 61.3.6 of the Medicare Claims Processing
Manual. Further, in the CY 2021 OPPS/ASC final rule with comment period
(85 FR 86017, 86018, and 86302), we made conforming changes to our
regulations at Sec. 419.45(b)(1) and (2) that codified this policy.
We did not propose any changes, and we did not receive any public
comments related to our policies regarding payment for no cost/full
credit and partial credit devices for CY 2024.
V. OPPS Payment for Drugs, Biologicals, and Radiopharmaceuticals
A. OPPS Transitional Pass-Through Payment for Additional Costs of
Drugs, Biologicals, and Radiopharmaceuticals
1. Background
Section 1833(t)(6) of the Act provides for temporary additional
payments or ``transitional pass-through payments'' for certain drugs
and biologicals. Throughout this final rule with comment period, the
term ``biological'' is used because this is the term that appears in
section 1861(t) of the Act. A ``biological'' as used in this final rule
with comment period includes (but is not necessarily limited to) a
``biological product'' or a ``biologic'' as defined under section 351
of the PHS Act. As enacted by the Medicare, Medicaid, and SCHIP
Balanced Budget Refinement Act of 1999 (BBRA) (Pub. L. 106-113), this
pass-through payment provision requires the Secretary to make
additional payments to hospitals for: current orphan drugs for rare
diseases and conditions, as designated under section 526 of the Federal
Food, Drug, and Cosmetic Act; current drugs and biologicals and
brachytherapy sources used in cancer therapy; and current
radiopharmaceutical drugs and biologicals. ``Current'' refers to those
types of drugs or biologicals mentioned above that are hospital
outpatient services under Medicare Part B for which transitional pass-
through payment was made on the first date the hospital OPPS was
implemented.
Transitional pass-through payments also are provided for certain
``new'' drugs and biologicals that were not being paid for as an HOPD
service as of December 31, 1996, and whose cost is ``not
insignificant'' in relation to the OPPS payments for the procedures or
services associated with the new drug or biological. For pass-through
payment purposes, radiopharmaceuticals are included as ``drugs.'' As
required by statute, transitional pass-through payments for a drug or
biological described in section 1833(t)(6)(C)(i)(II) of the Act can be
made for a period of at least 2 years, but not more than 3 years, after
the payment was first made for the drug as a hospital outpatient
service under Medicare Part B. Final CY 2024 pass-through drugs and
biologicals and their designated APCs are assigned status indicator
``G'' in Addenda A and B to this CY 2024 OPPS/ASC final rule with
comment period (which are available on the CMS website).\137\
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Section 1833(t)(6)(D)(i) of the Act specifies that the pass-through
payment amount, in the case of a drug or biological, is the amount by
which the amount determined under section 1842(o) of the Act for the
drug or biological exceeds the portion of the otherwise applicable
Medicare OPD fee schedule that the Secretary determines is associated
with the drug or biological. The methodology for determining the pass-
through payment amount is set forth in regulations at 42 CFR 419.64.
These regulations specify that the pass-through payment equals the
amount determined under section 1842(o) of the Act minus the portion of
the APC payment that CMS determines is associated with the drug or
biological.
Section 1847A of the Act establishes the average sales price (ASP)
methodology, which is used for payment for drugs and biologicals
described in section 1842(o)(1)(C) of the Act furnished on or after
January 1, 2005. The ASP methodology, as applied under the OPPS, uses
several sources of data as a basis for payment, including the ASP, the
wholesale acquisition cost (WAC), and the average wholesale price
(AWP). In this final rule with comment period, the term ``ASP
methodology'' and ``ASP-based'' are inclusive of all data sources and
methodologies described therein. Additional information on the ASP
methodology can be found on our website at: https://www.cms.gov/medicare/payment/fee-for-service-providers/part-b-drugs/average-drug-sales-price.
The pass-through application \138\ and review process for drugs and
biologicals
[[Page 81761]]
is described on our website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/pass-through-payment-status-new-technology-ambulatory-payment-classification-apc.
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\138\ To apply for OPPS transitional Pass-Through Payment Status
and New Technology Ambulatory Payment Classification (APC),
applicants complete an application that is subject to the Paperwork
Reduction Act of 1995 (PRA) (44 U.S.C. 3501 et seq.). This
information collection (CMS-10008) is currently approved under OMB
control number of 0938-0802 and has an expiration date of January
31, 2025.
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2. Transitional Pass-Through Payment Period for Pass-Through Drugs,
Biologicals, and Radiopharmaceuticals and Quarterly Expiration of Pass-
Through Status
As required by statute, transitional pass-through payments for a
drug or biological described in section 1833(t)(6)(C)(i)(II) of the Act
can be made for a period of at least 2 years, but not more than 3
years, after the payment was first made for the drug or biological as a
hospital outpatient service under Medicare Part B. Our current policy
is to accept pass-through applications on a quarterly basis and to
begin pass-through payments for approved pass-through drugs and
biologicals on a quarterly basis through the next available OPPS
quarterly update after the approval of a drug's or biological's pass-
through status. However, prior to CY 2017, we expired pass-through
status for drugs and biologicals on an annual basis through notice-and-
comment rulemaking (74 FR 60480). In the CY 2017 OPPS/ASC final rule
with comment period (81 FR 79662), we finalized a policy change,
beginning with pass-through drugs and biologicals approved in CY 2017
and subsequent calendar years, to allow for a quarterly expiration of
pass-through payment status for drugs, biologicals, and
radiopharmaceuticals to afford a pass-through payment period that is as
close to a full 3 years as possible for all pass-through drugs,
biologicals, and radiopharmaceuticals.
This change eliminated the variability of the pass-through payment
eligibility period, which previously varied based on when a particular
application was initially received. We adopted this change for pass-
through approvals beginning on or after CY 2017, to allow, on a
prospective basis, for the maximum pass-through payment period for each
pass-through drug without exceeding the statutory limit of 3 years.
Notice of drugs for which pass-through payment status is ending during
the calendar year is included in the quarterly OPPS Change Request
transmittals.
3. Drugs and Biologicals With Expiring Pass-Through Payment Status in
CY 2023
There are 43 drugs and biologicals for which pass-through payment
status expires by December 31, 2023, as listed in Table 89. These drugs
and biologicals will have received OPPS pass-through payment for 3
years during the period of April 1, 2020, through December 31, 2023. In
accordance with the policy finalized in CY 2017 and described earlier,
pass-through payment status for drugs and biologicals approved in CY
2017 and subsequent years will expire on a quarterly basis, with a
pass-through payment period as close to 3 years as possible.
With the exception of those groups of drugs and biologicals that
are always packaged when they do not have pass-through payment status
(specifically, anesthesia drugs; drugs, biologicals, and
radiopharmaceuticals that function as supplies when used in a
diagnostic test or procedure (including diagnostic
radiopharmaceuticals, contrast agents, and stress agents); and drugs
and biologicals that function as supplies when used in a surgical
procedure), our standard methodology for providing payment for drugs
and biologicals with expiring pass-through payment status in an
upcoming calendar year is to determine the product's estimated per day
cost and compare it with the OPPS drug packaging threshold for that
calendar year (which will be $135 for CY 2024), as discussed further in
section V.B.1 of this final rule with comment period. If the estimated
per day cost for the drug or biological is less than or equal to the
applicable OPPS drug packaging threshold, we package payment for the
drug or biological into the payment for the associated procedure in the
upcoming calendar year. If the estimated per day cost of the drug or
biological is greater than the OPPS drug packaging threshold, we
provide separate payment at the applicable ASP methodology-based
payment amount (which is generally ASP plus 6 percent), as discussed
further in section V.B.2 of this final rule with comment period.
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Comment: One commenter requested CMS use its equitable adjustment
authority to extend the pass-through eligibility period for three
radiopharmaceuticals whose pass-through payment status will expire
between September 30, 2023, and December 31, 2023. The commenter stated
that if CMS does not unpackage diagnostic radiopharmaceuticals in 2024,
they recommended extending pass-through status through at least CY 2024
due to the effect of the PHE on claims data used for ratesetting. This
same commenter supported CMS's policy under which radiopharmaceuticals
are treated as drugs that are eligible for pass-through status. This
commenter additionally commended CMS for proposing to continue its
policy to provide for quarterly expiration of pass-through payment
status.
[[Page 81765]]
Response: We thank the commenter for their comment, but we continue
to believe that the data collected for CY 2024 ratesetting will result
in the necessary cost data being collected and incorporated into the
costs for expiring pass-through drugs, biologicals, and devices into
the procedure APC rate. Therefore, we believe that the claims data used
in CY 2024 OPPS ratesetting for procedures including these drugs,
biologicals, and devices with expiring pass-through status is
sufficient and an additional extension of separate payment to mimic
pass-through status is neither necessary nor appropriate. We refer
readers to section IV of the CY 2023 OPPS/ASC final rule with comment
period (87 FR 71887) for a full discussion of CMS's final decision not
to provide any additional quarters of separate payment for any drug,
biological, or device category whose pass-through payment status will
expire between December 31, 2022, and December 31, 2023. We appreciate
commenters' support for our policy to treat radiopharmaceuticals as
drugs that are eligible for drug pass-through status and to continue
quarterly expiration of pass-through status.
4. Drugs, Biologicals, and Radiopharmaceuticals With Pass-Through
Payment Status Expiring in CY 2024
We proposed to end pass-through payment status in CY 2024 for 25
drugs and biologicals. These drugs and biologicals, which were
initially approved for pass-through payment status between April 1,
2021, and January 1, 2022, are listed in Table 90. The APCs and HCPCS
codes for these drugs and biologicals, which have pass-through payment
status that will end by December 31, 2024, are assigned status
indicator ``G'' (Pass-Through Drugs and Biologicals) in Addenda A and B
to the CY 2024 OPPS/ASC proposed rule (which are available on the CMS
website).\139\ The APCs and HCPCS codes for these drugs and biologicals
are assigned status indicator ``G'' only for the duration of their
pass-through status.
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Section 1833(t)(6)(D)(i) of the Act sets the amount of pass-through
payment for pass-through drugs and biologicals (the pass-through
payment amount) as the difference between the amount authorized under
section 1842(o) of the Act and the portion of the otherwise applicable
OPD fee schedule that the Secretary determines is associated with the
drug or biological. For CY 2024 and subsequent years, we proposed to
continue to pay for pass-through drugs and biologicals using the ASP
methodology, meaning a payment rate based on ASP, WAC, or AWP, as
applicable. This payment rate is generally ASP plus 6 percent,
equivalent to the payment rate these drugs and biologicals would
receive in the physician's office setting in CY 2024. We note that,
under the OPD fee schedule, separately payable drugs assigned to an APC
are generally payable at ASP plus 6 percent. Therefore, we proposed
that a $0 pass-through payment amount would be paid for pass-through
drugs and biologicals under the CY 2024 OPPS, and in subsequent years,
because the difference between the amount authorized under section
1842(o) of the Act, which is generally ASP plus 6 percent, and the
portion of the otherwise applicable OPD fee schedule that the Secretary
determines is appropriate, which is also proposed to be the same
payment rate, which is generally ASP plus 6 percent, is $0. We proposed
that this policy and the other policies proposed in this section would
apply in both CY 2024 and subsequent years as they have been our
longstanding policies under the OPPS. Therefore, we explained that we
do not believe the policies need to be reproposed annually and should
apply for subsequent years until such time as we propose to change
them.
In the case of policy-packaged drugs (which include the following:
anesthesia drugs; drugs, biologicals, and radiopharmaceuticals that
function as supplies when used in a diagnostic test or procedure
(including contrast agents, diagnostic radiopharmaceuticals, and stress
agents); and drugs and biologicals that function as supplies when used
in a surgical procedure), we proposed that their pass-through payment
amount would be equal to a payment rate calculated using the ASP
methodology, meaning a payment rate based on ASP, WAC, or AWP. We
proposed that this payment rate would generally be ASP plus 6 percent
for CY 2024 and subsequent years, minus a payment offset for the
portion of the otherwise applicable OPD fee schedule that the Secretary
determines is associated with the drug or biological as described in
section V.A.6 of this final rule with comment period. We proposed this
policy because, if not for the pass-through payment status of these
policy-packaged products, payment for these products would be packaged
into the associated procedure and therefore, there are associated OPD
fee schedule amounts for them.
We proposed to continue to update pass-through payment rates on a
quarterly basis on the CMS website during CY 2024 and subsequent years
if later quarter ASP submissions (or more recent WAC or AWP
information, as applicable) indicate that adjustments to the payment
rates for these pass-through payment drugs or biologicals are
necessary. For a full description of this policy, we refer readers to
the CY 2006 OPPS/ASC final rule with comment period (70 FR 68632
through 68635).
For CY 2024 and subsequent years, consistent with our CY 2023
policy for diagnostic and therapeutic radiopharmaceuticals, we proposed
to continue to provide payment for both diagnostic and therapeutic
radiopharmaceuticals that are granted pass-through payment status based
on the ASP methodology. As stated earlier, for purposes of pass-through
payment, we consider radiopharmaceuticals to be drugs under the OPPS.
Therefore, if a diagnostic or therapeutic radiopharmaceutical receives
pass-through payment status during CY 2024 or subsequent years, we
proposed to follow the standard ASP methodology to determine the pass-
through payment rate that drugs receive under section 1842(o) of the
Act, which is generally ASP plus 6 percent. If ASP data are not
available for a radiopharmaceutical, we proposed to provide pass-
through payment at WAC plus 3 percent (consistent with our policy in
section V.B.2.a of the CY 2024 OPPS/ASC proposed rule (88 FR 49680)),
the equivalent payment provided for pass-through drugs and biologicals
without ASP information. Additional detail on the WAC plus 3 percent
payment policy can be found in section V.B.2.a of this CY 2024 OPPS/ASC
final rule with comment period. If WAC information also is not
available, we proposed to provide payment for the pass-through
radiopharmaceutical at 95 percent of its most recent AWP.
We refer readers to Table 90 below for the list of drugs and
biologicals with pass-through payment status expiring during CY 2024.
We did not receive any public comments on this section.
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5. Drugs, Biologicals, and Radiopharmaceuticals With Pass-Through
Payment Status Continuing Through CY 2024
We proposed to continue pass-through payment status in CY 2024 for
42 drugs and biologicals. These drugs and biologicals, which were
approved for pass-through payment status with effective dates beginning
between April 1, 2022, and October 1, 2023, are listed in Table 91. The
APCs and HCPCS codes for these drugs and biologicals, which have pass-
through payment status that would continue after December 31, 2024, are
assigned status indicator ``G'' in Addenda A and B to this final rule
with comment period (which are available on the CMS website).\140\
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Section 1833(t)(6)(D)(i) of the Act sets the amount of pass-through
payment for pass-through drugs and biologicals (the pass-through
payment amount) as the difference between the amount authorized under
section 1842(o) of the Act and the portion of the otherwise applicable
OPD fee schedule that the Secretary determines is associated with the
drug or biological. For CY 2024 and subsequent years, we proposed to
continue to pay for pass-through drugs and biologicals at a payment
rate based on the ASP methodology, which may be based on ASP, WAC, or
AWP, but is generally ASP plus 6 percent, which is equivalent to the
payment rate these drugs and biologicals would receive in the
physician's office setting in CY 2024. We proposed that a $0 pass-
through payment amount would be paid for pass-through drugs and
biologicals that are not policy-packaged under the
[[Page 81769]]
CY 2024 OPPS or in subsequent years, because the difference between the
amount authorized under section 1842(o) of the Act, which would
generally be ASP plus 6 percent, and the portion of the otherwise
applicable OPD fee schedule that the Secretary determines is
appropriate, which would also generally be ASP plus 6 percent, is $0.
In the case of policy-packaged drugs (which include the following:
anesthesia drugs; drugs, biologicals, and radiopharmaceuticals that
function as supplies when used in a diagnostic test or procedure
(including contrast agents, diagnostic radiopharmaceuticals, and stress
agents); and drugs and biologicals that function as supplies when used
in a surgical procedure), we proposed that their pass-through payment
amount would be equal to a payment rate based on the ASP methodology,
which may be based on ASP, WAC, or AWP, but would generally be ASP plus
6 percent for CY 2024, minus a payment offset for any predecessor drug
products contributing to the pass-through payment as described in
section V.A.6 of this final rule with comment period. We proposed this
policy because, if not for the pass-through payment status of these
policy-packaged products, payment for these products would be packaged
into the associated procedure and therefore, there are associated OPD
fee schedule amounts for them.
We proposed to continue to update pass-through payment rates on a
quarterly basis on our website during CY 2024, and in subsequent years,
if later quarter ASP submissions (or more recent WAC or AWP
information, as applicable) indicate that adjustments to the payment
rates for these pass-through payment drugs or biologicals are
necessary. For a full description of this policy, we refer readers to
the CY 2006 OPPS/ASC final rule with comment period (70 FR 68632
through 68635).
For CY 2024 and subsequent years, consistent with our CY 2023
policy for diagnostic and therapeutic radiopharmaceuticals, we proposed
to continue to provide payment for both diagnostic and therapeutic
radiopharmaceuticals that are granted pass-through payment status based
on the ASP methodology. As stated earlier, for purposes of pass-through
payment, we consider radiopharmaceuticals to be drugs under the OPPS.
Therefore, if a diagnostic or therapeutic radiopharmaceutical receives
pass-through payment status during CY 2024, we will continue to follow
the standard ASP methodology to determine the pass-through payment rate
that drugs receive under section 1842(o) of the Act, which would
generally be ASP plus 6 percent. If ASP data are not available for a
radiopharmaceutical, we would provide pass-through payment at WAC plus
3 percent (consistent with our policy in section V.B.2.a of this final
rule with comment period), the equivalent payment provided to pass-
through drugs and biologicals without ASP information. Additional
detail on the WAC plus 3 percent payment policy can be found in section
V.B.2.a of this final rule with comment period. If WAC information also
is not available, we would provide payment for the pass-through
radiopharmaceutical at 95 percent of its most recent AWP.
We proposed that the other policies in this section would apply in
both CY 2024 and subsequent years as they have been our longstanding
policies under the OPPS. Therefore, we do not believe the policies need
to be reproposed- annually and should apply for subsequent years until
such time as we propose to change them.
The drugs and biologicals that we proposed would have pass-through
payment status expire after December 31, 2024, are shown in Table 91.
We did not receive any public comments on this section.
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6. Provisions for Reducing Transitional Pass-Through Payments for
Policy-Packaged Drugs, Biologicals, and Radiopharmaceuticals To Offset
Costs Packaged Into APC Groups
Under the regulation at 42 CFR 419.2(b)(15), nonpass-through drugs,
biologicals, and radiopharmaceuticals that function as supplies when
used in a diagnostic test or procedure are packaged in the OPPS. This
category includes diagnostic radiopharmaceuticals, contrast agents,
stress agents, and other diagnostic drugs. Also, under the regulation
at 42 CFR 419.2(b)(16), nonpass-through
[[Page 81775]]
drugs and biologicals that function as supplies in a surgical procedure
are packaged in the OPPS. This category includes skin substitutes and
other surgical-supply drugs and biologicals. Finally, under the
regulation at 42 CFR 419.2(b)(4), anesthesia drugs are packaged in the
OPPS. As described earlier, section 1833(t)(6)(D)(i) of the Act
specifies that the transitional pass-through payment amount for pass-
through drugs and biologicals is the difference between the amount paid
under section 1842(o) of the Act and the otherwise applicable OPD fee
schedule amount. Because a payment offset is necessary in order to
provide an appropriate transitional pass-through payment, we deduct
from the pass-through payment for policy-packaged drugs, biologicals,
and radiopharmaceuticals an amount reflecting the portion of the APC
payment associated with predecessor products in order to ensure no
duplicate payment is made. This amount reflecting the portion of the
APC payment associated with predecessor products is called the payment
offset.
The payment offset policy applies to all policy-packaged drugs,
biologicals, and radiopharmaceuticals. For a full description of the
payment offset policy as applied to policy-packaged drugs, which
include diagnostic radiopharmaceuticals, contrast agents, stress
agents, and skin substitutes, we refer readers to the discussion in the
CY 2016 OPPS/ASC final rule with comment period (80 FR 70430 through
70432). For CY 2024 and subsequent years, as we did in CY 2023, we
proposed to continue to apply the same policy-packaged offset policy to
payment for pass-through diagnostic radiopharmaceuticals, pass-through
contrast agents, pass-through stress agents, and pass-through skin
substitutes. We proposed that these policies would apply in both CY
2024 and subsequent years as they are our longstanding policies under
the OPPS, and we do not believe they need to be reproposed annually.
Instead, we believe they should apply for subsequent years until such
time as we propose to change them or until such time as the APCs to
which a payment offset may be applicable for certain products change.
The APCs to which a payment offset may be applicable for pass-through
diagnostic radiopharmaceuticals, pass-through contrast agents, pass-
through stress agents, and pass-through skin substitutes are identified
in Table 92. We note that in the CY 2024 OPPS/ASC proposed rule (88 FR
49676), we erroneously labeled these APCs as ``CY 2023'' rather than
the correct ``CY 2024.''
[GRAPHIC] [TIFF OMITTED] TR22NO23.136
We proposed to continue to post annually on our website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/annual-policy-files a file that contains the APC offset
amounts that will be used for that year for purposes of both evaluating
cost significance for candidate pass-through payment device categories
and drugs and biologicals and establishing any appropriate APC offset
amounts. Specifically, the file will continue to provide the amounts
and percentages of APC payment associated with packaged implantable
devices, policy-packaged drugs, and threshold packaged drugs and
biologicals for every OPPS clinical APC.
Comment: One commenter requested that we establish a ``two-times
rule'' for diagnostic radiopharmaceuticals since they are packaged into
the cost of the associated testing or administration procedure. While
the commenter did not describe their precise goal, it appears they
support a policy where, if the per-day cost of a diagnostic
radiopharmaceutical is more than twice the cost of testing or the
administration procedure where the product would be used, we should use
our process under the OPPS to create a temporary HCPCS code to describe
a new testing or administration procedure. The temporary HCPCS code for
the new testing or administrative procedure would only be used with
high-cost diagnostic radiopharmaceuticals for which the commenter
believes payment is not sufficient. The commenter believed creating a
temporary code for testing or administrative procedures for
[[Page 81776]]
use only with high-cost diagnostic radiopharmaceuticals would better
reflect the cost of the high-cost diagnostic radiopharmaceutical
products as lower-cost products would not be billed with, and would
thus be excluded from the cost of, the test or procedure for which the
temporary HCPCS would be established.
Response: Our packaged payment policies for diagnostic
radiopharmaceuticals are designed to encourage the use of the most
cost-effective items and services for Medicare beneficiaries. Creating
separate HCPCS codes for procedures utilizing high-cost diagnostic
radiopharmaceuticals would segment payment for diagnostic
radiopharmaceuticals and would reduce the prospective nature of the
OPPS. We believe that the policy the commenter is suggesting may
discourage the use of effective, lower-cost products.
However, we appreciate the comment and will consider it as we
explore possible changes to our diagnostic radiopharmaceutical payment
policy, which may include new payment and coding approaches for high-
cost diagnostic radiopharmaceuticals in the outpatient hospital setting
in future rulemaking. Additionally, please refer to section II.A.3 of
this final rule with comment period for a discussion of our comment
solicitation regarding possible new approaches for the payment of
diagnostic radiopharmaceuticals.
Comment: One commenter asked for an analysis of how we incorporate
the cost of diagnostic radiopharmaceuticals with pass-through status
into the payment for the associated test or administration procedure
when the pass-through status of the diagnostic radiopharmaceutical
ends.
Response: We identify single procedure claims that describe a
procedure where a diagnostic radiopharmaceutical whose pass-through
status is ending is used. The separate cost of the diagnostic
radiopharmaceutical is added to the payment rate of the associated
single procedure minus any existing drug offset for the service. We
then calculate the geometric mean cost of all existing claims for the
associated procedure. In many cases, there may be several diagnostic
radiopharmaceuticals that can be used with a given procedure. The cost
of the procedure will reflect the resource cost to perform the
procedure along with the share of the procedures performed with the
drug for which pass-through status is ending and the share of other
diagnostic radiopharmaceuticals that may already be packaged into the
cost of the associated procedure.
We advise the commenter to refer to the CY 2024 OPPS final rule
claims accounting narrative and to section II.A.3 of this final rule
with comment period for information on how costs from drugs, including
diagnostic radiopharmaceuticals, and other ancillary services are
included in the cost of their associated procedures when payment for
those drugs and ancillary services is packaged.
Comment: One commenter requested that CMS release a copy of the APC
offset file with future OPPS/ASC proposed rules to enable the public to
calculate the percentage of APC payment associated with packaged drug
costs using APC offset data for the upcoming calendar year.
Response: We thank the commenter for their suggestion, and we will
consider it for future rulemaking.
Comment: One commenter supported keeping four payment levels (APC
5591 through APC 5594) for the Nuclear Medicine and related services
APC.
Response: We appreciate the support of the commenter.
After consideration of the public comments we received, we are
finalizing our proposals without modification regarding the APCs where
drug offsets for policy-packaged drugs or radiopharmaceuticals could
apply. We are also finalizing our proposal, without modification, to
continue to annually post a file that contains the APC offset amounts.
B. OPPS Payment for Drugs, Biologicals, and Radiopharmaceuticals
Without Pass-Through Payment Status
1. Criteria for Packaging Payment for Drugs, Biologicals, and
Radiopharmaceuticals
a. Packaging Threshold
In accordance with section 1833(t)(16)(B) of the Act, the threshold
for establishing separate APCs for payment of drugs and biologicals was
set to $50 per administration during CYs 2005 and 2006. In CY 2007, we
used the four-quarter moving average Producer Price Index (PPI) levels
for Pharmaceutical Preparations (Prescription) to trend the $50
threshold forward from the third quarter of CY 2005 (when the Pub. L.
108-173 mandated threshold became effective) to the third quarter of CY
2007. We then rounded the resulting dollar amount to the nearest $5
increment in order to determine the CY 2007 threshold amount of $55.
Using the same methodology as that used in CY 2007 (which is discussed
in more detail in the CY 2007 OPPS/ASC final rule with comment period
(71 FR 68085 and 68086)), we set the packaging threshold for
establishing separate APCs for drugs and biologicals at $135 for CY
2023 (87 FR 71960 and 71961).
Following the CY 2007 methodology, for the CY 2024 OPPS/ASC
proposed rule, we used the most recently available four quarter moving
average PPI levels to trend the $50 threshold forward from the third
quarter of CY 2005 to the third quarter of CY 2024 and rounded the
resulting dollar amount ($138.44) to the nearest $5 increment, which
yielded a figure of $140. In performing this calculation, we used the
most recent forecast of the quarterly index levels for the PPI for
Pharmaceuticals for Human Use (Prescription) (Bureau of Labor
Statistics series code WPUSI07003) from IHS Global, Inc. IGI is a
nationally recognized economic and financial forecasting firm with
which CMS contracts to forecast the various price indexes including the
PPI Pharmaceuticals for Human Use (Prescription). Based on these
calculations using the CY 2007 OPPS methodology, we proposed a
packaging threshold for CY 2024 of $140.
Comment: One commenter requested that the drug packaging threshold
not be increased for CY 2024, but instead be maintained at $135 per
day. The commenter believes that the level of the drug packaging
threshold has increased faster over the last several years than the
rate of increase in OPPS payment rates.
Response: Consistent with our longstanding policy and practices,
for the final rule, we recalculated the drug packaging threshold amount
with updated data for the four-quarter moving average PPI level. When
we trended the $50 threshold forward from the third quarter of CY 2005
to the third quarter of CY 2024 and rounded the resulting dollar amount
($137.36) to the nearest $5 increment, we calculated a threshold amount
of $135, which is $5 less than our proposed threshold. We note,
however, that we are not changing the methodology by which we calculate
the threshold. Rather, recalculating the threshold amount using the
updated data for the four-quarter moving average PPI level resulted in
a lower amount that rounded to $135.
After consideration of the public comments we received and
consistent with our standard methodology, we are finalizing our
proposal with modification. We will maintain the drug packaging
threshold for CY 2024 at $135 per day, as the updated threshold amount
calculated rounded to the
[[Page 81777]]
nearest $5 increment is now $135, rather than the proposed $140.
b. Packaging of Payment for HCPCS Codes That Describe Certain Drugs,
Certain Biologicals, and Certain Therapeutic Radiopharmaceuticals Under
the Cost Threshold (``Threshold-Packaged Drugs'')
To determine the proposed CY 2024 packaging status for all nonpass-
through drugs and biologicals that are not policy packaged, we
calculated, on a HCPCS code-specific basis, the per day cost of all
drugs, biologicals, and therapeutic radiopharmaceuticals that had a
HCPCS code in CY 2022 and were paid (via packaged or separate payment)
under the OPPS. We used data from CY 2022 claims processed through June
30, 2022, for this calculation. However, we did not perform this
calculation for those drugs and biologicals with multiple HCPCS codes
that include different dosages, as described in section V.B.1.d of this
final rule with comment period, or for the following policy-packaged
items that we propose to continue to package in CY 2024: anesthesia
drugs; drugs, biologicals, and radiopharmaceuticals that function as
supplies when used in a diagnostic test or procedure; and drugs and
biologicals that function as supplies when used in a surgical
procedure.
In order to calculate the per day costs for drugs, biologicals, and
therapeutic radiopharmaceuticals to determine their proposed packaging
status in CY 2024, we used the methodology that was described in detail
in the CY 2006 OPPS proposed rule (70 FR 42723 and 42724) and finalized
in the CY 2006 OPPS final rule with comment period (70 FR 68636 through
68638). For each drug and biological HCPCS code, we used an estimated
payment rate based on the ASP methodology, which is generally ASP plus
6 percent (which is the payment rate we proposed for separately payable
drugs and biologicals) for CY 2024, as discussed in more detail in
section V.B.2.b of this final rule with comment period) to calculate
the CY 2024 proposed rule per day costs. We used the manufacturer-
submitted ASP data from the fourth quarter of CY 2022 (data that were
used for payment purposes in the physician's office setting, effective
April 1, 2023) to determine the proposed rule per day cost.
As is our standard methodology, for CY 2024, we proposed to use
payment rates based on the ASP data from the fourth quarter of CY 2022
for budget neutrality estimates, packaging determinations, impact
analyses, and completion of Addenda A and B to the CY 2024 OPPS
proposed rule (which are available via the internet on the CMS website)
because these are the most recent data available for use at the time of
development of the CY 2024 OPPS proposed rule. These data also were the
basis for drug payments in the physician's office setting, effective
April 1, 2023. For items that did not have an ASP-based payment rate,
such as some therapeutic radiopharmaceuticals, we used their mean unit
cost derived from the CY 2022 hospital claims data to determine their
per day cost.
We proposed to package items with a per day cost less than or equal
to $140 and identify items with a per day cost greater than $140 as
separately payable unless they are policy-packaged. Consistent with our
past practice, we cross-walked historical OPPS claims data from the CY
2022 HCPCS codes that were reported to the CY 2023 HCPCS codes that we
display in Addendum B to the OPPS CY 2024 proposed rule (which is
available on the CMS website) \141\ for proposed payment in CY 2024.
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\141\ https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient.
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Our policy during previous cycles of OPPS rulemaking has been to
use updated ASP and claims data to make final determinations of the
packaging status of HCPCS codes for drugs, biologicals, and therapeutic
radiopharmaceuticals for the OPPS/ASC final rule with comment period.
We note that it is also our policy to make an annual packaging
determination for a HCPCS code only when we develop the OPPS/ASC final
rule with comment period for the update year. Only HCPCS codes that are
identified as separately payable in the final rule with comment period
are subject to quarterly updates. For our calculation of per day costs
of HCPCS codes for drugs and biologicals in the CY 2024 OPPS proposed
rule, we proposed to use ASP data from the fourth quarter of CY 2022,
which is the basis for calculating payment rates for drugs and
biologicals in the physician's office setting using the ASP
methodology, effective April 1, 2023, along with updated hospital
claims data from CY 2022. We note that we also proposed to use these
data for budget neutrality estimates and impact analyses for the CY
2024 OPPS proposed rule.
Payment rates for HCPCS codes for separately payable drugs and
biologicals included in Addenda A and B of the CY 2024 OPPS proposed
rule are based on ASP data from the second quarter of CY 2023. These
data will be the basis for calculating payment rates for drugs and
biologicals in the physician's office setting using the ASP
methodology, effective October 1, 2023. These payment rates would then
be updated in the January 2024 OPPS update, based on the most recent
ASP data to be used for physicians' office and OPPS payment as of
January 1, 2024. For items that do not currently have an ASP-based
payment rate, we calculated their mean unit cost from all of the CY
2022 claims data and updated cost report information available for the
CY 2024 OPPS proposed rule to determine their final per day cost.
Consequently, the packaging status of some HCPCS codes for drugs,
biologicals, and therapeutic radiopharmaceuticals in the OPPS/ASC
proposed rule may be different from the same drugs' HCPCS codes'
packaging status determined based on the data used for this final rule
with comment period. Under such circumstances, we proposed to continue
to follow the established policies initially adopted for the CY 2005
OPPS (69 FR 65780) in order to more equitably pay for those drugs whose
costs fluctuate relative to the proposed CY 2024 OPPS drug packaging
threshold and the drug's payment status (packaged or separately
payable) in CY 2023. These established policies have not changed for
many years and are the same as described in the CY 2016 OPPS/ASC final
rule with comment period (80 FR 70434). Specifically, for CY 2024 and
subsequent years, consistent with our historical practice, we proposed
to apply the following policies to those HCPCS codes for drugs,
biologicals, and therapeutic radiopharmaceuticals whose relationship to
the drug packaging threshold changes based on the updated drug
packaging threshold and on the final updated data:
HCPCS codes for drugs and biologicals that were paid
separately in CY 2023 and that are proposed for separate payment in CY
2024, and that then have per day costs equal to or less than the CY
2024 final rule drug packaging threshold, based on the updated ASPs and
hospital claims data used for the CY 2024 final rule, would continue to
receive separate payment in CY 2024.
HCPCS codes for drugs and biologicals that were packaged
in CY 2023 and that are proposed for separate payment in CY 2024, and
that then have per day costs equal to or less than the CY 2024 final
rule drug packaging threshold, based on the updated ASPs and hospital
claims data used for the CY 2024 final rule, would remain packaged in
CY 2024.
HCPCS codes for drugs and biologicals for which we
proposed
[[Page 81778]]
packaged payment in CY 2024 but that then have per-day costs greater
than the CY 2024 final rule drug packaging threshold, based on the
updated ASPs and hospital claims data used for the CY 2024 final rule,
would receive separate payment in CY 2024.
We did not receive any public comments on our proposal, and we are
finalizing our proposal with modification because of the change in the
amount of the drug packaging threshold that was described in section
V.B.1.a of this final rule with comment period. We will package items
with a per day cost less than or equal to $135 and identify items with
a per day cost greater than $135 as separately payable unless they are
policy-packaged. In addition, we are finalizing, without modification,
our proposal to recalculate the mean unit cost for items that do not
currently have an ASP-based payment rate from all of the CY 2022 claims
data and updated cost report information available for this CY 2024
final rule with comment period to determine their final per day cost.
We also did not receive any public comments on our proposal to
continue to follow the established policies, initially adopted for the
CY 2005 OPPS (69 FR 65780), when the packaging status of HCPCS codes
for drugs, biologicals, and therapeutic radiopharmaceuticals in the
proposed rule is different from the same drug's HCPCS code's packaging
status determined based on the data used for the final rule with
comment period. For CY 2024, we are finalizing these two proposals
without modification. Please refer to Addendum B to this final rule
with comment period, which is available on the CMS website, for
information on the packaging status of drugs, biologicals, and
therapeutic radiopharmaceuticals.
c. Policy-Packaged Drugs, Biologicals, and Radiopharmaceuticals
As mentioned earlier in this section, under the OPPS, we package
several categories of nonpass-through drugs, biologicals, and
radiopharmaceuticals, regardless of the cost of the products. Because
the products are packaged according to the policies in 42 CFR 419.2(b),
we refer to these packaged drugs, biologicals, and radiopharmaceuticals
as ``policy-packaged'' drugs, biologicals, and radiopharmaceuticals.
These policies are either longstanding or based on longstanding
principles and inherent to the OPPS and are as follows:
Anesthesia, certain drugs, biologicals, and other
pharmaceuticals; medical and surgical supplies and equipment; surgical
dressings; and devices used for external reduction of fractures and
dislocations (Sec. 419.2(b)(4));
Intraoperative items and services (Sec. 419.2(b)(14));
Drugs, biologicals, and radiopharmaceuticals that function
as supplies when used in a diagnostic test or procedure (including, but
not limited to, diagnostic radiopharmaceuticals, contrast agents, and
pharmacologic stress agents) (Sec. 419.2(b)(15)); and
Drugs and biologicals that function as supplies when used
in a surgical procedure (including, but not limited to, skin
substitutes and similar products that aid wound healing and implantable
biologicals) (Sec. 419.2(b)(16)).
The policy at Sec. 419.2(b)(16) is broader than that at Sec.
419.2(b)(14). As we stated in the CY 2015 OPPS/ASC final rule with
comment period: ``We consider all items related to the surgical outcome
and provided during the hospital stay in which the surgery is
performed, including postsurgical pain management drugs, to be part of
the surgery for purposes of our drug and biological surgical supply
packaging policy'' (79 FR 66875). The category described by Sec.
419.2(b)(15) is large and includes diagnostic radiopharmaceuticals,
contrast agents, stress agents, and some other products. The category
described by Sec. 419.2(b)(16) includes skin substitutes and some
other products. We believe it is important to reiterate that cost
consideration is not a factor when determining whether an item is a
surgical supply (79 FR 66875).
Comment: One commenter recommended that CMS continue to apply
radiolabeled product edits to the nuclear medicine procedures to ensure
that all packaged costs are included on nuclear medicine claims in
order to establish appropriate payment rates in the future. The
commenter was concerned that many providers performing nuclear medicine
procedures are not including the cost of diagnostic
radiopharmaceuticals used for the procedures in their claim
submissions. The commenter believes this lack of drug cost reporting
could be causing the cost of nuclear medicine procedures to be
underreported and therefore requested that the radiolabeled product
edits be reinstated.
Response: We appreciate the commenter's feedback; however, we are
not reinstating the radiolabeled product edits for nuclear medicine
procedures, which required a diagnostic radiopharmaceutical to be
present on the same claim as a nuclear medicine procedure for payment
to be made under the OPPS. As previously discussed in the CY 2020 OPPS/
ASC final rule with comment period (85 FR 86033 and 86034), the edits
were in place between CY 2008 and CY 2014 (78 FR 75033). We believe the
period of time in which the edits were in place was sufficient for
hospitals to gain experience reporting procedures involving
radiolabeled products and to become accustomed to ensuring that they
code and report charges so that their claims fully and appropriately
reflect the costs of those radiolabeled products. As with all other
items and services recognized under the OPPS, we expect hospitals to
code and report their costs appropriately, regardless of whether there
are claims processing edits in place.
We welcome ongoing dialogue and engagement from interested parties
regarding suggestions for payment changes for consideration in future
rulemaking.
d. Packaging Determination for HCPCS Codes That Describe the Same Drug
or Biological But Different Dosages
In the CY 2010 OPPS/ASC final rule with comment period (74 FR 60490
and 60491), we finalized a policy to make a single packaging
determination for a drug, rather than an individual HCPCS code, when a
drug has multiple HCPCS codes describing different dosages because we
believe that adopting the standard HCPCS code-specific packaging
determinations for these codes could lead to inappropriate payment
incentives for hospitals to report certain HCPCS codes instead of
others. We continue to believe that making packaging determinations on
a drug-specific basis eliminates payment incentives for hospitals to
report certain HCPCS codes for drugs and allows hospitals flexibility
in choosing to report all HCPCS codes for different dosages of the same
drug or only the lowest dosage HCPCS code. Therefore, we proposed to
continue our policy to make packaging determinations on a drug-specific
basis, rather than a HCPCS code-specific basis, for those HCPCS codes
that describe the same drug or biological but different dosages in CY
2024.
In order to propose a packaging determination that is consistent
across all HCPCS codes that describe different dosages of the same drug
or biological, we aggregated both our CY 2022 claims data and our
pricing information, which is based on the ASP methodology, which is
generally ASP plus 6 percent, across all of the HCPCS codes that
describe each distinct drug or biological in order to determine the
mean units per
[[Page 81779]]
day of the drug or biological in terms of the HCPCS code with the
lowest dosage descriptor. The following drugs did not have pricing
information available for the ASP methodology for the CY 2024 OPPS/ASC
proposed rule; and, as is our current policy for determining the
packaging status of other drugs, we used the mean unit cost available
from the CY 2022 claims data to make the proposed packaging
determinations for them: HCPCS code C9257 (Injection, bevacizumab, 0.25
mg); HCPCS code J1840 (Injection, kanamycin sulfate, up to 500 mg);
HCPCS code J1850 (Injection, kanamycin sulfate, up to 75 mg); HCPCS
code J3472 (Injection, hyaluronidase, ovine, preservative free, per
1000 usp units); HCPCS code J7100 (Infusion, dextran 40, 500 ml); and
HCPCS code J7110 (Infusion, dextran 75, 500 ml).
For all other drugs and biologicals that have HCPCS codes
describing different doses, we then multiplied the proposed weighted
average ASP methodology based payment rate, which is generally ASP plus
6 percent, per-unit payment amount across all dosage levels of a
specific drug or biological by the estimated units per day for all
HCPCS codes that describe each drug or biological from our claims data
to determine if the estimated per day cost of each drug or biological
is less than or equal to the proposed CY 2024 drug packaging threshold
of $140 (in which case all HCPCS codes for the same drug or biological
would be packaged) or greater than the proposed CY 2024 drug packaging
threshold of $140 (in which case all HCPCS codes for the same drug or
biological would be separately payable). The proposed packaging status
of each drug and biological HCPCS code to which this methodology would
apply in CY 2024 is displayed in Table 93.
BILLING CODE 4150-28-P
[[Page 81780]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.137
BILLING CODE 4150-28-C
We did not receive any public comments on our proposal, and we are
finalizing our proposal with the only modification being that the final
CY 2024 drug packaging threshold will be $135 per day as described in
section V.B.1.a. of this final rule with comment period. All other
parts of the proposal are finalized without modification.
2. Payment for Drugs and Biologicals Without Pass-Through Status That
Are Not Packaged
a. Payment for Specified Covered Outpatient Drugs (SCODs) and Other
Separately Payable Drugs and Biologicals
Section 1833(t)(14) of the Act defines certain separately payable
radiopharmaceuticals, drugs, and biologicals and mandates specific
payments for these items. Under section 1833(t)(14)(B)(i) of the Act, a
``specified covered outpatient drug'' (known as a SCOD) is defined as a
covered outpatient drug, as defined in section 1927(k)(2) of the Act,
for which a separate APC has been established and that either is a
radiopharmaceutical agent or a drug or biological for which payment was
made on a pass-through basis on or before December 31, 2002.
Under section 1833(t)(14)(B)(ii) of the Act, certain drugs and
biologicals are designated as exceptions and are not
[[Page 81781]]
included in the definition of SCODs. These exceptions are--
A drug or biological for which payment is first made on or
after January 1, 2003, under the transitional pass-through payment
provision in section 1833(t)(6) of the Act.
A drug or biological for which a temporary HCPCS code has
not been assigned.
During CYs 2004 and 2005, an orphan drug (as designated by
the Secretary).
Section 1833(t)(14)(A)(iii) of the Act requires that payment for
SCODs in CY 2006 and subsequent years be equal to the average
acquisition cost for the drug for that year as determined by the
Secretary, subject to any adjustment for overhead costs and taking into
account the hospital acquisition cost survey data collected by the
Government Accountability Office (GAO) in CYs 2004 and 2005, and later
periodic surveys conducted by the Secretary as set forth in the
statute. If hospital acquisition cost data are not available, the law
requires that payment be equal to payment rates established under the
methodology described in section 1842(o), section 1847A, or section
1847B of the Act, as calculated and adjusted by the Secretary as
necessary for purposes of paragraph (14). We refer to this alternative
methodology as the ``statutory default.'' Most physician Part B drugs
are paid at ASP plus 6 percent in accordance with section 1842(o) and
section 1847A of the Act.
Section 1833(t)(14)(E)(ii) of the Act provides for an adjustment in
OPPS payment rates for SCODs to take into account overhead and related
expenses, such as pharmacy services and handling costs. Section
1833(t)(14)(E)(i) of the Act required MedPAC to study pharmacy overhead
and related expenses and to make recommendations to the Secretary
regarding whether, and if so how, a payment adjustment should be made
to compensate hospitals for overhead and related expenses. Section
1833(t)(14)(E)(ii) of the Act authorizes the Secretary to adjust the
weights for ambulatory procedure classifications for SCODs to take into
account the findings of the MedPAC study.\142\
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\142\ Medicare Payment Advisory Committee. June 2005 Report to
the Congress. Chapter 6: Payment for pharmacy handling costs in
hospital outpatient departments. Available at: https://www.medpac.gov/wp-content/uploads/import_data/scrape_files/docs/default-source/reports/June05_ch6.pdf.
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It has been our policy since CY 2006 to apply the same treatment to
all separately payable drugs and biologicals, which include SCODs, and
drugs and biologicals that are not SCODs. Therefore, we apply the
payment methodology in section 1833(t)(14)(A)(iii) of the Act to SCODs,
as required by statute, but we also apply it to separately payable
drugs and biologicals that are not SCODs, which is a policy
determination rather than a statutory requirement. For CY 2023 and
subsequent years, we finalized a policy to apply section
1833(t)(14)(A)(iii)(II) of the Act to all separately payable drugs and
biologicals, including SCODs. Although we do not distinguish SCODs in
this discussion, we note that we are required to apply section
1833(t)(14)(A)(iii)(II) of the Act to SCODs; but we also are applying
this provision to other separately payable drugs and biologicals,
consistent with our history of using the same payment methodology for
all separately payable drugs and biologicals.
For a detailed discussion of our OPPS drug payment policies from CY
2006 to CY 2012, we refer readers to the CY 2013 OPPS/ASC final rule
with comment period (77 FR 68383 through 68385). In the CY 2013 OPPS/
ASC final rule with comment period (77 FR 68386 through 68389), we
first adopted the statutory default policy to pay for separately
payable drugs and biologicals at ASP plus 6 percent based on section
1833(t)(14)(A)(iii)(II) of the Act. We have continued this policy of
paying for separately payable drugs and biologicals at the statutory
default for CYs 2014 through 2023.
In the case of a drug or biological during an initial sales period
in which data on the prices for sales of the drug or biological are not
sufficiently available from the manufacturer, section 1847A(c)(4) of
the Act permits the Secretary to make payments that are based on WAC.
Under section 1833(t)(14)(A)(iii)(II) of the Act, the amount of payment
for a separately payable drug equals the average price for the drug for
the year established under, among other authorities, section 1847A of
the Act. As explained in greater detail in the CY 2019 PFS final rule,
under section 1847A(c)(4) of the Act, although payments may be based on
WAC, unlike section 1847A(b) of the Act (which specifies that payments
using ASP or WAC must be made with a 6 percent add-on), section
1847A(c)(4) of the Act does not require that a particular add-on amount
be applied to WAC-based pricing for this initial period when ASP data
are not available. Consistent with section 1847A(c)(4) of the Act, in
the CY 2019 PFS final rule (83 FR 59661 through 59666), we finalized a
policy that, effective January 1, 2019, WAC-based payments for Part B
drugs made under section 1847A(c)(4) of the Act will utilize a 3-
percent add-on in place of the 6 percent add-on that was being used
according to our policy in effect as of CY 2018. For the CY 2019 OPPS,
we followed the same policy finalized in the CY 2019 PFS final rule (83
FR 59661 through 59666). Since CY 2020, we have continued to utilize a
3 percent add-on instead of a 6 percent add-on for drugs that are paid
based on WAC pursuant to our authority under section
1833(t)(14)(A)(iii)(II) of the Act (84 FR 61318 and 85 FR 86039), which
provides, in part, that the amount of payment for a SCOD is the average
price of the drug in the year established under section 1847A of the
Act. We also apply this provision to non-SCOD separately payable drugs.
Because we establish the average price for a drug paid based on WAC
under section 1847A of the Act as WAC plus 3 percent instead of WAC
plus 6 percent, we believe it is appropriate to price separately
payable drugs paid based on WAC at the same amount under the OPPS. Our
policy to pay for drugs and biologicals at WAC plus 3 percent, rather
than WAC plus 6 percent, applies whenever WAC-based pricing is used for
a drug or biological under 1847A(c)(4). We refer readers to the CY 2019
PFS final rule (83 FR 59661 through 59666) for additional background on
this policy.
Consistent with our current policy, payments for separately payable
drugs and biologicals are included in the budget neutrality
adjustments, under the requirements in section 1833(t)(9)(B) of the
Act. Also, the budget neutral weight scalar is not applied in
determining payments for these separately payable drugs and
biologicals.
We note that separately payable drug and biological payment rates
listed in Addenda A and B to the CY 2024 OPPS/ASC proposed rule
(available on the CMS website),\143\ which illustrate the proposed CY
2024 payment based on the ASP methodology for separately payable
nonpass-through drugs and biologicals and the ASP methodology for pass-
through drugs and biologicals, reflect either ASP information that is
the basis for calculating payment rates for drugs and biologicals in
the physician's office setting effective April 1, 2023, or WAC, AWP, or
mean unit cost from CY 2022 claims data and updated cost report
information available for the CY 2024 OPPS/ASC proposed rule. In
general, these published payment rates are not the same as the actual
January 2024 payment rates. This is because payment rates for drugs and
biologicals
[[Page 81782]]
with ASP information for January 2024 will be determined through the
standard quarterly process where ASP data submitted by manufacturers
for the third quarter of CY 2023 (July 1, 2023, through September 30,
2023) will be used to set the payment rates that are released for the
quarter beginning in January 2024 in December 2023. In addition,
payment rates for drugs and biologicals in Addenda A and B to the
proposed rule, for which there was no ASP, WAC, or AWP information
available for April 2023, are based on mean unit cost in the available
CY 2022 claims data. If new pricing information becomes available for
payment for the quarter beginning in January 2024, we will price
payment for these drugs and biologicals based on their newly available
information. Finally, there may be drugs and biologicals that have ASP,
WAC, or AWP information available for the CY 2024 OPPS/ASC proposed
rule (reflecting April 2023 ASP data) that do not have ASP, WAC, or AWP
information available for the quarter beginning in January 2024. These
drugs and biologicals would then be paid based on mean unit cost data
derived from CY 2022 hospital claims. Therefore, the proposed payment
rates listed in Addenda A and B to the proposed rule are not for
January 2024 payment purposes and are only illustrative of the CY 2024
OPPS payment methodology using the most recently available information
at the time of issuance of the CY 2024 OPPS/ASC proposed rule.
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\143\ https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient.
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For CY 2024, we did not propose any changes to our policies for
payment for separately payable drugs and biologicals; and we are
continuing our payment policy that has been in effect since CY 2013 to
pay for separately payable drugs and biologicals in accordance with
section 1833(t)(14)(A)(iii)(II) of the Act (the statutory default).
We did, however, propose to amend the regulation text to reflect
our longstanding policies for calculating the Medicare program payment
and copayment amounts for separately payable drugs and biologicals by
adding a new paragraph (d) to Sec. 419.41.
Comment: A few commenters supported separate payment for specific
drugs, biologicals, and radiopharmaceuticals for CY 2023. Commenters
also supported CMS paying for all separately payable drugs and
biologicals as SCODs. Multiple commenters expressed their approval for
our proposal to pay for separately payable drugs and biologicals at ASP
plus 6 percent.
Response: We appreciate the commenters' feedback and support.
Comment: One commenter requested that an add-on percentage of
greater than 6 percent of ASP be paid for separately payable
radiopharmaceuticals to reflect higher overhead and handling costs for
these products.
Response: The add-on percentage of 6 percent is generally viewed as
reflecting the overhead and handling cost of most drugs,
radiopharmaceuticals, and biologicals that are separately payable in
the OPPS even though the overhead and handling costs for individual
products may be higher or lower than 6 percent of the ASP. We believe
that the add-on percentage of 6 percent is appropriate for separately
payable radiopharmaceuticals.
Comment: One commenter requested that we exclude
radiopharmaceuticals from our proposed policy, explaining that during
an initial sales period in which cost data for the drug or biological
are not sufficiently available from the manufacturer, payments can be
made for drugs using WAC pricing plus a 3 percent price add-on. The
commenters believe the cost of preparing radiopharmaceuticals is higher
than the cost of preparing other drugs and biologicals and a 6 percent
price add-on should be required anytime that we use WAC to price a
radiopharmaceutical.
Response: The WAC of a drug or biological is defined in section
1847A(c)(6)(B) of the Act as the manufacturer's list price for the drug
or biological to wholesalers or direct purchasers in the United States,
not including prompt pay or other discounts, rebates or reductions in
price, for the most recent month for which the information is
available, as reported in wholesale price guides or other publications
of drug or biological pricing data. Because the WAC does not include
discounts, it typically exceeds ASP, and the use of a WAC-based payment
amount for the same drug results in higher dollar payments than the use
of an ASP-based payment amount. Also, MedPAC, in their June 2017 Report
to the Congress (https://www.medpac.gov/wp-content/uploads/import_data/scrape_files/docs/defaultsource/reports/jun17_reporttocongress_sec.pdf), suggested that greater parity between ASP-based acquisition
costs and WAC-based payments for Part B drugs could be achieved and
recommended changing the 6 percent add-on for WAC-based payments to 3
percent. Given this evidence that WAC pricing tends to overestimate
drug cost, we believe our current policy to pay for drugs at WAC plus 3
percent for drugs, biologicals, and radiopharmaceuticals when ASP is
not available more accurately reflects the cost of new products
recently entering the market than does WAC plus 6 percent.
For CY 2024, we did not propose any changes to our policies for
payment for separately payable drugs and biologicals; and we are
continuing our payment policy that has been in effect since CY 2013 to
pay for separately payable drugs and biologicals in accordance with
section 1833(t)(14)(A)(iii)(II) of the Act (the statutory default).
We did, however, propose to amend the regulation text to reflect
our longstanding policies for calculating the Medicare program payment
and copayment amounts for separately payable drugs and biologicals by
adding a new paragraph (d) to Sec. 419.41. After consideration of the
comments received, we are finalizing the proposal without modification.
b. Biosimilar Biological Products
(1) Provisions of the Inflation Reduction Act Relating to Biologicals
The Inflation Reduction Act (Pub. L. 117-169, August 16, 2022)
(hereinafter referred to as ``IRA'') contains two provisions that
affect payment limits for biosimilar biological products (hereinafter
referred to as ``biosimilars''): section 11402 of the IRA amends the
payment limit for new biosimilars furnished on or after July 1, 2024,
during the initial period when ASP data is not available. Section 11403
of the IRA makes changes to the payment limit for certain biosimilars
with an ASP that is not more than the ASP of the reference product for
a period of 5 years. We implemented section 11403 of the IRA under
program instruction,144 145 as permitted under section
1847A(c)(5)(C) of the Act.
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\144\ https://www.cms.gov/files/document/r11496cp.pdf.
\145\ https://www.cms.gov/medicare/payment/fee-for-service-providers/part-b-drugs/average-drug-sales-price.
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Section 11402 of the IRA amended section 1847A(c)(4) of the Act by
adding subparagraph (B), which limits the payment amount for
biosimilars during the initial period described in section
1847A(c)(4)(A). The provision requires that for new biosimilars
furnished on or after July 1, 2024, during the initial period when ASP
data are not available, the payment limit for the biosimilar is the
lesser of (1) an amount not to exceed 103 percent of the WAC of the
biosimilar or the Medicare Part B drug
[[Page 81783]]
payment methodology in effect on November 1, 2003, or (2) 106 percent
of the lesser of the WAC or ASP of the reference product, or in the
case of a selected drug during a price applicability period, 106
percent of the maximum fair price of the reference product. We referred
readers to the CY 2024 PFS proposed rule for the discussion of the
proposed changes to the regulation at Sec. 414.904 to codify section
11402 of the IRA (88 FR 52384 and 52385).
Section 11403 of the IRA amended section 1847A(b)(8) of the Act by
establishing a temporary payment increase for qualifying biosimilar
biological products (hereinafter referred to as ``qualifying
biosimilars'') furnished during the applicable 5-year period.\146\
Section 1847(b)(8)(B)(iii) of the Act defines ``qualifying biosimilar
biological product'' as a biosimilar biological product (as described
in section 1847A(b)(1)(C) of the Act) with an ASP (as described in
section 1847A(b)(8)(A)(i) of the Act) less than the ASP of the
reference product for a calendar quarter during the applicable 5-year
period. Section 11403 of the IRA requires that a qualifying biosimilar
be paid at ASP plus 8 percent of the reference product's ASP rather
than 6 percent during the applicable 5-year period. Section
1847A(b)(8)(B)(ii) of the Act defines the applicable 5-year period for
a qualifying biosimilar for which payment has been made using ASP (that
is, payment under section 1847A(b)(8) of the Act) as of September 30,
2022, as the 5-year period beginning on October 1, 2022. For a
qualifying biosimilar for which payment is first made using ASP during
the period beginning October 1, 2022, and ending December 31, 2027, the
statute defines the applicable 5-year period as the 5-year period
beginning on the first day of such calendar quarter of such payment. We
referred readers to the CY 2024 PFS proposed rule for the discussion of
the proposed changes to the regulations at Sec. Sec. 414.902 and
414.904 to codify section 11403 of the IRA.
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\146\ https://www.congress.gov/bill/117th-congress/house-bill/5376/text?q=%7B%22search%22%3A%5B%22inflation+reduction+act%22%2C%22inflation%22%2C%22reduction%22%2C%22act%22%5D%7D&r=1&s=1.
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Section 1833(t)(14)(A)(iii) of the Act provides for payment of
separately covered outpatient drugs (SCODs), and currently, CMS pays
under the OPPS for SCODs consistent with the payment methodology set
forth in section 1833(t)(14)(A)(iii)(II) of the Act (the statutory
default). Through rulemaking, CMS adopted a policy to apply the
statutory default payment methodology to separately payable drugs and
biologicals that are not SCODs (70 FR 68715 and 68716). Under this
authority, the payment rate for SCODs and applicable separately payable
drugs and biologicals is determined in accordance with sections 1842(o)
and 1847A of the Act, as calculated and adjusted by the Secretary as
necessary for purposes of paragraph (14). Because our current policy is
to pay for separately payable drugs and biologicals at payment amounts
determined under section 1847A, we proposed that, for a separately
payable biosimilar that is new for purposes of section 1847A(c)(4)(A),
the OPPS payment amount would be the amount determined under section
1847A, subject to the payment limit in section 1847A(c)(4)(A). We also
proposed that, for a separately payable biosimilar that meets the
definition of a ``qualifying biosimilar biological product'' for
purposes of section 1847A(b)(8)(B)(iii) of the Act, the OPPS payment
amount for the biosimilar would be the amount determined under section
1847A, subject to the temporary payment increase under section
1847A(b)(8)(B)(iii). We proposed to codify OPPS payment for biosimilars
consistent with sections 1847A(c)(4)(A) and 1847A(b)(8)(B)(iii) by
adding new paragraphs (f) and (g) to the regulation at Sec. 419.41.
The proposed regulation text cross-references the regulation text
included in the PFS proposed rule, which proposed to codify the
requirements in sections 1847A(c)(4)(A) and 1847A(b)(8)(B)(iii). We
referred readers to the PFS proposed rule for more information about
those proposed regulations.
We did not receive any public comments on our proposal and, for CY
2024, we are finalizing as proposed our proposal that the OPPS payment
amount for a separately payable biosimilar that meets the definition of
a ``qualifying biosimilar biological product'' for purposes of section
1847A(b)(8)(B)(iii) of the Act will be the amount determined under
section 1847A, subject to the temporary payment increase under section
1847A(b)(8)(B)(iii). For CY 2024, we are finalizing as proposed our
proposal to codify OPPS payment for biosimilars consistent with
sections 1847A(c)(4)(A) and 1847A(b)(8)(B)(iii) by adding new
paragraphs (f) and (g) to the regulation at Sec. 419.41. The final
regulation text cross-references the regulation text included in the
PFS final rule, which codifies the requirements in sections
1847A(c)(4)(A) and 1847A(b)(8)(B)(iii). We refer readers to the PFS
final rule for more information about those regulations.
(2) Proposal To Except Biosimilars From the OPPS Packaging Threshold
When Their Reference Products Are Separately Paid
Medicare Part B spending for biologicals and biosimilars has
significantly outpaced the spending for non-biologic drugs for the past
16 years. According to a 2020 report from the Assistant Secretary for
Planning and Evaluation (ASPE), the spending for biologicals and
biosimilars represented 77 percent of Medicare Part B prescription drug
spending in CY 2017.\147\ In a 2020 MedPAC report, the top 10 Part B
drugs based on spending were all biologicals, and spending on them in
the HOPD represented 39 percent of total HOPD drug spending in CY
2019.\148\ Although Part B drug spending for biologicals and
biosimilars has grown tremendously in the past 16 years, we also
recognize that there is evidence that the entry of biosimilars into the
market has contributed to lower aggregate spending for the Medicare
program.\149\
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\147\ Assistant Secretary for Planning and Evaluation.
``Medicare Part B Drugs: Trends in Spending and Utilization, 2006-
2017.'' November 2020. Available at https://aspe.hhs.gov/sites/default/files/private/pdf/264416/Part-B-Drugs-Trends-Issue-Brief.pdf.
\148\ Medicare Payment Advisory Commission. July 2021 Data Book:
Health Care Spending and the Medicare Program. July 2021. Available
at https://www.medpac.gov/wp-content/uploads/import_data/scrape_files/docs/default-source/data-book/july2021_medpac_databook_sec.pdf.
\149\ Medicare Payment Advisory Commission. July 2022 Data Book:
Health Care Spending and the Medicare Program. July 2022. Available
at https://www.medpac.gov/wp-content/uploads/2022/07/July2022_MedPAC_DataBook_Sec10_v2_SEC.pdf.
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Congress has made legislative changes related to payment for
biosimilars. First, it amended the Social Security Act to provide for
payment of biosimilars in the Affordable Care Act (ACA) and more
recently, in the IRA, to update payment for certain biosimilars. In
particular, section 3139 of the ACA amended section 1847A(b) by adding
a new paragraph (8), which provides that the payment amount for a
biosimilar biological product is the biosimilar's ASP and 6 percent of
the reference product's ASP.\150\ And as explained previously, section
11402 of the IRA changed the payment limit for biosimilars during the
initial period when ASP data is not available; and section 11403 of the
IRA temporarily
[[Page 81784]]
increased the payment limit for certain biosimilars.
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\150\ https://www.congress.gov/111/plaws/publ148/PLAW-111publ148.pdf.
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Our overarching policy goal is to create incentives for efficiency
and selection of the least costly products while still meeting a
beneficiary's clinical needs and to protect the long-term solvency of
the Part B Trust Fund. When we established a policy to pay for
biosimilars, we intended to promote the use of biosimilars as a less
expensive alternative to their reference products. For CY 2016 and CY
2017, we finalized a policy to pay for biosimilar biological products
based on the payment allowance of the product as determined under
section 1847A of the Act and to subject nonpass-through biosimilar
biological products to our annual threshold-packaged policy (for CY
2016, 80 FR 70445 and 70446; and for CY 2017, 81 FR 79674). In the CY
2018 OPPS/ASC final rule with comment period (82 FR 59351), we
explained that consistent with our established OPPS drug, biological,
and radiopharmaceutical payment policy, HCPCS coding for biosimilar
biological products will be based on policy established under the CY
2018 PFS final rule with comment period (82 FR 53182 through 53187),
where CMS finalized a policy to implement separate HCPCS codes for
biosimilar biological products. We also clarified that all biosimilar
biological products will be eligible for pass-through payment and not
just the first biosimilar biological product for a reference product.
Our threshold packaging policy's intent is to create incentives for
efficiency, but we have concerns that packaging biosimilars when the
reference product or other marketed biosimilars are separately paid may
create financial incentives for providers to select more expensive, but
clinically similar, products. In most cases, a biosimilar either has
pass-through status or is separately payable. However, there have been
a few instances where biosimilars are packaged. For example, in CY
2021, we noted that HCPCS code Q5105 (Injection, epoetin alfa-epbx,
biosimilar, (Retacrit) (for esrd on dialysis), 100 units), was on pass-
through status through September 2021. HCPCS code Q5105 is a biosimilar
for HCPCS code Q4081 (injection, epoetin alfa, 1000 units (for esrd on
dialysis)), and HCPCS code Q4081 is currently packaged under the OPPS.
After HCPCS code Q5105's pass-through status expired, payment for HCPCS
code Q5105 was packaged because its per day cost fell below our
packaging threshold of $130 for CY 2021. In CY 2023, payment for HCPCS
code Q5101 (Injection, filgrastim-sndz, biosimilar, (zarxio), 1
microgram) is packaged because its per day cost fell below our
packaging threshold of $135 for CY 2023. HCPCS code Q5101 is the
biosimilar for HCPCS code J1442 (Injection, filgrastim (g-csf),
excludes biosimilars, 1 microgram), which is currently separately
payable with a status indicator ``K.''
Packaging payment for both of these biosimilars is consistent with
our policy since CY 2018 to subject nonpass-through biosimilars to the
OPPS threshold-packaging policy. However, we believe this policy may
create incentives to use the more expensive reference product or
biosimilars that are separately payable, as hospitals would be paid
less for using the threshold-packaged biosimilar. For example, the CY
2023 threshold packaging of the biosimilar described by HCPCS code
Q5101 (Injection, filgrastim-sndz, biosimilar, (zarxio), 1 microgram)
may have created a financial incentive for providers to select the
separately paid reference product or the separately paid filgrastim
biosimilar over the packaged filgrastim biosimilar, which is
inconsistent with our policy goal of encouraging efficiency and
promoting use of biosimilars as lower cost alternatives to their
reference products. Accordingly, for CY 2024, we proposed to except
biosimilars from the OPPS threshold packaging policy when their
reference products are separately paid, meaning we would pay separately
for these biosimilars even if their per-day cost is below the threshold
packaging policy. We believe the threshold packaging exception for
biosimilars when their reference products are separately paid would
preserve our policy intent to promote biosimilar use as a lower cost
alternative to higher cost reference products.
In addition, if a reference product's per-day cost falls below the
threshold packaging policy, we proposed that all the biosimilars
related to the reference product would be similarly packaged regardless
of whether their per-day costs are above the threshold. This would
allow for consistent treatment of similar biological products in the
unusual circumstance in which a biosimilar is priced above the
reference product. For the purpose of identifying biosimilar(s) related
to a reference product, we would rely on the product's FDA approval
under section 351(k) of the Public Health Service Act. For example,
filgrastimsndz (Zarxio), filgrastim-aafi (Nivestym), and filgrastim-
ayow (Releuko-) are biosimilars related to filgrastim (Neupogen).\151\
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\151\ https://purplebooksearch.fda.gov/results?query=filgrastim&title=Zarxio.
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Comment: Several commenters expressed support for our proposal to
except biosimilars from the drug packaging threshold when their
reference products are separately paid and not packaged.
Response: We thank the commenters for their support to except
biosimilars from the current threshold packaging policies when their
reference product is above the threshold and paid separately. As stated
earlier, when we established a policy to pay for biosimilars, we
intended to promote the use of biosimilars as a less expensive
alternative to their reference products. Our threshold packaging
policy's intent is to create incentives for efficiency, but we have
concerns that packaging biosimilars when the reference product or other
marketed biosimilars are separately paid may create financial
incentives for providers to select more expensive, but clinically
similar, products. We believe the threshold packaging exception for
biosimilars when their reference products are separately paid would
preserve our policy intent to promote biosimilar use as a lower cost
alternative to higher cost reference products.
Comment: Commenters generally opposed our proposal to package
payment for biosimilar(s) when its reference product is below the drug
packaging threshold and packaged. The commenters contended the current
threshold packaging policy imposes inflationary pressure on drug costs
by incentivizing manufacturers to maintain the ASP above the packaging
threshold to ensure separate payment while providers are incentivized
to select the higher cost biologicals for a similar reason.
Response: We thank the commenters for their insights on this
subject. The threshold-packaging policy's intent is to create
incentives for efficiency. We proposed the threshold-packaging
exception for biosimilars when its reference product is separately paid
to remove the financial incentives for providers to select a more
expensive biological. We believe there are merits to our proposal to
package biosimilars when their reference product's per day cost is
below the drug packaging threshold and payment for the reference
product is packaged. We believe this corresponding policy proposal
would also remove the financial incentive to use the more expensive
biologic, in this scenario, the biosimilar(s) (the more
[[Page 81785]]
expensive and separately paid product) when its reference product falls
below the packaging threshold. At the same time, we acknowledge that
the scenario of the per day cost of a reference product falling below
the packaging threshold while the per day cost of a biosimilar remains
above the packaging threshold has not yet occurred. For this reason,
for CY 2024, we are not finalizing our proposal to package
biosimilar(s) when their related reference product's per day cost is
below the drug packaging threshold and payment for the reference
product is packaged. We will continue to monitor Part B drug
utilization and spending for biologicals and potentially revisit this
issue in future rulemaking.
Comment: We received several comments requesting that the policy of
excepting biosimilars from the OPPS drug packaging threshold be applied
retroactively beginning with CY 2023. One commenter indicated that
making this policy change retroactive to CY 2023 would support the
continued use of biosimilars.
Response: Under the statute, retroactive rulemaking authority is
reserved for certain special circumstances that do not apply here. We
believe it would be inappropriate to apply our retroactive rulemaking
authority under section 1871(e)(1)(A) of the Act in this case.
Comment: Some commenters recommended that CMS categorically exempt
reference and biosimilar biological products from its threshold
packaging policy. The commenters believed the threshold packaging
policy imposes inflationary pressures on drug costs by incentivizing
manufacturers to price their products above the packaging threshold
and, as a result, incentivizing providers to switch to those products
above the packaging threshold, which would be paid separately.
Response: We thank the commenters for their comment. We believe our
threshold packaging policy encourages efficiency and is an essential
component of a prospective payment system. However, we will continue to
review new policy ideas that promote the use of biosimilars as a less
expensive alternative to their reference products for future
rulemaking.
Comment: One commenter stated the best policy is to treat
biosimilars and their reference product similarly by either packaging
all of them or paying separately for all of them. The commenter stated
that if any one of the related products (a biosimilar or reference
product) is below the packaging threshold, it would be appropriate to
package all of them. Conversely, the commenter believed biosimilars and
their reference products should be separately payable only if the per
day costs of all of the products exceed the packaging threshold.
Response: We thank the commenter for their feedback. As mentioned
above, we believe the threshold packaging exception for biosimilars
when their reference products are separately paid is consistent with
our broader policy intent to promote biosimilar use as a lower cost
alternative to higher cost reference products. However, we will not
finalize our proposal to package biosimilar(s) when their related
reference product's per day cost is below the drug packaging threshold
and payment for the reference product is packaged for CY 2024.
After consideration of the public comments we received, we are
finalizing our proposal with modification. Specifically, we are
finalizing the exception of biosimilars from the OPPS threshold
packaging policy when their reference products are separately paid,
meaning for CY 2024, we would pay separately for these biosimilars even
if their per-day cost is below the threshold packaging policy. We
believe creating a threshold-packaging exception for biosimilars when
their reference products are separately paid will remove the financial
incentive to use a more expensive separately payable biologic and
preserve our policy intent to promote biosimilar use as a lower cost
alternative to higher cost reference products. However, we believe our
policy proposal to package biosimilar(s) when the reference product's
per-day cost falls below the packaging threshold would be unnecessary
at this time since this scenario has not yet occurred. We will examine
the claims data, monitor Part B drug utilization and spending for
biologics, and address this issue in future rulemaking if necessary.
(3) Comment Solicitation on Packaging Policy for Reference Products and
Biosimilars
While we proposed to except biosimilars from the threshold
packaging policy when their reference products are separately paid, we
also solicited comment on the packaging of payment for a reference
product and its biosimilar(s) into the payment for the associated
service or procedure when the per-day cost of the reference product, or
any of its biosimilar(s), is less than or equal to the applicable OPPS
drug packaging threshold. While both our proposed policy and the policy
described by this comment solicitation share the goal of consistent
treatment of similar biologic products, the method to achieve that goal
differs. Our proposed policy would result in biosimilars being paid
separately if their reference product is paid separately, whereas here
we sought comment on a policy that would result in packaged payment for
a biologic if the reference product or any of its biosimilars have per
day costs below the drug packaging threshold.
For example, for purposes of this comment solicitation, if a
biosimilar's per-day cost is above the threshold and separately paid
but its reference product is packaged, the biosimilar (and all its
related biosimilar(s)) would be packaged.
Additionally, we sought comment on other ways to structure payment
for biologicals and biosimilars that would encourage efficiency while
maintaining beneficiary access.
Comment: Commenters generally opposed our comment solicitation to
package payment for biosimilar(s) and the reference product when the
per-day cost of any of the products fall below the packaging threshold.
Response: At this time, we are only finalizing our proposed policy
to except biosimilars from the OPPS threshold-packaging policy when
their reference products are separately paid, meaning that CMS will pay
separately for these biosimilars even if their per-day cost falls below
the cost threshold of the threshold-packaging policy. At this time, we
are not implementing a policy that packages payment for reference
products and biosimilars if the per-day cost of any product drops below
the OPPS drug packaging threshold. It is important to note that we have
not yet encountered a situation where the per-day cost of the reference
product is below the packaging threshold and the per-day cost of
biosimilar products is above the packaging threshold. CMS will continue
to monitor payment and utilization patterns as well as overall Part B
spending for biosimilars and their reference products and address any
problematic pricing trends that may develop in future rulemaking.
Comment: MedPAC stated that if any one of the products (the
biosimilar or reference product) is below the packaging threshold, they
should all be treated similarly and packaged, and that biosimilar
products and their reference product should be separately payable only
if the cost of all of the products exceeds the packaging threshold.
Response: We thank MedPAC for their response to this comment
solicitation. As mentioned above, we believe our final policy to except
biosimilars from the OPPS threshold-packaging policy when their
reference products are
[[Page 81786]]
separately paid will remove the financial incentive to use a more
expensive separately payable biological. We believe this policy is
consistent with broader agency goals of promoting biosimilars as a
lower cost alternative to higher cost reference products.
Comment: One commenter appreciated that we solicited comments on
alternative methods to structure payments for biosimilars. The
commenter noted that the current ASP-based payment methodology for
biosimilars has resulted in declining provider reimbursement that may
disincentivize use of these products.
Response: We thank the commenter for sharing their concerns. We do
not have any data to support the assertion that the current ASP-based
payment methodology for biosimilars has resulted in declining provider
reimbursement that may disincentivize provider use. We reiterate that
the ACA requires the ASP add-on for biosimilars to be 6 percent of the
reference product's ASP. Additionally, section 11403 of the IRA amended
section 1847A(b)(8) of the Act by establishing a temporary payment
limit increase for qualifying biosimilar biological products of ASP
plus 8 percent of the reference product's ASP rather than 6 percent
during the applicable 5-year period. Consistent with these authorities
and with the policy we are finalizing to except biosimilars from the
threshold packaging policy when their reference products are separately
paid, we seek to promote the use of biosimilars as a less expensive
alternative to their reference products, to provide more options to
patients and physicians, and to encourage competition to provide a
robust and comprehensive selection of choices for patients at a fair
price.
Comment: One commenter urged CMS to work with stakeholders to
develop new payment approaches for Part B biosimilars to ensure
sustainability.
Response: We thank the commenter, and we believe in a strong
working relationship with the interested parties on Part B issues. We
continue to believe that biosimilars are a less expensive alternative
to their reference products. For CY 2016 and CY 2017, we finalized a
policy to provide for the separate coding and payment for products
approved under each individual abbreviated application, rather than
grouping all biosimilars with a common reference product into codes (80
FR 70445 and 70446 and 81 FR 79674). Additionally, as required by
section 11403, we established a temporary payment limit increase for
qualifying biosimilar biological products of ASP plus 8 percent of the
reference product's ASP rather than 6 percent during the applicable 5-
year period. We believe that these policies together will encourage
greater manufacturer participation in the marketplace and the
introduction of more biosimilar products, thus driving competition and
providing savings in the long term.
Comment: One commenter urged CMS to consider how the Agency can
encourage other payers to similarly promote biosimilars.
Response: We thank the commenter, but we note this comment is out
of scope for this final rule.
We thank commenters for their valuable feedback, and we will
continue to explore policy ideas to increase healthcare efficiency and
promote biosimilar use in future rulemaking.
3. Payment Policy for Therapeutic Radiopharmaceuticals
In the CY 2023 OPPS/ASC final rule with comment period, we adopted
as final our proposal to continue our longstanding payment policy for
therapeutic radiopharmaceuticals for CY 2023 and subsequent years.
Accordingly, this payment policy for therapeutic radiopharmaceuticals
continues to apply in CY 2024. We pay for separately payable
therapeutic radiopharmaceuticals under the ASP methodology adopted for
separately payable drugs and biologicals. If ASP methodology (ASP, WAC,
and AWP) information is unavailable for a therapeutic
radiopharmaceutical, we base therapeutic radiopharmaceutical payment on
mean unit cost data derived from hospital claims. The rationale
outlined in the CY 2010 OPPS/ASC final rule with comment period (74 FR
60524 and 60525) for applying the principles of separately payable drug
pricing to therapeutic radiopharmaceuticals continues to be appropriate
for nonpass-through, separately payable therapeutic
radiopharmaceuticals. Therefore, we are paying for all nonpass-through,
separately payable therapeutic radiopharmaceuticals at ASP plus 6
percent (or applicable WAC or AWP amount) based on the statutory
default described in section 1833(t)(14)(A)(iii)(II) of the Act. For a
full discussion of ASP-based payment for therapeutic
radiopharmaceuticals, we refer readers to the CY 2010 OPPS/ASC final
rule with comment period (74 FR 60520 and 60521).
Consistent with the policy we adopted for CY 2023 and subsequent
years, for CY 2024, we will rely on the most recently available mean
unit cost data derived from hospital claims data for payment rates for
therapeutic radiopharmaceuticals for which ASP methodology (ASP, WAC,
and AWP) data are unavailable and to update the payment rates for
separately payable therapeutic radiopharmaceuticals according to our
usual process for updating the payment rates for separately payable
drugs and biologicals on a quarterly basis if updated ASP methodology
(ASP, WAC, and AWP) information is unavailable. For a complete history
of the OPPS payment policy for therapeutic radiopharmaceuticals, we
refer readers to the CY 2005 OPPS final rule with comment period (69 FR
65811), the CY 2006 OPPS final rule with comment period (70 FR 68655),
and the CY 2010 OPPS/ASC final rule with comment period (74 FR 60524).
The proposed CY 2024 payment rates for nonpass-through, separately
payable therapeutic radiopharmaceuticals are included in Addenda A and
B of the CY 2024 OPPS/ASC proposed rule (which are available on the CMS
website).\152\
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We did not receive any public comments on our payment policy for
therapeutic radiopharmaceuticals or our proposed CY 2024 final payment
rates for nonpass-through, separately payable therapeutic
radiopharmaceuticals, and we are finalizing our proposed rates without
modification.
4. Payment for Blood Clotting Factors
For CY 2023, we provided payment for blood clotting factors under
the same methodology as other nonpass-through separately payable drugs
and biologicals under the OPPS and continued paying an updated
furnishing fee (87 FR 71969 and 71970). That is, for CY 2023, we
provided payment for blood clotting factors under the OPPS at ASP plus
6 percent, plus an additional payment for the furnishing fee. We note
that when blood clotting factors are provided in physicians' offices or
other settings for which Medicare makes payment under Part B, a
furnishing fee is also applied to the payment. The CY 2023 updated
furnishing fee was $0.250 per unit.
In the CY 2023 OPPS/ASC final rule with comment period, we adopted
as final for CY 2023 and subsequent years a policy to pay for blood
clotting factors at ASP plus 6 percent, consistent with our payment
policy for other nonpass-through, separately payable drugs and
biologicals, and to pay an updated furnishing fee. Our policy to pay a
furnishing fee for blood clotting factors under the OPPS is consistent
with the methodology applied in the physician's
[[Page 81787]]
office and in the inpatient hospital setting. These methodologies were
first articulated in the CY 2006 OPPS final rule with comment period
(70 FR 68661) and later discussed in the CY 2008 OPPS/ASC final rule
with comment period (72 FR 66765). The proposed furnishing fee update
is based on the percentage increase in the Consumer Price Index (CPI)
for medical care for the 12-month period ending with June of the
previous year. Because the Bureau of Labor Statistics releases the
applicable CPI data after the PFS and OPPS/ASC proposed rules are
published, we are not able to include the actual updated furnishing fee
in the proposed rules. Therefore, in accordance with our policy as
finalized in the CY 2008 OPPS/ASC final rule with comment period (72 FR
66765), we will announce the actual figure for the percent change in
the applicable CPI and the updated furnishing fee calculated based on
that figure through applicable program instructions and posting on our
website at: https://www.cms.gov/medicare/payment/fee-for-service-providers/part-b-drugs/average-drug-sales-price.
We did not receive any public comments on our proposed payment
policy for blood clotting factors and are finalizing our proposal
without modification. For CY 2024, we will continue to pay for blood
clotting factors using the same methodology as other separately payable
drugs and biologicals under the OPPS and will continue to pay an
updated furnishing fee. We will announce the actual figure of the
percent change in the applicable CPI and the updated furnishing fee
calculation based on that figure through the applicable program
instructions and posting on the CMS website.
5. Payment for Nonpass-Through Drugs, Biologicals, and
Radiopharmaceuticals With HCPCS Codes But Without OPPS Hospital Claims
Data
In the CY 2023 OPPS/ASC final rule with comment period, we adopted
as final our proposal to continue our longstanding payment policy for
nonpass-through drugs, biologicals, and radiopharmaceuticals with HCPCS
codes but without OPPS hospital claims data for CY 2023 and subsequent
years. Therefore, for CY 2024, this policy will continue to apply. For
a detailed discussion of the payment policy and methodology, we refer
readers to the CY 2016 OPPS/ASC final rule with comment period (80 FR
70442 and 70443). Consistent with our policy, because we have no claims
data and must determine if these products exceed the per-day cost
threshold, we estimated the average number of units of each product
that would typically be furnished to a patient during one day in the
hospital outpatient setting and utilized the ASP methodology to
determine whether their payment will be packaged as well as their
payment status indicators. We refer readers to Table 94 below for the
final CY 2024 status indicator for each of the nonpass-through drugs,
biologicals, and radiopharmaceuticals with HCPCS codes but without OPPS
hospital claims data, which are also listed in Addendum B to this rule
on the CMS website.\153\
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BILLING CODE 4150-28-P
[[Page 81788]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.126
[[Page 81789]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.127
BILLING CODE 4150-28-C
We did not receive any specific public comments regarding our
payment for non-pass-through drugs, biologicals, and
radiopharmaceuticals with HCPCS codes but without OPPS hospital claims
data. For CY 2024, we will continue to assign drug or biological
products status indicator ``K'' and pay for these products separately
for the remainder of CY 2024 if pricing information becomes available.
The CY 2024 payment status of each of the nonpass-through drugs,
biologicals, and radiopharmaceuticals with HCPCS codes but without OPPS
hospital claims data is listed in Addendum B to this final rule with
comment period, which is available on the CMS website.
6. OPPS Payment Methodology for 340B Purchased Drugs and Biologicals
a. Overview
Under the OPPS, we generally set payment rates for separately
payable drugs and biologicals under section 1833(t)(14)(A) of the Act.
Section 1833(t)(14)(A)(iii)(II) of the Act provides that, if hospital
acquisition cost data is not available, the payment amount is the
average price for the drug in a year established under section 1842(o)
of the Act, which cross-references section 1847A of the Act, which
generally sets a default rate of ASP plus 6 percent for certain drugs
and biologicals. The provision also provides that the average price for
the drug or biological in the year as established under section 1847A
of the Act is calculated and adjusted by the Secretary as necessary for
purposes of paragraph (14). As described below, beginning in CY 2018,
the Secretary adjusted the 340B drug payment rate to ASP minus 22.5
percent to approximate a minimum average discount for 340B drugs and
biologicals, which was based on findings of the GAO \154\ and MedPAC
\155\ that 340B hospitals were acquiring drugs and biologicals at a
significant discount under HRSA's 340B Drug Pricing Program. We direct
readers to the CY 2018 OPPS/ASC final rule with comment period for a
more detailed discussion of the 340B drug payment policy (82 FR 52493
through 52511).
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\154\ Government Accountability Office. ``Medicare Part B Drugs:
``Action Needed to Reduce Financial Incentives to Prescribe 340B
Drugs at Participating Hospitals.'' June 2015. Available at https://www.gao.gov/assets/gao-15-442.pdf.
\155\ Medicare Payment Advisory Commission. March 2016 Report to
the Congress: Medicare Payment Policy. March 2016. Available at
Medicare Payment Advisory Commission. March 2016 Report to the
Congress: Medicare Payment Policy. March 2016. Available at https://www.medpac.gov/document/http-www-medpac-gov-docs-default-source-reports-may-2015-report-to-the-congress-overview-of-the-340b-drug-pricing-program-pdf/.
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This policy has been the subject of extensive litigation, including
before the Supreme Court of the United States. On June 15, 2022, the
Supreme Court held in American Hospital Association v. Becerra, 142 S.
Ct. 1896, that if CMS has not conducted a survey of hospitals'
acquisition costs, it may not vary the payment rates for outpatient
prescription drugs by hospital group. While the Supreme Court's
decision addressed payment rates for CYs 2018 and 2019, it had
implications for subsequent payment rates. Therefore, for CY 2023, we
finalized a policy to revert to the default payment rate, which is
generally ASP plus 6 percent, for 340B acquired drugs and biologicals
and finalized a policy to pay for 340B
[[Page 81790]]
acquired drugs and biologicals no differently than we pay for drugs and
biologicals that are not acquired through the 340B program. We also
finalized a budget neutrality adjustment to the CY 2023 OPPS conversion
factor of 0.9691 percent rather than the 0.9596 percent adjustment we
had proposed. This adjustment offset the prior increase of 3.19 percent
that was applied to the conversion factor when we implemented the 340B
payment policy in CY 2018 in a budget neutral manner and ensured the CY
2023 conversion factor was equivalent to the conversion factor that
would be in place if the 340B drug payment policy had never been
implemented.
After the publication of the proposed CY 2023 OPPS rule, on
September 28, 2022, the District Court issued a final judgment vacating
the 340B reimbursement rate for the remainder of 2022, which the
District Court explained would automatically reestablish the default
rate for 340B-acquired drugs and biologicals. The agency took the
necessary steps, including issuing instructions to Medicare contractors
and updating drug payment files, to implement that September 28, 2022,
decision and has since paid the default rate, which is generally ASP
plus 6 percent, for 340B acquired drugs and biologicals.\156\
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\156\ Vacating Differential Payment Rate for 340B-Acquired Drugs
in 2022 Outpatient Prospective Payment System Final Rule with
Comment Period. https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient.
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Comment: Many commenters supported our proposal to continue to pay
a rate of ASP plus 6 percent, or equivalent, for 340B-acquired drugs
and biologicals. Several commenters acknowledged the benefit of the
340B program for their particular hospital and reiterated their belief
that CMS should maintain the same payment rate for 340B-acquired drugs
and those drugs not acquired through the 340B program. When explaining
the benefit of the 340B program, one commenter asked CMS to work with
HRSA, Congress, and others to protect the 340B program.
Response: We thank commenters for their support. We note that the
340B Drug Pricing Program is a program administered by HRSA and
comments regarding its administration are outside the scope of this
final rule with comment period.
Comment: Some commenters believed that CMS should not continue the
increased ASP plus 6 percent payment rate for 340B-acquired drugs.
These commenters believed that this would increase out-of-pocket costs
for beneficiaries for these drugs and were concerned about the benefit
of the 340B drug pricing program to vulnerable patients. One commenter
spoke about the perverse incentive that the significant difference
between 340B drug acquisition costs and the Medicare payment rate
creates. The commenter was concerned that this incentive could further
exacerbate the issue of increased drug spending and drug prices.
Several commenters encouraged CMS to take appropriate steps to curtail
payments that are significantly greater than the rate at which
hospitals acquire 340B drugs and noted that a survey of hospital
acquisition costs could help CMS achieve significant drug savings.
Similarly, one commenter believed that CMS's proposed policy would be
paying hospitals close to 50 percent more than their 340B drug
acquisitions costs and that CMS has already determined that a generous
reimbursement rate for 340B-acquired drugs would be ASP minus 28.7
percent per a previous drug acquisition cost survey. This commenter was
concerned that CMS was ignoring the Supreme Court ruling that, in their
view, stated that the CMS could vary reimbursement rates based on
survey data and that payment rates based on ASP plus 6 percent were
arbitrary. There were also concerns from this commenter that CMS
violated the Administrative Procedure Act by not acknowledging and
using this survey data to inform payment rates.
Response: We thank the commenters for their viewpoints expressed
here and for their suggestions regarding drug cost surveys. For CY
2024, we are continuing our policy to apply to longstanding payment
methodologies for 340B-acquired drugs that existed prior to CY 2018. In
the CY 2021 OPPS/ASC final rule with comment period, we adopted as
final our proposal to continue the Medicare payment policy for 340B
drugs in place at that time (that is, the policy to pay a general rate
of ASP minus 22.5 percent), rather than finalizing our alternative
proposal to pay for 340B drugs at a rate of ASP minus 28.7 percent
based on survey data (86 FR 63646 through 63648). We stated that while
we believed our methods to conduct the 340B drug acquisition cost
survey referenced in that rule, as well as the methodology we used to
calculate the proposed average or typical discount received by 340B
entities on 340B drugs, were valid, we nonetheless recognized that we
received many comments on that survey from stakeholders. We noted that
using survey data is complex, and we emphasized that we wished to
continue to evaluate how to balance and weigh the use of survey data,
the necessary adjustments to the data, and the weighting and
incorporation of ceiling prices--all to determine how best to take the
relevant factors into account for potentially using the survey to set
Medicare OPPS drug payment policy (86 FR 63646). Since the CY 2021
OPPS/ASC final rule with comment period was issued, the Supreme Court
held that because CMS had not conducted a survey of hospitals'
acquisition costs, it could not vary the payment rates for outpatient
prescription drugs by hospital group. See Am. Hosp. Ass'n v. Becerra,
142 S. Ct. 1896, 1906 (2022). We are concerned that using data from the
2020 survey, which surveyed only 340B hospitals, might not comport with
the Supreme Court's decision.
We are also mindful of the burden surveys place on hospitals and
CMS, should we decide to conduct an updated survey. The survey we
previously conducted was just a survey of 340B hospitals; we did not
conduct a survey of additional hospital groups at that time. And while
that more limited survey placed a certain burden on 340B providers (a
comment we received at the time), a survey of all hospital groups would
be a much larger, more complex endeavor. According to the GAO hospitals
survey in 2005, surveys may be useful on occasion to validate
ratesetting data CMS receives, such as ASP. However, they also create
significant work for hospitals and CMS as the data collector. For these
reasons, GAO recommended that CMS survey hospitals only occasionally to
validate hospital acquisition costs. We are mindful of these concerns
but will take the commenters' feedback regarding a survey of hospital
drug acquisition costs into consideration as we consider potential
future rulemaking.
After a consideration of comments received, for CY 2024, we are
finalizing the general payment rate of ASP plus 6 percent as the
default payment rate for drugs and biologicals acquired under the 340B
program and will pay for these drugs and biologicals no differently
than we pay for those drugs and biologicals that are not acquired under
the 340B program.
We note that many commenters also referenced the 340B Remedy
proposed rule (88 FR 44078) in their comments. We note that these
comments were out of scope for purposes of this CY 2024 OPPS/ASC final
rule with comment period; however, the 340B Remedy final rule publishes
in the Federal Register of November 8, 2023 (FR Doc. 2023-24407), and
the summaries of and our responses to the public comments can be found
on the CMS OPPS website.\157\
[[Page 81791]]
b. Payment for 340B Drugs and Biologicals in CYs 2018 Through 2022
For full descriptions of our OPPS payment policy for drugs and
biologicals acquired under the 340B program beginning in CY 2018, we
refer readers to the CY 2018 OPPS/ASC final rule with comment period
(82 FR 59353 through 59371); the CY 2019 OPPS/ASC final rule with
comment period (83 FR 59015 through 59022); the CY 2021 OPPS/ASC final
rule with comment period (85 FR 86042 through 86055); the CY 2022 OPPS/
ASC final rule with comment period (86 FR 63640 through 63649); and the
CY 2023 OPPS/ASC final rule with comment period (87 FR 71970 through
71976).
In July of 2023, CMS published a proposed rule, referred to as the
``remedy proposed rule'' to address the reduced payment amounts to 340B
hospitals under the reimbursement rates in effect for CYs 2018 through
2022 and to comply with the statutory requirement to maintain budget
neutrality under the OPPS. The remedy proposed rule does not propose
changes to our CY 2024 OPPS drug payment policy or the CY 2024 OPPS
conversion factor, but it does propose changes to the calculation of
the OPPS conversion factor beginning in CY 2025. We believe our
proposed remedy rule is consistent with the Supreme Court's decision in
American Hospital Association and the District Court's remand order. We
refer readers to the 340B Remedy proposed rule (88 FR 44078) for a full
description of the proposed remedy policy as well as the 340B Remedy
final rule.
c. CY 2024 Proposed 340B Drug Payment Policy
For CY 2024, consistent with our policy finalized for CY 2023, we
proposed to continue to pay the statutory default rate, which is
generally ASP plus 6 percent, for 340B acquired drugs and biologicals.
The payment for 340B acquired drugs and biologicals will not differ
from the payment rate for drugs and biologicals not acquired through
the 340B program. We believe this policy is appropriate given the
Supreme Court decision discussed previously.
In the CY 2023 OPPS/ASC final rule with comment period, we
maintained the requirement that 340B hospitals report the ``JG'' (Drug
or biological acquired with 340B drug pricing program discount,
reported for informational purposes) or ``TB'' (Drug or biological
acquired with 340B drug pricing program discount, reported for
informational purposes for select entities) modifiers to identify drugs
and biologicals acquired through the 340B Program for informational
purposes (87 FR 71974). We explained that we believed maintaining both
modifiers would reduce provider burden compared to shifting to a single
modifier, as all providers can continue utilizing the modifier (either
``JG'' or ``TB'') that they had been using for the previous five
calendar years. On December 20, 2022, we issued ``Part B Inflation
Rebate Guidance: Use of 340B Modifiers,'' which, in accordance with
section 1847A(i) of the Act, requires all 340B covered entities,
including hospital-based and non-hospital-based entities, to report the
applicable modifier for separately payable drugs and biologicals
acquired through the 340B Program.\158\ Section 1847A(i) of the Act, as
added by the Inflation Reduction Act, requires the Secretary to
establish a Part B inflation rebate by manufacturers of certain single
source drugs and biologicals with prices increasing faster than the
rate of inflation. Section 1847A(i)(3)(B)(ii)(I) of the Act
specifically excludes units of drugs and biologicals for which the
manufacturer provides a discount under the 340B program from the units
of drugs and biologicals for which a manufacturer otherwise may have a
Part B inflation rebate liability. Effective implementation of the Part
B inflation rebate requires CMS to identify units of drugs and
biologicals acquired through the 340B Program so they can be subtracted
from the total number of otherwise rebatable units as applicable. This
guidance explained that the ``JG'' and ``TB'' modifiers provide an
existing mechanism to identify drugs and biologicals acquired through
the 340B Program that is familiar to most 340B covered entities paid
under the OPPS, and stated that it did not change the requirements in
the CY 2023 OPPS/ASC final rule with comment period (i.e., that 340B
covered entity hospitals should continue to use the modifiers they used
previously to identify 340B drugs and biologicals). For claims with
dates of service beginning no later than January 1, 2024, the guidance
instructed all 340B covered entities to report the appropriate
modifier, including those not currently reporting the ``JG'' or ``TB''
modifier, such as Ryan White clinics and hemophilia clinics, which
should report the ``JG'' modifier on separately payable Part B claim
lines for drugs and biologicals acquired through the 340B Program.
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Although we stated in the CY 2023 OPPS/ASC final rule with comment
period and in the ``Part B Inflation Rebate Guidance: Use of 340B
Modifiers'' that hospital-based 340B covered entities should continue
to use the modifier they used previously (either the ``JG'' or ``TB''
modifier), we now believe utilizing a single modifier will allow for
greater simplicity, especially because both modifiers are used for the
same purpose: to identify separately payable drugs and biologicals
acquired under the 340B Program. Requiring hospitals to report a single
modifier would allow CMS to continue to identify and exclude 340B-
acquired drugs and biologicals from the definition of units for the
purpose of Part B inflation rebate liability, while eliminating the
need to use two modifiers for the same purpose. Additionally, we
believed the proposal would lessen the burden on providers as they
would only have to report one modifier for all scenarios in which a
340B drug is acquired. Accordingly, we proposed that all 340B covered
entity hospitals paid under the OPPS would report the ``TB'' modifier
effective January 1, 2025, even if the hospital previously reported the
``JG'' modifier.
The ``JG'' modifier would remain effective through December 31,
2024. Hospitals that currently report the ``JG'' modifier could choose
to continue to use it in CY 2024 or choose to transition to use of the
``TB'' modifier during that year. Beginning on January 1, 2025, the
``JG'' modifier would be deleted, and hospitals would be required to
report drugs and biologicals acquired through the 340B program using
the ``TB'' modifier. Additionally, beginning January 1, 2025, we would
revise the ``TB'' modifier descriptor (Drug or biological acquired with
340B drug pricing program discount, reported for informational purposes
for select entities) to no longer include ``. . .for select entities''
as all entities would report this modifier after this date. We noted
that the proposal, if finalized, would update the December 20, 2022,
guidance titled ``Part B Inflation Rebate Guidance: Use of the 340B
Modifiers.'' \159\ Additionally, CMS plans to further update this
guidance to align the modifier requirements for 340B covered entity
providers and suppliers not paid under the OPPS with the modifier
requirement changes for 340B covered entity hospitals paid under the
OPPS.
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For more information on the Medicare Part B inflation rebate
program, please visit ``Inflation Rebates in Medicare'' at https://
www.cms.gov/inflation-
[[Page 81792]]
reduction-act-and-medicare/inflation-rebates-medicare.
Comment: Commenters generally opposed the continued requirement to
report the 340B modifiers, citing the administrative burden associated
with the required reporting. Commenters believed CMS should abandon the
requirement of any 340B modifiers after the Supreme Court decision that
the 340B drug payment policy was unlawful.
Response: We thank the commenters for their feedback. We reiterate
that the 340B modifier requirement is to identify and exclude 340B-
acquired drugs and biologicals from the definition of units for the
purpose of Part B inflation rebate liability. We note that the
requirement for the 340B modifier(s) was not the subject of the Supreme
Court 340B decision. We believe it is appropriate to consolidate the
340B modifier to a single modifier, which will allow for greater
operational simplicity to achieve the IRA policy objective.
Comment: A commenter requested that CMS clarify the purpose for the
continued requirement of a 340B modifier. The commenter stated the CY
2024 OPPS/ASC proposed rule on this subject is unclear if the only
purpose of the modifier is for implementing the Inflation Reduction Act
requirements related to Part B inflation rebates.
Response: We thank the commenter for their feedback. We reiterate
the purpose of the 340B modifier requirement is to is to identify and
exclude 340B-acquired drugs and biologicals from the definition of
units for the purpose of Part B inflation rebate liability.
Comment: Commenters stated that the 340B modifier requirement
presents a considerable administrative burden for 340B hospitals,
demanding substantial staff time and resources. One commenter explained
that hospital pharmacists devote significant time to determining if new
drug codes require the 340B modifier. Once the drugs have been
identified, the pharmacists must then communicate with other
departments to ensure the drugs are properly coded and billed. This is
in addition to the regular self-audits pharmacists perform. Some
commenters stated that reporting only one 340B modifier could
eventually be less burdensome (by reducing potential confusion) than
the current two modifiers. However, they noted that hospitals currently
billing with the ``JG'' modifier will still be required to change their
processes and bill using the ``TB'' modifier by January 1, 2025,
presenting an additional unnecessary administrative burden. The
commenters stated it is not necessary for CMS to collect the
information via the 340B modifier(s) in order to comply with the IRA
and that CMS could exclude all drug claims with the status indicator
``K'' that are billed by 340B hospitals from the IRA rebate
calculations as a less burdensome alternative.
Response: We thank commenters for their feedback. As mentioned
above, we note that this continued requirement for the 340B modifier is
to identify and exclude 340B-acquired drugs and biologicals from the
Part B inflation rebate liability. Many 340B hospitals have been
reporting the 340B modifiers since CY 2018, and many hospitals already
report a modifier through their State Medicaid program. We believe that
the continued requirement for a single 340B modifier on outpatient
claims for 340B-acquired drugs would promote consistency between the
two programs.
We disagree with commenters that CMS could accurately exclude 340B
drugs from the IRA rebate calculation without imposing a burden on 340B
providers. Some 340B covered entities provide healthcare services to
both 340B and non-340B patients, and the payment status indicator ``K''
does not differentiate between340B and non-340B claims. Therefore, the
340B modifier is needed to identify 340B drugs.
Comment: Some commenters supported the requirement of a single 340B
modifier and agreed a single modifier will simplify the identification
of 340B drugs or biologicals and help support reducing duplicate
discounts and diversion. They also stated that their study showed 340B
participating rural referral centers and sole community centers
reported only 61 percent of Part B separately payable products with the
applicable 340B modifiers. The commenters noted that there is no
penalty for 340B providers that choose not to comply with the policy
and recommended that CMS establish a robust audit process with
appropriate penalties to deter abuses of the 340B program. They also
suggested CMS adopt a ``non-340B'' modifier to enhance enforcement of
the policy to report the appropriate modifier, thereby reducing
duplicate discounts and diversion.
Response: We thank the commenters for their feedback. We are not
aware that covered entities are underreporting 340B claims. We note
that some 340B covered entities often provide healthcare services to
both 340B and non-340B patients, but it is their responsibility to
submit accurate claims. Under the False Claims Act 31, U.S.C. 3729-
3733, Medicare has the authority to fine providers who knowingly,
willfully, and repeatedly bill inaccurately coded claims. Providers are
required to maintain current knowledge of Medicare billing policies and
to submit accurate claims. Providers are also required to maintain all
documentation to support the validity of the services reported on the
claim and ensure this information is available upon request.
We noted that we had received a similar suggestion for a ``non-
340B'' modifier in the CY 2018 OPPS/ASC final rule with comment period
(82 FR 52508 and 52509). We disagree with the commenters and as noted
in the 2018 OPPS/ASC final rule with comment period, we believe a
consistent application of the modifier being required for a drug that
was purchased under the 340B Program instead of a drug not purchased
under the 340B Program will help improve program integrity by helping
ensure that hospitals are not receiving ``duplicate discounts'' through
both the Medicaid rebate program and the 340B Program.
After consideration of the public comments we received, we are
finalizing our proposal without modification to require that all 340B
covered entity hospitals paid under the OPPS report the ``TB'' modifier
effective January 1, 2025, even if the hospital previously reported the
``JG'' modifier, for 340B-acquired drugs and biologicals. We believe
the transition to a single 340B modifier ``TB'' will allow for greater
simplicity, especially because both modifiers are used for the same
purpose to continue to identify and exclude 340B-acquired drugs and
biologicals from the definition of units for the purpose of Part B
inflation rebate liability. We believe this policy will reduce the
burden on providers as they would only have to report one modifier for
all scenarios in which a 340B drug is acquired. The ``JG'' modifier
will remain effective through December 31, 2024. Hospitals that
currently report the ``JG'' modifier may choose to continue to use it
in CY 2024 or choose to transition to use of the ``TB'' modifier
sooner, provided all hospitals are using the ``TB'' modifier by January
1, 2025.
7. High-Cost/Low-Cost Threshold for Packaged Skin Substitutes
a. Background
In the CY 2014 OPPS/ASC final rule with comment period (78 FR
74938), we unconditionally packaged skin substitute products into their
associated surgical procedures as part of a broader policy to package
all drugs and biologicals that function as supplies
[[Page 81793]]
when used in a surgical procedure. As part of the policy to package
skin substitutes, we also finalized a methodology that divides the skin
substitutes into a high-cost group and a low-cost group, to ensure
adequate resource homogeneity among APC assignments for the skin
substitute application procedures (78 FR 74933). In the CY 2015 OPPS/
ASC final rule with comment period (79 FR 66886), we stated that skin
substitutes are best characterized as either surgical supplies or
devices because of their required surgical application and because they
share significant clinical similarity with other surgical devices and
supplies.
Skin substitutes assigned to the high-cost group are described by
HCPCS codes 15271 through 15278. Skin substitutes assigned to the low-
cost group are described by HCPCS codes C5271 through C5278. Geometric
mean costs for the various procedures are calculated using only claims
for the skin substitutes that are assigned to each group. Specifically,
claims billed with HCPCS code 15271, 15273, 15275, or 15277 are used to
calculate the geometric mean costs for procedures assigned to the high-
cost group, and claims billed with HCPCS code C5271, C5273, C5275, or
C5277 are used to calculate the geometric mean costs for procedures
assigned to the low-cost group (78 FR 74935).
Each of the HCPCS codes described earlier are assigned to one of
the following three skin procedure APCs according to the geometric mean
cost for the code: APC 5053 (Level 3 Skin Procedures): HCPCS codes
C5271, C5275, and C5277; APC 5054 (Level 4 Skin Procedures): HCPCS
codes C5273, 15271, 15275, and 15277; or APC 5055 (Level 5 Skin
Procedures): HCPCS code 15273. In CY 2023, the payment rate for APC
5053 (Level 3 Skin Procedures) was $580.95, the payment rate for APC
5054 (Level 4 Skin Procedures) was $1,725.86, and the payment rate for
APC 5055 (Level 5 Skin Procedures) was $3,253.04. This information is
also available in Addenda A and B of the CY 2023 final rule with
comment period (87 FR 71748) (Addenda A and B are available on the CMS
website: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices).
We have continued the high-cost/low-cost categories policy since CY
2014, and we proposed to continue it for CY 2024. Under the current
policy, skin substitutes in the high-cost category are reported with
the skin substitute application CPT codes, and skin substitutes in the
low-cost category are reported with the analogous skin substitute HCPCS
C-codes. For a discussion of the CY 2014 and CY 2015 methodologies for
assigning skin substitutes to either the high-cost group or the low-
cost group, we refer readers to the CY 2014 OPPS/ASC final rule with
comment period (78 FR 74932 through 74935) and the CY 2015 OPPS/ASC
final rule with comment period (79 FR 66882 through 66885).
For a discussion of the high-cost/low-cost methodology that was
adopted in CY 2016 and has been in effect since then, we refer readers
to the CY 2016 OPPS/ASC final rule with comment period (80 FR 70434 and
70435). Beginning in CY 2016 and in subsequent years, we adopted a
policy where we determined the high-cost/low-cost status for each skin
substitute product based on either a product's geometric mean unit cost
(MUC) exceeding the geometric MUC threshold or the product's per day
cost (PDC) (the total units of a skin substitute multiplied by the mean
unit cost and divided by the total number of days) exceeding the PDC
threshold. We assigned each skin substitute that exceeded either the
MUC threshold or the PDC threshold to the high-cost group. In addition,
we assigned any skin substitute with a MUC or a PDC that did not exceed
either the MUC threshold or the PDC threshold to the low-cost group (87
FR 71976).
However, some skin substitute manufacturers have raised concerns
about significant fluctuation in both the MUC threshold and the PDC
threshold from year to year using the methodology developed in CY 2016.
The fluctuation in the thresholds may result in the reassignment of
several skin substitutes from the high-cost group to the low-cost
group, which, under current payment rates, can be a difference of over
$1,000 in the payment amount for the same procedure. In addition, these
interested parties were concerned that the inclusion of cost data from
skin substitutes with pass-through payment status in the MUC and PDC
calculations would artificially inflate the thresholds. Skin substitute
interested parties requested that CMS consider alternatives to the
current methodology used to calculate the MUC and PDC thresholds and
whether it might be appropriate to establish a new cost group in
between the low-cost group and the high-cost group to allow for
assignment of moderately priced skin substitutes to a newly created
middle group.
We share the goal of promoting payment stability for skin
substitute products and their related procedures as price stability
allows hospitals using such products to more easily anticipate future
payments associated with these products. We have attempted to limit
year-to-year shifts for skin substitute products between the high-cost
and low-cost groups through multiple initiatives implemented since CY
2014, including: establishing separate skin substitute application
procedure codes for low-cost skin substitutes (78 FR 74935); using a
skin substitute's MUC calculated from outpatient hospital claims data
instead of an average of ASP plus 6 percent as the primary methodology
to assign products to the high-cost or low-cost group (79 FR 66883);
and establishing the PDC threshold as an alternate methodology to
assign a skin substitute to the high-cost group (80 FR 70434 through
70435).
To allow additional time to evaluate concerns and suggestions from
interested parties about the volatility of the MUC and PDC thresholds,
in the CY 2018 OPPS/ASC proposed rule (82 FR 33627), we proposed that a
skin substitute that was assigned to the high-cost group for CY 2017
would be assigned to the high-cost group for CY 2018, even if it did
not exceed the CY 2018 MUC or PDC thresholds. We finalized this policy
in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59347).
For more detailed information and discussion regarding the goals of
this policy and the subsequent comment solicitations in CY 2019 and CY
2020 regarding possible alternative payment methodologies for graft
skin substitute products, please refer to the CY 2018 OPPS/ASC final
rule with comment period (82 FR 59347); the CY 2019 OPPS/ASC final rule
with comment period (83 FR 58967 and 58968); and the CY 2020 OPPS/ASC
final rule with comment period (84 FR 61328 through 61331).
b. Proposals for Packaged Skin Substitutes for CY 2024
For CY 2024, consistent with our policy since CY 2016, we proposed
to continue to determine the high-cost/low-cost status for each skin
substitute product based on either a product's geometric MUC exceeding
the geometric MUC threshold or the product's PDC (the total units of a
skin substitute multiplied by the MUC and divided by the total number
of days) exceeding the PDC threshold. Consistent with the methodology
as established in the CY 2014 OPPS/ASC through CY 2018 OPPS/ASC final
rules with comment period, we analyzed CY 2022 claims data to calculate
the MUC threshold (a weighted average of all skin substitutes' MUCs)
and the PDC threshold (a weighted average of all skin substitutes'
[[Page 81794]]
PDCs). The proposed CY 2024 MUC threshold was $47 per cm\2\ (rounded to
the nearest $1) and the proposed CY 2024 PDC threshold was $817
(rounded to the nearest $1). Also, the availability of a HCPCS code for
a particular human cell, tissue, or cellular or tissue-based product
(HCT/P) does not mean that that product is appropriately regulated
solely under section 361 of the PHS Act and the FDA regulations in 21
CFR part 1271. Manufacturers of HCT/Ps should consult with the FDA
Tissue Reference Group (TRG) or obtain a determination through a
Request for Designation (RFD) on whether their HCT/Ps are appropriately
regulated solely under section 361 of the PHS Act and the regulations
in 21 CFR part 1271.
For CY 2024, as we did for CY 2023, we proposed to assign each skin
substitute that exceeds either the MUC threshold or the PDC threshold
to the high-cost group. In addition, we proposed to assign any skin
substitute that does not exceed either the MUC threshold or the PDC
threshold to the low-cost group except that we proposed that any skin
substitute product that was assigned to the high-cost group in CY 2023
would be assigned to the high-cost group for CY 2024, regardless of
whether it exceeds or falls below the CY 2024 MUC or PDC threshold.
This policy was established in the CY 2018 OPPS/ASC final rule with
comment period (82 FR 59346 through 59348).
For CY 2024, we proposed to continue to assign skin substitutes
with pass-through payment status to the high-cost category. We proposed
to assign skin substitutes with pricing information but without claims
data to calculate a geometric MUC or PDC to either the high-cost or
low-cost category based on the product's ASP plus 6 percent payment
rate as compared to the MUC threshold. If ASP is not available, we
proposed to use WAC plus 3 percent to assign a product to either the
high-cost or low-cost category. Finally, if neither ASP nor WAC is
available, we proposed to use 95 percent of AWP to assign a skin
substitute to either the high-cost or low-cost category. We proposed to
continue to use WAC plus 3 percent instead of WAC plus 6 percent to
conform to our proposed policy described in section V.B.2.b of the CY
2024 OPPS/ASC proposed rule to establish a payment rate of WAC plus 3
percent for separately payable drugs and biologicals that do not have
ASP data available. We proposed that any skin substitute product that
is assigned a code in the HCPCS A2XXX series would be assigned to the
high-cost skin substitute group including new products without pricing
information. New skin substitutes without pricing information that are
not assigned a code in the HCPCS A2XXX series would be assigned to the
low-cost category until pricing information is available to compare to
the CY 2024 MUC and PDC thresholds. For a discussion of our existing
policy under which we assign skin substitutes without pricing
information that are not assigned a code in the HCPCS A2XXX series to
the low-cost category until pricing information is available, we refer
readers to the CY 2016 OPPS/ASC final rule with comment period (80 FR
70436).
Comment: The HOP Panel recommended, and several commenters
supported, ending the packaging of the graft skin substitute
administration add-on codes (CPT codes 15272, 15274, 15276, and 15278;
HCPCS codes C5272, C5274, C5276, and C5278). The HOP Panel and the
commenters requested that these codes be assigned to APCs that reflect
the estimated costs of these service codes. Commenters claim that
packaging the graft skin substitute administration add-on codes
eliminates the variation in payment for wound care treatments based on
the size of the wound. They assert that providers are discouraged from
treating wounds between 26 and 99 cm\2\ and over 100 cm\2\ in the
outpatient hospital setting because of the financial losses they
experience to provide such care. Commenters believe that packaging
graft skin substitute administration add-on codes disrupts the
methodology of how the American Medical Association (AMA), the
organization that manages CPT service codes, intended graft skin
substitute procedures to be paid. The CPT codes describe the actual
amount of the graft skin substitute product that is used for an
individual service when the amount of product used is 25 cm\2\ or more.
Commenters request that providers receive additive payment for the
actual amount of skin substitute product used for the individual
service as described by both the procedure code and the associated add-
on code.
Response: We do not agree with the HOP Panel or the commenters that
we should pay separately for graft skin substitute add-on codes under
the OPPS. The OPPS is a prospective payment system and not a fee-for-
service payment system. That means that we generally attempt to make
one payment for all of the services billed with the primary medical
procedure, including add-on procedures such as the ones described by
CPT codes 15272, 15274, 15276, and 15278, and HCPCS codes C5272, C5274,
C5276, and C5278.
More specifically, we calculate the OPPS payment rate by first
calculating the geometric mean cost of the procedure. This calculation
includes claims for individual services that used a lower level of
resources and claims for individual services that used a higher level
of resources. The resulting geometric mean cost will reflect the median
service cost for a given medical procedure. Next, we group the medical
procedure with other medical procedures with clinical and resource
similarity in an APC and calculate the geometric mean of these related
procedures to generate a base payment rate for all procedures assigned
to the APC. Skin substitutes are surgical supplies and are packaged
into the cost of the associated procedure. The application of graft
skin substitutes cannot occur unless a graft skin substitute is used.
So, the cost of the product will be reflected in the overall cost of
the application procedure.
A prospective payment system like the OPPS is designed to pay
providers the median cost of the primary service they provide, and such
a system encourages efficiencies and cost-savings in the administration
of health care. However, a prospective payment system is not intended
to discourage providers from rendering medically necessary care to
patients. For example, it is possible that a provider could experience
a financial loss when they perform a service where a patient receives
85 cm\2\ of a graft skin substitute product, but that same provider
could see a financial gain when the next patient receives a skin graft
where only 10 cm\2\ of product is used. Paying separately for add-on
codes for the administration of graft skin substitutes in a prospective
payment system defeats the goals of such a payment system. Therefore,
we will continue to package the add-on codes for the administration of
graft skin substitutes in the OPPS to encourage cost-savings and
efficiencies with wound care treatment. If providers are paid at cost
or nearly at cost for each individual service they render, there is no
incentive for them to control costs. Add-on codes for the
administration of graft skin substitutes should be packaged with the
primary medical service to be able to establish a median payment rate
that gives providers incentives to keep their costs in line with
typical providers throughout the Medicare program. The need for cost
efficiencies in the application of graft skin substitutes to treat
wounds is no different than need for cost efficiencies in other
procedures administered in the outpatient hospital setting. Therefore,
we believe that add-on codes, including the add-on codes for the
administration
[[Page 81795]]
of graft skin substitutes, should remain packaged to maintain the
integrity of the OPPS.
Comment: The HOP Panel recommended, and several commenters
supported, ensuring that the payment rate for graft skin substitute
procedures be the same no matter where on the body the graft skin
substitute product is applied to the patient. There are four graft skin
substitute application procedures for high-cost skin substitute
products (CPT codes 15271, 15273, 15275, and 15277) and a similar four
graft skin substitute application procedures for low-cost skin
substitute products (HCPCS codes C5271, C5273, C5275, and C5277).
Commenters claim that the cost to apply graft skin substitute products
does not depend on the location of the wound because the same amount of
product is used on the wound and the same clinical resources are used
to treat the wound independent of the location of the wound.
Other commenters made a similar request, asking that CPT code 15277
(Application of skin substitute graft to face, scalp, eyelids, mouth,
neck, ears, orbits, genitalia, hands, feet, and/or multiple digits,
total wound surface area greater than or equal to 100 sq cm; first 100
sq cm wound surface area, or 1 percent of body area of infants and
children) that is currently assigned to APC 5054 (Level 4 Skin
Procedures) be reassigned to APC 5055 (Level 5 Skin Procedures). That
would mean that the two graft skin substitute application procedures
for the application of high-cost skin substitute products for wounds
greater than 100 cm\2\ (CPT code 15273 and 15277) would be in the same
APC.
Response: The reason there are four CPT codes describing graft skin
substitute application services is that there are different CPT codes
for applying graft skin substitutes for wounds up to 100 cm\2\ and for
wounds that are greater than 100 cm\2\; and there are different CPT
codes for applying graft skin substitutes to the trunk, arms, and legs
as compared to the face, scalp, eyelids, mouth, neck, ears, orbits,
genitalia, hands, feet, fingers, and toes. We appreciate commenters'
concerns and note that current codes describing the application of
high-cost graft skin substitutes for wounds less than 100 cm\2\ (CPT
codes 15271 and 15275) have been assigned to the same APC (5054), and
the current codes describing the application of low-cost graft skin
substitutes for wounds less than 100 cm\2\ (HCPCS codes C5271 and
C5275) have been assigned to the same APC (5053). Because they are
currently included in the same APC, the OPPS payment for them is the
same; and this payment policy is consistent with the recommendation
from the HOP Panel and other commenters. This means for the application
of graft skin substitute products up to 100 cm\2\, the location where
the graft skin substitute is applied does not affect the payment rate
for the service. We note that the code describing the application of
high-cost products for wounds that are greater than 100 cm\2\ on the
trunk, arms, and legs (CPT code 15273) has been assigned to a higher-
paying APC (APC 5055) than the APC assignment for the code describing
the application of high-cost graft skin substitute products for wounds
greater than 100 cm\2\ on the face, scalp, eyelids, mouth, neck, ears,
orbits, genitalia, hand, feet, fingers, and toes (CPT code 15277),
which is assigned to APC 5054. Likewise, the code describing the
application of low-cost products for wounds that are greater than 100
cm\2\ on the trunk, arms, and legs (HCPCS code C5273) has been assigned
to a higher-paying APC (APC 5054) than the code for the application of
low-cost graft skin substitute products for wounds greater than 100
cm\2\ on the face, scalp, eyelids, mouth, neck, ears, orbits,
genitalia, hand, feet, fingers, and toes (HCPCS code C5277), which is
assigned to APC 5054. The differences in costs that have determined APC
assignments for these services for wounds greater than 100 cm\2\ have
been supported by historical cost data. We also note that none of these
service codes are in violation of the 2 times rule, which requires that
the geometric mean cost of significant items and services within an APC
group to be no more than two-times the geometric mean cost of the
lowest geometric mean cost for a significant item or service within the
same APC group.
Comment: The HOP Panel recommended, and several commenters
supported, having us realign both the high-cost and low-cost
application procedure codes to potentially higher-paying APC groups
that reflect the current average sales prices of graft skin substitute
products as manufacturers now are required to submit average sales
prices for graft skin substitute products. Commenters believe combining
ASP prices for graft skin substitutes and the cost of the graft skin
substitute application procedures would better reflect the costs of
those procedures than our current methodology of using cost data from
claims to assign application procedures to APCs. Commenters believe
that the product cost information that is packaged into the graft skin
substitute application procedures is lower than the ASP price for graft
skin substitute products and leads to the graft skin substitute
application procedures being assigned APCs with lower payment rates
than the actual cost of the procedures. Commenters feel that this
approach also may provide more cost stability to the APC assignments
for the graft skin substitute application procedures.
Response: We disagree with the commenters that using ASP pricing
instead of using claims cost data would be a preferrable method for
estimating the graft skin substitute product cost of graft skin
substitute application procedures. It is unclear from the commenters'
suggestion how the product cost of the graft skin substitute would be
calculated if not using the charges reported by providers. Presumably,
their approach would involve extracting the units of graft skin
substitute product used on a particular packaged service and then
multiplying by an ASP on file to revise the cost of packaged procedure
to reflect the ASP price of the graft skin substitute product units. We
do not believe this is a feasible approach for CY 2024, and it appears
to be a different approach to pricing one group of packaged supplies as
compared to how all other packaged supplies are priced in the OPPS. We
normally use a provider's reported charges for supplies and use the
appropriate cost-to-charge ratio to estimate the contribution of the
supply cost to the overall cost of the procedure. However, we remain
open to new payment methodologies. We welcome feedback from interested
parties in future rulemaking about how this payment approach could work
and why it would improve the pricing of graft skin substitute
application procedures.
Comment: Two commenters asked that we eliminate the high-cost and
low-cost skin substitute groups for graft skin substitute products.
Instead, the commenter requested that we no longer policy package skin
substitute products in the OPPS. The commenter suggested we should pay
for graft skin substitutes separate from the application procedure
based on their ASP plus 6 percent price where available.
Response: A substantial portion of the cost of a skin substitute
graft application procedure is the graft skin substitute product
itself, and the cost of the skin substitute graft products is reflected
in the cost of the overall procedure. Packaging the cost of graft skin
substitute products into the affiliated procedures leads to cost
savings and efficiencies in the use of graft skin substitute products.
Providers have the opportunity to assess the value of products of
varying costs. The payment
[[Page 81796]]
rates for the application procedures for graft skin substitute products
reflect the decisions of providers across the United States between the
costs and benefits of all available products and should limit the use
of the highest-cost graft skin substitute products over lower-cost
products unless the highest-cost products are found to be clinically
superior. Packaging of graft skin substitute products helps to reduce
costs for graft skin substitute procedures and allows more Medicare
resources to be used for other categories of medical services.
Comment: The HOP Panel recommended, and several commenters
supported, that all new graft skin substitute products be assigned to
the low-cost group whether they have a Q-code or an A-code until cost
data become available for the product. Commenters believe it is not
appropriate that products assigned Q-codes are assigned to the low-cost
group while products assigned A-codes are assigned to the high-cost
group. Commenters note that A-codes are being assigned to graft skin
substitute products that have FDA 510(k) clearance but are not
synthetic products, which conflicts with the expectation that only
graft skin substitute products that would have been described by the
now-deleted HCPCS code C1849 (Skin substitute, synthetic, resorbable,
per square centimeter) be assigned to the high-cost group. More
broadly, commenters believed that no category of graft skin substitute
products should be assigned to the high-cost group until there is cost
data supporting that assignment.
Response: We appreciate the concerns of the commenters. However, we
decided on an approach that would ensure that any graft skin substitute
product that could potentially have been described by deleted HCPCS
code C1849 be included in the high-cost group. As explained in the CY
2023 OPPS final rule (87 FR 71980 and 71981), we wanted to ensure that
graft skin substitute products that were described by HCPCS code C1849
or could potentially be described by HCPCS code C1849 would be granted
time to develop the cost data necessary to allow us to determine if the
product should stay in the high-cost group, which provides stability
for the payment of these graft skin substitute products. We wanted to
avoid having products with less than two years of claims data that were
originally in the high-cost group be reassigned to the low-cost group
simply because of a lack of available data.
Also, as discussed in the CY 2023 OPPS final rule (87 FR 71981),
the current categorization of skin substitutes as either synthetic or
non-synthetic is not mutually exclusive given the expansion of skin
substitute products that may contain both biological and synthetic
elements. Having products with both biological and synthetic elements
leads to difficulty defining which of the products assigned to the
A2XXX series would be considered ``synthetic'' and described by HCPCS
code C1849. Therefore, for CY 2023, we finalized a policy, which will
continue for CY 2024, to assign to the high-cost group any skin
substitute product that is assigned a code in the HCPCS A2XXX series
including new products without pricing information. This policy gives
the broadest definition of products that could have been described by
HCPCS code C1849 and ensures that none of those graft skin substitute
products would be assigned to the low-cost group until we receive cost
data for them.
Comment: The HOP Panel recommended, and several commenters
supported, our current policy not to assign graft skin substitute
products that are not in sheet form (e.g., gel, powder, ointment, foam,
liquid, or injected) to any APC group, because these products cannot be
reported with the graft skin substitute application codes of CPT codes
15271 through 15278 (the high-cost group) or with HCPCS codes C5271
through C5278 (the low-cost group). Commenters note that skin
substitutes that are not in sheet form are used primarily for clinic
visits and the debridement of chronic wounds. Also, according to the
commenters, the use of skin substitutes that are not in sheet form does
not conform to the AMA's directions for the application of skin
substitute products.
Response: We appreciate the HOP Panel's and the commenters' support
of our policy.
Comment: One commenter disagreed with the HOP Panel recommendation
not to assign graft skin substitute products that are not in sheet form
(e.g., gel, powder, ointment, foam, liquid, or injected) to any APC
group. The commenter understands that current coding guidelines for CPT
codes 15271 through 15278 precludes products that are not in sheet form
from being billed with these CPT codes. However, the commenter
anticipates that in the future procedure codes for the application of
non-sheet products will be created; and the commenter thinks it is best
for us to prepare for the establishment of these new procedure codes.
Response: We appreciate the views of the commenter, but we did not
make any proposals related to payment for application of non-sheet skin
substitute products in this year's OPPS proposed rule. We may consider
this topic for future rulemaking if CPT or HCPCS codes are established
for the application of non-sheet skin substitute products.
Comment: Several commenters supported our current skin substitute
payment policy to assign graft skin substitute products to either a
high-cost or a low-cost group based on the product's cost. Likewise,
commenters also supported our policy of keeping graft skin substitute
products in the high-cost group once the cost of the product exceeds
either the MUC or the PDC threshold for at least one year even if in
future years the cost of the product is less than either the MUC or PDC
threshold.
Response: We appreciate the commenters' support of our policies.
Comment: Manufacturers of two products that are not traditional
graft skin substitute products requested that their products be
assigned to either of the high-cost skin or low-cost skin substitute
groups based on the cost of their products. One product is HCPCS code
A2014 (Omeza collagen matrix, per 100 mg) that is an amorphous solid,
which, according to its manufacturer, Omeza, is used to treat wounds
similar to the wounds treated by graft skin substitute products. The
second product is HCPCS code A2025 (Miro3d, per cubic centimeter) that
is a dry, thick sheet of uncompressed decellularized porcine liver that
has enough thickness for its base unit to be a cubic centimeter.
According to its manufacturer, Reprise Biomedical, Miro3d must be
rehydrated before being applied.
Response: We do not believe either HCPCS code A2014 (Omeza collagen
matrix, per 100 mg) or HCPCS code A2025 (Miro3d, per cubic centimeter)
should be assigned to either the high-cost or low-cost group. Regarding
Omeza collagen matrix, an amorphous solid is not a graft skin
substitute product even if the product forms a sheet-like layer after
application. Therefore, we cannot assign the product to either the
high-cost skin or the low-cost skin substitute group. For Miro3d,
normally a product with a base unit of cubic centimeter is a liquid
product. This is the first product with a base unit of a cubic
centimeter that we are aware of to be in solid form. We request further
information regarding this product to help us to determine whether
Miro3d should be assigned to the high-cost or low-cost skin substitute
group in a future OPPS quarterly update, including whether the product
could be reported with either CPT codes 15271
[[Page 81797]]
through 15278 or HCPCS codes C5271 through C5278.
Comment: The manufacturer of the product described by HCPCS code
Q4278 (Epieffect, per square centimeter) requested that the product be
assigned to the high-cost skin substitute group based on its ASP as
reported in a pricing compendium.
Response: We request that the manufacturer provide us with the
pricing information that they have cited regarding HCPCS code Q4278.
Once we receive this information, we will determine if HCPCS code Q4278
should be assigned to the high-cost group.
Comment: The manufacturer of the products described by HCPCS codes
Q4122 (Dermacell, dermacell awm or dermacell awm porous, per square
centimeter) and Q4150 (Allowrap dds or dry, per square centimeter)
requested that these graft skin substitute products continue to be
assigned to the high-cost skin substitute group for CY 2024.
Response: Based on their cost data and our policies, both HCPCS
codes Q4122 (Dermacell, dermacell awm or dermacell awm porous, per
square centimeter) and Q4150 (Allowrap dds or dry, per square
centimeter) will remain in the high-cost group for CY 2024.
After consideration of the public comments we received, we are
adopting our proposals without modification. Our final policies are to:
Continue assign skin substitutes with pass-through payment
status to the high-cost category.
Assign skin substitutes with pricing information but
without claims data to calculate a geometric MUC or PDC to either the
high-cost or low-cost category based on the product's ASP plus 6
percent payment rate as compared to the MUC threshold. If ASP is not
available for the product, we will use WAC plus 3 percent to assign a
product to either the high-cost or low-cost category. Finally, if
neither ASP nor WAC is available, we will use 95 percent of AWP to
assign a skin substitute to either the high-cost or low-cost category.
Continue to use WAC plus 3 percent instead of WAC plus 6
percent to conform to our policy described in section V.B.2.b of this
final rule with comment period to establish a payment rate of WAC plus
3 percent for separately payable drugs and biologicals that do not have
ASP data available.
Assign any skin substitute product that is assigned a code
in the HCPCS A2XXX series to the high-cost skin substitute group,
including new products without pricing information. New skin
substitutes without pricing information that are not assigned a code in
the HCPCS A2XXX series would be assigned to the low-cost category until
pricing information is available to compare to the CY 2024 MUC and PDC
thresholds.
Finally, we have updated the MUC and PDC thresholds for CY 2024.
The final MUC threshold will be $47 per cm\2\ (rounded to the nearest
$1) and the final PDC threshold will be $807 (rounded to the nearest
$1). Table 95 includes the final CY 2024 cost category assignment for
each skin substitute product.
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BILLING CODE 4150-28-C
8. Radioisotopes Derived From Non-Highly Enriched Uranium (non-HEU)
Sources
Radioisotopes are widely used in modern medical imaging,
particularly for cardiac imaging and predominantly for the Medicare
population. Some of the Technetium-99 (Tc-99m), the radioisotope used
in the majority of such diagnostic imaging services, has been produced
in legacy reactors outside of the United States using highly enriched
uranium (HEU).
The United States wanted to eliminate domestic reliance on these
reactors and has been promoting the conversion of all medical
radioisotope production to non-HEU sources. Alternative methods for
producing Tc-99m without HEU are technologically and economically
viable, but it was expected that this change in the supply source for
the radioisotope used for modern medical imaging would introduce new
costs into the payment system that were not accounted for in the
historical claims data.
Therefore, beginning in CY 2013, we finalized a policy to provide
an additional payment of $10 for the marginal cost for radioisotopes
produced by non-HEU sources (77 FR 68323). Under this policy, hospitals
report HCPCS code Q9969 (Tc-99m from non-highly enriched uranium
source, full cost recovery add-on per study dose) once per dose along
with any diagnostic scan or scans furnished using Tc-99m as long as the
Tc-99m doses used can be certified by the hospital to be at least 95
percent derived from non-HEU sources (77 FR 68323).
We stated in the CY 2013 OPPS/ASC final rule with comment period
(77 FR 68321) that our expectation was that this additional payment
would be needed for the duration of the industry's conversion to
alternative methods of producing Tc-99m without HEU. We also stated
that we would reassess, and propose, if necessary, on an annual basis
whether such an adjustment continued to be necessary and whether any
changes to the adjustment were warranted (77 FR 68321). A 2016 report
from the National Academies of Sciences, Engineering, and Medicine
anticipated the conversion of Tc-99m production from non-HEU sources
would be completed at the end of 2019.\160\ However, the Secretary of
Energy issued a certification effective January 2, 2020, stating that
there continued to be an insufficient global supply of molybdenum-99
(Mo-99), which is the source of Tc-99m, produced without the use of
HEU, available to satisfy the domestic U.S. market (85 FR 3362). The
January 2, 2020, certification was to remain in effect for up to 2
years.
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\160\ National Academies of Sciences, Engineering, and Medicine.
2016. Molybdenum-99 for Medical Imaging. Washington, DC: The
National Academies Press. Available at: https://doi.org/10.17226/23563.
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The Secretary of Energy issued a new certification regarding the
supply of non-HEU- sourced Mo-99 effective January 2, 2022 (86 FR
73270). This certification stated that there was a sufficient global
supply of Mo-99 produced without the use of HEU available to meet the
needs of patients in the United States. The Department of Energy also
expected that the last HEU reactor that produces Mo-99 for medical
providers in the United States would finish its conversion to a non-HEU
reactor by December 31, 2022. In CY 2019, we stated that we would
reassess the non-HEU incentive payment policy once conversion to non-
HEU sources is closer to completion or has been completed (83 FR
58979). There is now a sufficient supply of non-HEU-sourced Mo-99 in
the United States, and there is no available supply of HEU-sourced Mo-
99 in the United States. In the CY 2023 OPPS/ASC final rule with
comment period, we stated that we believed the conversion to non-HEU
sources of Tc-99m had reached a point where it was necessary to
reassess our policy of providing an additional payment of $10 for the
marginal cost for radioisotopes produced by non-HEU sources (87 FR
71987).
In the OPPS, diagnostic radiopharmaceuticals are packaged into the
cost of the associated diagnostic imaging procedure no matter the per
day cost of the radiopharmaceutical. The cost of the
radiopharmaceutical is included as a part of the cost of the diagnostic
imaging procedure and is reported through Medicare claims data.
Medicare claims data used to set payment rates under the OPPS generally
is from 2 years prior to the payment year.
As we explained in the CY 2023 OPPS/ASC final rule with comment
period (87 FR 71987), the claims data we would use to set payment rates
for
[[Page 81803]]
CY 2024 (likely CY 2022 claims data) contain claims for diagnostic
radiopharmaceuticals that reflect both HEU-sourced Tc-99m and non-HEU-
sourced Tc99m, rather than radiopharmaceuticals sourced solely from
non-HEU Tc-99m. The cost of HEU-sourced Tc-99m is substantially lower
than the cost of non-HEU- sourced Tc-99m. Therefore, we explained that
providers who use radiopharmaceuticals in CY 2024 that contain only
non-HEU-sourced Tc-99m might not receive a payment that is reflective
of the radiopharmaceutical's current cost without the add-on payment.
We believed that extending the additional $10 add-on payment described
by HCPCS code Q9969 for non-HEU-sourced Tc-99m through the end of CY
2024 would ensure adequate payment for non-HEU-sourced Tc-99m. Starting
in CY 2025, we believed the Medicare claims data utilized to set
payment rates (likely CY 2023 claims data) would only include claims
for diagnostic radiopharmaceuticals that utilized non-HEU-sourced Tc-
99m, meaning the data would reflect the full cost of the Tc-99m
diagnostic radiopharmaceuticals that would be used by providers in CY
2025. As a result, we believed there would no longer be a need for the
additional $10 add-on payment for CY 2025 or future years.
This policy was based on the Secretary of Energy's certification
that the last HEU reactor that produces Mo-99 for medical providers in
the United States would finish its conversion to a non-HEU reactor by
December 31, 2022, and that all Tc-99m used for radiopharmaceuticals in
2023 would be produced from non-HEU sources. However, we understand
that the conversion of the last HEU reactor that produces Tc-99m to a
non-HEU reactor did not occur until March 2023, so it is possible that
some claims for diagnostic radiopharmaceuticals in CY 2023 would report
the cost of HEU-sourced Tc-99m. This means that in CY 2025, as in CY
2024, there is the possibility that the payment rate for procedures
using diagnostic radiopharmaceuticals could be lower than the costs
providers will face for these procedures because providers will only
have access to non-HEU-sourced Tc-99m.
We believe that extending the additional $10 add-on payment
described by HCPCS code Q9969 for non-HEU-sourced Tc-99m through the
end of CY 2025 rather than the end of CY 2024, as we previously
finalized, would ensure adequate payment for non-HEU-sourced Tc-99m now
that the conversion from HEU-sourced Tc-99m to non-HEU-sourced Tc-99m
is complete. Starting in CY 2026, the Medicare claims data utilized to
set payment rates (likely CY 2024 claims data) will only include claims
for diagnostic radiopharmaceuticals that utilized non-HEU-sourced Tc-
99m, which means the data will more closely reflect the cost of the Tc-
99m diagnostic radiopharmaceuticals that will be used by providers in
CY 2026. As a result, there will no longer be a need for the additional
$10 add-on payment for CY 2026 or future years.
We proposed to continue the additional $10 payment through December
31, 2025, as, beginning in CY 2026, the Medicare claims data used to
set payment rates will reflect the full cost of non-HEU-sourced Tc-99m.
Comment: Multiple commenters supported making the additional $10
payment permanent rather than ending it after December 31, 2025. Some
of the commenters wanted a permanent $10 payment to help encourage the
domestic production of Tc-99m starting in CY 2026. One of the
commenters suggested adding a new claim edit to require providers to
identify whether the Tc-99m radiopharmaceutical product they use is
sourced from non-HEU or HEU reactors to confirm the transition from
HEU-sourced to non-HEU-sourced Tc-99m products has been completed.
Multiple commenters also requested that the $10 additional payment be
increased to an amount that reflects what the payment would have been
if it was adjusted annually by the hospital market basket since it was
implemented in 2013. The commenters also requested that the copayment
amount for HCPCS code Q9969 be eliminated because they are concerned
that the administrative burden of handling the beneficiary copayment is
discouraging providers from reporting the $10 additional payment.
Response: As stated in the CY 2023 OPPS final rule, the purpose of
the $10 additional payment is limited to mitigating any adverse impact
of transitioning to non-HEU sources (87 FR 71986). As the transition is
now complete, we do not think it is necessary to increase the amount of
the adjustment for its final two years. Once the transition is complete
and payment rates reported for Tc-99m radiopharmaceuticals no longer
include costs from HEU-sourced Tc-99m, the original purpose of the $10
additional payment to encourage the use of non-HEU-sourced Tc-99m will
be achieved. We will take the comments regarding using the $10
additional payment to encourage the domestic production of Tc-99m into
consideration for future rulemaking.
We also disagree with the request to waive the copayment for HCPCS
code Q9969 as we do not believe the administrative burden associated
with collecting copayments in this situation is unique or significant
to justify such an action. Providers regularly collect copayments for
services paid under the OPPS, and we do not believe that collecting a
copayment for the additional $10 payment is a significant added burden
for providers. Likewise, we do not agree with the suggestion to require
a claim edit to identify a radiopharmaceutical as non-HEU or HEU
sourced. We believe such a requirement would likely increase the
administrative burden on providers unnecessarily, because the
adjustment will only be in place for two more years and very few claims
will report Tc-99m radiopharmaceuticals that are HEU sourced.
Comment: Multiple commenters supported the portion of our proposal
that would continue the $10 additional payment for non-HEU sourced Tc-
99m radiopharmaceuticals through December 31, 2025.
Response: We appreciate the support of the commenters.
After consideration of the public comments we received, we are
finalizing without modification our proposal to continue the additional
$10 payment for CYs 2024 and 2025 to ensure providers receive
sufficient payment for diagnostic radiopharmaceuticals containing Tc99m
until such time as the full cost of non-HEU-sourced Tc-99m is reflected
in the Medicare claims data. We also are finalizing without
modification our proposal that the additional $10 payment will end
after December 31, 2025, as, beginning with CY 2026, the Medicare
claims data used to set payment rates will reflect the full cost of
non-HEU-sourced Tc-99m.
C. Requirement in the Physician Fee Schedule CY 2024 Proposed Rule for
HOPDs and ASCs To Report Discarded Amounts of Certain Single-Dose or
Single-Use Package Drugs
Section 90004 of the Infrastructure Investment and Jobs Act (Pub.
L. 117-9, November 15, 2021) (``the Infrastructure Act'') amended
section 1847A of the Act to redesignate subsection (h) as subsection
(i) and insert a new subsection (h), which requires manufacturers to
provide a refund to CMS for certain discarded amounts from a refundable
single-dose container or single-use package drug. The CY 2024 PFS
proposed rule
[[Page 81804]]
includes proposals to operationalize section 90004 of the
Infrastructure Act, including a proposal that impacts hospital
outpatient departments (HOPDs) and ambulatory surgical centers (ASCs).
Similar to our CY 2023 notice in the OPPS/ASC proposed rule (87 FR
71988), we wanted to ensure interested parties were aware of these
proposals and knew to refer to the Physician Fee Schedule (PFS)
proposed rule for a full description of the proposed policy. Interested
parties were asked to submit comments on any proposals related to
implementation of section 90004 of the Infrastructure Act on the CY
2024 PFS proposed rule. We stated that public comments on these
proposals would be addressed in the CY 2024 PFS final rule with comment
period. We note that this same notice appeared in section XIII.D.3 of
the proposed rule.
As explained in the CY 2024 OPPS/ASC proposed rule (88 FR 49759),
because the CY 2024 PFS proposed rule discussed and proposed to codify
certain billing requirements for HOPDs and ASCs, we wanted to ensure
interested parties were aware of them and knew to refer to that rule
for a full description of the proposed policy. Interested parties were
asked to submit comments on this and any other proposals to implement
section 90004 of the Infrastructure Act in response to the CY 2024 PFS
proposed rule. We stated public comments on these proposals would be
addressed in the CY 2024 PFS final rule.
We thank commenters for their feedback on the proposal. For final
details on this policy, we refer readers to the CY 2024 PFS final rule.
VI. Estimate of OPPS Transitional Pass-Through Spending for Drugs,
Biologicals, Radiopharmaceuticals, and Devices
A. Amount of Additional Payment and Limit on Aggregate Annual
Adjustment
Section 1833(t)(6)(E) of the Act limits the total projected amount
of transitional pass-through payment for drugs, biologicals, and
categories of devices for a given year to an ``applicable percentage,''
currently not to exceed 2.0 percent of total program payments estimated
to be made for all covered services under the OPPS furnished for that
year. If we estimate before the beginning of the calendar year that the
total amount of pass-through payments in that year would exceed the
applicable percentage, section 1833(t)(6)(E)(iii) of the Act requires a
uniform prospective reduction in the amount of each of the transitional
pass-through payments made in that year to ensure that the limit is not
exceeded. We estimate the pass-through spending to determine whether
payments exceed the applicable percentage and the appropriate pro rata
reduction to the conversion factor for the projected level of pass-
through spending in the following year to ensure that total estimated
pass-through spending for the prospective payment year is budget
neutral, as required by section 1833(t)(6)(E) of the Act.
For devices, developing a proposed estimate of pass-through
spending in CY 2024 entails estimating spending for two groups of
items. The first group of items consists of device categories that are
currently eligible for pass-through payment and that will continue to
be eligible for pass-through payment in CY 2024. The CY 2008 OPPS/ASC
final rule with comment period (72 FR 66778) describes the methodology
we have used in previous years to develop the pass-through spending
estimate for known device categories continuing into the applicable
update year. The second group of items consists of devices that we know
are newly eligible, or project may be newly eligible, for device pass-
through payment in the remaining quarters of CY 2023 or beginning in CY
2024. The sum of the proposed CY 2024 pass-through spending estimates
for these two groups of device categories equals the proposed total CY
2024 pass-through spending estimate for device categories with pass-
through payment status. We determined the device pass-through estimated
payments for each device category based on the amount of payment as
required by section 1833(t)(6)(D)(ii) of the Act, and as outlined in
previous rules, including the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75034 through 75036). We note that, beginning in CY 2010,
the pass-through evaluation process and pass-through payment
methodology for implantable biologicals newly approved for pass-through
payment beginning on or after January 1, 2010, that are surgically
inserted or implanted (through a surgical incision or a natural
orifice) use the device pass-through process and payment methodology
(74 FR 60476). As has been our past practice (76 FR 74335), in the
proposed rule, we proposed to include an estimate of any implantable
biologicals eligible for pass-through payment in our estimate of pass-
through spending for devices. Similarly, we finalized a policy in CY
2015 that applications for pass-through payment for skin substitutes
and similar products be evaluated using the medical device pass-through
process and payment methodology (76 FR 66885 through 66888). Therefore,
as we did beginning in CY 2015, for CY 2024, we also proposed to
include an estimate of any skin substitutes and similar products in our
estimate of pass-through spending for devices.
For drugs and biologicals eligible for pass-through payment,
section 1833(t)(6)(D)(i) of the Act establishes the pass-through
payment amount as the amount by which the amount authorized under
section 1842(o) of the Act (or, if the drug or biological is covered
under a competitive acquisition contract under section 1847B of the
Act, an amount determined by the Secretary equal to the average price
for the drug or biological for all competitive acquisition areas and
year established under such section as calculated and adjusted by the
Secretary) exceeds the portion of the otherwise applicable fee schedule
amount that the Secretary determines is associated with the drug or
biological. Consistent with current policy, we proposed to apply a rate
of ASP plus 6 percent to most drugs and biologicals for CY 2024, and
therefore our estimate of drug and biological pass-through payment for
CY 2024 for this group of items was $100 million.
Payment for certain drugs, specifically diagnostic
radiopharmaceuticals and contrast agents without pass-through payment
status, is packaged into payment for the associated procedures, and
these products are not separately paid. In addition, we policy-package
all non-pass-through drugs, biologicals, and radiopharmaceuticals that
function as supplies when used in a diagnostic test or procedure, drugs
and biologicals that function as supplies when used in a surgical
procedure, drugs and biologicals used for anesthesia, and other
categories of drugs and biologicals, as discussed in section V.B.1.c of
the CY 2024 OPPS/ASC proposed rule (88 FR 49678). Consistent with
current policy, we proposed that all of these policy-packaged drugs and
biologicals with pass-through payment status will be paid at ASP+6
percent, like other pass-through drugs and biologicals, for CY 2024,
less the policy-packaged drug APC offset amount described below. Our
estimate of pass-through payment for policy-packaged drugs and
biologicals with pass-through payment status approved prior to CY 2024
is not $0. This is because the pass-through payment amount and the fee
schedule amount associated with the drug or biological will not be the
same, unlike for separately payable drugs and biologicals. In section
V.A.6 of the CY
[[Page 81805]]
2024 OPPS/ASC proposed rule (88 FR 49675 and 49676), we discuss our
policy to determine if the costs of certain policy-packaged drugs or
biologicals are already packaged into the existing APC structure. If we
determine that a policy-packaged drug or biological approved for pass-
through payment resembles predecessor drugs or biologicals already
included in the costs of the APCs that are associated with the drug
receiving pass-through payment, we proposed to offset the amount of
pass-through payment for the policy-packaged drug or biological. For
these drugs or biologicals, the APC offset amount is the portion of the
APC payment for the specific procedure performed with the pass-through
drug or biological, which we refer to as the policy-packaged drug APC
offset amount. Consistent with current policy, if we determine that an
offset is appropriate for a specific policy-packaged drug or biological
receiving pass-through payment, we proposed to reduce our estimate of
pass-through payments for these drugs or biologicals by the APC offset
amount.
Similar to pass-through spending estimates for devices, the first
group of drugs and biologicals requiring a pass-through payment
estimate consists of those products that were recently made eligible
for pass-through payment and that will continue to be eligible for
pass-through payment in CY 2024. The second group contains drugs and
biologicals that we know are newly eligible, or project will be newly
eligible, in the remaining quarters of CY 2023 or beginning in CY 2024.
The sum of the CY 2024 pass-through spending estimates for these two
groups of drugs and biologicals equals the total CY 2024 pass-through
spending estimate for drugs and biologicals with pass-through payment
status.
B. Estimate of Pass-Through Spending for CY 2024
For CY 2024, we proposed to set the applicable pass-through payment
percentage limit at 2.0 percent of the total projected OPPS payments
for CY 2024, consistent with section 1833(t)(6)(E)(ii)(II) of the Act
and our OPPS policy from CY 2004 through CY 2023 (87 FR 71989). The
pass-through payment percentage limit is calculated using pass-through
spending estimates for devices and for drugs and biologicals.
For the first group of devices, consisting of device categories
that are currently eligible for pass-through payment and will continue
to be eligible for pass-through payment in CY 2024, there are 7 active
categories for CY 2024. The active categories are described by HCPCS
codes C1747, C1761, C1826, C1827, C1831, C1832, and C1833. Based on the
information from the device manufacturers, we estimated that HCPCS code
C1747 will cost $37.5 million in pass-through expenditures in CY 2024,
HCPCS code C1761 will cost $19.6 million in pass-through expenditures
in CY 2024, HCPCS code C1826 will cost $7.4 million in pass-through
expenditures in CY 2024, HCPCS code C1827 will cost $28.8 million in
pass-through expenditures in CY 2024, HCPCS code C1831 will cost
$163,436 in pass-through expenditures in CY 2024, HCPCS code C1832 will
cost $37,603 in pass-through expenditures in CY 2024, and HCPCS code
C1833 will cost $281,238 in pass-through expenditures in CY 2024.
Therefore, we proposed an estimate for the first group of devices of
$93.7 million.
We did not receive any public comments on our proposal. Using our
methodology for this final rule with comment period, we estimate that
HCPCS code C1747 will cost $37.5 million in pass-through expenditures
in CY 2024, HCPCS code C1761 will cost $19.4 million in pass-through
expenditures in CY 2024, HCPCS code C1826 will cost $7.4 million in
pass-through expenditures in CY 2024, HCPCS code C1827 will cost $28.8
million in pass-through expenditures in CY 2024, HCPCS code C1831 will
cost $266,665 in pass-through expenditures in CY 2024, HCPCS code C1832
will cost $44,830 in pass-through expenditures in CY 2024, and HCPCS
code C1833 will cost $278,751 in pass-through expenditures in CY 2024.
Therefore, we have finalized the CY 2024 spending estimate for this
first group of devices of approximately $93.7 million.
In estimating our proposed CY 2024 pass-through spending for device
categories in the second group, we included the following: (1) device
categories that we assumed at the time of the development of the
proposed rule would be newly eligible for pass-through payment in CY
2024; (2) additional device categories that we estimated could be
approved for pass-through status after the development of the CY 2024
OPPS/ASC proposed rule (88 FR 49696) and before January 1, 2024; and
(3) contingent projections for new device categories established in the
second through fourth quarters of CY 2024. For CY 2024, we proposed to
use the general methodology described in the CY 2008 OPPS/ASC final
rule with comment period (72 FR 66778), while also taking into account
recent OPPS experience in approving new pass-through device categories.
For the CY 2024 OPPS/ASC proposed rule (88 FR 49696), the proposed
estimate of CY 2024 pass-through spending for this second group of
device categories was $40.4 million.
We did not receive any public comments on the proposal. As stated
earlier in this final rule with comment period, we are approving four
devices for pass-through payment status in the CY 2024 rulemaking
cycle: Ambu[supreg] aScope\TM\ 5 Broncho HD; FLEX Vessel
PrepTM System; CavaClear Inferior Vena Cava (IVC) Filter
Removal Laser Sheath; and CERAMENT[supreg] G. The manufacturers of
these systems provided utilization and cost data that indicate the
amount of spending for the devices would be approximately $14.4 million
for Ambu[supreg] aScope\TM\ 5 Broncho HD; $6.0 million for FLEX Vessel
PrepTM System; $5.2 million for CavaClear Inferior Vena Cava
(IVC) Filter Removal Laser Sheath; and $8.2 million for
CERAMENT[supreg] G. Therefore, we are finalizing an estimate of $33.8
million for this second group of devices for CY 2024.
To estimate proposed CY 2024 pass-through spending for drugs and
biologicals in the first group, specifically those drugs and
biologicals recently made eligible for pass-through payment and
continuing on pass-through payment status for at least one quarter in
CY 2024, we proposed to use the CY 2022 Medicare hospital outpatient
claims data regarding their utilization, information provided in their
respective pass-through applications, other historical hospital claims
data, pharmaceutical industry information, and clinical information
regarding these drugs and biologicals to project the CY 2024 OPPS
utilization of the products.
For the known drugs and biologicals (excluding policy-packaged
diagnostic radiopharmaceuticals, contrast agents, drugs, biologicals,
and radiopharmaceuticals that function as supplies when used in a
diagnostic test or procedure, and drugs and biologicals that function
as supplies when used in a surgical procedure) that will be continuing
on pass-through payment status in CY 2024, we estimated the pass-
through payment amount as the difference between the general payment
rate of ASP+6 percent and the payment rate for non pass-through drugs
and biologicals that would be separately paid. Because we proposed to
utilize a payment rate of ASP plus 6 percent for most separately
payable drugs and biologicals in the proposed rule, the proposed
payment rate difference between the pass-through payment
[[Page 81806]]
amount and the non pass-through payment amount was $0 for this group of
drugs.
We did not receive any comments on our proposal. Because payment
for policy-packaged drugs and biologicals is packaged if the product is
not paid separately due to its pass-through payment status, we proposed
to include in the CY 2024 pass-through estimate the difference between
payment for the policy-packaged drug or biological at ASP+6 percent (or
WAC+6 percent, or 95 percent of AWP, if ASP or WAC information is not
available) and the policy-packaged drug APC offset amount, if we
determine that the policy-packaged drug or biological approved for
pass-through payment resembles a predecessor drug or biological already
included in the costs of the APCs that are associated with the drug
receiving pass-through payment. For this first group of policy-packaged
drugs and biologicals, we estimated a pass-through for CY 2024 spending
of $90 million.
We did not receive any public comments on our proposal. Using our
methodology for this final rule with comment period, we calculated the
CY 2024 spending estimate for this first group of drugs and biologicals
of approximately $90 million using a rate of ASP+6 percent, which
remained unchanged from the proposed rule.
To estimate proposed CY 2024 pass-through spending for drugs and
biologicals in the second group (that is, drugs and biologicals that we
knew at the time of development of the CY 2024 OPPS/ASC proposed rule
(88 FR 49696) were newly eligible or recently became eligible for pass-
through payment in CY 2024, additional drugs and biologicals that we
estimated could be approved for pass-through status subsequent to the
development of the CY 2024 OPPS/ASC proposed rule (88 FR 49696) and
before January 1, 2024, and projections for new drugs and biologicals
that could be initially eligible for pass-through payment in the second
through fourth quarters of CY 2024), we proposed to use utilization
estimates from pass-through applicants, pharmaceutical industry data,
clinical information, recent trends in the per unit ASPs of hospital
outpatient drugs, and projected annual changes in service volume and
intensity as our basis for making the CY 2024 pass-through payment
estimate. We also proposed to consider the most recent OPPS experience
in approving new pass-through drugs and biologicals. Using our proposed
methodology for estimating CY 2024 pass-through payments for this
second group of drugs, we calculated a proposed spending estimate for
this second group of drugs and biologicals of approximately $10
million.
We did not receive any public comments on our proposal. Since the
release of the CY 2024 OPPS/ASC proposed rule, we have identified two
additional policy-packaged drugs in addition to the two policy-packaged
drugs that had pass-through status when the proposed rule was released.
Therefore, we have identified a total of four policy-packaged drugs
that have pass-through status. Our original proposed estimate of $10
million of additional pass-through payments for the second group of
drugs and biologicals did anticipate the approval of some of the
additional policy-packaged drugs and biologicals with pass-through
status, but not all of them. Therefore, for this final rule with
comment period, we are revising our estimate of pass-through spending
for the second group of drugs and biologicals to be $18.5 million.
We estimated for the CY 2024 OPPS/ASC proposed rule (88 FR 49696)
that the amount of pass-through spending for the device categories and
the drugs and biologicals that are continuing to receive pass-through
payment in CY 2024 and those device categories, drugs, and biologicals
that first become eligible for pass-through payment during CY 2024
would be approximately $234.1 million (approximately $134.1 million for
device categories and approximately $100 million for drugs and
biologicals) which represented 0.26 percent of total projected OPPS
payments for CY 2024 (approximately $88.6 billion). Therefore, we
estimated for the proposed rule that pass-through spending in CY 2024
would not amount to 2.0 percent of total projected OPPS CY 2024 program
spending.
We estimate for this final rule with comment period that the amount
of pass-through spending for the device categories and the drugs and
biologicals that are continuing to receive pass-through payment in CY
2024 and the amount of pass-through spending for those device
categories, drugs, and biologicals that first become eligible for pass-
through payment during CY 2024 would be approximately $236 million
(approximately $127.5 million for device categories and approximately
$108.5 million for drugs and biologicals), which represents only 0.27
percent of total projected OPPS payments for CY 2024 (approximately
$88.9 billion). Therefore, we estimate that pass-through spending in CY
2024 will not exceed the 2.0 percent of total projected OPPS CY 2024
program spending limit provided for in section 1833(t)(6)(E) of the
Act.
VII. OPPS Payment for Hospital Outpatient Visits and Critical Care
Services
For CY 2024, we proposed to continue our current clinic and
emergency department (ED) hospital outpatient visits payment policies.
For a description of these policies, we refer readers to the CY 2016
OPPS/ASC final rule with comment period (80 FR 70448). We also proposed
to continue our payment policy for critical care services for CY 2024.
For a description of this policy, we refer readers to the CY 2016 OPPS/
ASC final rule with comment period (80 FR 70449), and for the history
of this payment policy, we refer readers to the CY 2014 OPPS/ASC final
rule with comment period (78 FR 75043).
We did not receive any comments on our proposals to continue our
current ED outpatient visits and critical care payment policies for CY
2024 and are finalizing our proposals without modification.
As we stated in the CY 2022 OPPS/ASC final rule with comment period
(86 FR 63663), the volume control method for clinic visits furnished by
non-excepted off-campus provider-based departments (PBDs) applies for
CY 2022 and subsequent years. More specifically, we finalized a policy
to continue to utilize a PFS-equivalent payment rate for the hospital
outpatient clinic visit service described by HCPCS code G0463 when it
is furnished by these departments for CY 2022 and beyond. The PFS-
equivalent rate for CY 2024 is 40 percent of the proposed OPPS payment.
Under this policy, these departments will be paid approximately 40
percent of the OPPS rate for the clinic visit service in CY 2024.
The following is a summary of the comments we received and our
responses to those comments.
Comment: We received several comments on our overall clinic visit
payment policy. Many commenters continued to express the belief that
this policy undermines Congressional intent and exceeds the agency's
legal authority. As they have in previous years, commenters stated that
the policy is based on flawed assumptions and urged CMS to eliminate it
altogether. One of these commenters additionally requested that CMS
immediately restore the higher payment rates for clinic visits
furnished by excepted off-campus PBDs that existed before
implementation of the clinic visit payment policy and promptly repay
hospitals the difference between the amounts they would have received
under those higher rates and
[[Page 81807]]
the amounts they were paid under the policy.
Response: We continue to believe that section 1833(t)(2)(F) of the
Act gives the Secretary authority to develop a method for controlling
unnecessary increases in the volume of covered OPD services, including
a method that controls unnecessary volume increases by removing a
payment differential that is driving a site-of-service decision, and as
a result, is unnecessarily increasing service volume.\161\ As we noted
in the CY 2019 OPPS/ASC proposed rule (83 FR 37138 through 37143),
``[a] large source of growth in spending on services furnished in
hospital outpatient departments (HOPDs) appears to be the result of the
shift of services from (lower cost) physician offices to (higher cost)
HOPDs.'' We continue to believe that these shifts in the sites of
service are unnecessary if the beneficiary can safely receive the same
services in a lower cost setting but instead receives care in a higher
cost setting due to payment incentives. In most cases, the difference
in payment is leading to unnecessary increases in the volume of covered
outpatient department services, and we remain concerned that this shift
in care setting increases beneficiary cost-sharing liability because
Medicare payment rates for the same or similar services are generally
higher in hospital outpatient departments than in physician offices. We
continue to believe that our method addresses the concerns described in
the CY 2019 OPPS/ASC final rule with comment period (83 FR 59005).
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\161\ Available at: https://www.ssa.gov/OP_Home/ssact/title18/1833.htm.
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Additionally, we note that this policy has been litigated. On July
17, 2020, the United States Court of Appeals for the District of
Columbia Circuit (D.C. Circuit) ruled in our favor, holding that our
regulation was a reasonable interpretation of the statutory authority
to adopt a method to control for unnecessary increases in the volume of
the relevant service. The appellees petitioned the United States
Supreme Court for a writ of certiorari. On June 29, 2021, the Supreme
Court denied the petition.
Comment: We received comments supporting CMS's efforts to continue
implementing its method to control for unnecessary increases in the
volume of outpatient services. These commenters asked that CMS continue
to consider ways to expand the current site-neutral payment policies to
other services and settings. Some of these commenters suggested that
CMS apply the site-neutral payment policy to a list of 57 APCs for
which MedPAC determined it would be reasonable and appropriate to align
the OPPS and ASC payment rates with those set in the physician fee
schedule (PFS).\162\ Other commenters recommended that CMS consider
expanding the site-neutral payment policy to all services provided by
excepted, off-campus PBDs. Others suggested that the site-neutral
policy be extended to on-campus PBDs, ASCs, and emergency departments.
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\162\ Found at https://www.medpac.gov/wp-content/uploads/2022/06/Jun22_MedPAC_Report_to_Congress_v4_SEC.pdf.
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Response: We appreciate the commenters' support and we will
continue to monitor this policy and take commenters' suggestions into
consideration for potential future rulemaking.
After consideration of the public comments, we are continuing the
volume control method under which we utilize a PFS-equivalent payment
rate for the hospital outpatient clinic visit service described by
HCPCS code G0463 when it is furnished by excepted off-campus PBDs in CY
2024.
In the CY 2023 OPPS/ASC final rule with comment period (87 FR
71748), we finalized a policy that excepted off-campus provider-based
departments (PBDs) (departments that bill the modifier ``PO'' on claim
lines) of rural Sole Community Hospitals (SCHs), as described under 42
CFR 412.92 and designated as rural for Medicare payment purposes, are
exempt from the clinic visit payment policy that applies a Physician
Fee Schedule-equivalent payment rate for the clinic visit service, as
described by HCPCS code G0463, when provided at an off-campus PBD
excepted from section 1833(t)(21) of the Act. For the full discussion
of this policy, we refer readers to the CY 2023 OPPS/ASC final rule
with comment period (87 FR 72047 through 72051). For CY 2024, we
proposed to continue to exempt excepted off-campus PBDs of rural SCHs
from the clinic visit payment policy. We stated that we will continue
to monitor the effect of this change in Medicare payment policy,
including on the volume of these types of OPD services.
The following is a summary of the comments we received and our
responses to those comments.
Comment: All commenters supported our proposal to continue to
exempt excepted off-campus PBDs of rural SCHs from the clinic visit
payment policy for CY 2024. One commenter stated that the continuation
of the exemption is an important step in maintaining access to care for
a segment of the population that is underserved. This commenter
additionally stated that the continuation will not only improve patient
outcomes by allowing easily treatable conditions to be addressed in a
timely manner but will also reduce total Medicare spending as these
conditions will be treated in the most appropriate setting. Another
commenter praised the continuation of the exemption as a recognition on
CMS's part of the important role rural providers play in the delivery
of care and the financial pressures they face.
Response: We thank the commenters for their support.
Comment: Several of these commenters requested that CMS consider
expanding the exemption to excepted off-campus PBDs of rural hospitals
with fewer than 100 beds, Medicare Dependent Hospitals (MDHs), and Low
Volume Hospitals in a future rulemaking cycle, arguing that the same
reasoning that led CMS to propose to exempt SCHs also applies to these
hospitals. One commenter noted that MDHs have a larger percentage of
inpatient days or discharges for Medicare patients and that they are
therefore more vulnerable to inadequate Medicare payments than other
hospitals because they are less able to cross-subsidize inadequate
Medicare payments with more generous payments from private payers. The
commenter expressed that this greater dependence on Medicare may make
certain hospitals more financially vulnerable and thus, more worthy of
being exempt from the clinic visit policy. This commenter also
suggested that it would be appropriate to extend the exemption to urban
SCHs and provided specific examples of instances where an SCH is
designated urban by CMS, but the hospital is actually a considerable
distance from the nearest urban area. This commenter expressed that
there are many factors that underscore why urban SCHs and MDHs should
also receive the payment exemption, including below-average patient
care margins at these types of hospitals. The commenter also argued
that extending this exemption to MDHs and urban SCHs would only add
nominally to the cost of the proposed policy.
Response: In the CY 2006 OPPS final rule with comment period (70 FR
68556 through 68561) we uniquely identified rural SCHs as providers
with demonstrated additional resource costs. We found that rural SCHs
have significantly higher costs per unit than urban hospitals. We have
continued to adjust payments for rural SCHs by 7.1 percent each year
since 2006. Building upon that foundation, for CY 2018 we
[[Page 81808]]
finalized a policy to exclude rural SCHs from our 340B drug payment
policy and continued to do so until September 27, 2023, when the 340B
drug payment policy ended and we resumed paying for 340B drugs and
biologicals under the OPPS at the same rates we pay for non-340B drugs
and biologicals (generally, ASP plus 6 percent)). We believe exempting
rural SCHs, which have demonstrated additional resource costs, is
appropriate to ensure these hospitals can remain open to serve the
beneficiaries who rely on them for their care. We share commenters'
concerns about the financial difficulties associated with maintaining
access to care in medically vulnerable communities. However, in each of
these cases, the Congress did not determine that any of these hospital
types required additional payments for outpatient services. Section
1833(t)(13)(B) of the Act authorizes an appropriate adjustment for
hospitals located in rural areas where the Secretary determines, based
on a study, that the costs incurred by these hospitals by APC group
exceed costs incurred by hospitals in urban areas. In the CY 2006 OPPS
final rule with comment period (70 FR 68556 through 68561), we
summarized our study of the cost of covered outpatient department
services to hospitals in rural areas and found that rural SCHs were the
only rural hospital type that had higher resource costs for covered
outpatient department services. Rural SCHs demonstrated significantly
higher cost per unit than urban hospitals after controlling for labor
input prices, service-mix complexity, volume, facility size, and type
of hospital. In the CY 2006 OPPS final rule with comment period (70 FR
68556 through 68561) we stated that we found no significant difference
in cost between all small rural hospitals with 100 or fewer beds and
urban hospitals. We found that there was insufficient evidence to
conclude that rural hospitals with 100 or fewer beds have higher costs
than urban hospitals. We proposed a narrow exception to our clinic
visit policy largely based upon the historical treatment and documented
additional resource costs of rural SCHs under the OPPS. We are only
excepting rural SCHs because we continue to believe that the underlying
principles of the clinic visit policy continue to justify application
of the volume control method for clinic visits to the remaining
hospital types, including most rural and safety-net providers. Where
the difference in payment is leading to unnecessary increases in the
volume of covered outpatient department services, we remain concerned
that this shift in care setting increases beneficiary cost-sharing
liability because Medicare payment rates for the same or similar
services are generally higher in hospital outpatient departments than
in physician offices. Further, we do not believe that commenters
provided sufficient reasoning or data to show that the other provider
types suggested (Medicare Dependent Hospitals, Urban Sole Community
Hospitals, and Low-Volume Adjustment Hospitals) demonstrate the
additional resource costs that rural SCHs do and should therefore also
be exempted from this OPPS payment policy. We share commenters'
concerns about maintaining access to care in urban and rural settings
and enhancing access to care in medically vulnerable communities. We
also share commenters' concerns about profit margins. However, we must
balance the concerns of providers with the concerns of beneficiaries
regarding the affordability of their care. For hospitals subject to the
clinic visit policy, the proposed PFS-equivalent rate for a clinic
visit brings the approximate average copayment down from $26 to $10. We
will continue to study access and cost to see if further exemptions to
the clinic visit policy are appropriate.
Comment: One commenter noted that, while it is necessary to
distinguish between urban and rural hospitals for a number of payment
and policy mechanisms, they believe the Metropolitan Statistical Areas
(MSAs) CMS uses to delineate between these areas are not the most
precise tool. This commenter argued that CMS should extend this
exemption to urban SCHs because using MSAs to determine urban and rural
areas is imprecise and unfairly disadvantages urban SCHs that may be
the sole source of hospital services in their communities.
Response: We acknowledge the commenters' points about the important
role that urban SCHs serve in their communities. However, we have not
found that urban SCHs have the additional resource costs for covered
outpatient department services that rural SCHs have, and as such, we
are only applying the clinic visit policy exemption to rural SCHs.
Comment: A few commenters suggested extending the exemption to
hospitals that provide a disproportionate share of the nation's
uncompensated care, and serve high proportions of Medicaid, Medicare,
and uninsured patients. The commenters argued that PBDs of these
hospitals are disproportionately impacted by site-neutral payment
policies and shielding these PBDs from the impact of these policies
would ensure they can continue to cover the costs associated with
providing comprehensive, coordinated care to complex patient
populations in underserved areas. The commenters did acknowledge that
CMS has not defined hospitals that meet these criteria and would need
to do so in order to exempt associated PBDs from the clinic visit
policy. They further recognized that rural SCHs are easily identified
because there is an existing definition to capture the hospitals that
fall into this group. They recommended that CMS first define a group of
hospitals that meet these criteria and then exclude those hospitals'
excepted PBDs from the clinic visit policy to ensure continued access
for marginalized communities without other reliable sources of care.
Response: As the commenter stated, we have not created a definition
for the group of hospitals the commenter cited and would need to do so
in order use this definition to exempt associated PBDs from the clinic
visit policy. We will continue to monitor this issue and revisit any
additional exemptions in future rulemaking as appropriate.
Comment: One commenter presented data showing that 56 percent of
rural SCHs, 73 percent of urban SCHs, and 60 percent of Medicare
Dependent Hospitals (MDHs) are located in at least one type of
medically underserved area (MUA) as designated by the Health Resources
& Services Administration.
Response: We do not currently utilize MUA designations to determine
payment for covered outpatient department services under the OPPS. We
believe our policy to exempt rural SCHs is consistent with our other
policies that target this hospital type, which we have determined have
higher resource costs for covered outpatient department services, and
therefore, that our policy to exempt them is appropriate from an OPPS
perspective.
Comment: One commenter recommended that CMS broaden the scope of
exempted hospitals to support patient access to care and encouraged CMS
to work with interested parties to identify the additional types of
hospitals that would be eligible to receive an exemption.
Response: We appreciate the commenter's suggestion and will
consider it for future rulemaking.
After consideration of the public comments we received, we are
finalizing our proposal to continue to exempt excepted off-campus PBDs
of rural SCHs from the clinic visit payment policy in CY 2024.
[[Page 81809]]
VIII. Payment for Partial Hospitalization and Intensive Outpatient
Services
This section discusses payment for partial hospitalization services
as well as intensive outpatient services. Since CY 2000, Medicare has
paid for partial hospitalization services under the OPPS. Beginning in
CY 2024, as authorized by section 4124 of the Consolidated
Appropriations Act (CAA), 2023 (Pub. L. 117-328), Medicare will begin
paying for intensive outpatient services furnished by hospital
outpatient departments, community mental health centers, federally
qualified health centers, and rural health clinics. Additional
background on the partial hospitalization and intensive outpatient
benefits is included in the following paragraphs.
A. Partial Hospitalization
1. Background
A partial hospitalization program (PHP) is an intensive outpatient
program of psychiatric services provided as an alternative to inpatient
psychiatric care for individuals who have an acute mental illness,
which includes, but is not limited to, conditions such as depression,
schizophrenia, and substance use disorders (SUD). Section 1861(ff)(1)
of the Act defines partial hospitalization services as the items and
services described in paragraph (2) prescribed by a physician and
provided under a program described in paragraph (3) under the
supervision of a physician pursuant to an individualized, written plan
of treatment established and periodically reviewed by a physician (in
consultation with appropriate staff participating in such program),
which sets forth the physician's diagnosis, the type, amount,
frequency, and duration of the items and services provided under the
plan, and the goals for treatment under the plan. Section 1861(ff)(2)
of the Act describes the items and services included in partial
hospitalization services. Section 1861(ff)(3)(A) of the Act specifies
that a PHP is a program furnished by a hospital to its outpatients or
by a community mental health center (CMHC), as a distinct and organized
intensive ambulatory treatment service, offering less than 24-hour-
daily care, in a location other than an individual's home or inpatient
or residential setting. Section 1861(ff)(3)(B) of the Act defines a
CMHC for purposes of this benefit. We refer readers to sections
1833(t)(1)(B)(i), 1833(t)(2)(B), 1833(t)(2)(C), and 1833(t)(9)(A) of
the Act and 42 CFR 419.21, for additional information regarding PHP.
Partial hospitalization program policies and payment have been
addressed under OPPS since CY 2000. In CY 2008, we began efforts to
strengthen the PHP benefit through extensive data analysis, along with
policy and payment changes by implementing two refinements to the
methodology for computing the PHP median. For a detailed discussion on
these policies, we refer readers to the CY 2008 OPPS/ASC final rule
with comment period (72 FR 66670 through 66676). In CY 2009, we
implemented several regulatory, policy, and payment changes. For a
detailed discussion on these policies, we refer readers to the CY 2009
OPPS/ASC final rule with comment period (73 FR 68688 through 68697). In
CY 2010, we retained the two-tier payment approach for partial
hospitalization services and used only hospital-based PHP data in
computing the PHP APC per diem costs, upon which PHP APC per diem
payment rates are based (74 FR 60556 through 60559). In CY 2011 (75 FR
71994), we established four separate PHP APC per diem payment rates:
two for CMHCs (APC 0172 and APC 0173) and two for hospital-based PHPs
(APC 0175 and APC 0176) and instituted a 2-year transition period for
CMHCs to the CMHC APC per diem payment rates. For a detailed
discussion, we refer readers to section X.B of the CY 2011 OPPS/ASC
final rule with comment period (75 FR 71991 through 71994). In CY 2012,
we determined the relative payment weights for partial hospitalization
services provided by CMHCs based on data derived solely from CMHCs and
the relative payment weights for partial hospitalization services
provided by hospital-based PHPs based exclusively on hospital data (76
FR 74348 through 74352). In the CY 2013 OPPS/ASC final rule with
comment period, we finalized our proposal to base the relative payment
weights that underpin the OPPS APCs, including the four PHP APCs (APCs
0172, 0173, 0175, and 0176), on geometric mean costs rather than on the
median costs. For a detailed discussion on this policy, we refer
readers to the CY 2013 OPPS/ASC final rule with comment period (77 FR
68406 through 68412).
In the CY 2014 OPPS/ASC proposed rule (78 FR 43621 and 43622) and
CY 2015 OPPS/ASC final rule with comment period (79 FR 66902 through
66908), we continued to apply our established policies to calculate the
four PHP APC per diem payment rates based on geometric mean per diem
costs using the most recent claims data for each provider type. For a
detailed discussion on this policy, we refer readers to the CY 2014
OPPS/ASC final rule with comment period (78 FR 75047 through 75050). In
the CY 2016, we described our extensive analysis of the claims and cost
data and ratesetting methodology, corrected a cost inversion that
occurred in the final rule data with respect to hospital-based PHP
providers and renumbered the PHP APCs. In CY 2017 OPPS/ASC final rule
with comment period (81 FR 79687 through 79691), we continued to apply
our established policies to calculate the PHP APC per diem payment
rates based on geometric mean per diem costs and finalized a policy to
combine the Level 1 and Level 2 PHP APCs for CMHCs and for hospital-
based PHPs. We also implemented an eight-percent outlier cap for CMHCs
to mitigate potential outlier billing vulnerabilities. For a
comprehensive description of PHP payment policy, including a detailed
methodology for determining PHP per diem amounts, we refer readers to
the CY 2016 and CY 2017 OPPS/ASC final rules with comment period (80 FR
70453 through 70455 and 81 FR 79678 through 79680, respectively).
In the CYs 2018 and 2019 OPPS/ASC final rules with comment period
(82 FR 59373 through 59381, and 83 FR 58983 through 58998,
respectively), we continued to apply our established policies to
calculate the PHP APC per diem payment rates based on geometric mean
per diem costs, designated a portion of the estimated 1.0 percent
hospital outpatient outlier threshold specifically for CMHCs, and
proposed updates to the PHP allowable HCPCS codes. We finalized these
proposals in the CY 2020 OPPS/ASC final rule with comment period (84 FR
61352).
In the CY 2020 OPPS/ASC final rule with comment period (84 FR 61339
through 61350), we finalized a proposal to use the calculated CY 2020
CMHC geometric mean per diem cost and the calculated CY 2020 hospital-
based PHP geometric mean per diem cost, but with a cost floor equal to
the CY 2019 final geometric mean per diem costs as the basis for
developing the CY 2020 PHP APC per diem rates. Also, we continued to
designate a portion of the estimated 1.0 percent hospital outpatient
outlier threshold specifically for CMHCs, consistent with the
percentage of projected payments to CMHCs under the OPPS, excluding
outlier payments.
In the April 30, 2020 interim final rule with comment (85 FR 27562
through 27566), effective as of March 1, 2020, and for the duration of
the COVID-19 Public Health Emergency (PHE), hospital and CMHC staff
were
[[Page 81810]]
permitted to furnish certain outpatient therapy, counseling, and
educational services (including certain PHP services), incident to a
physician's services, to beneficiaries in temporary expansion
locations, including the beneficiary's home, so long as the location
meets all conditions of participation to the extent not waived. A
hospital or CMHC can furnish such services using telecommunications
technology to a beneficiary in a temporary expansion location if that
beneficiary is registered as an outpatient. In the CY 2023 OPPS/ASC
final rule (87 FR 72247), we confirmed these provisions as final,
including that they apply only for the duration of the COVID-19 PHE. On
May 11, 2023, the COVID-19 PHE ended, and accordingly, these
flexibilities ended as well.
In the CY 2021 OPPS/ASC final rule with comment period (85 FR 86073
through 86080), we continued our current methodology to utilize cost
floors, as needed. Since the final calculated geometric mean per diem
costs for both CMHCs and hospital-based PHPs were significantly higher
than each proposed cost floor, a floor was not necessary at the time,
and we did not finalize the proposed cost floors in the CY 2021 OPPS/
ASC final rule with comment period.
In the CY 2022 OPPS/ASC final rule with comment period (86 FR 63665
and 63666), we explained that we observed a number of changes, likely
as a result of the COVID-19 PHE, in the CY 2020 OPPS claims that we
would have ordinarily used for CY 2022 ratesetting, and this included
changes in the claims for partial hospitalization. We explained that
significant decreases in utilization and in the number of hospital-
based PHP providers who submitted CY 2020 claims led us to believe that
CY 2020 data were not the best overall approximation of expected PHP
services in CY 2022. Therefore, we finalized our proposal to calculate
the PHP per diem costs using the year of claims consistent with the
calculations that would be used for other OPPS services, by using the
CY 2019 claims and the cost reports that were used for CY 2021 final
rulemaking to calculate the CY 2022 PHP per diem costs. In addition,
for CY 2022 and subsequent years, we finalized our proposal to use cost
and charge data from the Hospital Cost Report Information System
(HCRIS) as the source for the CMHC cost-to-charge ratios (CCRs),
instead of using the Outpatient Provider Specific File (OPSF) (86 FR
63666).
In the CY 2023 OPPS/ASC final rule with comment period (87 FR
71995), we explained that we continued to observe a decrease in the
number of hospital-based and CMHC PHP days in our trimmed dataset due
to the continued effects of COVID-19, however, the Medicare outpatient
service volumes appeared to be returning to more normal, pre-pandemic
levels. Therefore, we finalized our proposal to use the latest
available CY 2021 claims, but use the cost information from prior to
the COVID-19 PHE for calculating the CY 2023 CMHC and hospital-based
PHP APC per diem costs. The application of the OPPS standard
methodology, including the effect of budget neutralizing all other OPPS
policy changes unique to CY 2023, resulted in the final calculated CMHC
PHP APC payment rate being unexpectedly lower than the CY 2022 final
CMHC PHP APC rate. Therefore, in the interest of accurately paying for
CMHC PHP services, under the unique circumstances of budget
neutralizing all other OPPS policy changes for CY 2023, and in keeping
with our longstanding goal of protecting continued access to PHP
services provided by CMHCs by ensuring that CMHCs remain a viable
option as providers of mental health care in the beneficiary's own
community, we finalized utilizing the equitable adjustment authority of
section 1833(t)(2)(E) of the Act to appropriately pay for CMHC PHP
services at the same payment rate as for CY 2022, that is, $142.70. In
addition, we clarified the payment under the OPPS for new HCPCS codes
that designate non-PHP services provided for the purposes of diagnosis,
evaluation, or treatment of a mental health disorder and are furnished
to beneficiaries in their homes by clinical staff of the hospital would
not be recognized as PHP services, however, none of the PHP regulations
would preclude a patient that is under a PHP plan of care from
receiving other reasonable and medically necessary non-PHP services
from a hospital (87 FR 72001 and 72002).
Section 4124(a) of Division FF of the CAA, 2023 amends section
1861(ff)(1) of the Act to modify the definition of partial
hospitalization services furnished on or after January 1, 2024.
Specifically, section 4124(a) of the CAA, 2023 amends section
1861(ff)(1) of the Act by adding to the current definition that partial
hospitalization services are ``for an individual determined (not less
frequently than monthly) by a physician to have a need for such
services for a minimum of 20 hours per week.'' We discuss these
revisions to the definition of partial hospitalization services in
section VIII.A.2 of this CY 2024 OPPS/ASC final rule.
2. Revisions to PHP Physician Certification Requirements
As amended by section 4124(a) of the CAA, 2023, section 1861(ff)(1)
requires that a physician determine that each patient needs a minimum
of 20 hours of PHP services per week, and this determination must occur
no less frequently than monthly. We proposed to codify this requirement
in regulation as an additional requirement for the physician
certification applicable for PHP services that we would add to Sec.
424.24(e)(1)(i). We did not propose any changes to the existing
physician certification requirements for PHP, including that the
patient would require inpatient hospitalization if they did not receive
PHP services, which will remain at Sec. 424.24(e)(1)(i).
Existing regulations at Sec. 410.43 set forth conditions and
exclusions that apply for partial hospitalization services. Under Sec.
410.43(a)(3), partial hospitalization services are services that are
furnished in accordance with a physician certification and plan of care
as specified under Sec. 424.24(e). Additionally, current patient
eligibility criteria at Sec. 410.43(c)(1) state that partial
hospitalization programs are intended for patients who require a
minimum of 20 hours per week of therapeutic services as evidenced in
their plan of care. Because partial hospitalization services are
already required to be furnished in accordance with a physician
certification and plan of care, we stated in the proposed rule that we
believe it is appropriate to include this 20-hour minimum weekly
requirement as a physician certification requirement at Sec.
424.24(e)(1)(i). We noted that we do not believe the proposed change to
the regulation would create a new requirement for PHPs from a practical
perspective, as the change to the definition of partial hospitalization
services made by the CAA, 2023 is consistent with the longstanding 20-
hour minimum weekly regulatory requirement at Sec. 410.43(c)(1) that
Medicare has applied to PHP.
We proposed to modify the regulation at Sec. 424.24(e)(1)(i) to
require the physician certification for PHP services include a
certification that the patient requires such services for a minimum of
20 hours per week. Current regulations at Sec. 424.24(e)(3)(ii)
require an initial recertification after 18 days, with subsequent
recertifications of PHP services no less frequently than every 30 days.
We stated that we believe this interval is consistent with the CAA,
2023 requirement that the physician's
[[Page 81811]]
determination of the need for PHP services at least 20 hours per week
must occur no less frequently than monthly.
Comment: Overall, commenters agreed that the proposed modification
to the regulation at Sec. 424.24(e)(1)(i) is consistent with the CAA,
2023 requirement that the physician certifies the need for PHP services
for at least 20 hours per week. One commenter recommended CMS consider
allowing any addiction treatment professional operating within their
scope of practice under state regulation to certify the need for PHP
for SUD treatment.
Response: We appreciate the commenters' support. Section 4124(a) of
the CAA, 2023 specifically states that the certification must be
determined by a physician. Section 1861(r) of the Act defines
``physician'' as a doctor of medicine or osteopathy legally authorized
to practice medicine and surgery by the State in which he performs such
function or action. Therefore, we do not believe we are able to expand
the certification of the need for PHP services to any addiction
treatment professional.
Comment: Commenters recommended that CMS reconsider the timing
associated with the initial PHP recertification requirement. Commenters
noted section 1861(ff)(1) of the Act, as amended by section 4124(a) of
the CAA, 2023, specifies that recertification should occur ``not less
frequently than monthly''. The commenters further noted that the
current regulation at Sec. 424.24(e)(3)(ii) requires the initial PHP
recertification as of the 18th day of partial hospitalization services,
which is significantly earlier than one month after the patient begins
receiving PHP services. The commenters stated it may be clinically
beneficial for the PHP to have more days of furnishing partial
hospitalization before determining whether recertification is warranted
for the person.
Response: We appreciate the commenter's concerns regarding the
timing of the first recertification of PHP services. We did not propose
to modify the regulation at Sec. 424.24(e)(3)(ii) which requires the
first recertification of PHP services occur as of the 18th day of
partial hospitalization services. As discussed in the April 2000 OPPS
final rule with comment period (65 FR 18454), because partial
hospitalization is the outpatient substitute for inpatient psychiatric
care, we stated that we believed it was appropriate to adopt the
standard used for inpatient psychiatric care at that time. The
requirement for initial recertification by the 18th day of an inpatient
psychiatric stay was codified in regulation at Sec. 424.14(d)(2) in
the March 1988 final rule with comment period (53 FR 6636 and 6637). We
later modified the initial recertification interval from 18 days to 12
days. As we explained in the RY 2007 IPF PPS final rule (71 FR 27076
and 27077), the standard for IPF initial recertification was determined
by the average length of stay (LOS) for inpatient psychiatric
hospitalization in the 1980s, which was 18 days. For RY 2007, we
amended the regulation at Sec. 424.14(d)(2) to require the initial
recertification for IPF patients as of the 12th day of hospitalization.
This change was based on analysis of the MedPAR 2002 claims data for
IPF services. Although the timing requirement for inpatient psychiatric
hospitalization was shortened, we continue to believe that the current
timing requirements for PHP initial recertification--that is, as of the
18th day of PHP services--is appropriate. We note that our analysis
shows that 18 days generally corresponds to the median length of stay
for PHP patients.
Final Decision: After consideration of the public comments we
received, we are finalizing our proposed revision to the regulation at
Sec. 424.24(e)(1)(i) to require the physician certification for PHP
services include a certification that the patient requires such
services for a minimum of 20 hours per week.
B. Intensive Outpatient Program Services
1. Establishment of Intensive Outpatient Services Benefit by Section
4124 of the CAA, 2023
Section 4124(b) of the CAA, 2023 established Medicare coverage for
intensive outpatient services effective for items and services
furnished on or after January 1, 2024. Section 4124(b)(1)(A) of the
CAA, 2023 amended section 1832(a)(2)(J) of the Act to add intensive
outpatient services to the scope of covered benefits provided by CMHCs,
and section 4124(b)(1)(B) amended section 1861(s)(2)(B) to add
intensive outpatient services to the definition of ``medical and other
health services'', specifically, as a service furnished ``incident to a
physicians' services.''
Intensive outpatient services are furnished under an intensive
outpatient program (IOP). Similar to PHP, an IOP is a distinct and
organized outpatient program of psychiatric services provided for
individuals who have an acute mental illness, which includes, but is
not limited to, conditions such as depression, schizophrenia, and SUD.
Generally speaking, an IOP is thought to be less intensive than a PHP,
and the statutory definition of IOP services reflects this difference
in intensity. Specifically, section 4124(b)(2)(B) of the CAA, 2023
amended section 1861(ff) of the Act to add a new paragraph (4) to
define the term ``intensive outpatient services'' as having the same
meaning as ``partial hospitalization services'' in paragraph (1). In
particular, intensive outpatient services are the items and services
described in paragraph (2) prescribed by a physician for an individual
determined (not less frequently than once every other month) by a
physician to have a need for such services for a minimum of 9 hours per
week and provided under a program described in paragraph (3) under the
supervision of a physician pursuant to an individualized, written plan
of treatment established and periodically reviewed by a physician (in
consultation with appropriate staff participating in such program),
which sets forth the physician's diagnosis, the type, amount,
frequency, and duration of the items and services provided under the
plan, and the goals for treatment under the plan. For patients of an
IOP, section 1835(a)(2)(F)(i) of the Act does not apply, that is,
individuals receiving IOP would not require inpatient psychiatric care
in the absence of such services. Lastly, section 4124(b)(2)(B) of the
CAA, 2023 further added to section 1861(ff)(4)(C), which cross-
references paragraph (3), that an IOP is a program furnished by a
hospital to its outpatients, or by a community mental health center
(CMHC), a Federally qualified health center (FQHC), or a rural health
clinic (RHC), as a distinct and organized intensive ambulatory
treatment service, offering less than 24-hour-daily care, in a location
other than an individual's home or inpatient or residential setting.
Section 4124(c) of the CAA, 2023 amends section 1834 of the Act by
adding a new paragraph (5) to subsection (o) and a new paragraph (3) to
subsection (y), which include special payment rules for intensive
outpatient services furnished in FQHCs and RHCs, which are discussed in
greater detail in section VIII.F of this final rule with comment
period.
This final rule establishes payment and program requirements for
the IOP benefit in all of the above-described settings. Section
VIII.B.2 of this final rule with comment period discusses the scope of
benefits for IOP services, and section VIII.B.3 of this final rule with
comment period discusses physician certification requirements. Section
VIII.C of this final rule with comment period discusses coding and
billing for
[[Page 81812]]
both PHP and IOP services under the OPPS beginning in CY 2024. Section
VIII.D of this final rule with comment period discusses the payment
methodology. Section VIII.E of this final rule with comment period
discusses the outlier policy for CMHCs. Section VIII.F of this final
rule with comment period discusses payment for IOP services in FQHCs
and RHCs, and section VIII.G of this final rule with comment period
discusses payment for IOP services in Opioid Treatment Programs (OTPs).
2. IOP Scope of Benefits
Section 1861(ff)(2) of the Act describes the items and services
available under the IOP benefit. These items and services include:
individual and group therapy with physicians or psychologists (or other
mental health professionals to the extent authorized under State law);
occupational therapy requiring the skills of a qualified occupational
therapist; services of social workers, trained psychiatric nurses, and
other staff trained to work with psychiatric patients; drugs and
biologicals furnished for therapeutic purposes (which cannot, as
determined in accordance with regulations, be self-administered);
individualized activity therapies that are not primarily recreational
or diversionary; family counseling (the primary purpose of which is
treatment of the individual's condition); patient training and
education (to the extent that training and educational activities are
closely and clearly related to individual's care and treatment);
diagnostic services; and such other items and services as the Secretary
may provide (excluding meals and transportation) that are reasonable
and necessary for the diagnosis or active treatment of the individual's
condition, reasonably expected to improve or maintain the individual's
condition and functional level and to prevent relapse or
hospitalization, and furnished pursuant to such guidelines relating to
frequency and duration of services as the Secretary shall by regulation
establish, taking into account accepted norms of medical practice and
the reasonable expectation of patient improvement.
Consistent with the statutory definition of intensive outpatient
services under section 1861(ff)(2) of the Act, we proposed to add
regulations at 42 CFR 410.44 to set forth the conditions and exclusions
that would apply for intensive outpatient services. Consistent with the
existing regulations for partial hospitalization services, we proposed
to require that intensive outpatient services must be furnished in
accordance with a physician certification and plan of care. However,
where partial hospitalization requires the physician to certify that
the services are instead of inpatient hospitalization, intensive
outpatient program services are not intended for those who otherwise
need an inpatient level of care. That is, section 1861(ff)(4)(A) of the
Act, as added by section 4124 of the CAA, 2023, states that for
intensive outpatient services, section 1835(a)(2)(F)(i) of the Act
shall not apply. As further discussed in section VIII.B.3 of this final
rule with comment period, we proposed to add language to the regulation
at Sec. 424.24(d), which is currently reserved, that would set forth
the physician certification and plan of care requirements for intensive
outpatient services.
Additionally, we proposed to revise certain existing regulations at
Sec. Sec. 410.2, 410.3, 410.10, 410.27, 410.150, and 419.21 to add a
regulatory definition of intensive outpatient services and to include
intensive outpatient services in the regulations for medical and other
health services paid for under Medicare Part B, and in the case of
Sec. 419.21, under the OPPS. We proposed to create regulations at
Sec. 410.111 to establish the requirements for coverage of IOP
services furnished in CMHCs, and at Sec. 410.173 to establish
conditions of payment for IOP services furnished in CMHCs. Lastly, we
proposed to revise Sec. 410.155 to exclude IOP services from the
outpatient mental health treatment limitation, consistent with the
statutory requirement of section 1833(c)(2) of the Act, as amended by
section 4124(b)(3) of the CAA, 2023. We discuss our proposals and the
comments we received in the following paragraphs.
a. Definition of Intensive Outpatient Services
We proposed the following definition at Sec. 410.2 for intensive
outpatient services: Intensive outpatient services means a distinct and
organized intensive ambulatory treatment program that offers less than
24-hour daily care other than in an individual's home or in an
inpatient or residential setting and furnishes the services as
described in Sec. 410.44. Intensive outpatient services are not
required to be provided in lieu of inpatient hospitalization. We noted
that the proposed definition for intensive outpatient services is
consistent with the statutory requirements of section 1861(ff)(3)(A),
which apply to both IOP and PHP services. Accordingly, the proposed
definition is largely consistent with the existing regulatory
definition of partial hospitalization services. However, in accordance
with section 1861(ff)(4)(A) of the Act, as added by the CAA, 2023, we
included a clarification in the regulatory definition of ``intensive
outpatient services'' that they are not required to be provided in lieu
of inpatient hospitalization. We stated that we included this
clarification in order to more clearly differentiate between the
definitions of partial hospitalization and intensive outpatient at
Sec. 410.2.
Comment: Commenters were generally supportive of the proposed
definition at Sec. 410.2 for intensive outpatient services. However,
commenters recommended that language specifying IOP represents a less
intensive service than partial hospitalization be included in the
definition. The commenters stated this addition could avoid any
misconception that IOP is substantively different from PHP.
Response: We thank commenters for their suggestions. We proposed
the regulations for IOP to be similar to PHP due to the similarities of
both programs as enacted by section 4124(b) of the CAA, 2023. The key
distinctions between IOP and PHP can be found in the proposed
regulations at Sec. 424.24(d). The proposed regulations at Sec.
424.24(d) outline the content of certification and plan of treatment
requirements for IOP, which differ from PHP requirements. Specifically,
proposed regulations at Sec. 424.24(d)(1) do not include a requirement
that individuals receiving IOP would require inpatient psychiatric care
in the absence of such services, which is required under PHP at Sec.
424.24(e)(1)(i). Additionally, the proposed modification to the PHP
regulation at Sec. 424.24(e)(1)(i) requires individuals receiving PHP
be certified by a physician to need a minimum of 20 hours per week of
such services; while the proposed IOP regulation at Sec.
424.24(d)(1)(i) requires individuals receiving IOP be certified by a
physician to need a minimum of 9 hours per week of such services.
Therefore, we believe the proposed definition at Sec. 410.2 for
intensive outpatient services sufficiently defines an intensive
outpatient program.
Comment: A few commenters were concerned CMS did not propose to
include IOP services furnished remotely. Commenters noted how the
availability of remote PHP services during the COVID-19 public health
emergency (PHE) has increased access to these services, especially in
rural areas. The commenters stated remote IOP services would also be
beneficial to increase access to the benefit.
Response: We appreciate the comments on how the availability of
remote services increased access during the COVID-19 PHE. Section
[[Page 81813]]
1861(ff)(3)(A) of the Act does not allow Medicare to pay for partial
hospitalization services furnished to beneficiaries in a home or
residential setting. As discussed in the CY 2023 OPPS/ASC final rule
with comment period (87 FR 72000 through 72002), we did not propose to
recognize OPPS remote services, as described in section X.A.5 of the CY
2023 OPPS/ASC final rule with comment period (87 FR 72014 through
72017), as PHP services, because we do not have statutory authority to
pay for services furnished in a home or residential setting as partial
hospitalization services. However, we clarified that none of the PHP
regulations would preclude a patient that is under a PHP plan of care
from receiving other reasonable and medically necessary non-PHP
services from a hospital. This means that patients in a PHP are not
precluded from receiving remote mental health services provided outside
of the PHP by the same or another hospital, when such services are
reasonable and medically necessary. In response to IOP services being
furnished remotely to beneficiaries in their homes, we note that
section 1861(ff) of the Act, as amended by section 4124(b)(2)(B) of the
CAA, 2023 adopts much of the statutory definition for PHP and applies
it to IOP. Specifically, section 1861(ff)(3)(A) prohibits both PHP and
IOP services from being furnished other than in an individual's home or
in an inpatient or residential setting. However, as we discussed in the
CY 2023 OPPS/ASC final rule with comment period for PHP, we are
clarifying in this final rule that none of the proposed IOP regulations
would preclude a patient that is under an IOP plan of care from
receiving other reasonable and medically necessary non-IOP services
from a hospital.
Additionally, we are reiterating and clarifying in this final rule
that we would expect that a physician would update the patient's PHP or
IOP plan of care to appropriately reflect any change to the type,
amount, duration, or frequency of the therapeutic services planned for
that patient in circumstances when a PHP or IOP patient receives non-
PHP/IOP remote mental health services from a hospital outpatient
department. We also note that the medical documentation should continue
to support the patient's eligibility for participation in a PHP or IOP.
Final Decision: After consideration of the public comments we
received, we are finalizing the proposed definition at Sec. 410.2 for
intensive outpatient services: Intensive outpatient services means a
distinct and organized intensive ambulatory treatment program that
offers less than 24-hour daily care other than in an individual's home
or in an inpatient or residential setting and furnishes the services as
described in Sec. 410.44.
The conditions and exclusions for partial hospitalization services
are included in the regulation at Sec. 410.43. We proposed that the
conditions and exclusions for intensive outpatient services would be
included in new regulations at Sec. 410.44.
At new Sec. 410.44, we proposed to establish regulatory language
for intensive outpatient services that is consistent with the existing
language for partial hospitalization conditions and exclusions and the
statutory definition of intensive outpatient services. Specifically,
under Sec. 410.44(a) we proposed that IOP services are services that:
(1) are reasonable and necessary for the diagnosis or active treatment
of the individual's condition; (2) are reasonably expected to improve
or maintain the individual's condition and functional level and to
prevent relapse or hospitalization; (3) are furnished in accordance
with a physician certification and plan of care as specified under new
regulations at Sec. 424.24(d); and include any of the services listed
in Sec. 410.44(a)(4). Under Sec. 410.44(a)(4), we include a list of
the types of services that we proposed would be covered as intensive
outpatient services:
Individual and group therapy with physicians or
psychologists or other mental health professionals to the extent
authorized under State law.
Occupational therapy requiring the skills of a qualified
occupational therapist, provided by an occupational therapist, or under
appropriate supervision of a qualified occupational therapist by an
occupational therapy assistant as specified in part 484.
Services of social workers, trained psychiatric nurses,
and other staff trained to work with psychiatric patients.
Drugs and biologicals furnished for therapeutic purposes,
subject to the limitations specified in Sec. 410.29.
Individualized activity therapies that are not primarily
recreational or diversionary.
Family counseling, the primary purpose of which is
treatment of the individual's condition.
Patient training and education, to the extent the training
and educational activities are closely and clearly related to the
individual's care and treatment.
Diagnostic services.
The proposed list at Sec. 410.44(a)(4) is based on the list of
items and services described in section 1861(ff)(2) of the Act. We note
that 1861(ff)(2) of the Act also provides that intensive outpatient
services may include such other items and services as the Secretary may
provide (but in no event to include meals and transportation). As
discussed in section VIII.C of this final rule with comment period, we
solicited comments on whether additional codes should be added to the
list of services recognized as appropriate for PHP and IOP. We discuss
the comments we received and provide our responses in that section of
this final rule with comment period, and we note that none of the codes
we are adopting in that section of this final rule with comment period
necessitate changes to the proposed list at Sec. 410.44(a)(4).
In the proposed rule, we further noted that both the statute at
section 1861(ff)(2)(C) of the Act and our proposed regulation at Sec.
410.44(a)(4)(iii) refer to ``trained psychiatric nurses, and other
staff trained to work with psychiatric patients.'' We explained that
under our longstanding policy for partial hospitalization services, we
have considered nurses and other staff trained to work with patients
within their state scope of practice who are receiving treatment for
SUD to be included under this statutory definition and the regulatory
definition of PHP at Sec. 410.43(a)(4). We stated that we have heard
from interested parties that there could be a misconception that
Medicare does not cover PHP for the treatment of SUD. We are clarifying
that, in general, notwithstanding the requirement that PHP services are
provided in lieu of inpatient hospitalization, Medicare covers PHP for
the treatment of SUD, and we consider services that are for the
treatment of SUD and behavioral health generally to be consistent with
the statutory and regulatory definition of PHP. We clarified in the
proposed rule that the terms ``trained psychiatric nurses, and other
staff trained to work with psychiatric patients,'' as used in
Sec. Sec. 410.43(a)(4) and 410.44(a)(4) would include trained SUD
nurses and other staff trained to work with SUD patients. Under Sec.
410.44(b), we proposed that the following services are separately
covered and not paid as intensive outpatient services: (1) physician
services; (2) physician assistant services; (3) nurse practitioner and
clinical nurse specialist services; (4) qualified psychologist
services; and (5) services furnished to residents of a skilled nursing
facility (SNF). We note that these proposed exclusions are consistent
with the services excluded from payment as partial hospitalization
[[Page 81814]]
program services at Sec. 410.43(b). The services listed under
Sec. Sec. 410.43(b) and 410.44(b) would be paid under the applicable
systems for such services.
Lastly, under Sec. 410.44(c), we proposed to establish patient
eligibility criteria for intensive outpatient services. Specifically,
we proposed that intensive outpatient services are intended for
patients who: (1) require a minimum of 9 hours per week of therapeutic
services as evidenced in their plan of care; (2) are likely to benefit
from a coordinated program of services and require more than isolated
sessions of outpatient treatment; (3) do not require 24-hour care; (4)
have an adequate support system while not actively engaged in the
program; (5) have a mental health diagnosis; (6) are not judged to be
dangerous to self or others; and (7) have the cognitive and emotional
ability to participate in the active treatment process and can tolerate
the intensity of the intensive outpatient program.
We noted that these proposed patient eligibility criteria at Sec.
410.44(c) are consistent with the existing partial hospitalization
patient eligibility criteria at Sec. 410.43(c). With respect to the
proposed criterion of a ``mental health diagnosis'', we clarified that
a mental health diagnosis would include SUD and behavioral health
diagnoses generally under both the existing partial hospitalization
regulation at Sec. 410.43(c)(5) and the proposed intensive outpatient
services regulation at Sec. 410.44(c)(5). As discussed earlier in this
section, this inclusion of SUD and behavioral health diagnoses as among
the patient eligibility criteria for PHP services is consistent with
our longstanding policy. However, we noted that interested parties have
raised concerns that this policy may not be clear. Therefore, we
clarified that the term ``mental health diagnosis'' as used at both
Sec. Sec. 410.43(c)(5) and 410.44(c)(5) would include SUD and
behavioral health diagnoses.
Comment: Commenters suggested the proposed regulation at Sec.
410.44(a)(2) codifying the condition that IOP services ``are reasonably
expected to improve or maintain the individual's condition and
functional level and to prevent relapse or hospitalization'' be
modified. Specifically, commenters suggested the regulation at Sec.
410.44(a)(2) be modified to read as follows: ``Are reasonably expected
to improve or maintain the individual's condition and functional level
and to prevent relapse or worsening of the individual's condition.''
The commenters stated that as IOP is not provided in lieu of
hospitalization, more expansive language may be appropriate.
Response: We appreciate the concern that commenters raised that
more expansive language may be appropriate for patients of an IOP. As
discussed above, at new Sec. 410.44, we proposed to establish
regulatory language for intensive outpatient services that is
consistent with the existing language for partial hospitalization
conditions and exclusions and the statutory definition of intensive
outpatient services. The regulatory language for IOP and PHP is derived
from the language of section 1861(ff)(2) of the Act. We do not believe
it is appropriate to revise the language for IOP.
Comment: A majority of commenters appreciated the clarification
that the terms ``trained psychiatric nurses, and other staff trained to
work with psychiatric patients,'' as referenced in Sec. 410.43(a)(4)
and proposed Sec. 410.44(a)(4) would include trained SUD nurses and
other staff trained to work with SUD patients; however, they requested
CMS codify this interpretation in the regulations. Specifically,
commenters requested that CMS amend the regulations at Sec.
410.43(a)(4)(i) and (iii), proposed Sec. 410.44(a)(4)(i) and (iii) for
PHP and IOP, respectively, to include services furnished by SUD
counselors, and reference individuals with mental health or SUD
diagnoses. In addition, commenters requested CMS amend Sec.
410.43(c)(5) and proposed Sec. 410.44(c)(5) to reference ``mental
health or SUD diagnosis'' as acceptable for both the PHP and IOP
benefits.
Response: As discussed in the CY 2024 OPPS/ASC proposed rule (88 FR
49700 and 49701) under our longstanding policy for partial
hospitalization services, we have considered nurses and other staff
trained to work with patients within their state scope of practice who
are receiving treatment for SUD to be included under this statutory
definition and the regulatory definition of PHP at Sec. 410.43(a)(4).
After consideration of the public comments received, and the
misconception we have heard that Medicare does not cover PHP for the
treatment of SUD, we are finalizing an amendment the PHP regulations at
Sec. 410.43(a)(4)(i) and (iii) to include references to SUD
professionals and patients with SUD, respectively. Additionally, we are
finalizing a modification to the proposed IOP regulations at Sec. Sec.
410.44 (a)(4)(i) and 410.43(a)(4)(iii) to include references to SUD
professionals and patients with SUD, respectively. Furthermore, we are
finalizing a modification to the PHP regulation at Sec. 410.43(c)(5),
as well as the proposed IOP regulation at Sec. 410.44(c)(5), to
include references to SUD diagnoses.
We remind readers that the inclusion of SUD in these regulations
does not change the applicability of any other existing PHP regulations
or proposed IOP regulations. In all cases, these services must be
reasonable and necessary, furnished in accordance with a physician
certification and plan of treatment, and provided by an individual
working within his or her scope of practice. Further, in the case of
PHP services for the treatment of SUD, such services must be provided
in lieu of inpatient hospitalization.
Comment: Some commenters requested that CMS amend the regulation at
Sec. 410.43(a)(4)(iii) to specifically reference that the services of
marriage and family therapists (MFTs) and mental health counselors
(MHCs) comprise a portion of partial hospitalization services; while
other commenters requested CMS amend the regulatory exclusions at Sec.
410.43(b) and proposed Sec. 410.44(b) of PHP and IOP, respectively, to
encompass the professional services of MFTs and MHCs.
Response: As we discussed in the 2000 OPPS final rule (65 FR
18452), payment for partial hospitalization services under the OPPS
represents the provider's overhead costs, support staff, and the
services of clinical social workers (CSWs) and occupational therapists
(OTs), whose professional services are considered to be partial
hospitalization services for which payment is made to the provider.
These same components of cost discussed in that 2000 OPPS final rule
were used to determine the per diem costs for both PHP and IOP for this
CY 2024 OPPS/ASC final rule. Although we did not propose to name MHCs
or MFTs in the regulatory language of Sec. 410.43(a) or Sec.
410.44(a), the services of these providers, when furnished to PHP or
IOP patients, would constitute services of ``other mental health
professionals'' under Sec. Sec. 410.43(a)(4)(i) and 410.44(a)(4)(i).
We did not propose to exclude MHCs or MFTs under Sec. 410.43(b) or
Sec. 410.44(b), and in accordance with our longstanding policy, to
maintain the historical patterns of treatment billed during the base
year, we are clarifying that the services of MFTs and MHCs are
considered to be partial hospitalization and intensive outpatient
services. The services of MFTs and MHCs should not be billed separately
when provided to PHP or IOP patients, because they are included within
the overhead costs and costs for support staff which are made
[[Page 81815]]
to the provider through the per diem PHP or IOP payment.
Comment: Commenters requested CMS remove the proposed regulation at
Sec. 410.44(c)(4) which states an IOP is intended for patients who
have an adequate support system while not actively engaged in the
program. Commenters noted that while mental health outcomes are
enhanced by a patient's support system, many IOP patients have housing
insecurities or are at risk of being housing insecure. The commenters
stated conditioning treatment on a patient's support system may
prohibit patients from enrolling in an IOP.
Response: As discussed in the CY 2009 OPPS/ASC final rule with
comment period (73 FR 68695) our goal is to improve the level of
service furnished in a PHP day, while also ensuring that the partial
hospitalization benefit is being utilized by the appropriate
population. In addition, for the program to be fully beneficial, a PHP
participant should have a strong support system outside of the PHP
program to help to ensure success. We also believe having a strong
support system outside of the IOP program to help ensure success will
further our goal to improve the level of service across the mental
health continuum of care.
Final Decision: After consideration of the public comments we
received, we are finalizing the proposed regulations at Sec. 410.44
with modifications to include references to SUD. In addition, we are
modifying the parallel existing regulations for PHP at Sec. 410.43 to
include the same references to SUD.
b. Coverage of IOP as Medical and Other Health Services Paid under Part
B
We proposed to amend the regulation at Sec. 410.10(c) to add a
reference to ``intensive outpatient services'' to the list of services
that are covered as medical and other health services under Part B,
when furnished as hospital or CAH services incident to a physician's
professional services. We believe this is consistent with section
1861(s)(2)(B) of the Act, as amended by section 4124(b)(1)(B) of the
CAA, 2023 to include ``intensive outpatient services'' under the
definition of medical and other health services; specifically, hospital
services incident to a physicians' services. We note that the services
described at Sec. 410.10(c) are furnished by a hospital or CAH.
Accordingly, we proposed conforming changes to the regulations at Sec.
410.27(a)(2) and (e) introductory text to include references to
intensive outpatient services.
We did not receive any public comments on our proposal, and we are
finalizing our proposal without modification to amend the regulation at
Sec. 410.10(c) to add a reference to ``intensive outpatient services''
to the list of services that are covered as medical and other health
services under Part B, when furnished as hospital or CAH services
incident to a physician's professional services. Additionally, we are
finalizing our proposal to codify conforming changes to the regulations
at Sec. 410.27(a)(2) and (e) introductory text to include references
to intensive outpatient services.
c. Technical Changes to Codify Requirements for IOP at CMHCs
We proposed technical changes to the regulations at 42 CFR parts
488 and 489.
First, we proposed to add the statutory basis for IOP at CMHCs at
Sec. 488.2. The proposed technical revision would add section
1832(a)(2)(J) of the Act, which sets forth the statutory basis of
intensive outpatient services provided by CMHCs at Sec. 488.2.
We also proposed to revise the provision at 42 CFR 489.2(c)(2) so
that CMHCs may enter into provider agreements to furnish intensive
outpatient services. We proposed to revise the current requirement that
allows for CMHCs to enter into provider agreements only for the
provision of partial hospitalization services. The proposed revisions
to this provision would allow CMHCs to enter into provider agreements
only to furnish partial hospitalization services and intensive
outpatient services.
Comment: Commenters expressed concern that there may be a mistaken
impression that 42 CFR 489.2 means that the only clinical activities
for which an entity enrolled as a CMHC may bill Medicare are PHP and
IOP services. The commenters requested CMS clarify that nothing in the
CMHC conditions for participation prevents or discourages entities
enrolled as CMHCs from also being enrolled in Medicare as Part B
suppliers (physician groups) furnishing outpatient behavioral health
services covered under the Physician Fee Schedule (PFS).
Response: We thank the commenters for raising concerns about a
potential misinterpretation of Sec. 489.2 to mean that an entity
enrolled as a CMHC may only bill Medicare for PHP and IOP services. In
response to these concerns, we are clarifying that nothing in
regulation, including the CMHC conditions of participation, prohibits
an entity from enrolling as a CMHC and also enrolling in Medicare as a
physician group to provide and bill for outpatient behavioral health
services under Medicare Part B. In fact, CMHC conditions of
participation at Sec. 485.918(b) require CMHCs to provide a broad
array of outpatient behavioral health services to the individuals they
serve. When billing for PHP or IOP, the CMHC would submit a facility
bill for payment under the OPPS at the applicable PHP or IOP per diem
rate. When billing for other outpatient behavioral health services
under Medicare Part B, including services for PHP and IOP patients that
are excluded under Sec. Sec. 410.43(b) and 410.44(b) and paid
separately, the billing practitioner would bill for the services
provided, subject to all applicable billing requirements under the PFS.
We also note that CMHC conditions of participation under part 485,
subpart J, apply to all patients of the CMHC, so if a patient is
discharged from a PHP or IOP and begins receiving behavioral health
services billed under Medicare Part B, the CMHC conditions of
participation would continue to apply.
Final Decision: After consideration of the public comments we
received, we are finalizing our proposals without modification to add
the statutory basis for IOP at CMHCs at Sec. 488.2 and to revise the
provision at 42 CFR 489.2(c)(2) so that CMHCs may enter into provider
agreements to furnish IOP services.
d. Technical Changes to Codify Coverage of IOP at CMHCs
We proposed several technical changes and additions to the
regulations at Sec. Sec. 410.2, 410.3, 410.111, 410.150, and 410.173.
First, we proposed to revise the definition of ``Community Mental
Health Center (CMHC)'' at Sec. 410.2 to refer to intensive outpatient
services. Specifically, we proposed to revise the regulation to state
that a CMHC is an entity that provides day treatment or other partial
hospitalization services or intensive outpatient services, or
psychosocial rehabilitation services. Second, we proposed to revise the
definition of ``Participating'' at Sec. 410.2 to refer to intensive
outpatient services as services that CMHCs can provide. Specifically,
we proposed that ``Participating'' refers to a CMHC that has in effect
an agreement to participate in Medicare, but only for the purposes of
providing partial hospitalization services and intensive outpatient
services. We clarified that the proposed definition would allow a CMHC
to be considered a participating provider of both partial
hospitalization services and intensive outpatient services, but would
not require a CMHC to provide both
[[Page 81816]]
types of services in order to be considered participating.
Comment: Commenters appreciated the clarification that
organizations need not furnish both PHP and IOP in order to qualify as
a CMHCs and were generally supportive of the proposed regulation at
Sec. 410.2 to refer to intensive outpatient services as part of the
definition of ``Community Mental Health Center (CMHC)''. However,
commenters requested clarification on why the reference to psychosocial
rehabilitation is included in the definition of CMHC. The commenters
stated their understanding that PHP and IOP are the only two discrete
Medicare services for which CMHCs may bill the program under the CMHC
enrollment.
Response: We appreciate commenters' support of the proposed
definition of CMHC at regulation Sec. 410.2. In response to the
comments regarding CMHCs providing psychosocial rehabilitation, as
discussed in the 1994 interim final rule with comment period (59 FR
6571) section 1916(c)(4) of the Public Health Service (PHS) Act (42
U.S.C. 300x-4(c)(4)) requires a CMHC to provide specialized outpatient
services; 24-hour-a-day emergency care services; day treatment, other
partial hospitalization services, or psychosocial rehabilitation
services; screenings to determine appropriateness of admission to State
mental health facilities; and consultation and education services.
Accordingly, in that same interim final rule with comment period (59 FR
6577) CMS (formerly known as Health Care Financing Administration
(HCFA)) finalized the definition of CMHC in regulation at Sec. 410.2
to include an entity that provides psychosocial rehabilitation
services.
In addition, we proposed to revise the scope of benefits provision
at Sec. 410.3(a)(2) to provide that the covered services for which the
Medicare Part B supplementary medical insurance (SMI) program helps pay
include partial hospitalization services and intensive outpatient
services provided by CMHCs. We believe these proposed changes are
consistent with the scope of benefits provision at section
1832(a)(2)(J) of the Act, as amended by section 4124(b)(1)(A) of the
CAA, 2023 to include intensive outpatient services, as well as the
proposed CMHC conditions of participation at Sec. 485.918(b)(1)(iii).
We refer readers to section XVII.B.5 of this final rule with comment
period for discussion on the proposed amendments to regulations at
Sec. 485.918(b)(1)(iii).
We did not receive any public comments on our proposal and are
finalizing a revision to the scope of benefits provision at Sec.
410.3(a)(2) to provide that the covered services for which the Medicare
Part B supplementary medical insurance (SMI) program helps pay include
partial hospitalization services and intensive outpatient services
provided by CMHCs.
In addition, subpart E of part 410 includes requirements for
Community Mental Health Centers (CMHCs) Providing Partial
Hospitalization Services. We proposed to modify the subpart E heading
to include a reference to intensive outpatient services as well. Under
subpart E, we proposed to add a new Sec. 410.111 to set forth
Requirements for coverage of intensive outpatient services furnished in
CMHCs. We proposed that Medicare Part B would cover IOP services
furnished by or under arrangements made by a CMHC if the CMHC has in
effect a provider agreement and the services are prescribed by a
physician and furnished under the general supervision of a physician,
and subject to the proposed physician certification and plan of care
requirements under Sec. 424.24(d).
We did not receive any public comments on our proposals and are
finalizing a modification to the subpart E heading to include a
reference to intensive outpatient services, and the addition of a new
Sec. 410.111 to set forth Requirements for coverage of intensive
outpatient services furnished in CMHCs.
Additionally, we proposed to revise Sec. 410.150(b)(13) to include
a reference to intensive outpatient services. Specifically, we proposed
that payment would be made to a CMHC on an individual's behalf for
partial hospitalization services or intensive outpatient services
furnished by or under arrangements made by the CMHC.
We did not receive any public comments on our proposal and are
finalizing a revision to Sec. 410.150(b)(13) to include a reference to
intensive outpatient services.
We also proposed to add a new Sec. 410.173 to establish conditions
of payment for IOP services furnished in CMHCs. We proposed to state
that Medicare Part B pays for intensive outpatient services furnished
in a CMHC on behalf of an individual only if the following conditions
are met: (a) The CMHC files a written request for payment on the CMS
form 1450 and in the manner prescribed by CMS; and (b) The services are
furnished in accordance with the requirements described in Sec.
410.111.
We did not receive any public comments on our proposal and are
finalizing the addition of Sec. 410.173 as proposed.
Lastly, we proposed to amend Sec. 419.21(c) to refer to intensive
outpatient services provided by CMHCs as services for which payment is
made under the OPPS. The proposed amendment would be consistent with
current regulations at Sec. 419.21(c), which include partial
hospitalization services provided by CMHCs. We note that further
discussion of the payment methodology under the OPPS for intensive
outpatient services is found in section VIII.D of this final rule with
comment period.
Final Decision: After consideration of the public comments we
received, we are finalizing the proposed technical changes and
additions to the regulations at Sec. Sec. 410.2, 410.3, 410.111,
410.150, and 419.21 as proposed.
e. Exclusion of Intensive Outpatient Services From the Outpatient
Mental Health Treatment Limitation
Section 1833(c)(2) of the Act, as amended by section 4124(b)(3) of
the CAA, 2023, excludes intensive outpatient services that are not
directly provided by a physician from the term ``treatment'' for the
purposes of the outpatient mental health treatment limitation under
section 1833(c)(1) of the Act, similar to partial hospitalization
services. Accordingly, we proposed to amend the regulations at Sec.
410.155(b)(2)(iii) to state that intensive outpatient services not
directly provided by a physician are not subject to the outpatient
mental health treatment limitation.
Comment: Commenters were supportive of the proposal to amend the
regulations at Sec. 410.155(b)(2)(iii) to state that intensive
outpatient services not directly provided by a physician are not
subject to the outpatient mental health treatment limitation. However,
commenters requested clarification whether the proposed regulation at
42 CFR 410.155(b)(2)(iii) means that the mental health treatment
limitation does not apply to the professional services furnished to PHP
or IOP participants, under the PHP or IOP plan of care, by clinicians
other than physicians even though those services are billed under the
Part B PFS rather than the OPPS.
Response: Under Sec. 410.155(b)(1), services furnished by
physicians and other practitioners, whether furnished directly or
incident to those practitioners' services, are subject to the
limitation if they are furnished in connection with the treatment of a
mental, psychoneurotic, or personality disorder and are furnished to an
individual who is not an inpatient of a hospital. This includes
services furnished directly by physicians to PHP
[[Page 81817]]
and IOP patients. However, we are clarifying that since CY 2014, under
current regulation at Sec. 410.155(a)(5), 100 percent of the expenses
incurred for such services during a calendar year are considered
incurred expenses under Medicare Part B when determining the amount of
payment and deductible.
Final Decision: After consideration of the public comments we
received, we are finalizing without modification our proposed
regulations at Sec. 410.155(b)(2)(iii) to state that intensive
outpatient services not directly provided by a physician are not
subject to the outpatient mental health treatment limitation.
3. IOP Certification and Plan of Care Requirements
Section 4124(b)(2)(B) of the CAA, 2023 amended section 1861(ff) of
the Act by adding a new paragraph (4) to define intensive outpatient
services as the items and services prescribed by a physician for an
individual determined (not less frequently than once every other month)
by a physician to have a need for such services for a minimum of 9
hours per week. This certification must occur no less frequently than
once every other month, and there is no requirement to certify that IOP
patients would need inpatient hospitalization if they did not receive
such services, which is required for PHP patients.
We proposed to codify the content of the certification and plan of
treatment requirements for intensive outpatient services at Sec.
424.24(d). Specifically, we proposed to mirror the PHP content of
certification and plan of care treatment requirements at Sec.
424.24(e), with the following exceptions: require the content of
certification to include documentation that the individual requires
such services for a minimum of 9 hours per week (with no requirement
for the patient to need inpatient psychiatric care if the IOP services
were not provided). The physician's certification of the patient's need
for either IOP or PHP services should be based on the physician's
determination of the patient's needs and whether the patient meets the
IOP or PHP patient eligibility criteria under Sec. 410.44(c) or Sec.
410.43(c), respectively. We noted that the physician's certification
should certify the patient's need for either IOP or PHP, and that
patients participating in an IOP or PHP should not be under any other
IOP or PHP plan of care for the same date of service. The patient's
individualized plan of treatment should address all of the conditions
that are being treated by the IOP or PHP.
Comment: Commenters disagreed that the certification for IOP
services should be limited to a physician. Commenters requested that
CMS explicitly allow psychiatric nurse practitioners to certify the
need for IOP services and plan of care.
Response: We understand the commenter's request to expand the
certification of IOP services to non-physician mental health
professionals. However, section 1861(ff) of the Act, as amended by
section 4124(b)(2)(B) of the CAA, 2023, specifically states the
certification must be determined by a physician. Section 1861(r) of the
Act defines ``physician'' as a doctor of medicine or osteopathy legally
authorized to practice medicine and surgery by the State in which he
performs such function or action. Therefore, we do not believe we have
the ability to expand the certification of the need for IOP services to
psychiatric nurse practitioners or other mental health professionals.
Comment: A few commenters requested that CMS revise the minimum
hours per week for the IOP program from 9 hours per week to 6 hours per
week. The commenters stated that IOPs should be highly flexible and
reducing the number of required hours would allow a patient to ``step
down'' within the confines of IOP treatment, without immediately
jumping to individual mental health services.
Response: We appreciate the commenter's suggestions to provide
greater flexibility within the mental health continuum of care.
However, section 1861(ff) of the Act, as amended by section
4124(b)(2)(B) of the CAA, 2023 specifically states that a patient must
require a minimum of 9 hours of IOP services per week. As discussed in
section VIII.D.3 of this final rule with comment period, we proposed to
apply the three-service payment rate (that is, payment for PHP APCs
5853 for CMHCs and 5863 for hospitals, and IOP APCs 5851 for CMHCs and
5861 for hospitals) for days with three or fewer services while we
monitor the initial utilization of IOP services. In addition, patients
who do not meet the requirement of needing at least 9 hours per week of
IOP services may still receive individual mental health services under
the OPPS.
Additionally, we proposed to require in the regulation at Sec.
424.24(d)(3)(ii) that the recertification of IOP services occur no less
frequently than every 60 days. We stated that we believe the IOP
recertification timing of no less frequently than every 60 days is
consistent with the requirement in the statute that an individual be
determined by a physician to have a need for IOP services ``not less
frequently than once every other month'' because the minimum number of
days for two consecutive months is 59 days. We stated that we believe
that a consistent 60-day interval would be the most appropriate way to
implement the statutory recertification requirement for IOP.
We solicited public comments on whether it would be appropriate to
consider finalizing a shorter interval for the first recertification
and for subsequent recertification for IOP patients. For example, we
requested comments on whether we should consider requiring an initial
recertification by the 30th day of IOP services, and no less frequently
than every 60 days thereafter. We requested that commenters provide as
much detail as possible about the rationale for a shorter
recertification interval, if appropriate.
Lastly, we proposed to make conforming changes to Sec. 424.24(b)
to add a reference to paragraph (d)(1) in the list of paragraphs that
specify the content for which physician certification is required for
medical and other health services furnished by providers (and not
exempted under Sec. 424.24(a)) which are paid for under Medicare Part
B.
Comment: Most commenters supported the proposal to require in the
regulation at Sec. 424.24(d)(3)(ii) that the recertification of IOP
services occur no less frequently than every 60 days. These commenters
agreed that the proposal is consistent with the CAA, 2023 requirements
and that a shorter than 60-day recertification interval for IOP
patients would not be beneficial.
A few other commenters stated the recertification interval should
be no less frequently than every 30 days. The commenters advocating for
a 30-day recertification interval argued that patients at the IOP level
of care should be in a significantly more stable condition than at the
PHP level of care, and after 30 days of service, should continue to
improve their stability. Further, the commenters stated a 60-day
recertification interval may encourage a longer length of stay and go
against the preference for always keeping the patient at the least
restrictive level of care.
Response: We appreciate the input from commenters. As we stated in
the CY 2024 OPPS/ASC proposed rule (88 FR 49702) we believe that a
consistent 60-day interval would be the most appropriate way to
implement the statutory recertification requirement for IOP. We intend
to monitor the provision of services and lengths of stay in the IOP
program, and may consider changes to
[[Page 81818]]
the IOP recertification interval, if necessary, in future rulemaking.
Final Decision: After consideration of the public comments we
received, we are finalizing, without modification, our proposal to
codify the content of the certification and plan of treatment
requirements for intensive outpatient services at Sec. 424.24(d).
C. Coding and Billing for PHP and IOP Services Under the OPPS
1. Condition Code 41 and 92
In the CY 2024 OPPS/ASC proposed rule, we explained that we
considered the similarities between the types of items and services
covered by both PHP and IOP, and the larger continuum of care, when
developing the proposed list of services that we believe would
appropriately identify the range of services that IOPs provide to
Medicare beneficiaries. Since the statutory definitions of both IOP and
PHP generally include the same types of items and services covered, we
stated that we believe it is appropriate to align the programs using a
consistent list of services, so that level of intensity would be the
only differentiating factor between partial hospitalization services
and intensive outpatient services.
We noted that currently, hospital outpatient departments use
condition code 41 to indicate that a claim is for partial
hospitalization services. CMHCs do not currently use a condition code
on the bill type used--that is, 76X--to indicate that a claim is for
partial hospitalization services, because they are only considered a
provider of services for partial hospitalization; and therefore,
partial hospitalization services are identified by the 76X bill type.
We explained that in order to differentiate between IOP and PHP for
billing purposes, the National Uniform Billing Committee (NUBC) has
approved a new condition code, condition code 92, to identify intensive
outpatient claims. Therefore, we proposed to require hospitals and
CMHCs to report condition code 92 on claims to indicate that a claim is
for intensive outpatient services. We proposed to continue to require
hospitals to report condition code 41 for partial hospitalization
claims. Additionally, because CMHCs would be permitted to provide both
PHP and IOP beginning January 1, 2024, we also proposed to require
CMHCs to report condition code 41 for partial hospitalization claims.
We stated that we believe this requirement would better allow us to
identify which claims are for PHP and which are for IOP. We solicited
comment on these proposed reporting requirements for PHP and IOP.
Comment: Commenters supported the proposal that hospitals and CMHCs
report condition code 41 to identify partial hospitalization claims,
and condition code 92 to identify intensive outpatient claims. The
commenters agreed with the importance of distinguishing between PHP and
IOP claims.
Response: We appreciate the commenters' support. Beginning January
1, 2024, we will require the use of condition code 41 on all PHP claims
from hospitals and CMHCs and require the use of condition code 92 on
all IOP claims from hospitals and CMHCs. We will issue operational
guidance explaining the use of these condition codes in further detail.
2. Proposed HCPCS Coding for CY 2024
Under current policy, PHPs submit claims with HCPCS codes to
identify the services provided during each PHP day. Therefore, we
worked in conjunction with physicians to develop a consolidated list of
all HCPCS codes that we believe would appropriately identify the full
range of services that both IOPs and PHPs provide to Medicare
beneficiaries. For reference, Table 42 includes the current list of
HCPCS codes that are recognized for PHP payment. For CY 2024, we
proposed to add certain codes to the list, change the descriptions of
other codes, and remove one code from the list. The list of proposed
consolidated HCPCS codes is included in Table 96.
We recognize that the level of intensity of mental health services
a patient requires may vary over time; therefore, we believe utilizing
a consolidated list of HCPCS codes to identify services under both the
IOP and PHP benefits would ensure a smooth transition for patients when
a change in the intensity or their services is necessary to best meet
their needs. For example, a patient receiving IOP services may
experience an acute mental health need that necessitates more intense
services through a PHP. Alternatively, an IOP patient that no longer
requires the level of intensity provided by the IOP can access less
intense mental health services, such as individual mental health
services. Therefore, we proposed to add several HCPCS codes that are
currently recognized as mental health codes under the OPPS, but are not
recognized as PHP codes, to the list of codes that would be recognized
for PHP payment. We proposed to maintain all of the existing PHP codes,
except for one. We proposed to remove 90865 Narcosynthesis, because we
stated that we do not believe this code is widely used in the provision
of PHP, and we do not anticipate it would be widely used in the
provision of IOP in the future. We proposed that the HCPCS codes listed
in Table 43 of the CY 2024 OPPS/ASC proposed rule (88 FR 49704 and
49705) would be payable when furnished by PHPs or IOPs. For reference,
this list of codes is reproduced in Table 96 of this final rule with
comment period.
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[[Page 81819]]
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We proposed to add 18 codes to the list of recognized PHP/IOP
codes, as shown in Table 96 of this final rule with comment period.
These codes are currently recognized as mental health codes under the
OPPS, and we stated we believe it would be appropriate to recognize
them for PHP and IOP as well. Additionally, we proposed to update the
descriptions of five existing Level II HCPCS codes that are currently
recognized for PHP to also refer to IOP.
As shown in Table 96, we proposed to add CPT code 90853 Group
psychotherapy to the list of service codes recognized for PHP and IOP.
We stated we believe there could be overlap between 90853 and two
existing Level II HCPCS codes for PHP group psychotherapy, specifically
G0410 and G0411. We stated that we considered whether it would be
appropriate to remove G0410 and G0411 from the list of recognized
service codes for PHP and IOP, and retain only CPT code 90853. We
solicited comments on this topic, and were interested in hearing
specific reasons commenters believe support either keeping G0410 and
G0411 on the list or removing them. We stated that we were particularly
interested in understanding whether it would be appropriate to maintain
these codes on a temporary basis to provide a transition for existing
PHPs that are using these codes.
We proposed to use the list of HCPCS codes in Table 96 to determine
the number of services per PHP or IOP day, and therefore to determine
the APC per diem payment amount for each day, as discussed in section
VIII.D of this final rule with comment period. In addition, as
discussed in section VIII.D of this final rule with comment period, we
proposed to calculate the costs for 3-service and 4-service days based
on the list of HCPCS codes in Table 96. We reminded readers that
currently, to qualify for payment at the applicable PHP APC (5853 or
5863) one service must be from the Partial Hospitalization Primary
list, and we identified the services that are currently included in the
Partial Hospitalization Primary list along with those which we proposed
to add based on our analysis of the services included on days with
three and four services from the proposed list shown in Table 96 of
this final rule with comment period. We proposed to maintain this
requirement for CY 2024 and subsequent years to qualify for payment at
the PHP or IOP APC. Thus, we proposed that to qualify for payment for
an IOP APC, at least one service must be from the Partial
Hospitalization and Intensive Outpatient Primary list. Specifically, we
proposed that to qualify for payment for the IOP APC (5851, 5852, 5861
or 5862) or the PHP APC (5853, 5854, 5863, or 5864) one service must be
from the Partial Hospitalization and Intensive Outpatient Primary list,
which is reproduced in Table 97 of this final rule with comment period
for reference.
[[Page 81821]]
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Lastly, we proposed that in the future, in the event there are new
codes that represent the PHP and IOP services described under
Sec. Sec. 410.43(a)(4) and 410.44(a)(4), respectively, we would add
such codes to Table 96 through sub-regulatory guidance, and that these
codes would be payable when furnished by a PHP or IOP. We note that
coding updates frequently occur outside of the standard rulemaking
timeline. We proposed this sub-regulatory process in order to pay
expeditiously when new codes are created that describe any of the
services enumerated at Sec. Sec. 410.43(a)(4) and 410.44(a)(4), which
PHPs and IOPs, respectively, would provide. We would identify codes to
be added sub-regulatorily if a new code is cross-walked to a previously
included code, or if the code descriptor is substantially similar to a
descriptor for a code on the list or describes a service on the list.
We proposed that any additional services not described at Sec.
410.43(a)(4) or Sec. 410.44(a)(4) would be added to the lists in
regulation through notice and comment rulemaking.
We invited public comment on the proposed consolidated list of
HCPCS codes that would be payable when furnished in a PHP and IOP. As
discussed in the following section of this CY 2024 OPPS/ASC final rule,
we also solicited comment on any additional codes that we should
consider adding. Specifically, we stated that we were interested in
hearing from commenters if there are any other existing codes that CMS
should consider adding to the list, or new codes that CMS should
consider creating, to describe specific services not appropriately
described by the codes shown in Table 96 of this final rule with
comment period.
Comment: Commenters supported the removal of 90865 Narcosynthesis
and agreed this code is not widely used in the provision of PHP. The
commenters also supported a consolidated list of HCPCS codes that would
align both the PHP and IOP benefits.
Response: We appreciate the commenters' support. After
consideration of the public comments we received, we are finalizing the
removal of 90865 Narcosynthesis from the list of HCPCS codes applicable
for PHP and IOP.
Comment: One commenter expressed support for adding 90839 (Psytx
crisis initial 60 min) to the PHP and IOP code list, but also requested
that CMS include 90840 (Psytx crisis ea addl 30 min) to recognize the
time associated with additional crisis psychotherapy services.
Response: We appreciate the commenter's suggestion, and we agree
that this code would be appropriate to recognize for PHP and IOP. We
have
[[Page 81822]]
included 90840 (Psytx crisis ea addl 30 min) in Table 98 of this final
rule with comment period.
Comment: Commenters supported adding 90853 (Group psychotherapy) as
well as maintaining G0410 (Grp psych partial hosp/IOP 45-50) and G0411
(Inter active grp psych PHP/IOP) on the list of HCPCS codes applicable
to PHP and IOP. The commenters stated there are differences in the
application and descriptions between these codes. Accordingly,
commenters stated including codes G0410, G0411, and 90853 on the list
would avoid unintentional billing errors.
Response: We appreciate the commenters' input. After consideration
of the public comments we received, we are finalizing adding code 90853
Group psychotherapy and maintaining G0410 and G0411 on the list of
HCPCS codes applicable to PHP and IOP. We intend to monitor the
utilization of these codes and may consider changes in future
rulemaking, if necessary.
Comment: Commenters supported adding codes to the list of HCPCS
applicable for PHP and IOP through a sub-regulatory process when the
codes added describe a service already enumerated at Sec. 410.43(a)(4)
or Sec. 410.44(a)(4).
Response: We appreciate the commenters' support. After
consideration of the public comments we received, we are finalizing our
proposal to add codes to the list of HCPCS applicable for PHP and IOP
through a sub-regulatory process when the codes to be added describe a
service already enumerated at Sec. 410.43(a)(4) or Sec. 410.44(a)(4).
Comment: Commenters did not support the proposal requiring that to
qualify for payment for the IOP APC (5851, 5852, 5861 or 5862) one
service must be from the Partial Hospitalization and Intensive
Outpatient Primary list. The commenters stated that the requirement of
a primary service may undermine the flexibility to provide the full
scope of services within IOP. Commenters suggested CMS review
utilization data to determine which services should be added or removed
from the Partial Hospitalization and Intensive Outpatient Primary
Services list.
Response: While we appreciate commenters' input, we disagree that
requiring one service from the Partial Hospitalization and Intensive
Outpatient Primary list in order to qualify for payment for under IOP
may undermine the flexibility to provide the full scope of services. To
ensure program integrity, we expect that at least one of the services
on the Partial Hospitalization and Intensive Outpatient Primary list
will be indicated per day for patients who need the level of care
offered by a PHP or IOP program.
Final Decision: After consideration of the public comments we
received, we are finalizing our proposal to add code 90853 Group
psychotherapy, as well as to maintain G0410 and G0411 on the list of
HCPCS codes applicable to PHP and IOP, as well as to add additional
codes describing a service already enumerated at Sec. 410.43(a)(4) or
Sec. 410.44(a)(4) through a sub-regulatory process.
Further, we are finalizing that at least one service must be from
the Partial Hospitalization and Intensive Outpatient Primary Services
list to qualify for payment for the PHP or IOP APC. The final list of
Partial Hospitalization and Intensive Outpatient Primary Services is
found in table 99 of this final rule with comment period.
3. Additional HCPCS Codes Considered for CY 2024 in Response to
Comments
As we noted in the prior section, we solicited comment in the CY
2024 OPPS/ASC proposed rule on any additional codes that we should
consider adding to the list of HCPCS Applicable for PHP and IOP.
Specifically, we stated that we were interested in hearing from
commenters if there are any other existing codes that CMS should
consider adding to the list, or new codes that CMS should consider
creating, to describe specific services not appropriately described by
the codes shown in Table 96 of this final rule with comment period.
We provided some examples of such services for public consideration
and comment, including caregiver-focused services, services of peer
support specialists, and services related to discharge planning and
care coordination. In addition, commenters suggested additional
services for consideration, as discussed in the following sections.
a. Caregiver-Focused Services
In the proposed rule, we explained that we were particularly
interested in whether it would be appropriate to include caregiver-
focused services in the list of recognized services for PHP and IOP. We
identified and solicited comment on including the following HCPCS codes
describing services related to caregivers:
96202 multiple -family group behavior management/
modification training for parents(s) guardians(s) caregivers(s) with a
mental or physical health diagnosis, administered by a physician or
other QHP without the patient present, face to face up to 60 minutes.
96203 each additional 15 minutes.
96161 administration of caregiver-focused health risk
assessment instrument (that is, depression inventory) for the benefit
of the patient, with scoring and documentation, per standardized
instrument.
9X015 CAREGIVER TRAINING 1ST 30 MIN
9X016 CAREGIVER TRAINING EA ADDL 15
9X017 GROUP CAREGIVER TRAINING
We noted that the CMHC conditions of participation at Sec.
485.916(b) and (c) already include references to the role of caregivers
in the development and implementation of the individualized treatment
plan for PHP patients, and we referred readers to section XVII.B.4 of
the CY 2024 OPPS/ASC proposed rule for discussion of proposed
amendments to the regulations at Sec. 485.916(d). We solicited
comments on whether it would be appropriate to include costs for such
services in the calculation of PHP and IOP per diem payment rates. We
noted that if we were to include such services, we believe it would be
appropriate to exclude them from the determination of the number of
services provided per day, but we could include such services in the
calculation of cost per day for determining the PHP and IOP payment
rates.
Comment: Many commenters supported the inclusion of caregiver-
focused services, such as codes 96202, 96203, 96161, 9X015, 9X016, and
9X017, in the list of recognized services for PHP and IOP. A majority
of commenters advocated for both including caregiver-focused services
in the cost per day and in the determination of the number of services
provided per day. One commenter supported including caregiver-focused
services in the cost per day but excluding them from the determination
of number of services provided per day.
Response: In light of commenters' input, we are adopting the
identified codes for caregiver-focused services in the final
consolidated list of HCPCs codes recognized for PHP and IOP. We note
that placeholder codes 9X015, 9X016, and 9X017 have been replaced with
CPT codes 97550, 97551, and 97552 respectively. We believe that
including caregiver services as covered under the PHP and IOP benefits
supports the directive to consider family caregivers across policies
and programs under the Executive Order on Increasing
[[Page 81823]]
Access to High-Quality Care and Supporting Caregivers.\163\
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\163\ https://www.whitehouse.gov/briefing-room/presidential-actions/2023/04/18/executive-order-on-increasing-access-to-high-quality-care-and-supporting-caregivers/.
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We believe that these services can be appropriately considered
patient training and education services under Sec. Sec.
410.43(a)(4)(vii) and 410.44(a)(4)(vii), and therefore we are not
making any changes to the conditions and exclusions for PHP or IOP in
adopting these codes. When these codes are reported, they will not
count toward payment for a 3-service or 4-service day; however, we will
include the costs associated with providing such services when
calculating the PHP and IOP payment rates in future years.
b. Discharge and Transition Planning
In addition, we solicited comments on whether it would be
appropriate to add services related to coordinating a patient's
discharge from a PHP or IOP, or their transition from one level of care
to another. We note that current regulations require physicians,
hospitals, and CMHCs to address discharge planning for PHP patients,
and we proposed the same requirements for IOP patients. Specifically,
physician recertification requirements for PHP at Sec.
424.24(e)(3)(iii)(C) state that the physician's recertification must
address treatment goals for coordination of services to facilitate
discharge from the partial hospitalization program. We noted that we
proposed the same requirement for IOP at Sec. 424.24(d)(3)(iii)(C),
which we are finalizing in this final rule. Additionally, hospital CoPs
at Sec. 482.43, which apply to hospital outpatient departments
providing PHP and IOP, and CMHC CoPs at Sec. 485.914(e), require
appropriate discharge planning to meet each patient's needs. We
solicited comments on whether the proposed codes shown in Table 96 of
this final rule with comment period represent the services that PHPs
and IOPs provide to support transition and discharge planning for their
patients, or whether we should consider additional codes. We asked
commenters to provide as much detail as possible about the nature of
any additional services, and whether there are any existing codes that
could describe such services.
Comment: Commenters supported the inclusion of services related to
discharge and transition between one level of care to another.
Specifically, commenters suggested codes for discharge-related
services, care coordination, and case management services, such as
99484 (Coordinated care services/care coordination). One commenter
suggested codes 99424-99427 (Principal care management services), 99437
and 99439 (Chronic care management services), and 99489-99491 (Complex
chronic care management services). Commenters stated these services are
especially important for patients with co-occurring conditions that are
being treated in multiple settings simultaneously. Several commenters
recommended that CMS recognize proposed coding for Principal Illness
Navigation (PIN), social determinants of health (SDOH) risk assessment,
and community health integration (CHI) under the Physician Fee Schedule
as PHP and IOP codes.
Response: We thank commenters for their suggestions to consider
adopting PIN, CHI, and SDOH risk assessment codes, which are described
in the CY 2024 Physician Fee Schedule proposed rule (88 FR 52325
through 52336), for inclusion in the list of PHP and IOP codes. As
discussed in the CY 2024 PFS proposed rule (88 FR 52325), the proposed
PIN, CHI, and SDOH risk assessment codes are intended to better
identify and value practitioners' work when they incur additional time
and resources helping patients with serious illnesses navigate the
healthcare system or removing health-related social barriers that are
interfering with the practitioner's ability to execute a medically
necessary plan of care.
CMS proposed the following descriptions for CHI codes:
GXXX1 Community health integration services performed by certified
or trained auxiliary personnel, including a community health worker,
under the direction of a physician or other practitioner; 60 minutes
per calendar month, in the following activities to address social
determinants of health (SDOH) need(s) that are significantly limiting
ability to diagnose or treat problem(s) addressed in an initiating E/M
visit:
Person-centered assessment, performed to better understand
the individualized context of the intersection between the SDOH need(s)
and the problem(s) addressed in the initiating E/M visit.
++ Conducting a person-centered assessment to understand patient's
life story, strengths, needs, goals, preferences and desired outcomes,
including understanding cultural and linguistic factors.
++ Facilitating patient-driven goalsetting and establishing an
action plan.
++ Providing tailored support to the patient as needed to
accomplish the practitioner's treatment plan.
Practitioner, Home-, and Community-Based Care
Coordination.
++ Coordinating receipt of needed services from healthcare
practitioners, providers, and facilities; and from home- and community-
based service providers, social service providers, and caregiver (if
applicable).
++ Communication with practitioners, home- and community-based
service providers, hospitals, and skilled nursing facilities (or other
health care facilities) regarding the patient's psychosocial strengths
and needs, functional deficits, goals, preferences, and desired
outcomes, including cultural and linguistic factors.
++ Coordination of care transitions between and among health care
practitioners and settings, including transitions involving referral to
other clinicians; follow-up after an emergency department visit; or
follow-up after discharges from hospitals, skilled nursing facilities
or other health care facilities.
++ Facilitating access to community-based social services (e.g.,
housing, utilities, transportation, food assistance) to address the
SDOH need(s).
Health education--Helping the patient contextualize health
education provided by the patient's treatment team with the patient's
individual needs, goals, and preferences, in the context of the SDOH
need(s), and educating the patient on how to best participate in
medical decision-making.
Building patient self-advocacy skills, so that the patient
can interact with members of the health care team and related
community-based services addressing the SDOH need(s), in ways that are
more likely to promote personalized and effective diagnosis or
treatment.
Health care access/health system navigation
++ Helping the patient access healthcare, including identifying
appropriate practitioners or providers for clinical care and helping
secure appointments with them.
Facilitating behavioral change as necessary for meeting
diagnosis and treatment goals, including promoting patient motivation
to participate in care and reach person-centered diagnosis or treatment
goals.
Facilitating and providing social and emotional support to
help the patient cope with the problem(s) addressed in the initiating
visit, the SDOH need(s), and adjust daily routines to better meet
diagnosis and treatment goals.
[[Page 81824]]
Leveraging lived experience when applicable to provide
support, mentorship, or inspiration to meet treatment goals.
GXXX2--Community health integration services, each additional 30
minutes per calendar month (List separately in addition to GXXX1).
CMS proposed the following description for PIN codes:
GXXX3 Principal Illness Navigation services by certified or trained
auxiliary personnel under the direction of a physician or other
practitioner, including a patient navigator or certified peer
specialist; 60 minutes per calendar month, in the following activities:
Person-centered assessment, performed to better understand
the individual context of the serious, high-risk condition.
++ Conducting a person-centered assessment to understand the
patient's life story, strengths, needs, goals, preferences, and desired
outcomes, including understanding cultural and linguistic factors.
++ Facilitating patient-driven goal setting and establishing an
action plan.
++ Providing tailored support as needed to accomplish the
practitioner's treatment plan.
Identifying or referring patient (and caregiver or family,
if applicable) to appropriate supportive services.
Practitioner, Home, and Community-Based Care Coordination
++ Coordinating receipt of needed services from healthcare
practitioners, providers, and facilities; home- and community-based
service providers; and caregiver (if applicable).
++ Communication with practitioners, home-, and community-based
service providers, hospitals, and skilled nursing facilities (or other
health care facilities) regarding the patient's psychosocial strengths
and needs, functional deficits, goals, preferences, and desired
outcomes, including cultural and linguistic factors.
++ Coordination of care transitions between and among health care
practitioners and settings, including transitions involving referral to
other clinicians; follow-up after an emergency department visit; or
follow-up after discharges from hospitals, skilled nursing facilities
or other health care facilities.
++ Facilitating access to community-based social services (e.g.,
housing, utilities, transportation, food assistance) as needed to
address SDOH need(s).
Health education--Helping the patient contextualize health
education provided by the patient's treatment team with the patient's
individual needs, goals, preferences, and SDOH need(s), and educating
the patient (and caregiver if applicable) on how to best participate in
medical decision-making.
Building patient self-advocacy skills, so that the patient
can interact with members of the health care team and related
community-based services (as needed), in ways that are more likely to
promote personalized and effective treatment of their condition.
Health care access/health system navigation.
++ Helping the patient access healthcare, including identifying
appropriate practitioners or providers for clinical care, and helping
secure appointments with them.
++ Providing the patient with information/resources to consider
participation in clinical trials or clinical research as applicable.
Facilitating behavioral change as necessary for meeting
diagnosis and treatment goals, including promoting patient motivation
to participate in care and reach person-centered diagnosis or treatment
goals.
Facilitating and providing social and emotional support to
help the patient cope with the condition, SDOH need(s), and adjust
daily routines to better meet diagnosis and treatment goals.
Leverage knowledge of the serious, high-risk condition
and/or lived experience when applicable to provide support, mentorship,
or inspiration to meet treatment goals.
GXXX4--Principal Illness Navigation services, additional 30 minutes
per calendar month (List separately in addition to GXXX3).
CMS proposed the following description for SDOH risk assessment:
GXXX5, Administration of a standardized, evidence-based Social
Determinants of Health Risk Assessment, 5-15 minutes, not more often
than every 6 months
We note that placeholder codes GXXX1 and GXXX2 have been replaced
with GCPCS codes G0019 and G0022, respectively; placeholder codes GXXX3
and GXXX4 have been replaced with HCPCS codes G0023 and G0024
respectively; and placeholder code GXXX5 has been replaced with HCPCS
code G0136.
As described above, all of these proposed codes include activities
related to addressing social needs. Both PIN and CHI include certain
care coordination activities and care transitions for the patient.
However, there are distinct differences in the primary focus of PIN and
CHI codes. As discussed in the CY 2024 PFS proposed rule (88 FR 52334),
CMS proposed that in order to bill for PIN, time spent providing such
services must be documented in the medical record in its relationship
to the serious, high-risk illness. On the other hand, in the case of
CHI services, CMS proposed that time spent providing such services must
be documented in the patient's medical record in its relationship to
the SDOH need(s) they are intended to address and the clinical
problem(s) they are intended to help resolve (88 FR 52329).
As discussed in the CY 2024 Physician Fee Schedule proposed rule
(88 FR 52335), CMS proposed that a practitioner could bill separately
for other care management services during the same month as PIN or CHI,
if time and effort are not counted more than once, requirements to bill
the other care management services are met, and the services are
medically reasonable and necessary. However, in the case of a patient
participating in a PHP or IOP, we anticipate that the time and effort
of facility staff in addressing the components of PIN services would
generally be duplicative of the time and effort of providing CHI
services. Furthermore, because PIN also includes an assessment of and
activities related to addressing social needs, we believe that for PHP
and IOP patients, the time and effort of facility staff associated with
PIN services would generally be duplicative of the time and effort of
providing SDOH risk assessment services.
We believe PIN would generally be the most appropriate code for
patients participating in a PHP or IOP, because a patient's
participation in one of these programs indicates the presence of a
serious, high-risk mental health condition (inclusive of SUD). In
addition, participation in a PHP or IOP requires certification and
periodic recertification of the need for such services by a physician,
which we believe is analogous to an initiating visit that is required
for PIN services billed under the PFS. Therefore, after consideration
of the public comments we received, we are adopting PIN services as
applicable for PHP and IOP. We believe the PIN services described by
codes G0023, G0024 appropriately describe the broad range of services
that PHP and IOP staff provide to program participants each patient
month, which include discharge and transition planning, care
coordination, and case management services within PHPs and IOPs. We
note that as discussed in the CY 2024 PFS final rule, CMS is removing
references to peer support specialists from the final descriptions for
G0023 and G0024, and is finalizing separate codes that better represent
the
[[Page 81825]]
scope of practice for peer support specialists.
In addition, we note that these PIN services are reported monthly
and represent time spent throughout the month; therefore, we will not
count PIN services in the evaluation of whether a PHP or IOP day
receives the 3-service or 4-service day for payment; however, we intend
to analyze utilization and cost data for these services and consider
any payment changes in future rulemaking to better recognize such
costs.
We are not adopting SDOH risk assessment or CHI services described
by G0136, G0019, and G0022 because we believe the inclusion of these
codes would likely be duplicative of PIN services for a patient
participating in a PHP or IOP. With respect to the principal care
management, chronic care management, and complex chronic care
management services that commenters suggested, we discussed these
recommendations with CMS medical officers and have determined these
services are more appropriate for the primary care setting, rather than
a defined program of services like a PHP or IOP.
c. Peer Support Specialists
Additionally, we solicited comments in the proposed rule on peer
services, and whether these would be appropriate to include for PHPs
and IOPs. Peer support workers are people who have been successful in
the recovery process who help others experiencing similar situations.
Through shared understanding, respect, and mutual empowerment, peer
support workers help people become and stay engaged in the recovery
process and reduce the likelihood of relapse. Peer support services can
effectively extend the reach of treatment beyond the clinical setting
into the everyday environment of those seeking a successful, sustained
recovery process. Peer support workers typically engage in a wide range
of activities, including: advocating for people in recovery; sharing
resources and building skills; building community and relationships;
leading recovery groups; and mentoring and setting goals.\164\ We
stated in the CY 2024 OPPS/ASC proposed rule that we were interested in
information about any available codes that would appropriately describe
such services.
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\164\ https://www.samhsa.gov/brss-tacs/recovery-support-tools/peers.
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Comment: Commenters strongly supported the inclusion of peer
support services in the list of codes recognized for PHP and IOP.
Response: As discussed above, we are adopting coding for PIN
services. Additionally, as discussed in the CY 2024 PFS final rule, CMS
is finalizing additional PIN codes which describe the set of services
that are within the scope of practice of peer support specialists. As
shown in Table 98 of this final rule with comment period, we are
adopting these codes as applicable for PHP and IOP. We believe it is
appropriate to recognize the services of peer support specialists
working within the scope of practice for which they are licensed or
certified under applicable State law, or meeting the requirements set
forth in the CY 2024 PFS final rule if no applicable State requirements
exist, as the services of staff trained to work with psychiatric
patients, which is included under section 1861(ff)(2)(c) and which we
have codified under the PHP benefit at Sec. 410.43(a)(4)(iii) and are
finalizing under the IOP benefit at Sec. 410.44(a)(4)(iii) in this
final rule.
As we noted above for PIN services, these peer support PIN service
codes are reported monthly and represent time spent throughout the
month; therefore, we will not count them in the evaluation of whether a
PHP or IOP day receives the 3-service or 4-service day for payment;
however, we intend to analyze utilization and cost data for these
services and consider any payment changes in future rulemaking to
better recognize such costs.
d. Testing and Diagnostic Services
We noted in the proposed rule that our analysis of PHP claims
showed that the provision of testing and diagnostic services is very
low among PHPs, although such services are covered under the PHP
benefit. We included testing and diagnostic services in the proposed
list of codes shown in Table 96 of this final rule with comment period,
and we proposed to cover such services under the IOP benefit as well.
We noted that our analysis of non-PHP days with 3 and 4 services, which
we believe could represent IOP days in the future, shows a higher
provision of testing and diagnostic services than is found among PHP
days. We stated that we believe testing and diagnostic services would
be included as component services of PHPs and IOPs, and we are
interested in information from the public about why PHPs are not more
frequently billing for these services. In particular, we welcomed
information from commenters about whether there are specific challenges
that PHPs face in providing these services, as well as whether there
are different codes, other than those shown in Table 96 of this final
rule with comment period, that could better describe the testing and
diagnostic services that are provided to PHP patients. In addition, we
stated that we are interested in understanding whether these services
are typically provided by an entity other than the PHP, such as by a
referring provider.
Comment: Commenters provided useful information about why PHPs are
not more frequently billing for testing and diagnostic services.
Specifically, the commenters stated that the vast majority of PHPs and
IOPs are generally designed to treat common types of behavioral health
issues and typically focus on depression, anxiety, bipolar disorder,
and self-harm. Commenters stated that testing and diagnostic services
are usually more common in specialty programs such as eating disorders,
obsessive-compulsive disorders, anger management, and child/adolescent
programs. Additionally, commenters stated that while diagnostic
services are covered under the PHP benefit, since PHP is intended for
patients who have a mental health diagnosis, patients that are admitted
to a PHP typically have a mental health diagnosis from a referring
provider.
Response: We appreciate the information that commenters provided
regarding testing and diagnostic services. While we recognize that
these may not be used in most programs, we note that section
1861(ff)(2)(H) specifically includes diagnostic services in the
definition of partial hospitalization and intensive outpatient
services. We continue to believe it is appropriate to include these
codes in the available PHP and IOP code set for those programs that do
provide these services. We intend to monitor the provision of these
services for PHP and IOP patients and may consider coding changes in
the future.
e. Other Categories of Services
Comment: One commenter suggested including a variety of codes
commonly billed for occupational therapy. For example, codes 97165-
97167 for low, moderate, and high complexity occupational therapy
evaluations; and code 97168 Occupational therapy re-evaluation.
Response: We appreciate the commenter's recommendation to adopt
more detailed coding for occupational therapy. We note that
occupational therapy services are an important part of PHPs,
specifically listed under 1861(ff)(2)(B) and Sec. 410.43(a)(4)(ii). We
also proposed to include occupational therapy services under Sec.
410.44(a)(4). We proposed to include G0129, which is the currently
recognized code for
[[Page 81826]]
occupational therapy services provided for PHP patients, and we
proposed to recognize this code for IOP patients beginning in CY 2024
as well. We are not including the more detailed list of CPT codes that
the commenter recommended; however, we will take this comment into
consideration to potentially inform future rulemaking.
Comment: Commenters suggested adding SUD screening and diagnostic
evaluations (including G0396 and G0397), GXXX5 Social determinants of
health assessment, and individual and group SUD counseling.
Additionally, commenters suggested including codes 99446-99449
Interprofessional phone/internet/electronic health record consultation
services, as well as withdrawal management, medication management, and
psychoeducation services. One commenter advocated the creation of a new
add-on code for psychoeducation services.
Response: After consideration of the public comments received, we
do not believe SUD screening and diagnostic evaluations, social
determinants of health assessment, individual and group SUD counseling,
withdrawal management, medication management, or psychoeducation
services are appropriate for the PHP or IOP benefits. We consulted with
physicians and have determined these services are typically provided by
a primary care provider for screening purposes.
Comment: A few commenters suggested including transportation and
meals.
Response: While we appreciate the commenters' input, we remind
readers that section 1861(ff)(2)(I) of the Act excludes transportation
and meals from the items and services that may be offered provided
under the PHP and IOP benefits.
Final Decision: After consideration of the public comments we
received, we are adopting as final the following list of PHP and IOP
codes for CY 2024, which is presented in Table 98.
BILLING CODE 4150-28-P
[[Page 81827]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.138
[[Page 81828]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.139
[[Page 81829]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.140
BILLING CODE 4150-28-P
D. Payment Rate Methodology for PHP and IOP
In summary, we proposed for CY 2024 to revise our methodology for
calculating PHP payment rates. We proposed to establish four separate
PHP APC per diem payment rates: one for CMHCs for 3-service days and
another for CMHCs for 4-service days (APC 5853 and APC 5854,
respectively), and one for hospital-based PHPs for 3-service days and
another for hospital-based PHPs for 4-service days (APC 5863 and APC
5864, respectively). In addition, for hospital-based PHPs, we proposed
to calculate payment rates using the broader OPPS data set, instead of
hospital-based PHP data only, because we believe using the broader OPPS
data set would allow CMS to capture data from claims not identified as
PHP, but that also include the service codes and intensity required for
a PHP day. Because we proposed to establish consistent coding and
payment between the PHP and IOP benefits, we proposed to consider all
OPPS data for PHP days and non-PHP days that include 3 or more of the
same service codes. We proposed to establish four separate IOP APC per
diem payment rates at the same rates we proposed for PHP APCs: one for
CMHCs for 3-service days and another for CMHCs for 4-service days (APC
5851 and APC 5852, respectively), and one for hospital-based IOPs for
3-service days and another for hospital-based IOPs for 4-service days
(APC 5861 and APC 5862, respectively). We received public comments on
these proposals, which we discuss and provide responses to in the
following sections of this CY 2024 OPPS/ASC final rule.
1. Background
The standard PHP day is typically four services or more per day. We
currently provide payment for three services a day for extenuating
circumstances when a beneficiary would be unable to complete a full day
of PHP treatment. As we stated in the CY 2008 OPPS/ASC final rule with
comment period (72 FR 66672), it was never our intention that days with
only three units of service should represent the number of services
provided in a typical PHP day. Our intention was to cover days that
consisted of three units of service only in certain limited
circumstances. For example, as we noted in the CY 2009 OPPS/ASC
proposed rule (73 FR 41513), we believe 3-service days may be
appropriate when a patient is transitioning towards discharge (or days
when a patient who is transitioning at the beginning of his or her PHP
stay). Another example of when it may be appropriate for a program to
provide only three units of service in a day is when a patient is
[[Page 81830]]
required to leave the PHP early for the day due to an unexpected
medical appointment.
2. Current Payment Rate Methodology for PHP
Since CY 2017, our longstanding policy has been to pay PHP on a per
diem basis for days that include three or more PHP services, which are
identified using a defined list of codes in the Healthcare Common
Procedure Coding System (HCPCS). We currently (for CY 2023) utilize two
separate PHP APC per diem payment rates: CMHC PHP APC 5853 (Partial
Hospitalization (three or More Services Per Day)) using only CMHC data,
and hospital-based PHP APC 8563 (Partial Hospitalization (three or More
Services Per Day)) using only hospital-based PHP data.
Under longstanding OPPS policy, the hospital-based PHP APC per diem
payment amount is also applied as a daily mental health cap, which
serves as an upper limit on payment per day for individual OPPS mental
health services. Under the current methodology, for CY 2023, hospital-
based PHPs are paid a per diem rate of $268.22 for three or more PHP
services per day, and CMHCs are paid a per diem rate of $142.70 for
three or more PHP services per day. We refer readers to the PHP
ratesetting methodology described in section VIII.B.2 of the CY 2016
OPPS/ASC final rule with comment period (80 FR 70462 through 70466) for
information on the current calculation of geometric mean per diem costs
and payment rates for PHP APCs 5853 and 5863, and the CY 2017 OPPS/ASC
final rule with comment period (81 FR 79680 through 79687) and the CY
2022 OPPS/ASC final rule with comment period (86 FR 63665 and 63666)
for information on modifications incorporated into the PHP ratesetting
methodology.
We note that under our current methodology, we have historically
prepared the data by first applying PHP-specific trims and data
exclusions and assessing CCRs. We direct the reader to the CY 2016
OPPS/ASC final rule with comment period (80 FR 70463 through 70465) for
a more complete discussion of these trims, data exclusions, and CCR
adjustments. In prior rules, we have typically included a discussion of
PHP-specific data trims, exclusions, and CCR adjustments; we are not
including that discussion in this rule. These PHP-specific data trims
and exclusions addressed limitations as well as anomalies in the PHP
data. However, as discussed in the following section, we proposed for
CY 2024 to calculate hospital-based PHP payment rates for 3 services
per day and 4 services per day based on cost per day using the broader
OPPS data set. Accordingly, we proposed not to apply PHP-specific trims
and data exclusions, but rather to apply the same trims and data
exclusions consistent with the OPPS.
We did not receive any public comments regarding the proposal, and
we are finalizing it as proposed. Additional information about the data
trims, data exclusions, and CCR adjustments applicable to the data used
for this final rule can be found online at https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html).\165\
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\165\ Click on the link labeled ``CY 2024 OPPS/ASC Notice of
Final Rulemaking'', which can be found under the heading ``Hospital
Outpatient Prospective Payment System Rulemaking'' and open the
claims accounting document link at the bottom of the page, which is
labeled ``2024 NFRM OPPS Claims Accounting (PDF)''.
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3. CY 2024 Payment Rate Methodology for PHP and IOP
As we noted in the proposed rule, the CAA, 2023 established IOP
within the continuum of care, and the statute makes reference to weekly
hour requirements. Specifically, IOP patients are required to be
certified by a physician as needing at least 9 hours of services per
week; while PHP patients are required to be certified by a physician as
needing at least 20 hours of services per week.
We stated in the proposed rule that while no IOP benefit existed
prior to the CAA, 2023, the types of items and services included in IOP
have been, and are, paid for by Medicare either as part of the PHP
benefit or under the OPPS more generally. Additionally, we stated that
prior to the CAA, 2023, CMS had begun gathering information from
interested parties on IOP under Medicare. In the CY 2023 OPPS/ASC
proposed rule (87 FR 44679), we issued a comment solicitation on
intensive outpatient mental health treatment, including SUD treatment
furnished by IOPs, to collect information regarding whether there are
any gaps in coding that may be limiting access to needed levels of care
for treatment of mental health disorders or SUDs for Medicare
beneficiaries, and specific information about IOP services, such as the
settings of care in which these programs typically furnish services,
the range of services typically offered, and the range of practitioner
types that typically furnish these services.
We explained that along with the requirements for IOP mandated by
the CAA, 2023, we took into consideration information we received from
the comment solicitation to construct an appropriate data set to
develop proposed rates for IOP. Since IOPs furnish the same types of
services as PHP, just at a lower intensity, we stated that we believe
it is appropriate to use the same data and methodology for calculating
payment rates for both PHP and IOP for CY 2024. We explained that
although PHP claims can be specifically identified, there is no
specific identifier or billing code to indicate IOP services. However,
we noted that hospitals are permitted to furnish and bill for many of
these services as outpatient services under the OPPS. Thus, we analyzed
a broader set of data that includes both PHP and non-PHP days with 3 or
more services in order to calculate proposed payment for PHP services.
In order to establish consistent payment between PHP and IOP, we
proposed to set IOP payment rates at the same rates as PHP. We stated
that the primary goal in developing the proposed payment rate
methodology for IOP and PHP services was to pay providers an
appropriate amount relative to the patients' needs, and to avoid cost
inversion in future years.
For CY 2024, we proposed to calculate hospital-based PHP payment
rates for 3 services per day and 4 services per day based on cost per
day using the broader OPPS data set, a change from the current
methodology of using only PHP data. We stated that we believe using the
broader OPPS data set would allow us to capture data from claims that
are not identified as PHP, but that include the service codes and
intensity required for a PHP day. We stated that the larger data set
would expand the sample size to allow for more precise rate
calculations. In addition, we proposed to calculate the 3 services per
day and 4 services per day PHP rates for CMHCs and hospital-based
programs separately.
We also proposed to set payment rates for IOP APCs at amounts equal
to the payment rates for PHP APCs. We stated that setting the IOP
payment rates equal to the PHP payments would be appropriate because
IOP is a newly established benefit, and we do not have definitive data
on utilization. However, we explained that both programs utilize the
same services, but furnish them at different levels of intensity, with
different numbers of services furnished per day and per week, depending
on the program. Therefore, we stated that we expect it would be
appropriate to pay the same per diem rates for IOP and PHP services
unless future data analysis supports calculating rates independently.
Table 100 below shows the proposed APCs and the calculated
[[Page 81831]]
geometric mean per diem costs for the CY 2024 OPPS/ASC proposed rule.
[GRAPHIC] [TIFF OMITTED] TR22NO23.141
For beneficiaries in a PHP or IOP, we proposed applying the four-
service payment rate (that is, payment for PHP APCs 5854 for CMHCs and
5864 for hospitals, and IOP APCs 5852 for CMHCs and 5862 for hospitals)
for days with 4 or more services. For days with three or fewer
services, we proposed to apply the three-service payment rate (that is,
payment for PHP APCs 5853 for CMHCs and 5863 for hospitals, and IOP
APCs 5851 for CMHCs and 5861 for hospitals), which we noted would be a
departure from our current policy. We explained that under our current
policy, we do not make payment for any PHP days with fewer than three
services. We stated that we have heard from interested parties that
this policy could discourage treatment of PHP patients when, due to
extenuating circumstances, they cannot complete a full day. We stated
that we believe paying for a day with three or fewer services would
allow us to more easily monitor the actual utilization of services,
particularly IOP. Specifically, we stated that we believe utilizing the
three-service payment rate (that is, payment for PHP APCs 5853 for
CMHCs and 5863 for hospitals, and IOP APCs 5851 for CMHCs and 5861 for
hospitals) for days with three or fewer service would accommodate
occasional instances when a patient is unable to complete a full day of
PHP or IOP. We stated that we expect days with fewer than three
services would be very infrequent, and that we intend to monitor the
provision of these days among providers and individual patients.
Additionally, we proposed that the 3 service per day hospital-based
PHP APC per diem payment amount for APC 5863 would also be applied as
the daily mental health cap, which serves as the upper limit on payment
per day for individual OPPS mental health services. We explained that
setting the 3 service per day hospital-based PHP APC per diem payment
amount as the daily mental health cap would be appropriate because
currently the daily mental health cap is equal to the payment amount
for hospital-based PHP APC 5863, which is payment for 3 or more
services per day. Therefore, we noted that consistency with the current
daily mental health cap would be maintained. Additionally, we stated
that PHP is meant to be the most intensive mental health services
program, requiring inpatient care if PHP is not received, and the daily
mental health cap is not expected to reach such level of intensity. We
stated that we believe applying the 3 service per day hospital-based
PHP APC per diem payment amount for APC 5863 as the daily mental health
cap would preserve the difference of intensity between PHP and
individual OPPS mental health services to not incentivize one over the
other. We noted that the proposed CY 2024 payment amount for APC 5863
would be comparable to the CY 2023 payment amount for APC 5863, which
is currently applied as the daily mental health cap.
Lastly, we noted that section 4124(c) of the CAA, 2023 requires
that the payment amount for intensive outpatient services furnished in
FQHCs and RHCs be equal to the payment amount that would have been paid
for the same service furnished by a hospital outpatient department,
thus establishing site-neutral payment for hospital outpatient
departments, FQHCs, and RHCs. We explained that the CAA, 2023 is silent
with respect to the payment methodology for IOP services provided by
CMHCs. Based on our analysis of CMHC costs, we stated that we continue
to observe that CMHCs incur significantly different costs than
hospitals in the provision of PHP services, and stated that we
anticipate in the future there will be significant differences between
CMHCs' and hospitals' costs of furnishing IOP services as well. We
explained that we believe it is appropriate to continue to recognize
the differences in cost structures for different providers of PHP. We
further explained that this is of particular importance not only to the
Medicare program, but also for the Medicare beneficiaries that CMHCs
serve, who incur a 20 percent copay on all PHP services under Part B.
Therefore, we proposed to continue calculating CMHC payment rates based
solely on CMHC claims. However, we stated that we were also considering
whether establishing a site-neutral payment for all providers of IOP
using data from all providers of IOP would be more appropriate in an
effort to increase access to mental health services. In order to inform
public awareness, we calculated combined payment rates for the proposed
rule by using the broader OPPS data from both hospitals and CMHCs to
estimate the costs associated
[[Page 81832]]
with providing days with three and four services from the proposed list
of services, which is reproduced in Table 96 of this final rule with
comment period. We provided these alternative cost calculations in
Table 46 in section VIII.D.3.b of the CY 2024 OPPS/ASC proposed rule.
We solicited comments on whether this approach would be more
appropriate to consider for establishing payment beginning in CY 2024.
Specifically, we stated that we were interested in any information from
commenters on how IOPs may structure their service days, and how the
differences in cost structures of CMHCs might affect a site-neutral
payment for IOP services. We also solicited comments on any ways IOP
days could differ from PHP days, and considerations that could affect
payment.
We received a number of public comments on these proposals. Our
summaries and responses to the comments we received are included in the
following paragraphs.
Comment: Overall, commenters expressed support for the proposed
methodology of calculating PHP and IOP rates using a broader set of
OPPS data. Several commenters expressed support for the proposed
payment for intensive outpatient services and the proposed increases to
payment rates for partial hospitalization services for CY 2024. One
commenter raised concerns that using a broader set of OPPS data may
result in inadequate reimbursement for hospital-based PHPs that furnish
IOPs, given the additional resource costs associated with these sites
of care.
Response: We appreciate the support from commenters. As noted
earlier, we proposed to use a broader set of OPPS data in order to
capture data from claims that are not identified as PHP, but that
include the service codes and intensity required for a PHP day. In
general, our analysis finds that non-PHP days furnished in the hospital
outpatient setting that include 3 services and 4 or more services
generally have comparable costs to PHP days furnished in the hospital
setting with a comparable number of services provided. As we have
discussed in prior rulemaking (85 FR 86075; 84 FR 61343), data from a
small number of providers with low service costs per day have driven
fluctuations in PHP payment rates, which has necessitated certain
policies to stabilize payment in the past. We believe that using a
broader set of OPPS data for days with a similar type and number of
services appropriately provides stability for the calculation of PHP
and IOP payment rates for CY 2024.
Comment: Commenters strongly supported the proposal to stratify
payment for PHP and IOP days into 3-service and 4-service days. Several
commenters stated that bifurcating each service into two tiers takes
into account the varying levels of need among individuals receiving
services. Commenters also strongly supported our proposal to make
payment at the applicable 3-service rate for PHP and IOP days with
fewer than 3 services. Commenters expressed that this flexibility is
particularly important for ensuring that the new IOP benefit is made
available to patients.
Response: We appreciate the support for the proposal to stratify
payment and to make payment for days with fewer than 3 services. We
share the commenters' view that these proposed policies are important
for supporting access to the new IOP benefit and appropriately matching
payment to daily service intensity for patients participating in both
PHPs and IOPs. We are reiterating our expectation that days with fewer
than three services should be very infrequent, and we are reminding
readers that we intend to monitor the provision of these days among
providers and individual patients.
Comment: Commenters generally supported the proposal to calculate
the per diem payment rates for IOP based on the proposed per diem
payment rates for PHP. As noted earlier in this final rule, several
commenters raised concerns that the proposal to pay the same rates for
PHP and IOP may be driving the proposed requirement that a service from
the ``primary list'' be provided for each day that received payment.
These commenters encouraged CMS to revisit this question in future
rulemaking as cost and claims data are available, to analyze the key
differences between IOP and PHP, including the prevalence of certain
services within the bundle.
Response: We appreciate the support from commenters regarding the
proposal. As we stated in the proposed rule, we proposed to use the PHP
rates, calculated using the broader OPPS data set, as the basis for the
proposed CY 2024 IOP rates, because IOP is a newly established benefit
for which we do not have definitive data on utilization.
Regarding the statement that the proposed payment policy is the
reason for the proposal to require a primary service for each day that
receives payment, we are clarifying that this is not the case. As we
noted earlier in this CY 2024 OPPS/ASC final rule, the purpose of the
primary list is to ensure that IOPs and PHPs are being provided with an
appropriate level of intensity to ensure program integrity. Although we
expect IOPs to be less intensive than PHPs and to involve fewer weekly
hours, we nevertheless expect the services provided to be of an
intensity that is commensurate with treating the patient's condition.
Because we have proposed to pay IOP on a per diem basis, we believe it
is important to ensure a minimum standard of program intensity for each
date of service.
Comment: A few commenters expressed support for establishing
separate payment rates that recognize the cost differences between
hospital outpatient departments and CMHCs. These commenters agreed with
CMS that hospitals and CMHCs have different cost structures, and
encouraged CMS to finalize payment rates that reflect these
differences.
In contrast, several commenters opposed the proposal to establish
separate payment rates for hospital outpatient departments and CMHCs,
advocating for the alternative combined site-neutral payment rates
presented in the proposed rule. These commenters stated that the stark
discrepancy in rates between HOPDs and CMHCs for partial
hospitalization services may not be representative of these entities'
true cost structures. These commenters further noted that the addition
of IOP to the Medicare service array may encourage additional
facilities around the country to elect to enroll in Medicare as CMHCs.
Commenters advocating for site-neutral payment responded to CMS'
concerns regarding coinsurance burdens for CMHC patients by stating a
large percentage of the low-income patients served by community-based
behavioral health providers are dual eligible beneficiaries, for whom
Medicaid typically covers Medicare coinsurance costs.
Response: We appreciate the comments we received on this topic. As
we noted in the proposed rule, the best available data that we have at
this time for assessing the cost of IOP services comes from PHP and
OPPS days with similar services provided at the expected intensity
level. Current data for partial hospitalization do reflect significant
cost structure differences between hospitals and CMHCs, and our
longstanding payment policies reflect those differences. We have no
factual basis at this time on which to assume, as many commenters
suggest, that the stark difference between hospital and CMHC payment
rates for PHP services indicate that such services do not reflect the
actual cost structure differences between facility types.
We recognize that there is uncertainty about the cost structures of
CMHCs that
[[Page 81833]]
may in the future enroll in Medicare to provide IOP services. As we
noted in the proposed rule, we intend to analyze actual IOP utilization
data beginning in CY 2024 to understand the actual structure and costs
associated with these programs. We are not adopting the commenter's
recommendation to finalize the alternative site neutral payment rates
for this CY 2024 OPPS/ASC final rule, but we will take these comments
into consideration to potentially inform future rulemaking.
Comment: Interested parties overwhelming advocated for establishing
the OPPS daily mental health cap based on proposed APC 5864, rather
than APC 5863 as proposed. Commenters stated that this would be
consistent with CMS's historical use of the highest PHP per diem
payment amount as the basis for the OPPS daily mental health cap.
Response: We appreciate the comments' feedback regarding the
proposal. We agree with commenters that the proposed APC 5864 would be
the most resource intensive mental health service and would be
appropriate to finalize as the basis for the OPPS daily mental health
cap in CY 2024. As discussed in section II.A.2.c.(1) of this CY 2024
OPPS/ASC final rule, we are finalizing the use of APC 5864 to establish
the payment rate for APC 8010 in CY 2024, rather than using APC 5863 as
proposed.
Final Decision: After consideration of the public comments we
received, we are finalizing our proposal to establish separate APC per
diem payment rates for PHP days with 3 services and 4 or more services
and to establish separate APC per diem payment rates for CMHCs and
hospital-based PHPs. We are also finalizing our proposal to set APC per
diem payment rates for IOP days based on the APC per diem payment rates
for PHP in CY 2024. Lastly, we are finalizing our proposal to make
payment at the 3-service rate for PHP or IOP days that have fewer than
3 services.
a. PHP APC Changes and Effects on Geometric Mean Per Diem Costs
For CY 2024 and subsequent years, we are finalizing a revision to
our existing methodology to calculate the CMHC and hospital-based PHP
geometric mean per diem costs to incorporate the larger data set under
the OPPS, including PHP and non-PHP hospital claims for mental health
services. We are finalizing our proposal to use the latest available CY
2022 claims data, and CY 2021 cost data. This is consistent with the
overall use of cost data for the OPPS, which is discussed in section
II.A.1.a. of this final rule with comment period. In addition, we are
establishing four separate PHP APC per diem payment rates: two for
CMHCs (APC 5853 and APC 5854) and two for hospital-based PHPs (APC 5863
and APC 5864). Following this methodology, we will use the geometric
mean per diem cost of $90.02 for CMHCs providing 3-service days (APC
5853), and the geometric mean per diem cost of $161.80 for CMHCs
providing 4-service days (APC 5854), as the basis for developing the CY
2024 CMHC PHP APC per diem rates. Additionally, we will use the
geometric mean per diem cost of $266.35 for hospital-based providers
providing 3-service days (APC 5863), and the geometric mean per diem
cost of $367.79 for hospital-based providers providing 4-service days
(APC 5864) as the basis for developing the CY 2024 hospital-based PHP
APC per diem rates. Lastly, we are establishing four separate IOP APC
per diem payment rates: two for CMHCs (APC 5851 and APC 5852 for 3-
service days and 4-service days, respectively) and two for hospital-
based IOPs (APC 5861 and APC 5862 for 3-service days and 4-service
days, respectively) using the same above 3-service day and 4-service
day geometric mean per diem costs finalized for the PHP APC per diem
rates.
b. Development of the PHP and IOP APC Geometric Mean Per Diem Costs
The types of items and services paid as PHP (and that will be paid
as IOP) can also be provided outside of those benefits by hospitals;
therefore, we sought to understand the costs of those services in our
preliminary analysis to consider options for the proposed payment rates
for IOP services. In preparation for this CY 2024 final rule, in
collaboration with physicians, we developed a consolidated list of all
HCPCS codes that would be appropriate for identifying IOP and PHP
services for analytic purposes. We refer readers to section VIII.C of
this final rule with comment period for more detailed information on
the consolidated list of HCPCS codes applicable for IOP and PHP
services.
We calculated the final payment rates for hospital-based providers
based on costs for days with three services and days with four services
using the data from all OPPS claims for hospitals and calculated the
final payment rates for CMHCs based on costs for days with three
services and days with four services using only the data from CMHC
claims. As discussed in section VIII.B.1.a of the CY 2022 OPPS/ASC
final rule with comment period (86 FR 63666 through 63668), the costs
for CMHC service days are calculated using cost report information from
HCRIS. Although we anticipate that IOP weeks would generally include 9-
19 hours of services and PHP weeks would generally include 20 or more
hours of services, we did not restrict the data for this analysis by
weekly hours. Because IOP is a new benefit, we do not have definitive
data on utilization. However, if IOP utilization is similar to the data
we analyzed for beneficiary weeks with 9 to 19 hours of mental health
services, then we expect that IOP days will mostly include three
services or fewer but may sometimes include four or more. Given the
uncertainty about how IOPs will structure their service days in the
future, we proposed and believe it is appropriate to finalize 3-service
day and 4-service day APCs for IOP with payment rates that are the same
as the rates for the 3-service day and 4-service day APCs for PHP.
We analyzed all CMHC and hospital claims data under the OPPS used
to set final rates for this CY 2024 final rule. We identified all
patient days that included three or more services from the list in
Table 98. As discussed in section VIII.D.3 of this final rule with
comment period, we calculated PHP payment rates for days with three
services and days with four or more services, and we utilized these PHP
payment rates for the IOP APCs as well. We are finalizing our proposal
to calculate separate rates for hospitals and CMHCs.
c. CY 2024 PHP and IOP APC Geometric Mean Per Diem Costs
Following this structure, the final calculated CY 2024 PHP
geometric mean per diem cost for all CMHCs for providing 3 services per
day is $90.02, which we will use for calculating the payment rate for
the 3-service day APC, CMHC APC 5853. The final calculated CY 2024
geometric mean per diem cost for all CMHCs for providing four or more
services per day is $161.80, which we will use for calculating the
payment rate for the 4-service day APC, CMHC APC 5854. As noted, the
calculated CY 2024 hospital-based PHP APC geometric mean per diem cost
for hospital-based PHP providers that provide 3 services per service
day is $266.35, which we will use for calculating the payment rate for
the 3-service day hospital-based PHP APC 5863. The calculated CY 2024
hospital-based PHP APC geometric mean per diem cost for hospital-based
PHP providers that provide 4 or more services per day is $367.79, which
we will use for calculating the payment rate for the 4-service day
hospital-based PHP APC 5864.
Similarly, the calculated CY 2024 IOP geometric mean per diem cost
for all
[[Page 81834]]
CMHCs for providing 3 services per day is $90.02, which we will use for
calculating the payment rate for the 3-service day APC, CMHC APC 5851.
The calculated CY 2024 geometric mean per diem cost for all CMHCs for
providing 4 or more services per day is $161.80, which we will use for
calculating the payment rate for the 4-service day APC, CMHC APC 5852.
The calculated CY 2024 hospital-based IOP APC geometric mean per diem
cost for hospital-based IOP providers that provide 3 services per
service day is $266.35, which we will use for calculating the payment
rate for the 3-service day hospital-based IOP APC 5861. The calculated
CY 2024 hospital-based IOP APC geometric mean per diem cost for
hospital-based IOP providers that provide 4 services per day is
$367.79, which we proposed to use for calculating the payment rate for
the 4-service day hospital-based IOP APC 5862.
We intend to monitor the provision of services in both PHP and IOP
programs to better understand utilization patterns, and we are
finalizing our proposal to set equal payment rates for PHP and IOP
services until actual IOP utilization data becomes available for CY
2026 ratesetting, at which point we anticipate reevaluating our payment
rate methodology if necessary. In addition, we solicited comments on
the service mix used to develop the per diem amounts for both PHP and
IOP. We stated that we are interested in whether the proposed approach
is appropriate, and any feedback commenters have on the service mix
provided within each program.
The final CY 2024 PHP geometric mean per diem costs are shown in
Table 101 and are used to derive the final CY 2024 PHP APC per diem
rates for CMHCs and hospital-based PHPs-. As stated in section VIII.D.3
of this final rule with comment period, we are finalizing our proposal
to use the same 3--service day and 4-service day geometric mean per
diem PHP costs for the CY 2024 CMHC and hospital-based IOP APCs. The
final CY 2024 PHP and IOP APC per diem rates are included in Addendum A
to this final rule with comment period (which is available on our
website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.html) and in Table 101.
[GRAPHIC] [TIFF OMITTED] TR22NO23.142
E. Outlier Policy for CMHCs
For CY 2024, we proposed to update the calculations of the CMHC
outlier percentage, cutoff point and percentage payment amount, outlier
reconciliation, outlier payment cap, and fixed dollar threshold
according to previously established policies to include intensive
outpatient services. These topics are discussed in more detail. We
refer readers to section II.G.1 of this final rule with comment period
for our general policies for hospital outpatient outlier payments.
1. Background
As discussed in the CY 2004 OPPS final rule with comment period (68
FR 63469 through 63470), we noted a significant difference in the
amount of outlier payments made to hospitals and CMHCs for PHP
services. Given the difference in PHP charges between hospitals and
CMHCs, we did not believe it was appropriate to make outlier payments
to CMHCs using the outlier percentage target amount and threshold
established for hospitals. Therefore, beginning in CY 2004, we created
a separate outlier policy specific to the estimated costs and OPPS
payments provided to CMHCs. We designated a portion of the estimated
OPPS outlier threshold specifically for CMHCs, consistent with the
percentage of projected payments to CMHCs under the OPPS each year,
excluding outlier payments, and established a separate outlier
threshold for CMHCs. This separate outlier threshold for CMHCs resulted
in $1.8 million in outlier payments to CMHCs in CY 2004 and $0.5
million in outlier payments to CMHCs in CY 2005 (82 FR 59381). In
contrast, in CY 2003, more than $30 million was paid to CMHCs in
outlier payments (82 FR 59381).
2. CMHC Outlier Percentage
In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59267
and 59268), we described the current outlier policy for hospital
outpatient payments and CMHCs. We note that we also discussed our
outlier policy for CMHCs in more detail in section VIII.C of that same
final rule (82 FR 59381). We set our projected target for all OPPS
aggregate outlier payments at 1.0 percent of the estimated aggregate
total payments under the OPPS (82 FR 59267). This same policy was also
reiterated in the CY 2019 OPPS/ASC final rule with comment period (83
FR 58996), the CY 2020 OPPS/ASC final rule with comment period (84 FR
61350), and the CY 2021 OPPS/ASC final rule with comment period (85 FR
86082).
We estimated CMHC per diem payments and outlier payments for this
rule by using the most recent available utilization and charges from
CMHC claims, updated CCRs, and the proposed payment rates for PHP APCs
5853 and 5854. We recognize that CMHCs would be permitted to provide
and bill for IOP beginning in CY 2024 and would be paid under IOP APCs
5851 and 5852. However, we have not included estimates of utilization
for these APCs, because the latest available claims from CY 2022 do not
reflect the provision of IOP services. For increased transparency, we
are providing a more detailed explanation of the existing
[[Page 81835]]
calculation process for determining the CMHC outlier percentages. To
calculate the CMHC outlier percentage, we follow three steps:
Step 1: We multiply the OPPS outlier threshold, which is
1.0 percent, by the total estimated OPPS Medicare payments (before
outliers) for the prospective year to calculate the estimated total
OPPS outlier payments:
(0.01 x Estimated Total OPPS Payments) = Estimated Total OPPS Outlier
Payments.
Step 2: We estimate CMHC outlier payments by taking each
provider's estimated costs (based on their allowable charges multiplied
by the provider's CCR) minus each provider's estimated CMHC outlier
multiplier threshold (we refer readers to section VIII.C.3 of the CY
2022 OPPS/ASC proposed rule). That threshold is determined by
multiplying the provider's estimated paid days by 3.4 times the total
of CMHC PHP APC and CMHC IOP payment rates. If the provider's costs
exceed the threshold, we multiply that excess by 50 percent, as
described in section VIII.E.3 of this final rule with comment period,
to determine the estimated outlier payments for that provider. CMHC
outlier payments are capped at 8 percent of the provider's estimated
total per diem payments (including the beneficiary's copayment), as
described in section VIII.E.5 of this final rule with comment period,
so any provider's costs that exceed the CMHC outlier cap will have its
payments adjusted downward. After accounting for the CMHC outlier cap,
we sum all of the estimated outlier payments to determine the estimated
total CMHC outlier payments.
(Each Provider's Estimated Costs - Each Provider's Estimated
Multiplier Threshold) = A. If A is greater than 0, then (A x 0.50) =
Estimated CMHC Outlier Payment (before cap) = B. If B is greater than
(0.08 x Provider's Total Estimated Per Diem Payments), then cap
adjusted B = (0.08 x Provider's Total Estimated Per Diem Payments);
otherwise, B = B. Sum (B or cap-adjusted-B) for Each Provider = Total
CMHC Outlier Payments.
Step 3: We determine the percentage of all OPPS outlier
payments that CMHCs represent by dividing the estimated CMHC outlier
payments from Step 2 by the total OPPS outlier payments from Step 1:
(Estimated CMHC Outlier Payments/Total OPPS Outlier Payments).
We proposed to continue to calculate the CMHC outlier percentage
according to previously established policies. However, beginning in CY
2024, CMHCs will be permitted to provide and bill for intensive
outpatient services for Medicare patients. Therefore, we proposed to
expand the calculation of the CMHC outlier percentage to include PHP
and IOP, because we anticipate that total payments will increase for
CMHCs in CY 2024. We proposed to maintain our current methodology for
calculating the CMHC outlier percentage, but to apply it to payments
for IOP services as well as PHP services beginning in CY 2024.
Therefore, based on our CY 2024 payment estimates, including our
estimates of both PHP and IOP services, CMHCs are projected to receive
0.01 percent of total hospital outpatient payments in CY 2024,
excluding outlier payments. We proposed to designate approximately less
than 0.01 percent of the estimated 1.0 percent hospital outpatient
outlier threshold for CMHCs. This percentage is based upon the formula
given in Step 3.
We did not receive any public comments on our proposal and are
finalizing our proposal as proposed.
3. Cutoff Point and Percentage Payment Amount
As described in the CY 2018 OPPS/ASC final rule with comment period
(82 FR 59381), our policy has been to pay CMHCs for outliers if the
estimated cost of the day exceeds a cutoff point. In CY 2006, we set
the cutoff point for outlier payments at 3.4 times the highest CMHC PHP
APC payment rate implemented for that calendar year (70 FR 68551). For
CY 2018, the highest CMHC PHP APC payment rate was the payment rate for
CMHC PHP APC 5853. In addition, in CY 2002, the final OPPS outlier
payment percentage for costs above the multiplier threshold was set at
50 percent (66 FR 59889). In CY 2018, we continued to apply the same 50
percent outlier payment percentage that applies to hospitals to CMHCs
and continued to use the existing cutoff point (82 FR 59381).
Therefore, for CY 2018, we continued to pay for partial hospitalization
services that exceeded 3.4 times the CMHC PHP APC payment rate at 50
percent of the amount of CMHC PHP APC geometric mean per diem costs
over the cutoff point. For example, for CY 2018, if a CMHC's cost for
partial hospitalization services paid under CMHC PHP APC 5853 exceeded
3.4 times the CY 2018 payment rate for CMHC PHP APC 5853, the outlier
payment would be calculated as 50 percent of the amount by which the
cost exceeds 3.4 times the CY 2018 payment rate for CMHC PHP APC 5853
[0.50 x (CMHC Cost-(3.4 x APC 5853 rate))]. This same policy was also
reiterated in the CY 2019 OPPS/ASC final rule with comment period (83
FR 58996 through 58997), CY 2020 OPPS/ASC final rule with comment
period (84 FR 61351), the CY 2021 OPPS/ASC final rule with comment
period (85 FR 86082 through 86083), the CY 2022 OPPS/ASC final rule
with comment period (86 FR 63670), and the CY 2023 OPPS/ASC final rule
with comment period (87 FR 72004). For CY 2024, we proposed to continue
to pay for partial hospitalization services that exceed 3.4 times the
proposed CMHC PHP APC payment rate at 50 percent of the CMHC PHP APC
geometric mean per diem costs over the cutoff point. In addition, we
proposed to extend this policy to intensive outpatient services. That
is, for CY 2024, if a CMHC's cost for partial hospitalization services
paid under CMHC PHP APCs 5853 or 5854 exceeds 3.4 times the payment
rate for the APC (either CMHC APC 5853 or 5854), the outlier payment
would be calculated as: [0.50 x (CMHC cost-(3.4 x (PHP APC payment)))].
Similarly, if a CMHC's cost for intensive outpatient services paid
under CMHC IOP APCs 5851 or 5852 exceeds 3.4 times the payment rate for
the APC (either CMHC APCs 5851 or 5852), the outlier payment would be
calculated as: [0.50 x (CMHC cost-(3.4 x (IOP APC payment)))].
We did not receive any public comments on our proposal and are
finalizing our proposed policy as proposed.
4. Outlier Reconciliation
In the CY 2009 OPPS/ASC final rule with comment period (73 FR 68594
through 68599), we established an outlier reconciliation policy to
address charging aberrations related to OPPS outlier payments. We
addressed vulnerabilities in the OPPS outlier payment system that led
to differences between billed charges and charges included in the
overall CCR, which are used to estimate cost and would apply to all
hospitals and CMHCs paid under the OPPS. We initiated steps to ensure
that outlier payments appropriately account for the financial risk when
providing an extraordinarily costly and complex service but are only
being made for services that legitimately qualify for the additional
payment.
For a comprehensive description of outlier reconciliation, we refer
readers to the CY 2023 OPPS/ASC and CY 2019 OPPS/ASC final rules with
comment period (83 FR 58874 and 58875 and 81 FR 79678 through 79680).
We proposed to continue these policies for partial hospitalization
services provided through PHPs for CY 2024. In addition, since CMHCs
will be permitted to provide and bill for
[[Page 81836]]
intensive outpatient services for Medicare patients we proposed to
extend these policies to include intensive outpatient services in order
to encompass the full scope of services that CMHCs will be permitted to
furnish. The current outlier reconciliation policy requires that
providers whose outlier payments meet a specified threshold and whose
overall ancillary CCRs change by plus or minus 10 percentage points or
more, are subject to outlier reconciliation, pending approval of the
CMS Central Office and Regional Office (as established in the CY 2009
OPPS/ASC final rule with comment period (73 FR 68596 through 68599)).
We note that the current threshold for outlier reconciliation for
hospitals is $500,000, and there is no threshold for CMHCs (that is,
all outlier payments are subject to reconciliation for CMHCs whose
overall ancillary CCRs change by plus or minus 10 percentage points or
more). The policy also includes provisions related to CCRs and to
calculating the time value of money for reconciled outlier payments due
to or due from Medicare, as detailed in the CY 2009 OPPS/ASC final rule
with comment period and in the Medicare Claims Processing Manual (73 FR
68595 through 68599 and Medicare Claims Processing internet Only
Manual, Chapter 4, Section 10.7.2 and its subsections, available at:
https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/clm104c04.pdf).
We did not receive any public comments on our proposal and are
finalizing our proposed policy as proposed.
5. Outlier Payment Cap
In the CY 2017 OPPS/ASC final rule with comment period, we
implemented a CMHC outlier payment cap to be applied at the provider
level, such that in any given year, an individual CMHC will receive no
more than a set percentage of its CMHC total per diem payments in
outlier payments (81 FR 79692 through 79695). Our analysis of CY 2014
claims data found that CMHC outlier payments began to increase
similarly to the way they had prior to CY 2004. This was due to
inflated cost from three CMHCs that accounted for 98 percent of all
CMHC outlier payments that year and received outlier payments that
ranged from 104 percent to 713 percent of their total per diem
payments. To balance our concern about disadvantaging CMHCs with our
interest in protecting the benefit from excessive outlier payments and
to mitigate potential inappropriate outlier billing vulnerabilities, we
finalized the CMHC outlier payment cap at 8 percent of the CMHC's total
per diem payments (81 FR 79694 and 79695) to limit the impact of
inflated CMHC charges on outlier payments. This outlier payment cap
only affects CMHCs, it does not affect other provider types (that is,
hospital-based PHPs), and is in addition to and separate from the
current outlier policy and reconciliation policy in effect. In the CY
2020 OPPS/ASC final rule with comment period (84 FR 61351), we
finalized a proposal to continue this policy in CY 2020 and subsequent
years. We proposed to maintain the 8 percent outlier payment cap for CY
2024 and apply it to both PHP and IOP payments. We note that the 8
percent would be calculated as 8 percent of total per diem PHP and IOP
payments for CY 2024. As discussed earlier in this rule, beginning in
CY 2024, CMHCs will be permitted to provide and bill for intensive
outpatient services for Medicare patients. Therefore, we proposed to
expand the calculation of the CMHC outlier cap to include both PHP and
IOP, because we anticipate that total payments will increase for CMHCs
in CY 2024. Therefore, we proposed to calculate the 8 percent outlier
payment cap for each CMHC in a way that would encompass the full scope
of services that CMHCs will be permitted to furnish in CY 2024.
We did not receive any public comments on our proposal and
therefore, we are finalizing as proposed.
6. Fixed-Dollar Threshold
In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59267
and 59268), for the hospital outpatient outlier payment policy, we set
a fixed-dollar threshold in addition to an APC multiplier threshold.
Fixed-dollar thresholds are typically used to drive outlier payments
for very costly items or services, such as cardiac pacemaker
insertions. Currently, for CY 2023, CMHC PHP APC 5853 is the only APC
for which CMHCs may receive payment under the OPPS and is for providing
a defined set of services that are relatively low cost when compared to
other OPPS services. Because of the relatively low cost of CMHC
services that are used to comprise the structure of CMHC PHP APC 5853,
it is not necessary to also impose a fixed-dollar threshold on CMHCs.
Therefore, in the CY 2018 OPPS/ASC final rule with comment period, we
did not set a fixed-dollar threshold for CMHC outlier payments (82 FR
59381). This same policy was also reiterated in the CY 2020 OPPS/ASC
final rule with comment period (84 FR 61351), the CY 2021 OPPS/ASC
final rule with comment period (85 FR 86083), the CY 2022 OPPS/ASC
final rule with comment period (86 FR 63508), and the CY 2023 OPPS/ASC
final rule with comment period (87 FR 72004). We proposed to continue
this policy for CY 2024 and not set a fixed-dollar threshold for the
CMHC PHP APCs (5853 or 5854) or IOP APCs (5851 or 5852).
Comment: Several commenters urged CMS to implement a site-neutral
payment for CMHCs and hospital-based providers for PHP and IOP
services. Commenters stated that a site-neutral payment would eliminate
the need for a separate outlier policy for CMHCs.
Response: We disagree with commenters who believe that a site-
neutral payment would eliminate the need for a separate outlier policy
for CMHCs. As discussed in the CY 2004 OPPS final rule with comment
period (68 FR 63469 and 63470), we noted a significant difference in
the amount of outlier payments made to hospitals and CMHCs for PHP
services. Given the difference in PHP charges between hospitals and
CMHCs, we did not believe it was appropriate to make outlier payments
to CMHCs using the outlier percentage target amount and threshold
established for hospitals. Therefore, beginning in CY 2004, we created
a separate outlier policy specific to the estimated costs and OPPS
payments provided to CMHCs. We designated a portion of the estimated
OPPS outlier threshold specifically for CMHCs, consistent with the
percentage of projected payments to CMHCs under the OPPS each year,
excluding outlier payments, and established a separate outlier
threshold for CMHCs. Furthermore, to balance our concern about
disadvantaging CMHCs with our interest in protecting the benefit from
excessive outlier payments and to mitigate potential inappropriate
outlier billing vulnerabilities, we finalized the CMHC outlier payment
cap at 8 percent of the CMHC's total per diem payments (81 FR 79694 and
79695) to limit the impact of inflated CMHC charges on outlier
payments. In conclusion, CMS does not believe payment methodology has
any effect on outlier policy.
Final Decision: After consideration of the public comments we
received, we are finalizing our proposed policy as proposed.
[[Page 81837]]
F. Rural Health Clinics (RHCs) and Federally Qualified Health Centers
(FQHCs)
1. Background
a. Statutory Background
The Rural Health Clinic Services Act of 1977 (Pub. L. 95-210,
December 13, 1977), amended the Act by enacting section 1861(aa) of the
Act to extend Medicare and Medicaid entitlement and payment for rural
health clinics (RHCs), which are defined as being primarily engaged in
furnishing outpatient services by physicians and certain nonphysician
practitioners, and for services and supplies incidental to their
services. ``Nonphysician practitioners'' included nurse practitioners
and physician assistants. (Subsequent legislation extended the
definition of covered RHC services to include the services of clinical
psychologists, clinical social workers, certified nurse midwives,
marriage and family therapist, and mental health counselors). The
statutory payment requirements for RHC services are set forth at
section 1833(a)(3) of the Act, which states that RHCs are paid
reasonable costs, less the amount a provider may charge as described in
clause of section 1866(a)(2)(A) of the Act, but in no case may the
payment exceed 80 percent of such costs.
Section 1861(aa)(2) of the Social Security Act (42 U.S.C.
1395x(aa)(2)) defines the term ``rural health clinic'', in relevant
part, as a facility that is located in an area that is not an urbanized
area and in which there are insufficient numbers of needed health care
practitioners and is not a rehabilitation agency or a facility
primarily for the care and treatment of mental diseases. Additionally,
the law includes a basic requirement that the facility is primarily
engaged in providing health care services furnished by physicians,
physician assistants, nurse practitioners, clinical psychologists, and
clinical social workers to outpatients.
Section 4161 of the Omnibus Budget Reconciliation Act of 1990 (Pub.
L. 101-508, November 5, 1990) (OBRA 90) established Federally Qualified
Health Centers (FQHCs) in 1990 to be effective beginning on October 1,
1991. The law mandated that FQHCs furnish services that are typically
furnished in an outpatient setting.
Section 1861(aa)(3) of the Act extends Medicare and Medicaid
entitlement and payment for those services defined as RHC services
under section 1861(aa)(1) of the Act, preventive services defined under
section 1861(ddd)(3) of the Act, and preventive primary health services
that a center is required to provide under section 330 of the Public
Health Service Act furnished at a FQHC. Section 1861(aa)(4) of the Act
describes the statutory requirements that FQHCs must meet to qualify
for Medicare payment. Section 10501(i)(3)(A) of the Affordable Care Act
(Pub. L. 111-148) added section 1834(o) of the Act to establish a new
system of payment for the costs of FQHC services under Medicare Part B
(Supplemental Medical Insurance) based on prospectively set rates.
Section 1834(o)(2)(A) of the Act, the FQHC prospective payment system
(PPS) was effective beginning on October 1, 2014. In addition, section
10501(i)(3)(B) of the Affordable Care Act added section 1833(a)(1)(Z)
to the Act to specify that Medicare payment for FQHC services under
section 1834(o) of the Act shall be 80 percent of the lesser of the
actual charge or the amount determined under section 1834(o) of the
Act.
Regulations pertaining to RHC and FQHC benefits are codified at 42
CFR part 405, subpart X.
b. Medicare Part B Payment of RHC and FQHC Services
As provided in 42 CFR part 405, subpart X, of our regulations, RHC
and FQHC visits generally are face-to-face encounters between a patient
and one or more RHC or FQHC practitioners during which one or more RHC
or FQHC qualifying services are furnished. RHC and FQHC practitioners
are physicians, NPs, PAs, certified nurse-midwife (CNMs), clinical
psychologists (CPs), and clinical social workers, and under certain
conditions, a registered nurse or licensed practical nurse furnishing
care to a homebound RHC or FQHC patient in an area with a shortage of
home health agencies. We note, effective January 1, 2024, marriage and
family therapist and mental health counselor services are considered
RHC services in accordance with section 1861(aa)(1)(B) of the Act as
amended by section 4121(b) of CAA, 2023, which is incorporated into
FQHC services through section 1861(aa)(3)(A) of the Act. In the CY 2024
PFS proposed rule, we propose to codify payment for MFTs and MHCs at
Sec. 405.2411 (88 FR 52398). Only medically necessary medical, mental
health, or qualified preventive health services that require the skill
level of an RHC or FQHC practitioner are RHC or FQHC billable visits.
Services furnished by auxiliary personnel (for example, nurses, medical
assistants, or other clinical personnel acting under the supervision of
the RHC or FQHC practitioner) are considered incident to the visit and
are included in the per-visit payment.
Section 130 of the Consolidated Appropriations Act, 2021 (CAA,
2021) (Pub. L. 116-260, December 27, 2020), updated section 1833(f) of
the Act by restructuring the payment limits for RHCs beginning April 1,
2021. As of April 1, 2021, all RHCs are subject to payment limits on
the all-inclusive rate (AIR), and this limit will be determined for
each RHC in accordance with section 1833(f) of the Act. RHCs generally
are paid an AIR for all medically necessary medical and mental health
services and qualified preventive health services furnished on the same
day (with some exceptions). The AIR is subject to a payment limit,
meaning that an RHC will not receive any payment beyond the specified
limit amount.
FQHCs were paid under the same AIR methodology until October 1,
2014. Subsequently, FQHCs began to transition to the FQHC PPS system,
in which they are paid based on the lesser of the FQHC PPS rate or
their actual charges. The FQHC PPS rate is adjusted for geographic
differences in the cost of services by the FQHC PPS geographic
adjustment factor (GAF). The rate is increased by 34 percent when an
FQHC furnishes care to a patient that is new to the FQHC, or to a
beneficiary receiving an initial preventive physical examination (IPPE)
or has an annual wellness visit (AWV).
Both the RHC AIR and FQHC PPS payment rates were designed to
reflect the cost of all services and supplies that an RHC or FQHC
furnishes to a patient in a single day. The rates are not adjusted for
the complexity of the patient health care needs, the length of the
visit, or the number or type of practitioners involved in the patient's
care. RHCs and FQHCs are required to file a cost report annually to
determine their payment rate, which reflects adjustments for GME
payments, bad debt, and influenza, pneumococcal and COVID-19 vaccines
and covered monoclonal antibody products used as pre-exposure
prophylaxis prevention of COVID-19 and their administration.
There are additional payments for non-face-to-face services for
care management services including chronic care management (CCM),
principal care management (PCM), chronic pain management (CPM), general
behavior health integration (GBHI), psychiatric collaborative care
model (CoCM), and virtual communications (Sec. 405.2464(c)).
Additionally, for FQHCs, Sec. 405.2462(d) describes a
``grandfathered tribal FQHC'' as a FQHC that is operated by a tribe or
tribal organization under the Indian Self-
[[Page 81838]]
Determination and Education Assistance Act (ISDEAA); was billing as if
it were a provider-based to an Indian Health Service (IHS) hospital on
or before April 7, 2000, and is not currently operating as a provider-
based department of an IHS hospital. We refer to these tribal FQHCs as
``grandfathered tribal FQHCs'' to distinguish them from freestanding
tribal FQHCs that are currently being paid the lesser of their charges
or the adjusted national FQHC PPS rate, and from provider-based tribal
clinics that may have begun operations subsequent to April 7, 2000.
Under the authority in section 1834(o) of the Act to include
adjustments determined appropriate by the Secretary, we revised
Sec. Sec. 405.2462 and 405.2464 to pay these grandfathered tribal
FQHCs on the Medicare outpatient per visit rate as set annually by the
IHS, and not the FQHC PPS payment rates (80 FR 71089). Such payment
rates for outpatient medical care (also referred to as outpatient
hospital services) furnished by the IHS and tribal facilities is set
annually by the IHS under the authority of sections 321(a) and 322(b)
of the Public Health Service Act (the PHS Act) (42 U.S.C. 248 and
249(b)) (Pub. L. 83-568 (42 U.S.C. 2001(a)), and the IHCIA, based on
the previous year cost reports from Federal and tribal hospitals. The
outpatient per visit rate is only applicable for those IHS or tribal
facilities that meet the definition of a provider-based department as
described at Sec. 413.65(m), or a ``grandfathered'' tribal FQHC as
described at Sec. 405.2462(d)(1). There is a higher outpatient per
visit rate for IHS and tribal Medicare visits in Alaska and a lower
general outpatient per visit rate for IHS/tribal Medicare visits in the
lower 48 States (IHS does not operate any hospitals or facilities in
Hawaii or the territories, and thus, no rates are set in those
localities). For CY 2023, the outpatient per visit rate for Medicare
visits in Alaska is $801 and $620 in the lower 48 States.
2. Establishment of Intensive Outpatient Services Benefit by Section
4124 of the CAA, 2023
a. Section 4124 of the Consolidated Appropriations Act of 2023
As we discuss in the CY 2024 OPPS proposed rule (88 FR 49714 and
49715) section 4124 of Division FF of the CAA, 2023 established
Medicare coverage for intensive outpatient program (IOP) services
furnished by a hospital to its outpatients, or by a community mental
health center (CMHC)), a FQHC or a RHC, as a distinct and organized
intensive ambulatory treatment service offering less than 24-hour daily
care in a location other than an individual's home or inpatient or
residential setting, effective January 1, 2024.
We explained that an IOP is a distinct and organized outpatient
program of psychiatric services provided for individuals who have an
acute mental illness, which includes, but is not limited to conditions
such as depression, schizophrenia, and substance use disorders. We
noted an IOP is thought to be less intensive than a partial
hospitalization program (PHP).
This new provision mandated several changes to the RHC and FQHC
policies, including scope of benefits and services, certification and
plan of care requirements, and special payment rules for IOP services
in RHCs and FQHCs, all of which are discussed in the paragraphs below.
3. IOP Scope of Benefits and Scope of Services in RHC and FQHC Settings
a. Background
As described in section 1861(aa) of the Act and codified under
Sec. Sec. 405.2411 and 405.2446, the current scope of benefits for RHC
and FQHC services are those services covered in a RHC, FQHC, or other
outpatient setting, including a patient's place of residence, or a
Medicare-covered Part A skilled nursing facility (SNF) when provided by
a physician, nurse practitioner, physician assistant, certified nurse
midwife, clinical psychologist, or a clinical social worker. RHC/FQHC
services may also be covered for individuals who have elected hospice
when provided by an RHC/FQHC physician, nurse practitioner, or
physician assistant employed or under contract with the RHC or FQHC at
the time the services are furnished, who has been designated by the
patient as his or her attending physician. Starting January 1, 2024,
services of a marriage and family therapist (MFT) or mental health
counselor (MHC) are covered under RHC/FQHC services if such MFT or MHC
is employed or under contract with the RHC or FQHC at the time the
services are furnished.
As defined in Sec. 405.2415, RHCs and FQHCs furnish physicians'
services; services and supplies ``incident to'' the services of
physicians: Nurse practitioner (NP), physician assistant (PA),
certified nurse-midwife (CNM), clinical psychologist (CP), and clinical
social worker (CSW) services; and services and supplies incident to the
services of NPs, PAs, CNMs, CPs, and CSWs. They may also furnish
diabetes self-management training and medical nutrition therapy (DSMT/
MNT), transitional care management (TCM) services, and in some cases,
visiting nurse services furnished by a registered professional nurse or
a licensed practical nurse.
Only medically necessary medical, mental health, or qualified
preventive health services that require the skill level of an RHC or
FQHC practitioner are RHC or FQHC billable visits. Services furnished
by auxiliary personnel (for example, nurses, medical assistants, or
other clinical personnel acting under the supervision of the RHC or
FQHC practitioner) are considered incident to the visit and are
included in the per-visit payment.
RHC and FQHC services also include certain preventive services when
specified in statute or when established through the National Coverage
Determination (NCD) process. RHCs and FQHCs are paid for the
professional component of allowable preventive services when all of the
program requirements are met and frequency limits (where applicable)
have not been exceeded.
As discussed in the CY 2024 OPPS proposed rule (88 FR 49715),
section 4124(b)(4) of the CAA, 2023, amended section 1861(aa)(1) of the
Act by adding subparagraph (D) to establish Medicare Part B coverage
for IOP services as defined in section 1861(ff)(4) of the Act when
these services are furnished by RHCs, which is incorporated for FQHCs
by reference in section 1861(aa)(3)(A) of the Act, effective January 1,
2024. We explained that, section 1861(ff)(2) of the Act describes the
items and services available under the PHP and IOP benefits. These
items and services include: individual and group therapy with
physicians or psychologists (or other mental health professionals to
the extent authorized under State law); occupational therapy requiring
the skills of a qualified occupational therapist; services of social
workers, trained psychiatric nurses, and other staff trained to work
with psychiatric patients; drugs and biologicals furnished for
therapeutic purposes (which cannot, as determined in accordance with
regulations, be self-administered); individualized activity therapies
that are not primarily recreational or diversionary; family counseling
(the primary purpose of which is treatment of the individual's
condition); patient training and education (to the extent that training
and educational activities are closely and clearly related to
individual's care and treatment); diagnostic services; and such other
items and services as the Secretary may provide (excluding meals and
transportation) that are reasonable
[[Page 81839]]
and necessary for the diagnosis or active treatment of the individual's
condition, reasonably expected to improve or maintain the individual's
condition and functional level and to prevent relapse or
hospitalization, and furnished pursuant to such guidelines relating to
frequency and duration of services as the Secretary shall by regulation
establish, taking into account accepted norms of medical practice and
the reasonable expectation of patient improvement.
In the CY 2024 OPPS proposed rule (88 FR 49715), we stated that, in
order to be consistent with the scope of benefits required for IOP
services under section 1861(ff)(2) of the Act, we proposed to adopt the
same standards for IOP services furnished in RHCs and FQHCs as they
were proposed for the outpatient hospital setting. For the outpatient
hospital setting, we proposed to add regulations at Sec. 410.44 to set
forth the conditions and exclusions that would apply for intensive
outpatient services (88 FR 49700). Therefore, to be consistent with the
statute, we proposed revisions to the RHC and FQHC regulations at 42
CFR part 405, subpart X, that would crosswalk to Sec. 410.44.
Specifically, we proposed the following conforming regulatory changes:
At Sec. 405.2401, Scope and definitions, we proposed to
amend the section to add IOP services.
At Sec. 405.2411, Scope of benefits, we proposed to amend
the section to include IOP services.
At Sec. 405.2446, Scope of services, we proposed to amend
this section to include IOP services.
We noted that these proposals would expand access to behavioral
health treatment for Medicare beneficiaries and to ensure continuity of
care for IOP services to best meet patient needs.
The following is a summary of the public comments received on the
scope of benefits for IOP services furnished in RHCs/FQHCs and our
responses:
Comment: Many commenters supported our proposal to use the same
standards for IOP services furnished in RHCs/FQHCs as in other
settings. Commenters stated that these services would expand access to
affordable and culturally competent services for the most vulnerable
Medicare beneficiaries and hopefully increase rural uptake of this
program. One commenter urged CMS to implement these proposals
permanently as they will reduce barriers for patients, increase access
to crucial services, and improve equity. One commenter encouraged CMS
to continue to seek ways to clarify and enhance occupational therapy's
role within FQHCs and RHCs. Other commenters urged CMS to provide
additional guidance to health centers on classifying professional
services furnished by physicians, NPs, PAs, and psychologists during an
IOP service.
Response: We appreciate the commenters support. As we noted in the
CY 2024 OPPS proposed rule (88 FR 49714) and as discussed in section
VIII.B.2 of this final rule with comment period, section 4124 of the
CAA, 2023 established Medicare coverage for IOP services to be
furnished by FQHCs and RHCs, effective January 1, 2024. Therefore,
beginning January 1, 2024, IOP is a permanent benefit that RHCs and
FQHCs will be able to furnish in their respective settings.
Regarding occupational therapy's role within RHCs and FQHCs, we
note the IOP benefit includes occupational therapy as part of its list
of items and services. To reiterate, the types of services covered as
intensive outpatient services and the classifications of the types of
professional that can provide some of the services include: individual
and group therapy with physicians or psychologists or other mental
health professionals to the extent authorized under State law;
occupational therapy requiring the skills of a qualified occupational
therapist, provided by an occupational therapist, or under appropriate
supervision of a qualified occupational therapist by an occupational
therapy assistant; services of social workers, trained psychiatric
nurses, and other staff trained to work with psychiatric patients;
drugs and biologicals furnished for therapeutic purposes;
individualized activity therapies that are not primarily recreational
or diversionary; family counseling, the primary purpose of which is
treatment of the individual's condition; patient training and
education, to the extent the training and educational activities are
closely and clearly related to the individual's care and treatment; and
diagnostic services. CMS is unclear about what the commenter meant by
``classifying professional services,'' but we note that physicians,
NPs, PAs, and psychologists are practitioners in FQHCs and as such can
furnish IOP services. As with any new benefit under Medicare for RHCs
and FQHCs, we will be updating our sub-regulatory guidance and
providing outreach and education.
After consideration of the public comments we received, we are
finalizing our proposal to adopt the same standards for IOP services
furnished in RHCs and FQHCs as in the outpatient hospital and CMHC
settings, as proposed. That is, IOP services are services that: (1) are
reasonable and necessary for the diagnosis or active treatment of the
individual's condition; (2) are reasonably expected to improve or
maintain the individual's condition and functional level and to prevent
relapse or hospitalization; (3) are furnished in accordance with a
physician certification and plan of care as specified under new
regulations at Sec. 424.24(d); and can be individual and group
therapy, occupational therapy, drugs and biologicals furnished for
therapeutic purposes, which cannot be self-administered, family
counseling, beneficiary education, and diagnostic services.
Accordingly, we are finalizing our proposal to make conforming
regulatory changes to Sec. Sec. 405.2401, 405.2411, and 405.2446. We
note a detailed discussion regarding the final policies under Sec.
410.44 are available in section VIII.B.2 of this final rule with
comment period.
b. Certification and Plan of Care Requirements for IOPs in RHC and FQHC
Settings
Section 4124(b)(2)(B) of the CAA, 2023 amended section 1861(ff) of
the Act to add paragraph (4) to define intensive outpatient services as
the items and services prescribed by a physician for an individual
determined (not less frequently than once every other month) by a
physician to have a need for such services for a minimum of 9 hours per
week and provided under a program described in paragraph (3) (that is,
an outpatient program of mostly mental health related services and
therapies provided by a hospital or CMHC on an outpatient basis) under
the supervision of a physician. The services must be provided pursuant
to an individualized, written plan of treatment established and
periodically reviewed by a physician (in consultation with appropriate
staff participating in such program), which sets forth the physician's
diagnosis, the type, amount, frequency, and duration of the items and
services provided under the plan, and the goals for treatment under the
plan.
In the CY 2024 OPPS proposed rule (88 FR 49716), we stated to be
consistent with physician certification and plan of care requirements
required for IOP under section 1861(ff)(4) of the Act, we proposed to
adopt the same standards for RHCs and FQHCs as they were proposed for
the outpatient hospital setting. For the outpatient hospital setting,
we proposed to codify the content of the certification and plan of
treatment requirements for intensive outpatient services at Sec.
424.24(d) (88 FR 49702). We explained that physicians would be required
to certify that an
[[Page 81840]]
individual needs IOP services for a minimum of 9 hours per week and no
more than 19 hours per week, as set out in section 4124 of CAA, 2023.
This certification would require documentation to include that the
individual requires such services for a minimum of 9 hours per week;
require the first certification as of the 30th day of IOP services; and
require that the certification of IOP services occur no less frequently
than every other month. Therefore, to be consistent with the statute,
we proposed to revise our regulations at 42 CFR part 405, subpart X, to
specify that for the purpose of furnishing IOP services RHCs and FQHCs
must similarly meet the certification and plan of care requirements at
proposed Sec. 424.24(d).
As discussed in the CY 2024 OPPS proposed rule (88 FR 49716), we
also proposed to establish the same patient eligibility criteria for
intensive outpatient services as described in proposed Sec. 410.44(c).
Specifically, we proposed that intensive outpatient services are
intended for patients who: (1) require a minimum of 9 hours per week of
therapeutic services as evidenced in their plan of care; (2) are likely
to benefit from a coordinated program of services and require more than
isolated sessions of outpatient treatment; (3) do not require 24-hour
care; (4) have an adequate support system while not actively engaged in
the program; (5) have a mental health diagnosis; (6) are not judged to
be dangerous to self or others; and (7) have the cognitive and
emotional ability to participate in the active treatment process and
can tolerate the intensity of the intensive outpatient program.
The following is a summary of the public comments received on the
certification and plan of care requirements for IOP services furnished
in RHCs/FQHCs and our responses:
Comment: Commenters were supportive of CMS' proposal to adopt the
same standards of physician certification and plan of care requirements
for IOP services furnished in RHCs and FQHCs. One commenter recommended
that CMS ensure that IOP certification appointments count as FQHC
visits by amending the Medicare FQHC-specific payment codes to allow
for a physician visit with the purpose of evaluating a patient for IOP
(or recertifying the patient) to qualify as a billable mental health
``visit.''
Response: We appreciate the support received from commenters. In
response to comments regarding the IOP certification appointments
counting as an FQHC visit, we note that medically necessary medical,
mental health, or qualified preventive health services that require the
skill level of an RHC or FQHC practitioner are RHC or FQHC billable
visits. We believe that the physician determination of the need for a
patient to receive IOP services, certification for IOP services and
recertification would generally be tied to an E/M visit and qualify as
an RHC or FQHC billable visit. We believe that the FQHC Specific
Payment Code list of qualifying visits under FQHC PPS \166\ includes an
array of services and appears to capture the type of visit, that is a
medical or mental health service that could determine a patient's need
for IOP and certification or recertification.
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\166\ https://www.cms.gov/medicare/medicare-fee-for-service-payment/fqhcpps/downloads/fqhc-pps-specific-payment-codes.pdf.
---------------------------------------------------------------------------
Comment: We received a comment from an RHC association in response
to the comment solicitation in the CY 2024 OPPS proposed rule on peer
services, and whether these would be appropriate to include for PHPs
and IOPs (88 FR 49707). The commenter supports including services that
are furnished by a peer support specialist as IOP services. They stated
that rural areas are facing a dearth of behavioral health practitioners
and oftentimes rely upon professionals with less intensive education
and training requirements, like peer support specialists. The commenter
further stated that peer support specialists also bring lived
experience to their work, which can help them address the unique needs
of rural beneficiaries with behavioral health diagnoses and that peer
support specialists could be treated similarly to community health
workers in CMS' proposed community health integration services.
Response: We thank the commenter for raising this concern. As
discussed in section VIII.C of this final rule with comment period, CMS
is adopting principal illness navigation (PIN) services as applicable
to IOP to be included as IOP services after consideration of the
comments received in support of the inclusion of peer support
specialist services. Specifically, we discuss the appropriateness of
the PIN services described by codes G0023, G0024, G0140, and G0146.
Consequently, to the extent that such services are permissible under
Sec. 410.44, RHCs and FQHCs could provide them as part of the IOP
benefit.
We believe peer support workers are people who have been successful
in the recovery process who help others experiencing similar
situations. Through shared understanding, respect, and mutual
empowerment, peer support workers help people become and stay engaged
in the recovery process and reduce the likelihood of relapse. Peer
support services can effectively extend the reach of treatment beyond
the clinical setting into the everyday environment of those seeking a
successful, sustained recovery process. Peer support workers typically
engage in a wide range of activities, including: advocating for people
in recovery; sharing resources and building skills; building community
and relationships; leading recovery groups; and mentoring and setting
goals.
With regard to RHCs and FQHCs, we believe that peer support
specialists are considered auxiliary personnel, and as such can provide
RHC/FQHC services under the direct supervision of the RHC or FQHC
practitioner, as long as the peer support specialists are certified or
trained to provide all elements in the corresponding service and be
authorized to perform them under applicable State law and regulations.
A detailed discussion regarding PIN services is available in section
II.E of the CY 2024 PFS final rule.
After consideration of the public comments we received, we are
finalizing our proposal to adopt the same standards for physician
certification and plan of care requirements for RHCs and FQHCs
providing IOP services as in the outpatient hospital and CMHC settings.
In summary, certification requirements include the physician certifying
and documenting that the patient has a need for a minimum of 9 hours of
IOP services and must occur at least once every other month.\167\ The
patient's individualized plan of treatment should address all of the
conditions that are being treated by the IOP. Recertification of IOP
should occur at least every 60 days.
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\167\ We note in the CY 2024 OPPS proposed rule (88 FR 49716),
we incorrectly summarized the proposed language for Sec. 424.24(d),
that is, (1) that the physician must also certify that an individual
needs IOP services for no more than 19 hours per week and (2) that
it is a requirement for the first certification take place as of the
30th day of IOP services.
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Accordingly, we are finalizing that for the purpose of furnishing
IOP services, RHCs and FQHCs must similarly meet the certification and
plan of care requirements at Sec. 424.24(d). This provision is
codified in the RHC/FQHC regulations in the final revisions to
Sec. Sec. 405.2401, 405.2411, and 405.2446 by way of the crosswalk to
Sec. 410.44 as finalized above in section VIII.B.3. of this final rule
with comment period. That is, in Sec. 410.44(a)(3) we have finalized
requirements that intensive outpatient services are furnished in
[[Page 81841]]
accordance with a physician certification and plan of care as specified
under Sec. 424.24(d). We note a detailed discussion regarding the
final policies under Sec. 424.24(d) are available in section VIII.B.3
of this final rule with comment period.
In addition, we are finalizing the same patient eligibility
criteria for intensive outpatient services as described Sec.
410.44(c), as proposed. Specifically, we are finalizing requirements
that intensive outpatient services are available for patients who meet
the following criteria: (1) require a minimum of 9 hours per week of
therapeutic services as evidenced in their plan of care; (2) are likely
to benefit from a coordinated program of services and require more than
isolated sessions of outpatient treatment; (3) do not require 24-hour
care; (4) have an adequate support system while not actively engaged in
the program; (5) have a mental health diagnosis; (6) are not judged to
be dangerous to self or others; and (7) have the cognitive and
emotional ability to participate in the active treatment process and
can tolerate the intensity of the intensive outpatient program. We note
a detailed discussion regarding the final policies under Sec.
410.44(c) are available in section VIII.B.2.a. of this final rule with
comment period.
4. Special Payment Rules for Intensive Outpatient Services
Under Medicare Part B, payment to RHCs for services (defined in
Sec. 405.2411) furnished to beneficiaries is made on the basis of an
all-inclusive payment methodology subject to a maximum payment per-
visit and annual reconciliation. Our regulations at Sec. 405.2470
provide that RHCs are required to submit cost reports to allow the
Medicare Administrative Contractor (MAC) to determine payment in
accordance with 42 CFR part 405, subpart X, and instructions issued by
CMS. The beneficiary is responsible for the Medicare Part B deductible
and coinsurance amounts. Section 1866(a)(2)(A)(ii) of the Act and
implementing regulations at Sec. 405.2410(b) establish beneficiary
coinsurance at an amount not to exceed 20 percent of the clinic's
reasonable charges for covered services.
Under Medicare Part B, FQHCs are paid under the FQHC PPS for
services (defined in Sec. 405.2446) furnished to beneficiaries. The
statutory payment requirements for FQHC services are set forth at
section 1834(o) of the Act. In addition, section 1833(a)(1)(Z) of the
Act requires Medicare payment for FQHC services, determined under
section 1834(o) of the Act, to be 80 percent of the lesser of the
actual charge or the amount determined under section 1834(o) of the
Act. Under the FQHC PPS, FQHCs are paid based on the lesser of the
FQHC's actual charge for the service or the PPS rate (Sec.
405.2462(g)(1)). The FQHC PPS rate is subsequently adjusted for certain
circumstances as described under Sec. 405.2464(b)(2). The Medicare
Part B deductible does not apply to FQHC services. The beneficiary is
responsible for a coinsurance amount of 20 percent of the lesser of the
FQHC's actual charge for the service or the adjusted PPS rate.
As we discuss in the CY 2021 PFS final rule (85 FR 84699 through
84710), the FQHC PPS base payment is annually increased by the
percentage increase in the FQHC market basket, which reflects the
operating and capital cost structures for freestanding FQHC facilities.
Beginning with CY 2017, FQHC PPS payments were updated using a 2013-
based FQHC market basket. A complete discussion of the 2013-based FQHC
market basket can be found in the CY 2017 PFS final rule (81 FR 80393
through 80403). In the CY 2021 PFS final rule, we finalized the
rebasing and revising of the FQHC market basket to reflect a 2017 base
year. The 2017-based FQHC market basket is primarily based on Medicare
cost report data for freestanding FQHCs for 2017, which are for cost
reporting periods beginning on and after October 1, 2016, and prior to
September 31, 2017. We explained that we used data from cost reports
beginning in FY 2017 because these data were the latest available,
complete data for calculating the major cost weights for the market
basket at the time of rulemaking. We also explained that CMS updates
the market basket periodically so that the cost weights reflect a
current mix of goods and services purchased in providing FQHC services.
Seven FQHCs that have been determined to be grandfathered tribal
FQHCs and due to this designation are paid based on the lesser of the
outpatient per visit rate or their actual charges, as set out at Sec.
405.2462(f). These grandfathered tribal FQHCs are paid the outpatient
per visit rate for furnishing FQHC services.
In addition to the normal package of services, RHCs and FQHCs
receive payment for certain additional services. In the CY 2022 PFS
final rule (86 FR 65205 and 65206), we implemented section 132 of CAA,
2021, which amended section 1834(o) of the Act and added a new section
1834(y) to the Act, to provide statutory authority for FQHCs and RHCs,
respectively, to receive payment for hospice attending physician
services. In the CY 2023 PFS final rule (87 FR 69463, 69737 through
69739) we implemented sections 304(b) and (c) of division P of the CAA,
2022 (Pub. L. 117-103, March 15, 2022). Those subsections modified
sections 1834(y) and 1834(o)(4) of the Act, respectively, to delay in-
person visit requirements in order to for RHCs and FQHCs to receive
payment for mental health visits furnished via telecommunications
technology.
As we discuss in the CY 2024 OPPS proposed rule (88 FR 49716 and
49717), section 4124(c) of the CAA, 2023 further amended section
1834(o) of the Act and section 1834(y) of the Act, to provide special
payment rules for both FQHCs and RHCs, respectively, for furnishing
intensive outpatient services. Section 4124(c)(1) of the CAA, 2023
amended section 1834(o) of the Act to add a new paragraph (5)(A) to
require that payment for IOP services furnished by FQHCs be equal to
the amount that would have been paid under Medicare for IOP services
had they been covered outpatient department services furnished by a
hospital. In addition, section 4124(c)(2) of the CAA, 2023 amended
section 1834(y) of the Act to add a new paragraph (3)(A) to require
that payment for IOP services furnished by RHCs be equal to the amount
that would have been paid under Medicare for IOP services had they been
covered outpatient department services furnished by a hospital.
In the CY 2024 OPPS proposed rule (88 FR 49707 through 49711), we
provide a detailed discussion of the proposed CY 2024 payment rate
methodology for IOP. We proposed to establish two IOP APC per diem
payment rates for hospital-based IOPs (APC 5861 and APC 5862 for 3-
service days and 4-service days, respectively).
Consequently, in the CY 2024 OPPS proposed rule (88 FR 49716 and
49717), we addressed our proposed payment policy for RHCs and FQHCs
that furnish IOP services. We stated that we believe that it is
appropriate to provide a payment structure that supports beneficiaries
in an IOP where the utilization is typically structured to be days with
three or fewer services. Therefore, we proposed that the rate
determined for APC 5861 (Intensive Outpatient (3 services per day) for
hospital-based IOPs) would be the payment rate for IOP services
furnished in an RHC. For IOP services furnished in FQHCs, we proposed
that payment be based on the lesser of a FQHC's actual charges or the
rate determined for APC 5861. Additionally, we proposed that
grandfathered tribal FQHCs will
[[Page 81842]]
continue to have their payment based on the outpatient per visit rate
when furnishing IOP services. That is, payment is based on the lesser
of a grandfathered tribal FQHC's actual charges or the outpatient per
visit rate. We proposed to revise Sec. Sec. 405.2410, 405.2462, and
405.2464 in the regulations to reflect the payment amount for IOP
services and how the Medicare Part B deductible and coinsurance are
applied.
In addition, we solicited comment on whether the payment rate for
IOP services furnished in RHCs and FQHCs should be adjusted to reflect
the variations in costs of furnishing services in different geographic
areas and what approaches would be appropriate for determining the
value of the adjustment. We also solicited comment on whether the
hospital-based IOP APC 5862 for 4-service days would be appropriate for
RHCs and FQHCs.
In the CY 2024 OPPS proposed rule (88 FR 49716 and 49717), we
discussed the proposals for coding and billing for IOP services under
the OPPS. We explained that beginning January 1, 2024, the hospital
outpatient department and CMHCs would be able to furnish items and
services of both PHPs and IOPs. We stated that we believed it was
appropriate to align these programs by using a consolidated list of
HCPCS codes would identify the full range of services that both IOPs
and PHPs provide to Medicare beneficiaries for billing purposes. We
explained that those settings are paid under the OPPS and since they
can furnish either PHP or IOP, when submitting a claim to CMS for
payment they would be required to report a new condition code 92 to
differentiate between PHP and IOP.
We explained that, while RHCs and FQHCs are not authorized to
furnish PHP services, we proposed to also require RHCs and FQHCs to
report condition code 92 to identify intensive outpatient claims. Since
RHCs and FQHCs are paid for IOP services outside of the RHC AIR
methodology and FQHC PPS, we believe the condition code reporting
approach would allow us to operationalize a 3 service per day payment
amount using the final list of HCPCS codes used to identify the full
range of services for IOP. In addition, we proposed to align with the
requirement under the OPPS, which is in order to qualify for IOP
payment, at least one service must be from the Intensive Outpatient
Primary list.
We stated, section 4124(c)(1) of the CAA, 2023 amended section
1834(o) of the Act to add a new paragraph (5)(B) to require that costs
associated with intensive outpatient services not be used to determine
the amount of payment for FQHC services under the FQHC PPS. Likewise,
section 4124(c)(2) of the CAA, 2023 amended section 1834(y) of the Act
to add a new paragraph (3)(B) to require that costs associated with
intensive outpatient services not be used to determine the amount of
payment for RHC services under the methodology for all-inclusive rates
(established by the Secretary) under section 1833(a)(3) of the Act.
Therefore, we proposed conforming revisions under Sec. 405.2468. In
addition, we stated conforming revisions would be made to the cost
reporting instructions to account for these changes.
We received many comments on our proposals to implement the special
payment rule provisions required by section 4124(c)(1) and (2) of the
CAA, 2023. The following is a summary of the public comments received
on the special payment rules for IOP services furnished in RHCs/FQHCs
and our responses:
Comment: Commenters were generally supportive of payment for IOP
services furnished by RHCs/FQHCs to be paid outside of the RHC AIR and
the FQHC PPS and be paid at the hospital outpatient department (HOPD)
rate. Commenters were supportive of CMS' proposal for establishing an
IOP APC per diem payment rates for hospital-based IOP for a 3-service
day and the use of the condition code for IOP services and agreed with
the applicability for RHCs and FQHCs. Commenters also supported CMS'
calculation of the IOP payment methodology. Commenters stated that they
understood that the statutory language is clear on RHC payment being
``equal to the amount that would have been paid under this title for
such services had such services been covered HOPD services furnished by
a hospital.''
Response: We appreciate the commenters support on the special
payment rules as it relates to payment for IOP services at the HOPD
rate.
Comment: One commenter stated that flexibilities granted within
this new benefit for other providers should be extended to RHCs as well
and asked CMS to allow RHCs to bill for the 3-service day, in the
occasional instance when a patient completes three or fewer services in
a day, as well.
Response: As we discuss above, in the CY 2024 OPPS proposed rule
(88 FR 49717) we proposed to align with the requirement under the OPPS,
that in order to qualify for IOP payment, at least one service must be
from the Intensive Outpatient Primary list. We note Table 99 of this
final rule with comment period identifies the list of intensive
outpatient primary services. We believe that this policy is consistent
with the commenter's request. In addition, since we otherwise did not
receive comment on the proposal, we are finalizing it as proposed. We
continue to believe that it is appropriate to provide a payment
structure that supports beneficiaries in an IOP where the utilization
is typically structured to be days with three or fewer services.
Comment: We received a few comments with respect to CMS'
solicitation of comments on whether the hospital-based IOP APC 5862 for
4-service days would be appropriate for RHCs and FQHCs. Several
commenters requested that CMS apply the hospital-based IOP rate for 4-
service days to RHCs/FQHCs to account for any variations in the cost of
furnishing these services in RHCs compared to other settings and
geographic areas. One commenter stated that to help address disparities
that hinders access to diagnosis and treatment for severe mental
illness (SMI), major depressive disorder (MDD), and postpartum
depression (PPD) due to severe mental health provider shortages, CMS
should finalize an upward variation in the payment rate. The commenter
stated that this issue disproportionately impacts rural communities and
minorities. Another commenter stated that given IOP is an entirely new
benefit and that there is no data on its utilization or cost, CMS
should grant broad flexibilities to all providers eligible for the
benefit so it can be used as necessary for patients whether three or
four separate qualifying IOP services are reported on the claim with
condition code 92, the RHC should be eligible to receive the associated
payment, $284.00 or $368.18, respectively, similar to how the program
will be structured for hospital-based IOPs.
Response: We appreciate feedback in response to our comment
solicitation on whether the hospital-based IOP APC 5862 for 4-service
days would be appropriate for RHCs and FQHCs. We did not propose the
stratified payment rate structure in the initial year of this new
benefit for a couple reasons. Section 1861(aa)(2)(K)(iv) of the Act
describes an RHC and states that an RHC is not a rehabilitation agency
or a facility which is primarily for the care and treatment of mental
diseases. Given this statutory provision, we believe uptake will be
slow since these settings currently focus on primary care service. We
believe providing a single payment rate valued at 3 services is
adequate in these settings since the expected acuity of the patients
are such that they
[[Page 81843]]
typically do not need more than 3 services per day.
We do not believe that access would be hindered in these early
stages of a new benefit. Considering a week's worth of care which is
how the physician certifies the individual, RHCs and FQHCs will be paid
each day an IOP service is furnished whether it is 1 or more so in the
rare occasion someone is in the clinic and receives 4 services (but is
paid for 3), there could be days that week where someone is in the
clinic and receives 1 service (but is paid for 3).
Since this is a new program for these settings, we encourage RHCs
and FQHCs to report all of the IOP services they furnish on the claim
so that we can gather data. We are excited for RHCs and FQHCs to have
the opportunity to furnish IOP services and we are interested to see
these programs grow. We plan to monitor utilization of IOP services in
these and other settings to inform refinements in the future.
Comment: A few commenters requested that CMS clarify that an FQHC's
payment amount for IOP services would be the lesser of the FQHC's
actual charges for IOP services or the payment amount for a hospital
outpatient department providing IOP services.
Response: In response to commenters request that CMS clarify FQHC
payment, we refer the commenter to the discussion in the proposed rule
(88 FR 49716 and 49717), that the statutory payment requirements for
FQHC services are set forth in section 1834(o) of the Act. In addition,
section 1833(a)(1)(Z) of the Act requires Medicare payment for FQHC
services, determined under section 1834(o) of the Act, to be 80 percent
of the lesser of the actual charge or the amount determined under
section 1834(o) of the Act.
When we apply this framework, section 1834(o)(5)(A) of the Act as
amended by CAA, 2023 requires payment for IOP services furnished by
FQHCs be equal to the amount that would have been paid under Medicare
for IOP services had they been covered outpatient department services
furnished by a hospital. Therefore, this payment amount determined
under section 1834(o) of the Act, is subject to the lesser of
provisions required under section 1833(a)(1)(Z) of the Act. To clarify,
as we finalize above, an FQHC's payment amount for IOP services would
be the lesser of the FQHC's actual charges for IOP services or the rate
determined for APC 5861.
Comment: With respect to CMS' solicitation of comments on whether
the payment rate for IOP services furnished in RHCs/FQHCs should be
adjusted to reflect the variations in cost of furnishing services in
different geographic areas, one commenter stated that to offer these
services, RHCs may need to recruit and retain additional providers and
staff or make additional investments in their clinics with associated
expenses that may be higher due to their rural locations. The commenter
further stated that many RHCs face challenges with reliable broadband
connection, limited professional staff, etc. Therefore, they would
support a payment adjustment of 5% for rural providers (practicing in
areas of 50,000 or less) offering IOP services.
A few commenters did not support a geographic adjustment for
reimbursement of IOP services furnished in RHCs because RHC
reimbursement methodology for the Original Medicare program does not
have a mechanism for applying a geographic adjustment, and adding the
geographic adjustment as an additional factor will result in
inconsistency and unnecessary complexity. Other commenters stated that
they did not believe the application of a geographical adjuster is
statutorily required or required by regulation since payment for IOP is
not under the FQHC PPS and did not believe a geographical adjuster is
necessary for the purposes of payment for IOP services. These
commenters urged CMS adopt policies that ensure payments for IOP
services are equal, no matter the location of the health center.
Response: We appreciate feedback in response to our comment
solicitation on whether the payment rate for IOP services furnished in
RHCs and FQHCs should be adjusted to reflect the variations in costs of
furnishing services in different geographic areas and what approaches
would be appropriate for determining the value of the adjustment and
may take this information into consideration for future rulemaking.
Comment: There were a few comments related to billing for IOP
services. Some commenters stated that the proposal did not mention
whether RHCs/FQHCs will be required to use specific coding (i.e., list
each HCPCS code for each discreet service provided in an IOP service
day) on IOP claims and think that doing so would be beneficial in that
it would improve CMS' access to complete information on the provision
of IOP across various settings. Other commenters stated that CMS should
clarify if FQHCs should bill for professionals' services (i.e., MD,
NPs, PA, and psychologists) via the FQHC PPS or use their Part B
enrollment. These commenters believe that health centers should be
permitted to allocate the allowable costs like salary, contracting and/
or benefits costs associated with these professionals' time under the
``FQHC services'' cost report, if it cannot be included under their IOP
cost report. Some commenters requested that CMS provide operational
clarifications on how it plans to require FQHCs to bill for IOP
services.
Response: We thank the commenters for their questions on billing
for IOP services. We agree that specific coding for IOP services will
improve CMS access to complete information and provide us with more
data with which to monitor IOP services. In response to comments on the
use of specific coding on IOP claims, we stated in CY 2024 OPPS
proposed rule (88 FR 49717), we proposed to also require RHCs and FQHCs
to report condition code 92 to identify intensive outpatient claims.
Since RHCs and FQHCs are paid outside of the RHC AIR methodology and
FQHC PPS, respectively, for IOP services we believe the condition code
reporting approach will allow us to operationalize a 3 service per day
payment amount using the final list of HCPCS codes used to identify the
full range of services for IOP and therefore we proposed to adopt the
same list of services. The list of proposed HCPCS codes is included in
Table 96 of this final rule with comment period for reference. In
addition, we proposed to align with the requirement under the OPPS,
which is in order to qualify for IOP payment, at least one service must
be from the Intensive Outpatient Primary list. Table 97 of this final
rule with comment period identifies the proposed list of intensive
outpatient primary services. Regarding commenters' request for CMS to
clarify if FQHCs should bill for professionals' services (i.e., MD,
NPs, PA, and psychologists) via the FQHC PPS or use their Part B
enrollment, as IOP services are a new benefit for RHCs and FQHCs, the
service is billed on the FQHC claim and not on a professional claim
using the practitioners Part B enrollment. Therefore, we would like to
reiterate that although RHCs and FQHCs are paid outside of the RHC AIR
methodology and FQHC PPS, respectively, for IOP services, FQHCs should
bill the same way that they currently bill today, that is, on the FQHC
claim. We will be issuing sub regulatory guidance and billing
instructions related to the RHC and FQHC IOP policies finalized in this
final rule as is typically done with any new service.
Comment: One commenter agrees and supports the proposal to pay
Grandfathered Tribal FQHCs that furnish IOP services based on the
outpatient per visit rate via the IHS AIR.
[[Page 81844]]
Response: We appreciate the support received from the commenter.
After consideration of the public comments we received, we are
finalizing our proposal to implement the special payment rules for IOP
services as proposed. We are finalizing that the rate determined for
APC 5861 (Intensive Outpatient (3 services per day) for hospital-based
IOPs) is the payment rate for IOP services furnished in an RHC. For IOP
services furnished in FQHCs, the payment is based on the lesser of a
FQHC's actual charges or the rate determined for APC 5861.
Additionally, grandfathered tribal FQHCs will continue to have their
payment based on the outpatient per visit rate when furnishing IOP
services. That is, payment is based on the lesser of a grandfathered
tribal FQHC's actual charges or the outpatient per visit rate.
Accordingly, we are finalizing revisions to Sec. Sec. 405.2410,
405.2462, and 405.2464 in the regulations to reflect the payment amount
for IOP services and how the Medicare Part B deductible and coinsurance
are applied. Finally, we are finalizing to require RHCs and FQHCs to
report condition code 92 to identify intensive outpatient claims.
Tables 98 and 99 of this final rule with comment period display the
final HCPCS applicable for IOP and the final IOP primary services,
respectively.
c. FQHC Supplemental Payments
As discussed in the May 2, 2014 final rule with comment period (79
FR 25461), section 1833(a)(3)(B)(i)(II) of the Act requires that FQHCs
that contract with MA organizations be paid at least the same amount
they would have received for the same service under the FQHC PPS. This
provision ensures FQHCs are paid at least the Medicare amount for FQHC
services. Therefore, if the MA organization contract rate is lower than
the amount Medicare would otherwise pay for FQHC services, FQHCs that
contract with MA organizations would receive a wrap-around payment from
Medicare to cover the difference (see Sec. 422.316). If the MA
organization contract rate is higher than the amount Medicare would
otherwise pay for FQHC services, there is no additional payment from
Medicare.
In the CY 2024 OPPS proposed rule (88 FR 49717), we stated that we
believe the special payment rule, is also included in the FQHC PPS rate
as described in section 1834(o) of the Act and therefore, IOP services
are included in the wrap-around payment. We proposed to make revisions
under Sec. 405.2469 to reflect these changes.
The following is a summary of the public comments received on the
FQHC supplemental payment for IOP services furnished in FQHCs and our
responses:
Comment: Commenters were generally supportive of CMS' proposal on
the FQHC supplemental payments. Some commenters stated that the
proposed rule failed to acknowledge that health centers are reimbursed
outside of the FQHC PPS rate for IOP, which requires a different
supplemental payment rate methodology and strongly urged CMS to adopt a
broader interpretation of the special payment rule to ensure health
centers are paid up to the original Medicare amount that would be paid
for IOP services, which is not FQHC PPS. Commenters requested that CMS
clarify in the final rule that supplemental payments for Medicare
Advantage (MA) beneficiaries cover the difference between the contract
rate and the IOP service rate.
Response: We would like to reiterate that we stated in the CY 2024
OPPS proposed rule (88 FR 49717), that IOP services provided in an FQHC
are also subject to the wrap-around payment. We stated that this
provision ensures FQHCs are paid at least the Medicare amount for FQHC
services, which includes FQHC PPS and now IOP services. Therefore, if
the MA organization contract rate is lower than the amount Medicare
would otherwise pay for FQHC IOP services, FQHCs that contract with MA
organizations would receive a wraparound payment from Medicare to cover
the difference (see Sec. 422.316). We further stated that if the MA
organization contract rate is higher than the amount Medicare would
otherwise pay for FQHC IOP services, there is no additional payment
from Medicare for IOP services.
After consideration of the public comments, we are finalizing our
proposal as proposed, that is revising Sec. 405.2469 to reflect that
payment for IOP services are subject to the wrap-around payments.
5. Multiple Visits
a. Background
Currently, RHC and FQHC encounters with more than one health
professional and multiple encounters with the same health professional
that take place on the same day and a single location constitute a
single visit, with the following exceptions:
A patient has a medical visit and a mental health visit on
the same day; or
A patient has an initial preventive physical exam visit
and a separate medical or mental health visit on the same day.
In the CY 2024 OPPS proposed rule (88 FR 49717), we explained that
since IOP services are behavioral health services, we did not believe
it would be appropriate to pay for a mental health visit and IOP
services on the same day. In the case of a medical visit, an encounter
can include a medical visit and a mental health visit or a medical
visit and IOP services. An encounter cannot include two mental health
visits on the same day. As such, we proposed to make amend Sec.
405.2463(c) in the regulations to clarify that we will permit a mental
health visit or IOP services on the same day as a medical visit.
The following is a summary of the public comments received on
multiple visits for IOP services furnished in FQHCs and our responses:
Comment: We received a few comments on multiple visits. Commenters
were generally supportive of CMS' proposal. Some commenters suggested
that CMS allow, at a minimum, for an exception so that under emergency
circumstances, an FQHC/RHC mental health visit could be furnished (and
billable) on the same day that IOP services are provided. The
commenters understood that that payment for IOP in FQHCs/RHCs, like IOP
in other settings, will be subject to the clinician exclusions
described in proposed 42 CFR 410.44(b) and that under this provision,
the clinical services of various professionals, when delivered as part
of an IOP care plan, are nonetheless unbundled and not paid for as IOP
services under the OPPS, but instead, under the relevant Part B
methodology. However, given that this provision will also apply to IOP
furnished in FQHCs/RHCs, commenters stated that a prohibition on same-
day payment for mental health visits in RHC/FQHC settings may be
inappropriate. Other commenters strongly urged CMS to allow for a FQHC
``mental health visit'' to occur on the same day as IOP services. These
commenters expressed concern that under the proposed rule, health
centers risk providing a range of services to a patient without
adequate reimbursement due to same-day billing restrictions and believe
there could be instances where same-day IOP and mental health visits
could occur. They stated as an example that when an IOP patient
receives individual therapy sessions with physicians or psychologists
as part of an IOP day, it appears that such a service would be billed
separately under the relevant methodology (FQHC PPS). They further
state that as patient centered medical homes, health centers should not
be precluded from providing two different services to a patient on a
single day and should be able to bill an FQHC PPS
[[Page 81845]]
mental health service and IOP service if delivered on the same day.
Another commenter recommended CMS clarify that the IOP benefit does not
preclude beneficiaries from receiving other services, including remote
mental health services.
Response: We thank the commenters for raising these concerns. As we
stated in the proposed rule (88 FR 49717), IOP services are behavioral
health services, and we did not believe it would be appropriate to pay
for a mental health visit and IOP services on the same day. We
understand that in the HOPD setting, additional mental health services
may be provided, but are capped at a payment amount not to exceed the
IOP or PHP payment amounts. We did not intend to imply that additional
services would not be reportable. Under the RHC AIR and FQHC PPS, when
there are multiple visits on the same day, we permit those services to
be reported, however, we only pay for one visit. We believe the same
situation applies here, that is, if additional mental health visits are
needed in addition of the 3-IOP services per day, we would expect an
RHC or FQHC to report those services on the claim. Payment for the
service would be included in the IOP rate similar to how the additional
mental health services would be paid for under the OPPS.
After consideration of the public comments, we are finalizing our
proposal with a clarification. We are amending Sec. 405.2463(c) in the
regulations to state that we will pay a mental health visit or IOP
services on the same day as a medical visit. We are clarifying that if
a mental health visit is furnished the same day as IOP services, all
services are covered under Medicare Part B, however, we will only pay
the IOP rate and the mental health visit will be considered packaged.
While there could be emergency circumstances for which a mental health
visit and IOP services are furnished, at this time we believe that it
is unlikely that an FQHC or RHC would simultaneously have a specific
patient enrolled in the IOP and need a separate and distinct mental
health service delivered at the same FQHC or RHC, in a given day of
service. In addition, we believe that the payment amount is adequate if
these situations occur, since the rate is based on the costs associated
with administering an IOP in the hospital setting which represent a
resource intensive program and, therefore, we should not pay more for a
day with individual services. As we mentioned above, we recognize that
this is a new program for these settings, we encourage RHCs and FQHCs
to report all of the services they furnish on the claim so that we can
gather data. We plan to monitor utilization of IOP services in these
and other settings to inform refinements in the future.
6. Other Regulatory Updates
In addition to the regulatory changes described in this section of
the rule, we proposed a revision to Sec. 405.2400 to reflect that 42
CFR part 405, subpart X, is based not only on the provisions of
sections 1833, 1861(aa), 1834(o) of the Act, but also the provisions
under section 1834(y) of the Act. We believed we inadvertently did not
revise the regulations when the CAA, 2021 amended section 1834 of the
Act to add new paragraph (y), as we discuss in the CY 2022 PFS final
rule (86 FR 65205 through 65206).
We did not receive any comments on the proposal. Therefore, we are
finalizing our proposal as proposed to revise Sec. 405.2400 to reflect
that 42 CFR part 405, subpart X, is not based only on the provisions of
sections 1833, 1861(aa), 1834(o) of the Act, but also the provisions
under section 1834(y) of the Act.
G. Modifications Related to Medicare Coverage for Opioid Use Disorder
(OUD) Treatment Services Furnished by Opioid Treatment Programs (OTPs)
1. Background
Section 2005 of the Substance Use-Disorder Prevention that Promotes
Opioid Recovery and Treatment for Patients and Communities Act (SUPPORT
Act) (Pub. L. 115-271, October 24, 2018) established a new Medicare
Part B benefit category for OUD treatment services furnished by OTPs
during an episode of care beginning on or after January 1, 2020. In the
CY 2020 Physician Fee Schedule (PFS) final rule (84 FR 62630 through
62677 and 84 FR 62919 through 62926), we implemented Medicare coverage
and provider enrollment requirements and established a methodology for
determining the bundled payments for episodes of care for the treatment
of OUD furnished by OTPs. We established new codes and bundled payments
for weekly episodes of care that include methadone, oral buprenorphine,
implantable buprenorphine, injectable buprenorphine or naltrexone, and
non-drug episodes of care, as well as add-on codes for intake and
periodic assessments, take-home dosages for methadone and oral
buprenorphine, and additional counseling. For CY 2024, we proposed
modifications to the regulations and policies governing Medicare
coverage and payment for OUD treatment services furnished by OTPs in
both the CY 2024 OPPS proposed rule (88 FR 49717 through 49723) as well
as the CY 2024 PFS proposed rule (88 FR 52413 through 52416).
2. Statutory Authority for Coverage of Opioid Use Disorder Treatment
Service Provided by OTPs
Intensive outpatient programs (IOPs) [American Society of Addiction
Medicine (ASAM) Level 2.1 of Care] are diverse and flexible programs
that can provide both a step-up and step-down level of care for the
treatment of substance use disorders (SUDs). IOPs may offer a step-down
level of care in cases where a patient has been stabilized in a
hospital facility or residential treatment program but continues to
need services to maintain or achieve further treatment progress. IOPs
also offer a step-up level of care in cases where a patient may need a
higher level of care that is more structured or intensive than what can
be provided in a typical outpatient treatment setting that offers care
on a less frequent basis.\168\ IOPs can be housed in an OTP, specialty
addiction treatment facility, community mental health center (CHMC), or
another setting.\169\ According to the National Substance Use and
Mental Health Services Survey, as of 2021, approximately 557 OTPs offer
IOP services nationwide (30.1 percent of SUD treatment facilities
offering OTPs).\170\ Section 4124 of the Consolidated Appropriations
Act (CAA), 2023, which was enacted on December 29, 2022, provides for
Medicare coverage and payment for IOP services in hospital outpatient
department (HOPDs), CMHCs, rural health clinics (RHCs), and federally
qualified health centers (FQHCs). However, section 4124 of the CAA,
2023 did not address coverage for IOP services furnished in OTP
settings.
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\168\ https://www.ncbi.nlm.nih.gov/books/NBK64088/.
\169\ The ASAM National Guideline for the Treatment of Opioid
Use Disorder (2020): https://sitefinitystorage.blob.core.windows.net/sitefinity-production-blobs/docs/default-source/guidelines/npg-jam-supplement.pdf?sfvrsn=a00a52c2_2 2.
\170\ Substance Abuse and Mental Health Services Administration,
National Substance Use and Mental Health Services Survey (N-SUMHSS),
2021: Annual Detailed Tables. Rockville, MD: Substance Abuse and
Mental Health Services Administration, 2023. Weblink: https://www.samhsa.gov/data/sites/default/files/reports/rpt39450/2021%20N-SUMHSS%20Annual%20Detailed%20Tables_508_Compliant_2_8_2023.pdf.
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Section 1861(jjj)(1) of the Act defines ``opioid use disorder (OUD)
treatment services'' as items and services that are furnished by an OTP
for the treatment of OUD, including FDA-approved opioid agonist and
antagonist
[[Page 81846]]
medications, dispensing and administration of such medications,
substance use counseling, individual and group therapy, toxicology
testing, and other items and services that the Secretary determines are
appropriate (not including meals or transportation). For matters
related to payment for OUD treatment services, section 1834(w) of the
Act establishes that the Secretary shall pay bundled payments to OTPs
when they furnish OUD treatment services to an individual during an
episode of care. Section 1834(w)(2) of the Act states that for purposes
of making payments to OTPs, the Secretary may establish one or more
bundles based on the type of medication provided (such as
buprenorphine, methadone, naltrexone, or a new innovative drug), the
frequency of services, the scope of services furnished, characteristics
of the individuals furnished such services, or other factors as the
Secretary determine[s] appropriate. We interpret the statutory language
at sections 1861(jjj) and 1834(w) of the Act to grant the Secretary
authority to establish more than one bundled payment to OTPs for OUD
treatment services furnished during an episode of care provided that
the scope of services is medically reasonable and necessary for the
treatment of OUD. In the CY 2020 PFS final rule (84 FR 62644), we
finalized a definition of OUD treatment services as those items and
services that are specifically enumerated in section 1861(jjj)(1) of
the Act and finalized the weekly bundled payment for an episode of
care. After considering public comments, under the discretion granted
to the Secretary under section 1861(jjj)(1)(F) of the Act, we also
included additional items and services, including intake activities and
periodic assessments within the definition of OUD treatment services
specified in 42 CFR 410.67(b) (84 FR 62634). In addition, under our
authority under section 1834(w)(2) to create one or more bundled
payments, we finalized that we would utilize add-on codes as a way to
operationalize the creation of more than one bundled payment by making
payment adjustments to the weekly bundled payment for the additional
items and services.
Furthermore, CMS aims to ensure that Medicare beneficiaries have
appropriate access to high quality care for the treatment of OUD, and
that services provided to treat SUD under the Medicare OTP benefit are
consistent with the services that are available in other settings
covered under Medicare Part B. For example, when CMS first established
payment policy for OTPs under Medicare Part B in the CY 2020 PFS final
rule (84 FR 62630 through 62677 and 84 FR 62919 through 62926), we
considered the available benefits payable under Medicare at that time
in determining what items to propose to include in the bundled payment
for OUD treatment services furnished by OTPs. In light of new
legislation (CAA, 2023) granting authority for Medicare payment of IOP
services provided by other types of health care providers, we believe
it is appropriate to revisit the range of services covered under the
current benefit for OUD treatment services furnished by OTPs.
In the CY 2023 PFS proposed rule, we solicited comments on whether
there is a gap in coding under the PFS or other Medicare payment
systems that may be limiting access to needed levels of care for
treatment of mental health or SUD treatment for Medicare beneficiaries
(87 FR 45943 and 45944). Specifically, we sought information on
multiple issues, including: whether there is a gap in coding under
Medicare payment systems that may be limiting access to needed levels
of care for treatment of SUD; the extent to which potential gaps would
best be addressed by the creation of new codes or billing rules;
additional information related to IOP services, including their
settings, scope and types of offered services, and practitioners
involved; and, other relevant information to the extent it would inform
our ability to ensure Medicare beneficiaries have access to this care.
In response, many commenters noted that IOPs serve as a ``step-up''
level of care for individuals in need of more services/supports, close
monitoring, and structured therapy, but who cannot stabilize at a lower
level of care provided in an office setting. Commenters also noted that
IOPs simultaneously serve as a ``step-down'' level of care for
individuals who have more stabilized biomedical conditions and may no
longer need to be hospitalized but cannot be discharged safely.
Commenters mentioned that IOPs are tailorable to patient
characteristics and are often flexible in the length, frequency, and
days of treatment, but that typically patients receive at least 9 hours
a week of care. Moreover, commenters stated that IOPs may be provided
at stand-alone IOP facilities, OTPs, partial hospitalization programs,
residential treatment centers, detoxification centers, or within a
private outpatient office setting. Commenters further encouraged CMS to
allow coverage for IOP services across the full continuum of care
settings so that patients can receive the care they need in the setting
that is most clinically appropriate. Furthermore, several commenters
emphasized the importance of ensuring access to care for IOP services
provided in OTP settings. For example, one commenter recommended ``that
CMS also consider whether the agency has regulatory authority to extend
coverage of any new IOP billing codes to OTPs.'' Other commenters also
preferred the IOP payment methodology to be amenable and complementary
to the weekly bundled payment of OTPs, including a building block
methodology with drug and non-drug components, and add-on codes for
greater clinical complexity. As a whole, commenters were very receptive
to expanding access to IOP services in multiple settings of care,
including within OTPs.
Addressing the opioid crisis by expanding coverage for quality
treatment options and reducing barriers to care continues to remain a
high priority for CMS. Across the U.S., the rates of OUD have increased
more than threefold and opioid-related mortality has increased by
almost 18 percent amongst older adults in the past decade.\171\ From
2015-2019, nearly 1.7 million (3 percent of all) Medicare beneficiaries
had a SUD, though only 11 percent of those beneficiaries received
treatment for their condition in a given year.\172\ Among Medicare
beneficiaries with a SUD, one-third reported that financial barriers
were a reason for not receiving treatment. Research from the Office of
the Assistant Secretary for Planning and Evaluation (ASPE) indicates
that health plans that offer coverage for a greater number of IOP
services per enrollee experience higher rates of SUD treatment
initiation and continued engagement within their enrollee
populations.\173\ This suggests that IOP services could result in an
increased rate of SUD treatment initiation and continued engagement.
Therefore, expanding access to IOP services in other settings and
reducing financial barriers to access to IOP services through coverage
could potentially increase the number of Medicare beneficiaries seeking
and completing treatment for a SUD, including among Medicare
beneficiaries who are members of populations that have historically
been less likely to receive such treatment. Studies have shown that
among individuals in need of SUD treatment, Hispanic, Black, and
[[Page 81847]]
Asian populations are less likely to receive outpatient SUD treatment
for their condition than their White counterparts, suggesting greater
barriers to treatment access for these populations.\174\ Other evidence
indicates that Black Americans significantly underutilize specialty SUD
treatment and are also less likely to complete their SUD treatment
programs compared to White Americans, but these disparities are reduced
when Black Americans have access to health insurance.\175\ This
evidence suggests that financial barriers impede initiation and
completion of SUD treatment; in turn, providing health insurance
coverage for SUD treatment services (such as IOP services) may lessen
the impact of these financial barriers for all Medicare beneficiaries,
including those who are more likely to experience these barriers. Some
evidence also shows that zip codes in the U.S. within which there is at
least one OTP tend to have a higher proportion of residents who are
minorities (Black and Hispanic) and a lower proportion of White
residents, compared to zip codes in the U.S. without any OTPs,\176\ and
surveys of services provided by OTPs demonstrate that the majority of
OTPs (82.6 percent) conduct community outreach services to those in
need of treatment for OUD.\177\ This suggests that OTPs may be uniquely
positioned to reach minority populations in need of IOP services, which
would improve their access to SUD treatment services. In addition, from
2015 to 2019 and prior to implementation of the OTP benefit, Medicare
beneficiaries younger than 65 years old were more likely to receive SUD
treatment than those aged 65 years old or greater, due to more
beneficiaries over age 65 reporting they could not afford treatment or
that the treatment was not covered by Medicare or other insurance.\178\
Even after implementation of the OTP benefit, eliminating health
disparities in access to SUD treatment for this older age bracket
remains a priority. Therefore, we believe that expanding access to
coverage and payment under Medicare for IOP services provided by OTPs
may have a meaningful and positive impact on health equity, including
for Medicare beneficiaries that may face barriers in accessing
treatment, such as racial/ethnic minorities and/or beneficiaries aged
65 or older. Lastly, CMS' Behavioral Health Strategy includes multiple
stated goals and objectives to promote person-centered behavioral
health care.\179\ Expanding access to coverage and payment under
Medicare for IOP services provided by OTPs may help strengthen access
to SUD prevention, evidence-based treatment, and recovery services, as
well as advance the equity and quality of behavioral health services,
which are consistent with the goals of CMS' Behavioral Health Strategy.
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\171\ https://www.sciencedirect.com/science/article/pii/S0749379721000921?via%3Dihub.
\172\ https://doi.org/10.15585/mmwr.mm675152e1.
\173\ https://aspe.hhs.gov/sites/default/files/private/pdf/260791/BestSUD.pdf.
\174\ https://www.samhsa.gov/data/sites/default/files/reports/rpt35326/2021NSDUHSUChartbook102221B.pdf.
\175\ https://www.sciencedirect.com/science/article/pii/S0376871619302443.
\176\ https://pubmed.ncbi.nlm.nih.gov/36645315/.
\177\ https://www.samhsa.gov/data/sites/default/files/reports/rpt39450/2021%20N-SUMHSS%20Annual%20Detailed%20Tables_508_Compliant_2_8_2023.pdf.
\178\ https://www.sciencedirect.com/science/article/pii/S0749379722001040.
\179\ https://www.cms.gov/cms-behavioral-health-strategy.
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3. Coverage of IOP Services Furnished by OTPs
a. Inclusion of IOP Services Furnished by OTPs in the Definition of
Opioid Use Disorder Treatment Service
In recognition of the evidence provided in the discussion above, we
understand that some Medicare beneficiaries may continue to face
barriers in accessing treatment for their OUD. Additionally, we note
that many OTPs nationwide already provide IOP services and that IOP
services can be effective in promoting greater treatment initiation and
engagement, which may improve health outcomes. For these reasons, and
in order to expand access to behavioral health treatment for Medicare
beneficiaries with OUD and ensure continuity of care between different
treatment settings and levels of care, in the CY 2024 OPPS/ASC proposed
rule CMS proposed to establish payment under Part B for IOP services
furnished by OTPs for the treatment of OUD for CY 2024 and subsequent
years.
As explained previously, section 1861(jjj)(1) of the Act defines
``opioid use disorder treatment service'' as items and services that
are furnished by an OTP for the treatment of OUD, including FDA-
approved opioid agonist and antagonist medications, dispensing and
administration of such medications, substance use counseling,
individual and group therapy, toxicology testing, and other items and
services that the Secretary determines are appropriate (not including
meals or transportation). IOP services are intended to treat
individuals with an acute mental illness and/or substance use disorder,
including those with an OUD. We believe that IOP services are similar
to the specific services enumerated in section 1861(jjj)(1) of the Act,
and the services and intensity of care required to provide intensive
outpatient services under Level 2.1 of the ASAM continuum of care are a
step-up from the services within the existing OTP benefit. The ASAM
criteria's strength-based multidimensional assessment takes into
account a patient's needs, obstacles and liabilities, as well as their
strengths, assets, resources, and support structure; this information
is used to determine the appropriate level of care across a
continuum.\180\ OTP services that are currently covered under the OTP
benefit are at the Outpatient (Level 1) level of care, whereas IOP
services are classified as Level 2.1 on ASAM's continuum of care.
Individuals who meet the criteria for IOP services generally require
more frequent and intensive services.
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\180\ https://www.asam.org/asam-criteria/about-the-asam-criteria.
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Because the Secretary has discretion under section 1861(jjj)(1)(F)
of the Act to add other items and services furnished by an OTP for the
treatment of OUD, as appropriate, we proposed to add a new paragraph
(ix) to the definition of ``opioid use disorder treatment service'' in
Sec. 410.67(b) defining a new category of services called ``OTP
intensive outpatient services'' and incorporate OTP intensive
outpatient services in the definition that are covered under the Part B
OTP benefit. Specifically, we proposed to define OTP intensive
outpatient services as those services specified in proposed 42 CFR
410.44(a)(4) when furnished by an OTP as part of a distinct and
organized intensive ambulatory treatment program for the treatment of
Opioid Use Disorder and that offers less than 24-hour daily care other
than in an individual's home or in an inpatient or residential setting.
OTP intensive outpatient services are services that are reasonable and
necessary for the diagnosis or active treatment of the individual's
condition; are reasonably expected to improve or maintain the
individual's condition and functional level and to prevent relapse or
hospitalization; and are furnished in accordance with a physician
certification and plan of care. We proposed that in order to qualify as
``OTP intensive outpatient services,'' a physician must certify that
the individual has a need for such services for a minimum of 9 hours
per week and requires a higher level of care intensity compared to
existing OTP services. The specific services that we proposed to be
considered OTP intensive outpatient services would include any of the
following:
[[Page 81848]]
Individual and group therapy with physicians or
psychologists or other mental health professionals to the extent
authorized under State law.
Occupational therapy requiring the skills of a qualified
occupational therapist, provided by an occupational therapist, or under
appropriate supervision of a qualified occupational therapist by an
occupational therapy assistant as specified in part 484.
Services of social workers, trained psychiatric nurses,
and other staff trained to work with psychiatric patients.
Drugs and biologicals furnished for therapeutic purposes,
subject to the limitations specified in Sec. 410.29, excluding opioid
agonist and antagonist medications that are FDA-approved for use in
treatment of OUD or opioid antagonist medications for the emergency
treatment of known or suspected opioid overdose.
Individualized activity therapies that are not primarily
recreational or diversionary.
Family counseling, the primary purpose of which is
treatment of the individual's condition.
Patient training and education, to the extent the training
and educational activities are closely and clearly related to the
individual's care and treatment.
Diagnostic services that are reasonable and necessary for
the diagnosis or active treatment of the individual's condition, with
the exception of toxicology testing.
We proposed to exclude FDA-approved opioid agonist or antagonist
medications for the treatment of OUD or opioid antagonist medications
for the emergency treatment of known or suspected opioid overdose,
specifically, methadone, buprenorphine, naltrexone and naloxone, from
the definition of OTP intensive outpatient services because these
medications are already included as part of the weekly bundled payment
for an episode of care or as an adjustment to the bundled payment.
However, we solicited comment on the types of drugs and biologicals
that are furnished as part of an IOP program (for example, whether IOPs
furnish drugs used for emergent interventions), and the extent to which
these drugs overlap with medications included in the existing weekly
bundles described by HCPCS codes G2067 through G2073 and/or add-on
codes described by G2078 (take-home supply of methadone), G2079 (take-
home supply of oral buprenorphine), G2215 (take-home supply of nasal
naloxone), G2216 (take-home supply of injectable naloxone), and G1028
(take-home supply of nasal naloxone; 2-pack of 8mg per 0.1 mL nasal
spray). We explained that this information would help to inform our
consideration of the extent to which the drugs and biologicals
furnished as part of an IOP program would already be covered under the
drug component of the weekly bundled payment and the existing add-on
payments or would need to be reflected in the proposed IOP add-on
payment adjustment discussed in the next section. Similarly, we
proposed to exclude toxicology testing from the types of diagnostic
services that would be included in the definition of OTP intensive
outpatient services because toxicology testing is already included
within the definition of ``opioid use disorder treatment service'' and
paid for as part of the weekly bundled payment for an episode of care.
We received many public comments from a variety of commenters on
our proposal to establish coverage for IOP services provided by OTPs
and to include IOP services furnished by OTPs in the definition of
opioid use disorder treatment service. The comments and our responses
to these comments are included below.
Comment: We received many comments in strong support of our
proposal to establish coverage for IOP services provided by OTPs, with
some commenters expressing appreciation specifically for the proposed
inclusion of ``OTP intensive outpatient services'' under ``OUD
treatment services'' at Sec. 410.67(b). Commenters agreed with CMS
exercising its authority under sections 1861(jjj)(1)(F) and 1834(w) of
the Act to establish coverage and payment for IOP services furnished at
OTPs for beneficiaries who have an OUD. Commenters expressed that the
proposal would improve access to OUD treatment, enhance continuity of
care for patients with an OUD who need more intensive support and
services, ensure that OTPs are reimbursed by Medicare for the full
range of services they provide to beneficiaries, and promote efforts to
improve health equity for racial/ethnic populations and older
beneficiaries. Commenters expressed that establishing coverage for IOP
services at additional sites of care, like OTPs, would further drive
value for patients and provide another tool for providers to fight the
ongoing opioid epidemic. Another commenter expressed support for our
proposal and stated that our proposal goes beyond what was required of
CMS in the original provisions specified in the CAA, 2023, which first
authorized coverage and payment for IOP services under Medicare in only
hospital outpatient departments, CMHCs, RHCs, and FQHCs.
Response: We appreciate the support from commenters for our
proposal to extend coverage for IOP services to OTPs for the treatment
of OUD among Medicare beneficiaries and for recognition that our
proposal would extend coverage for IOP services beyond the care
settings addressed in the CAA, 2023 by allowing IOP services to be
furnished in OTP settings. We agree that establishing coverage for IOP
services at OTPs and including OTP intensive outpatient services under
the definition of OUD treatment services could improve continuity of
care between different treatment settings and levels of care, expand
access to treatment for Medicare beneficiaries with an OUD, and further
promote health equity among Medicare beneficiaries.
Comment: Several commenters agreed with the proposal to exclude
FDA-approved opioid agonist or antagonist medications for the treatment
of OUD or opioid antagonist medications for the emergency treatment of
known or suspected opioid overdose (e.g, methadone, buprenorphine,
naltrexone, and naloxone) from the definition of OTP intensive
outpatient services since these medications are already included as
part of the weekly bundled payment for an episode of care or as an
adjustment to the bundled payment and since all necessary and
appropriate Medications for Opioid Use Disorder (MOUD) should already
be included in the bundle. Additionally, one commenter responded to our
comment solicitation requesting additional details on the types of
drugs or biologicals that can be provided within an IOP program, and if
these drugs or biologicals overlap with existing medications included
in the OTP weekly bundles or add-on codes for take-home medications.
They stated that often medications administered as part of an IOP
include drugs that cannot be self-administered such as extended-release
formulations of buprenorphine and naltrexone used to treat OUD. The
same commenter further requested that CMS provide clarification on
whether the service associated with the administration of extended-
release formulations of buprenorphine and naltrexone would be billed
outside the add-on code for IOP services.
Response: We thank commenters for agreeing with our proposal to
exclude FDA-approved opioid agonist or antagonist medications for the
emergency treatment of known or suspected opioid overdose from the
definition of OTP intensive outpatient services. We also thank the
commenter
[[Page 81849]]
who submitted additional information on the types of medications that
are typically administered under an IOP. We note that extended-release
formulations of buprenorphine and naltrexone, which the commenter
stated are common medications used in IOP settings, and their
administration by a healthcare professional are already covered under
the existing weekly bundles described by HCPCS codes G2069 (medication-
assisted treatment, buprenorphine (injectable)) and G2073 (medication-
assisted treatment, naltrexone). Therefore, these services should
continue to be billed using the existing codes describing weekly
bundled payments to OTPs and not by billing the add-on payment for IOP
services furnished by OTPs.
Comment: One commenter stated that they supported CMS' proposal
that would permit IOP and partial hospitalization program (PHP)
services to be offered in OTPs.
Response: We would like to clarify that the CY 2024 OPPS/ASC
proposed rule included a proposal to provide coverage for IOP services
furnished at OTPs, but not a proposal to provide coverage for PHP
services furnished at OTPs. PHPs provide services to patients needing
higher levels of care, requiring 20 or more hours of services per week
(ASAM Level of Care 2.5), compared to IOPs which consists of at least 9
hours and no more than 20 hours per week of treatment services (ASAM
Level of Care 2.1).\181\
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\181\ https://www.asam.org/asam-criteria/about-the-asam-criteria.
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Comment: One commenter requested that the requirement for an
``adequate support system while not engaged in the program'' be
removed, since this requirement is not reflected in the eligibility
criteria for many other Medicare services and since individuals who
need IOP services often do not have an adequate support system.
Response: We clarify here that the requirement for an ``adequate
support system while not engaged in the program'' was not proposed as a
requirement for beneficiaries in need of IOP services in OTP settings.
Rather, we proposed requirements under paragraph (ix) of the definition
of ``opioid use disorder treatment service'' in 42 CFR 410.67(b) that
``OTP intensive outpatient services'' must be ``reasonable and
necessary for the diagnosis or active treatment of the individual's
condition; are reasonably expected to improve or maintain the
individual's condition and functional level and to prevent relapse or
hospitalization; and are furnished in accordance with a physician
certification and plan of care, in which a physician must certify that
the individual has a need for at least a minimum of nine hours of
services per week and requires a higher level of care intensity
compared to other non-intensive outpatient OTP services.'' We note that
this requirement for an ``adequate support system while not engaged in
the program'' applies to PHP programs and for IOP services in other
settings but not OTPs. For a discussion of this requirement and other
conditions and exclusions pertaining to IOP services furnished in other
settings, please reference section VIII.B.2.a of this final rule with
comment period.
Comment: We received multiple comments encouraging CMS to allow IOP
services furnished by OTPs under Medicare to be extended to individuals
with mental health conditions and SUDs other than OUD. Another
commenter recommended that CMS articulate these broader diagnostic
eligibilities for OTP intensive outpatient services in regulation.
Response: We thank commenters for this feedback and acknowledge
that OTPs may be treating individuals with a variety of mental health
and SUD-related conditions, as well as co-occurring conditions in
addition to OUD. However, section 1861(jjj)(1) of the Act, as added by
section 2005 of the SUPPORT Act, established Medicare coverage for OUD
treatment services furnished by OTPs and defined ``opioid use disorder
treatment services'' as ``items and services that are furnished by an
opioid treatment program for the treatment of opioid use disorder.''
Therefore, Medicare payment to OTPs must be for the purposes of
treating OUD. When OTPs provide mental health and/or SUD services to
individuals for primary conditions other than OUD, they would not be
payable under Medicare. However, IOP services for the treatment of
mental health and/or SUD services are payable under Medicare at
hospital outpatient departments, CMHCs, FQHCs, and RHCs.
Comment: One commenter requested that CMS remove the requirement
for a minimum of 9 hours per week to receive coverage for IOP services,
since they believed that some patients may face challenges meeting
these standards if they do not have adequate means or resources. In
contrast, several other commenters stated that CMS' proposal to require
nine hours of services per week is appropriate.
Response: We did not propose to require a minimum of 9 hours of
services per week for IOP services furnished by an OTP, as the
commenter suggests. Rather, we proposed, at paragraph (ix) of the
definition of ``opioid use disorder treatment service'' in Sec.
410.67(b) that ``a physician must certify that the individual has a
need for a minimum of nine hours of services per week and requires a
higher level of care intensity compared to other non-intensive
outpatient OTP services.'' Requiring a physician to certify this level
of need, that is, a minimum of 9 hours of IOP services per week, is
consistent with existing clinical standards that describe the intensity
of these services as specified under the Substance Abuse and Mental
Health Services Administration's (SAMHSA) treatment guidance.
Additionally, we proposed that by billing for IOP services, OTPs would
be attesting to the fact that they have furnished at least nine
services for that week that would otherwise qualify as OTP intensive
outpatient services as discussed in section VIII.G.3.a of the CY 2024
OPPS proposed rule (88 FR 49720). We acknowledge that not all services
will necessarily be 60 minutes in duration, therefore, if an OTP
furnishes a minimum of nine services, regardless of the length of each
service, these would meet the threshold to bill for IOP services for
the treatment of OUD. We understand that there may be weeks where
beneficiaries do not necessarily meet the minimum of 9 services per
week for IOP services, and we note that if a beneficiary does not meet
the minimum of 9 services per week of IOP services, an OTP can still
continue to bill the weekly bundles and add-on codes described by G2067
through G2080, and G2115, G2216, and G1028, as long as all applicable
requirements are met.
Comment: Several commenters requested additional services be
considered for the purposes of payment for IOP services, including FDA-
approved medical devices that aid in the reduction of withdrawal
symptoms associated with SUDs, community health integration (CHI),
social determinants of health, principal illness navigation services,
and case management and care coordination services.
Response: We appreciate commenters raising awareness of other types
of services that could be considered as potential IOP services
furnished by an OTP. In the proposed rule, we proposed to include
coverage for IOP services furnished by OTPs for the treatment of OUD in
a manner that would be consistent with the scope of services proposed
in other settings as specified in the proposed 42 CFR 410.44(a)(4). We
[[Page 81850]]
believed this would help ensure Medicare beneficiaries have access to
the same types of services across benefit categories and settings of
care for IOP services. For a more in-depth discussion regarding the
list of potential services for IOP payment, please see the discussion
in section VIII.B.2.a of this final rule with comment period. We may
consider future updates to this list of services for Medicare payment
purposes, including to OTPs through future rulemaking.
Comment: Multiple commenters recommended that CMS specify the
practitioners who would be permitted to deliver OTP IOP services. Other
commenters requested that CMS ensure flexibility in the types of
professionals that are able to provide counseling to patients as it
does with the existing OTP benefit.
Response: We thank the commenters for this comment. In the proposed
rule, we did not propose to limit the types of professionals that can
provide IOP services. Instead, in section VIII.G.3.a of the CY 2024
OPPS proposed rule (88 FR 49720), as reflected in proposed paragraph
(ix) of the definition of ``opioid use disorder treatment service'' in
Sec. 410.67(b) in the cross reference to Sec. 410.44(a)(4), we listed
examples of the types of professionals who could potentially provide
OTP IOP services, such as physicians, psychologists, occupational
therapists, social workers, trained psychiatrist nurses, or other
mental health professionals to the extent authorized under State law
and scope of practice requirements. However, this was not a
comprehensive list. We additionally note that if any professionals are
not authorized under state law or scope of practice requirements to
furnish therapy and counseling services, the therapy or counseling
services provided by these professionals would not be covered as OTP
intensive outpatient services. This would also be consistent with
existing guidance for counseling and therapy services under the non-
drug component of the existing OTP weekly bundles.\182\
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\182\ Page 5, 40.1.1 Aspects of the Bundle, Non-drug component:
https://www.cms.gov/files/document/chapter-17-opioid-treatment-programs-otps.pdf.
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Comment: One commenter said they would appreciate if CMS could
clarify any distinction between the existing scope of services included
in the OTP benefit and the scope of services described under the
proposed add-on payment adjustment for IOP services. They also stated
they would appreciate learning how billing and coding requirements may
differ under the proposed IOP add-on payment adjustment versus the
existing OTP bundles and/or add-on codes.
Response: We appreciate this request for clarification. The
existing OTP weekly bundled payment includes both non-drug and drug
components for an episode of care, as well as add-on codes for
additional services furnished and take-home medications, as specified
in 42 CFR 410.67(d)(2) and (4). Specifically, these are described by
HCPCS codes G2067 through G2080, and G2115, G2216, and G1028. OTP
services that are currently covered under the OTP benefit are at the
Outpatient (Level 1) level of care and typically require less than 9
hours of care per week, according to ASAM's criteria for the continuum
of care.\183\ The services included as part of the OTP bundles and/or
add-on codes, which are specified at 42 CFR 410.67(b) in the definition
of ``opioid use disorder treatment service,'' include FDA-approved
opioid agonist and antagonist medications (buprenorphine, methadone,
and naltrexone) or opioid antagonist medications for the emergency
treatment of known or suspected opioid overdose; overdose education;
dispensing and administering of MOUD, if applicable; substance use
counseling; individual and group therapy; toxicology testing; intake
activities; and periodic assessments. For these services, at least one
OUD treatment service must be furnished (from either the drug or non-
drug component) to the patient in order to meet the threshold to bill
for an episode of care.
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\183\ https://www.asam.org/asam-criteria/about-the-asam-criteria.
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Some of the services included in the non-drug component of the OTP
bundled payments may be furnished via telecommunications technology.
Individual and group therapy and substance use counseling may be
furnished using audio-video technology, as clinically appropriate, and
via audio-only technology if two-way audio/video communications
technology is not available to the beneficiary, provided all other
applicable requirements are met, as specified in paragraphs (iii) and
(iv) of the definition of ``opioid use disorder treatment service'' in
42 CFR 410.67(b). Initiation of treatment with buprenorphine (but not
methadone) via the OTP intake add-on code may be furnished via two-way
audio-video communications technology, and via audio-only communication
technology when audio-video technology is not available to the
beneficiary, to the extent that the use of audio-video
telecommunications technology to initiate treatment with buprenorphine
is authorized by the Drug Enforcement Administration (DEA) and SAMHSA
at the time the service is furnished, as specified in paragraph (vi) of
the definition of ``opioid use disorder treatment service'' in 42 CFR
410.67(b). Additionally, as of CY 2023, these services furnished via
OTP mobile units are considered for the purposes of determining
Medicare payments to OTPs under the bundled payment codes and/or add-on
codes to the extent that the services are medically reasonable and
necessary and are furnished in accordance with SAMHSA and DEA guidance.
Currently, periodic assessments are allowed to be furnished via audio-
only telecommunication through CY 2023, and finalized in the CY 2024
PFS final rule (87 FR 69404; November 18, 2023) so that these services
may be furnished audio-only through the end of CY 2024, to the extent
that use of audio-only communications technology is permitted under the
applicable SAMHSA and DEA requirements at the time the service is
furnished, and all other applicable requirements are met. For
additional details regarding existing flexibilities regarding use of
telecommunications under the OTP benefit, commenters can also reference
Chapter 17 of the Medicare Benefit Policy Manual for Opioid Treatment
Programs.\184\
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\184\ https://www.cms.gov/files/document/chapter-17-opioid-treatment-programs-otps.pdf.
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In contrast, IOP services correspond to Level 2.1 of ASAM's
continuum of care and range between 9 hours or more per week and no
more than 20 hours per week for adults requiring a higher acuity of
care compared to those at the outpatient level of care (Level 1), which
reflects the intensity of services currently described by the existing
OTP benefit. The proposed adjustment for IOP services furnished at OTPs
for the treatment of OUD would serve as an add-on code that can be
billed in conjunction with the existing weekly bundles for medication
assisted treatment, such as HCPCS codes G2067 through G2075, and would
reflect additional services required for patients with an OUD who need
more intensive and more frequent care than is typical at the outpatient
level. The proposed list of services for IOP services furnished at
OTPs, which is reflected in proposed paragraph (ix) of the definition
of ``opioid use disorder treatment service'' in Sec. 410.67(b) by the
inclusion of the language, ``one or more services specified in Sec.
410.44(a)(4),'' includes
[[Page 81851]]
individual and group therapy with physicians or psychologists or other
mental health professionals to the extent authorized under State law,
which may be more intensive in nature than other therapy services
delivered to patients at Level 1 of the ASAM continuum of care as in
the existing OTP benefit; occupational therapy requiring the skills of
a qualified occupational therapist, provided by an occupational
therapist, or under appropriate supervision of a qualified occupational
therapist by an occupational therapy assistant; services of social
workers, trained psychiatric nurses, and other staff trained to work
with psychiatric patients; drugs and biologicals furnished for
therapeutic purposes, subject to the limitations specified in Sec.
410.29, excluding opioid agonist and antagonist medications that are
FDA-approved for use in treatment of OUD or opioid antagonist
medications for the emergency treatment of known or suspected opioid
overdose; individualized activity therapies that are not primarily
recreational or diversionary; family counseling, the primary purpose of
which is treatment of the individual's condition; patient training and
education, to the extent the training and educational activities are
closely and clearly related to the individual's care and treatment;
and, diagnostic services that are reasonable and necessary for the
diagnosis or active treatment of the individual's condition, with the
exception of toxicology testing. We proposed, at Sec.
410.67(d)(4)(i)(F), that at least nine IOP services per week would need
to be furnished by an OTP in order to reach the threshold to bill for
IOP services.
Lastly, we note that while certain services under the existing OTP
benefit have additional flexibilities for being furnished via audio-
only/audio-video technologies, we did not propose similar
telecommunications technology flexibilities for OTP intensive
outpatient services and are not finalizing these type of flexibilities
for intensive outpatient services at this time. Not extending
telecommunications technology flexibilities to OTP intensive outpatient
services is consistent with policies being finalized in HOPDs, CMHCs,
RHCs, and FQHCs that are also not permitting these types of
flexibilities for IOP services. This will also allow CMS additional
time to examine the clinical evidence and guidance to ensure that any
IOP services furnished to beneficiaries with an OUD can be conducted in
a manner that maintains safety and a high quality of care for Medicare
beneficiaries.
After consideration of the public comments we received, we are
finalizing our proposal to add a new paragraph (ix) to the definition
of ``opioid use disorder treatment service'' in Sec. 410.67(b)
defining a new category of services called ``OTP intensive outpatient
services'' and incorporating ``OTP intensive outpatient services'' in
the definition of OUD treatment services that are covered under the
Part B OTP benefit. We are excluding FDA-approved opioid agonist or
antagonist medications for the treatment of OUD or opioid antagonist
medications for the emergency treatment of known or suspected opioid
overdose, from the definition of ``OTP intensive outpatient services''
because these medications are already included as part of the weekly
bundled payment for an episode of care or as an adjustment to the
bundled payment. Additionally, we are finalizing our proposal to
exclude toxicology testing from the types of diagnostic services that
would be included in the definition of ``OTP intensive outpatient
services'' because, similarly, toxicology testing is already included
as part of the bundled payment for an episode of care.
b. Establishment of a Weekly Payment Adjustment for IOP Services
Furnished by OTPs
Section 1834(w)(2) of the Act provides the Secretary discretion to
implement one or more payment bundles based on the type of medication
provided, frequency of services, scope of services furnished,
characteristics of the individuals furnished such services, and other
factors as the Secretary determines appropriate. Currently, ASAM
classifies OTP services as outpatient treatment services (under Level 1
of the continuum of care), which are typically provided for less than 9
hours a week, or as a step-down from intensive outpatient services,
whereas intensive outpatient services (under Level 2.1 of the continuum
of care) are typically provided for more than 9 hours a week and no
more than 20 hours a week for adults with more severe needs than those
for whom treatment provided according to Level 1 of the continuum of
care is clinically appropriate.\185\ In order to appropriately reflect
the more intensive treatment profile for those individuals receiving
IOP services versus OTP services, we proposed to establish a weekly
payment adjustment via an add-on code for OTP intensive outpatient
services, which is consistent with the weekly bundled payment structure
under the existing Medicare OTP benefit. We stated in the CY 2024 OPPS
proposed rule that we believe that a code billed on a weekly basis
would allow greater flexibility with respect to how IOP services are
rendered and how service hours may be distributed over a given week to
best meet patient needs. Under the proposal, we proposed that an OTP
could bill for the weekly add-on code for OTP intensive services in the
same week for the same beneficiary as the existing coding describing a
weekly OTP bundle, so long as all applicable billing requirements for
each code are met (88 FR 49720). However, we noted that under the
proposal, each OTP intensive outpatient service must be medically
reasonable and necessary and not duplicative of any service(s) for
which OTPs received bundled payments for an episode of care in a given
week.
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\185\ https://americanaddictioncenters.org/rehab-guide/asam-criteria-levels-of-care.
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For OTP intensive outpatient services, we proposed to permit OTPs
to bill new HCPCS code GOTP1 (Intensive outpatient services; minimum of
nine services over a 7-contiguous day period, which can include:
individual and group therapy with physicians or psychologists (or other
mental health professionals to the extent authorized under State law);
occupational therapy requiring the skills of a qualified occupational
therapist; services of social workers, trained psychiatric nurses, and
other staff trained to work with psychiatric patients; individualized
activity therapies that are not primarily recreational or diversionary;
family counseling (the primary purpose of which is treatment of the
individual's condition); patient training and education (to the extent
that training and educational activities are closely and clearly
related to individual's care and treatment); diagnostic services; List
separately in addition to code for primary procedure. (88 FR 49721)
We proposed to value HCPCS code GOTP1 based on an assumption of a
typical case of three IOP services furnished per day for approximately
3 days per week. In response to the comment solicitation on IOP
services in the CY 2023 PFS proposed rule, many commenters stated that
a typical IOP treatment plan consists of at least 9 hours of skilled
treatment services per week, which would follow both the treatment
protocol advised by SAMHSA and ASAM level placement criteria.\186\
Moreover, the definition of intensive outpatient services in section
4124(b)(2)(B) of the CAA, 2023 specifies
[[Page 81852]]
that in community mental health centers, hospital-based IOPs, RHCs, and
FQHCs, an individual in need of IOP services must be certified by a
physician to have a need for such services for a minimum of 9 hours per
week compared to a minimum of 20 hours per week in a partial
hospitalization service treatment program. Therefore, we proposed to
calculate the payment rate for add-on code GOTP1 based on 9 services
per week. We welcomed comments on whether 9 services per week is
representative of the typical number of services furnished to patients
with an OUD who receive IOP services at OTPs. (88 FR 49721)
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\186\ https://www.ncbi.nlm.nih.gov/books/NBK64088/; https://store.samhsa.gov/product/TIP-47-Substance-Abuse-Clinical-Issues-in-Intensive-Outpatient-Treatment/SMA13-4182.
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We proposed that by billing HCPCS code GOTP1, the OTP would be
attesting to the fact that it has furnished at least nine services for
that week that would otherwise qualify as OTP intensive outpatient
services as discussed in section VIII.G.3.a of the CY 2024 OPPS
proposed rule. We acknowledged that not all OTP intensive outpatient
services will necessarily be 60 minutes in duration, or be a time-based
service, therefore, we proposed that furnishing nine OTP intensive
outpatient services, regardless of the length of each service, would
meet the threshold to bill for HCPCS code GOTP1. We noted that this
aspect of our proposal differs from the proposed requirement for
physician certification, discussed in section VIII.G.3.c. of the CY
2024 OPPS proposed rule, pursuant to which a physician must certify
that the individual requires nine hours of OTP intensive outpatient
services, and not simply nine OTP intensive outpatient services.
Under the proposal to establish a weekly add-on payment for OTP
intensive outpatient services, we stated that no single service could
be counted more than once for the purpose of meeting the criteria for
billing for any given code. In other words, the same service could not
be used to qualify to bill both the weekly bundle and the add-on
payment adjustment for OTP intensive outpatient services. Additionally,
we recognized that some services furnished as part of OTP intensive
outpatient services may be required multiple times a week (for example,
occupational therapy, patient education, family counseling, activity
therapies) to meet individual patient needs and varying clinical
complexity. Such services of the same type would be allowable to meet
the minimum of 9 services per week, provided that all services are
medically reasonable and necessary.
We noted that the proposal for the calculation of the payment rate
for HCPCS code GOTP1 is similar to the payment methodology proposed for
IOP services furnished in other settings. We stated that we believed
that calculating the payment rate for the proposed add-on payment
adjustment for OTP intensive outpatient services based on the rate
provided in a hospital setting would promote greater consistency, site
neutrality, and parity with payment rates proposed for IOPs in a
majority of other settings, including hospital-based IOPs, FQHCs, and
RHCs. Please see a more detailed discussion regarding this payment
methodology in section VIII.D of this final rule.
We acknowledged that, since IOP services have not been covered or
paid under Medicare to date, CMS did not have direct data to estimate
utilization and costs of IOP services. However, many of the items and
services included in IOP services have been and are currently paid for
by Medicare as part of the PHP benefit or under the OPPS more
generally. Therefore, in our preliminary ratesetting exercise, we
identified, in consultation with clinicians, a list of HCPCS codes for
services that would be reasonably included as part of IOP services.
Please see a more comprehensive list of these HCPCS codes used to
inform the payment methodology during our preliminary ratesetting
exercise in Table 43 within section VIII.C of the CY 2024 OPPS proposed
rule (88 FR 49704 and 49705). The inclusion of many of these services
was informed by comments we received in response to comment
solicitations in the CY 2023 OPPS/ASC and PFS proposed rules. For
example, some of these codes correspond to services for individual and
group therapy, occupational therapy, individualized activity therapies,
family counseling, and patient training and education.
For the majority of these identified HCPCS codes, the most recent
utilization data available was for OPPS claims paid for dates of
service in CY 2022, and the most recent cost data available was from
the cost reports in CY 2021. Based on this cost and utilization data
from CY 2021 and CY 2022, respectively, the estimated payment rate for
3 services per day based on APC 5861 (Intensive Outpatient (1-3
services) for Hospital-based IOPs) was $280.80, at the time of drafting
the proposed rule; 3 services per day for 3 days a week would therefore
be equal to $842.40. Because we proposed that OTP intensive outpatient
services include individual and group therapy, which are also already
included in the non-drug component of the OTP bundled payments for an
episode of care, we proposed to subtract the amount that corresponds to
the individual and group therapy rate in the non-drug component of the
OTP bundled payment from our estimate of $842.40 in order to establish
the amount of the OTP intensive outpatient services add-on payment.
Specifically, in the CY 2020 PFS final rule (84 FR 62658), we finalized
a building block methodology to calculate the rate for the non-drug
component based on established non-facility rates for similar services
under the Medicare PFS, the Medicare Clinical Laboratory Fee Schedule
(CLFS), and state Medicaid programs. For group therapy, we used CPT
code 90853 (Group psychotherapy (other than of a multiple-family
group)) as a reference code, which at the time of drafting the CY 2020
PFS final rule, in CY 2019, was assigned a non-facility rate of $27.39.
In order to account for the application of the annual update to the
non-drug component, the adjusted amount for group psychotherapy was
$28.36. For individual therapy, in the CY 2023 PFS final rule (87 FR
69773), we finalized an update to the reference code used in the non-
drug component to be based on the CY 2019 non-facility rate for CPT
code 90834 (Psychotherapy, 45 minutes with patient), which was $91.18,
and which we adjusted to account for the application of the annual
update in the intervening years, resulting in $94.37. Therefore, we
proposed an add-on payment adjustment of approximately $719.67 for
HCPCS code GOTP1 ($842.40-($28.36 + $94.37)). We sought comment on
whether the proposed add-on payment adjustment accurately reflects the
typical resource costs involved in furnishing IOP services at OTPs. We
also sought comment on our proposal to adjust the proposed add-on
payment adjustment to account for individual and group therapy included
in the non-drug component of OTP bundled payments for an episode of
care.
In accordance with the methodology used to update the payment rate
for other services payable under the OTP benefit, we proposed to apply
an annual update based on the percentage increase in the Medicare
Economic Index (MEI) to the payment rate HCPCS code GOTP1, as described
in Sec. 414.30. Additionally, consistent with the methodology used to
determine payment for non-drug services furnished under the OTP
benefit, we proposed to apply a geographic adjustment to the payment
for HCPCS
[[Page 81853]]
code GOTP1 based on the Geographic Adjustment Factor (GAF), as
described in Sec. 414.26. Furthermore, consistent with the policy that
applies for other OUD treatment services furnished by OTPs, a
beneficiary copayment amount of zero would apply for OTP intensive
outpatient services. Lastly, we also sought comment on the impact the
proposal may have on dually eligible individuals, specifically, the
extent to which this expanded coverage and payment may supplant
Medicaid coverage for dually eligible individuals, versus the extent to
which it would supplement Medicaid if it were fundamentally different
from what Medicaid covers in a given state.
We recognized in the CY 2024 OPPS proposed rule (88 FR 49722) that
we proposed to adopt per diem rates for IOP services furnished in other
settings, including CMHCs, hospital-based settings, FQHCs, and RHCs,
and that per diem rates are used in the payment methodology for IOP
services in some state Medicaid programs. Therefore, we also sought
comment on whether a daily per diem rate based on 3 service hours per
day would be more appropriate for OTP settings, especially if one
payment methodology over the other would be less disruptive to OTPs as
it relates to coordination of benefits. Lastly, we sought feedback
about the experiences of furnishing IOP services within OTP settings,
including the extent to which it is similar to or different than
furnishing IOP services in other settings. We stated that we believed
this additional information may be helpful to understand the clinical
complexity of patients enrolled in OTPs who are in need of IOP services
for OUD and to compare the level of care and type of services that may
supplement and/or exceed those ordinarily provided under the existing
OTP benefit, in order to help inform potential future rulemaking on
this topic.
We proposed to add a new paragraph (d)(4)(i)(F) to Sec. 410.67 in
order to describe the new adjustment to the bundled payment for OTP
intensive outpatient services. Additionally, we proposed to amend Sec.
410.67(d)(4)(ii) to add that the payment amounts for OTP intensive
outpatient services will be geographically adjusted using the
Geographic Adjustment Factor described in Sec. 414.26. Lastly, we
proposed to amend Sec. 410.67(d)(4)(iii) to add that payment for OTP
intensive outpatient services will be updated annually using the
Medicare Economic Index described in Sec. 405.504(d).
We received many public comments on our proposal to establish a
weekly payment adjustment for IOP services furnished by OTPs. These
public comments and our responses to these comments are addressed in
the section below.
Comment: We received a few comments regarding our proposal to apply
a beneficiary copayment amount of zero for OTP intensive outpatient
services, which is consistent with the policy for other OUD treatment
services furnished by OTPs. Commenters were very supportive of this,
since they stated patient out of pocket costs, even if they are small,
are one of the largest deterrents for patients being able to access
care.
Response: We thank commenters for expressing their support for this
policy regarding beneficiary copayment amounts.
Comment: Many commenters submitted comments regarding the frequency
of payment (per-diem or weekly) for the proposed payment rate
methodology. The comments were mixed regarding whether a per-diem
versus a weekly payment rate would be more appropriate in an OTP
setting. Commenters in support of a per-diem approach raised that a
beneficiary may need nine or more hours of IOP services per week but
may not be able to always attend all the scheduled services each week
due to extenuating circumstances. Commenters also noted that in these
cases especially, a per diem rate may better approximate the actual
number of services delivered in a given week. One commenter recommended
a mixed approach, requesting that CMS make a per diem rate available
for providers to bill in cases where patients are unable to receive all
the scheduled services in a given week, but that CMS should also allow
providers to bill the weekly rate when the minimum nine services
requirement is met. This commenter also stated that providers should
not be penalized if patients cannot attend the minimum number of nine
services per week. Many other commenters supported the weekly billing
approach. A few commenters stated that a weekly structure would be the
easiest to implement, given that Medicare already pays OTPs on a weekly
basis, as well as TRICARE, and many State Medicaid programs. One
commenter encouraged CMS to allow some level of flexibility if a weekly
payment is finalized, such as partial payment or allowing OTPs to
average the number of service hours over multiple weeks, so that an OTP
is not expected to go without payment for the week when less than nine
services are furnished.
Response: We appreciate the comments related to the proposed
frequency of payment for OTP intensive outpatient services. We
understand that a beneficiary may have one or a number of extenuating
circumstances, which may make it difficult in a given week to meet the
weekly minimum nine services requirement for the weekly payment
approach. However, in the CY 2024 OPPS/ASC proposed rule, we stated
that a code billed on a weekly basis may allow greater flexibility than
a per diem approach with respect to how IOP services are rendered. We
believe that a weekly payment approach would allow more flexibility for
how service hours could be distributed over a given week to best meet
patient needs, including in a manner to balance frequent IOP treatment
with other obligations such as work, childcare, school, household
activities, etc., compared to a per-diem approach that would require a
specific number of service hours per day. Furthermore, we believe that
a weekly billing structure may allow OTPs to more easily verify that
the required number of IOP services have been furnished. Statutory
requirements, SAMHSA treatment guidance, and clinical standards from
ASAM indicate that a minimum of nine skilled treatment services is
standard for IOPs. The proposed payment amount for GOTP1 is based on
nine services per week, which is consistent with these existing
standards. Additionally, less than nine IOP services rendered per week
would be consistent with the intensity of care at the outpatient level,
which is already reflected in the existing OTP benefit. In response to
commenters' who stated that OTPs should not be penalized if patients
cannot attend the minimum number of nine services per week, we affirm
that OTPs can continue to bill the weekly bundles and add-on codes
described by G2067 through G2080, and G2115, G2216, and G1028, to
receive payment for treating Medicare beneficiaries with an OUD, as
long as all applicable requirements are met.
Finally, most comments in response to the CY 2023 PFS comment
solicitation on IOPs and in response to the proposed rule indicated a
preference for a weekly billing structure in OTP settings. We continue
to believe that a weekly billing structure is appropriate at this time.
However, we will continue to monitor the billing structure to ensure
that Medicare beneficiaries with an OUD do not face barriers to
accessing OTP intensive outpatient services and may consider
adjustments as needed through future rulemaking.
Comment: Multiple commenters expressed concern regarding our
proposal to subtract the payment rate for individual and group therapy
when
[[Page 81854]]
calculating the weekly payment adjustment for IOP services furnished by
OTPs. Commenters stated that OTPs who offer individual and group
therapy services as part of an IOP conduct these services in a way that
is separate and distinct from the therapy services they are already
providing to Medicare beneficiaries under the existing OTP benefit.
Commenters further explained that these individual and group therapy
services are more intensive and would be additional, not duplicative
services, compared to the existing covered therapy services built into
the weekly bundled payment. Commenters also stated that an IOP is a
critically important level of care for individuals who need more
intensive and structured treatment than outpatient services, but who
can live safely in their homes and communities without needing 24-hour
treatment in residential or inpatient settings. Therefore, commenters
requested that CMS not exclude the payment amount for individual and
group counseling services from the payment methodology for the IOP
payment adjustment.
Response: We appreciate commenters raising these concerns. We
proposed to deduct the payment rates for individual and group therapy
services from the payment rate for IOP services because we believed
that these therapy services may be duplicative of services included in
the non-drug component of the OTP bundled payment. However, we are
persuaded by the public comments received that requested that we do not
deduct the payment rate for individual and group therapy services from
the payment methodology for the IOP payment adjustment. Commenters
explained that the individual and group therapy services furnished as
part of an IOP are more intensive in nature and may be furnished on a
more frequent basis than those therapy services in the non-drug
component of the OTP bundled payment, thus they would not be
duplicative in nature. Additionally, we were persuaded by the rationale
that IOP services are often more intense than at an outpatient level
since they are often provided as a step-down from residential or
inpatient settings, whereby patients may still need intensive therapy
services at a higher acuity of care but may not necessarily require 24-
hour treatment. Furthermore, in response to the comment solicitation
for IOP services in the CY 2023 PFS proposed rule, commenters raised
that therapy services furnished in IOP services are structured, goal-
oriented, and often focus on social skill rehabilitation and ongoing
engagement. We also note that IOP services are usually provided at
Level 2.1 of the ASAM continuum of care, which is likely to reflect
therapy services that are more intensive, compared to services provided
at the outpatient level within the existing OTP benefit and that are
described by Level 1 of the ASAM continuum of care. We understand that
individual and group therapy services are fundamental to many IOPs. We
do not want to disincentivize OTPs furnishing necessary care for
Medicare beneficiaries with an OUD who need more intensive therapy, by
establishing a payment rate that does not reflect the resources
involved in furnishing these services. Therefore, in consideration of
these comments, we are finalizing a payment methodology for the IOP
payment adjustment that does not deduct the amount for individual
therapy (based on the CY 2019 non-facility rate for CPT code 90834,
which was $91.18) and for group therapy (based on the CY 2019 non-
facility rate for CPT code 90853, which was $27.39) and their annual
update adjustments. The finalized payment amount for GOTP1 for CY 2024
is $778.20. We are reflecting this policy change in new Sec.
410.67(d)(4)(i)(F) by removing the proposed language, ``excluding an
amount equivalent to the amount included in the OTP weekly bundled
payment for individual and group therapy.''
Comment: We received a few comments regarding payment neutrality
among multiple care settings. Specifically, commenters advocated that a
site-neutral set of payment rates should be applied to all providers of
IOP services, including hospital outpatient departments, CMHCs, FQHCs,
RHCs, and OTPs. One commenter further noted that as additional claims
and cost data become available in the years after the IOP benefit is
implemented, CMS can then evaluate whether adjustments and different
payment rates are appropriate for different settings.
Response: We thank the commenters for their feedback. As we stated
in the proposed rule, we did not have direct data to estimate
utilization and cost of IOP services at the time of setting proposed
payment rates since IOP services have not been covered or paid under
Medicare to date. We agree with the commenter that it would be
appropriate to continue to monitor cost and utilization data over time,
and if future adjustments are needed, we may consider these refinements
to the payment rate for future rulemaking. Additionally, we note that
by finalizing a policy to not deduct an amount for individual and group
therapy from the adjustment for IOP services furnished by OTPs, as
detailed in the discussion above, the payment rate for OTPs would be
consistent with the payment rate for most other settings under
Medicare. We would continue to base our payment rate for OTPs on APC
5861 (Intensive Outpatient (1-3 services) for Hospital-based IOPs),
which is reflected in the payment methodologies for the other settings
and would help promote site neutrality.
Comment: One commenter expressed appreciation that CMS clarified
that OTP intensive outpatient services do not necessarily need to be
one hour in duration and that the same IOP service can be performed
more than once per week to meet the nine-services threshold per week.
The commenter requested that CMS finalize these flexibilities.
Response: We thank the commenter for their support of these
proposed flexibilities for OTPs furnishing intensive outpatient
services.
Comment: One commenter expressed concern regarding the proposal to
update the payment for OTP intensive outpatient services annually using
the Medicare Economic Index (MEI). The commenter stated that the MEI
reflects the cost of physician practices but does not adequately
capture the cost and care delivery structures in the OTP setting. The
commenter raised that OTPs are more similar to hospital outpatient
departments because they include interdisciplinary teams, case
management services, Clinical Laboratory Improvement Amendments (CLIA)-
waived services, medication management and diversion control systems,
and other services. The commenter further added that OTPs are subject
to rigorous oversight, accreditation, and certification standards. For
these reasons, and because the MEI mirrors general inflation more than
medical inflation, the commenter contended that the MEI is not an
appropriate update factor and suggested that instead the Inpatient
Prospective Payment System (IPPS) market basket update would be a
better indicator for annual price growth.
Response: We appreciate hearing from the commenter on this issue.
However, we note that the payment amounts for other services under the
existing OTP benefit are annually updated by the MEI, as described in
42 CFR 410.67(d)(4)(iii). We did not propose to modify the update
factor for the non-drug component of the bundled payment for an episode
of care, and we do not believe it would be appropriate to apply a
different update factor for IOP
[[Page 81855]]
services furnished by OTPs without also adjusting the update factor for
the non-drug component in the existing weekly bundle. However, we may
consider this issue for future rulemaking.
Comment: One commenter did not object to the payment methodology
for setting the weekly payment rate for IOP services furnished in OTPs
or the actual payment amount, but pointed out that OTPs may be
benefitting from a higher payment rate for IOP services than CMHCs. The
same commenter believed it would be inequitable for CMS to provide the
higher IOP rate to new entity types furnishing IOP services compared to
CMHCs.
Response: We thank the commenter for their feedback. While we are
uncertain how long OTPs have historically furnished IOP services, we do
note that SAMHSA data suggests that approximately 557 OTPs offer IOP
services nationwide as of 2021, thus we do not necessarily believe OTPs
would be new entities furnishing intensive outpatient services.\187\ In
establishing payment to OTPs for these services, we are seeking to
finalize a payment rate that would be consistent with the payment rate
for IOP services in most other settings under Medicare, which would
promote site neutrality. For additional information on the payment
methodology for IOP services delivered in CMHCs, please reference
section VIII.D.3. of this final rule with comment period.
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\187\ Substance Abuse and Mental Health Services Administration,
National Substance Use and Mental Health Services Survey (N-SUMHSS),
2021: Annual Detailed Tables. Rockville, MD: Substance Abuse and
Mental Health Services Administration, 2023. Weblink: https://www.samhsa.gov/data/sites/default/files/reports/rpt39450/2021%20N-SUMHSS%20Annual%20Detailed%20Tables_508_Compliant_2_8_2023.pdf.
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Comment: In response to our request for comment regarding the
experiences of furnishing IOP services within OTP settings, including
to the extent to which it is similar to or different than furnishing
IOP services in other settings, several commenters expressed that
Medicare beneficiaries who need IOP services in addition to other
traditional OTP services often have complex and co-occurring SUDs and/
or mental health conditions. One commenter described that often
patients in an OTP will have OUD in addition to co-occurring SUDs and
or mental health conditions, where patients in other settings may not.
Another commenter mentioned that some OTPs may be treating other
individuals who only have a mental health condition and are receiving
IOP treatment, but who do not receive other treatment at the OTP.
Finally, one commenter urged CMS to develop payment policies or
crosswalk codes that enable OTPs to deliver IOP services to patients
who have mental health conditions or SUDs that are not just OUD.
Response: We appreciate commenters sharing this valuable
information regarding various experiences of furnishing IOP services in
an OTP setting. As previously stated, we note that section 1861 of the
Act requires Medicare coverage for services furnished by OTPs to be for
the treatment of OUD. However, we may consider these issues, including
ways to further improve access to care for Medicare beneficiaries with
an OUD who experience other co-occurring conditions, for future
rulemaking.
After considering public comments, we are modifying our proposed
payment methodology for calculating the payment adjustment for IOP
services furnished by OTPs in one respect. We are finalizing our
proposal to add a new paragraph (d)(4)(i)(F) to Sec. 410.67 to
describe the new adjustment to the bundled payment for OTP intensive
outpatient services. However, we are not finalizing our proposal to
deduct the amount for individual and group therapy that is included in
the non-drug component of the OTP bundled rates. Accordingly, we are
revising the proposed new Sec. 410.67(d)(4)(i)(F) to strike ``,
excluding an amount equivalent to the amount included in the OTP weekly
bundled payment for individual and group therapy,'' in response to the
public comments. We are finalizing that the adjustment will be made
when at least nine services of OTP intensive outpatient services are
furnished in a week. We are also finalizing a payment methodology to
price HCPCS code GOTP1 based on the estimated payment rate of 3
services per day based on APC 5861 (Intensive Outpatient (1-3 services)
for Hospital-based IOPs), which is $259.40, multiplied by 3 to reflect
3 days a week (for a weekly payment methodology), which results in a
final payment rate of $778.20.\188\ Additionally, we note that GOTP1
was a placeholder code for OTPs to bill for providing IOP services and
that the final code is HCPCS code G0137 (Intensive outpatient services;
minimum of nine services over a 7-contiguous day period, which can
include individual and group therapy with physicians or psychologists
(or other mental health professionals to the extent authorized under
State law); occupational therapy requiring the skills of a qualified
occupational therapist; services of social workers, trained psychiatric
nurses, and other staff trained to work with psychiatric patients;
drugs and biologicals furnished for therapeutic purposes, excluding
opioid agonist and antagonist medications that are FDA-approved for use
in treatment of OUD or opioid antagonist medications for the emergency
treatment of known or suspected opioid overdose; individualized
activity therapies that are not primarily recreational or diversionary;
family counseling (the primary purpose of which is treatment of the
individual's condition); patient training and education (to the extent
that training and educational activities are closely and clearly
related to individual's care and treatment); diagnostic services (not
including toxicology testing); (provision of the services by a
Medicare-enrolled Opioid Treatment Program); List separately in
addition to code for primary procedure, if applicable).
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\188\ We note that in the CY 2024 OPPS/ASC proposed rule, the
payment rate of 3 services per day for APC 5861 (Intensive
Outpatient (1-3 services) for Hospital-based IOPs) was $280.80.
However, this payment rate has been updated to $259.40 following the
publication of the proposed rule based on more recent cost data and
is used as the base rate for IOP services furnished by OTPs.
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We are also finalizing our proposal to amend Sec. 410.67(d)(4)(ii)
to add that the payment amount for OTP intensive outpatient services
will be geographically adjusted using the Geographic Adjustment Factor
(GAF) described in Sec. 414.26. Lastly, we are finalizing our proposal
to amend Sec. 410.67(d)(4)(iii) to add that payment for OTP intensive
outpatient services will be updated annually using the Medicare
Economic Index described in Sec. 405.504(d).
c. Certification and Plan of Care Requirements for IOPs in OTP Settings
In order to be consistent with physician certification and plan of
care requirements for IOP services furnished in other settings of care
and to ensure, to the extent possible, that IOP services are only
provided and paid for when medically necessary and appropriate for the
beneficiary, we proposed to adopt the same standards set forth in Sec.
424.24(d)(1) through (3) for OTPs providing OTP intensive outpatient
services (for more detailed discussions of these proposed standards,
please see section VIII.B.3 of the CY 2024 OPPS proposed rule).
Specifically, under the proposal, a physician would be required to
certify that an individual needs OTP intensive outpatient services for
a minimum of 9 hours per week, which is consistent with treatment
standards specified by SAMHSA and minimum hour standards described by
ASAM's
[[Page 81856]]
Level 2.1 of care for IOP services.\189\ This certification would
require: documentation in the patient's medical record to include that
the individual requires such services for a minimum of 9 hours of
services per week; the first recertification as of the 30th day of IOP
services; and that the certification of IOP services occur no less
frequently than every other month. Accordingly, we proposed to revise
Sec. 410.67 of our regulations to add a paragraph (c)(5) to specify
that OTPs must furnish OTP intensive outpatient services consistent
with the requirements regarding content of certification, plan of care
requirements, and recertification requirements as set forth under
proposed Sec. 424.24(d)(1) through (3).
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\189\ https://www.ncbi.nlm.nih.gov/books/NBK64088/; https://store.samhsa.gov/product/TIP-47-Substance-Abuse-Clinical-Issues-in-Intensive-Outpatient-Treatment/SMA13-4182.
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Regarding the recertification requirements, given that OTP services
are billed on a weekly basis, we proposed that the required
recertification could occur any time during an episode of care in which
the 30th day from the start of IOP services (and every other month
thereafter) falls. We noted that in the CY 2020 PFS final rule (84 FR
62641), we defined an episode of care as a 1-week (contiguous 7-day)
period at Sec. 410.67(b). In the CY 2021 PFS final rule (85 FR 84691),
we clarified that OTPs may choose to apply a standard billing cycle by
setting a particular day of the week to begin all episodes of care, or
they may choose to adopt weekly billing cycles that vary across
patients, and we proposed to adopt the same approach here. We welcomed
comments on these proposals.
We noted that the proposal requires that the physician certify a
need for at least 9 hours of services per week, which differs from our
proposal that in order to bill for the add-on payment adjustment for
OTP intensive outpatient services, the OTP must attest that it provided
9 such services to the beneficiary in a week. Given that services can
vary in duration and that some services are not time-based, we stated
that we believed it would be administratively simpler for OTPs to count
the number of services furnished rather than to count the number of
hours for purposes of billing the add-on payment adjustment for OTP
intensive outpatient services. Additionally, as described in section
VIII.G.3.b. of this final rule with comment period, our proposed
payment rate was based on the number of services furnished per day,
rather than the number of hours, consistent with the proposals for IOP
payment in other settings. In contrast, for the purposes of
certification and plan of care requirements for IOPs in OTP settings,
we stated that we believed that requiring a physician to certify that a
beneficiary requires a minimum of 9 hours of services per week is
consistent with existing clinical guidance describing the intensity of
care for IOP services.\190\ Additionally, a minimum of 9 hours of
services per week is consistent with proposals for the certification
and plan of care requirements for IOPs in other care settings. We
welcomed comments on both of these proposals, including whether this
distinction accurately reflects the practice patterns of OTPs
furnishing IOP services.
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\190\ https://www.ncbi.nlm.nih.gov/books/NBK64088/; https://store.samhsa.gov/product/TIP-47-Substance-Abuse-Clinical-Issues-in-Intensive-Outpatient-Treatment/SMA13-4182.
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We received multiple comments on our proposal for certification and
plan of care requirements for IOPs in OTP settings. The comments and
our responses to these commenters are included below.
Comment: A few commenters requested that CMS not finalize the
proposed requirement for recertification for OTP intensive outpatient
services ``as of the 30th day'' of IOP services as written in proposed
paragraph (c)(5) to Sec. 410.67. Commenters raised that they did not
believe it is appropriate to consider finalizing a shorter interval for
the first recertification or for the subsequent recertification.
Instead, they suggested that the first recertification should be
modified for OTPs to be consistent with the proposal for
recertification in other settings at Sec. 424.24(d)(3)(ii), which
states, ``no less frequently than every 60 days.'' Commenters believed
this may reduce burden and unnecessary documentation requirements on
providers. Another commenter did not believe that recertification
should be required every other month and instead recommended that a
redetermination occur when it is clinically necessary according to the
treatment plan, such as when a new episode of care begins. A different
commenter urged CMS to consider extending recertification to every 90
days instead.
Response: We appreciate commenters raising these issues regarding
the shorter interval for the first recertification in OTP settings. In
the CY 2024 OPPS proposed rule (88 FR 49722), we stated that ``this
certification would require documentation in the patient's medical
record to include that the individual requires such services for a
minimum of 9 hours per week; require the first recertification as of
the 30th day of IOP services; and require that the certification of IOP
services occur no less frequently than every other month.'' In the
proposed regulatory text, we stated ``OTPs that provide OTP intensive
outpatient services must meet the requirements set forth in Sec.
424.24(d)(1) through (3) of this chapter related to content of
certification, plan of treatment, and recertification for the purposes
of furnishing OTP intensive outpatient services, except that the
recertification required under Sec. 424.24(d)(3)(ii) may occur any
time during an episode of care in which the 30th day from the start of
IOP services falls.'' We are persuaded by the majority of commenters
who requested that we not require a recertification ``as of the 30th
day of services,'' as we agree that the recertification requirements
should be consistent with the other settings paying for IOP services
under Medicare. Accordingly, we are not finalizing our proposal to
require a recertification as of the 30th date of services, and are
instead finalizing that recertification must occur no less frequently
than every 60 days, which is consistent with the requirement at Sec.
424.24(d)(3)(ii). We believe this change will promote consistency with
the requirements for IOP services in other care settings under
Medicare, as well as limit potential additional and unnecessary
administrative requirements for OTPs. Accordingly, we are deleting the
phrase ``, except that the recertification required under Sec.
424.24(d)(3)(ii) of this chapter may occur any time during an episode
of care in which the 30th day from the start of IOP services falls''
from paragraph (c)(5) of Sec. 410.67.
Comment: Multiple commenters requested that CMS modify the
physician certification and plan of care requirements to include other
behavioral health professionals. A few commenters recommended that CMS
align these requirements for certification and plan of care with
existing clinical standards of practice and state requirements to
permit other non-physician professionals, including psychologists,
clinical social workers, and other behavioral health professionals to
perform eligibility assessments, develop treatment plans, and certify
the need for services. Multiple commenters noted that requiring only a
physician to complete these requirements would be a significant barrier
to care and add additional burden on providers. Other commenters noted
that ASAM level of
[[Page 81857]]
care determinations do not require a physician to complete the
assessment and that anyone trained to do level of care determinations
may complete them and that SUD counselors are certified and licensed
differently at the state level and this should be explicitly permitted
and addressed.
Response: We thank commenters for raising this important issue.
After considering the public comments, we understand that requiring a
physician to conduct certification and develop a plan of care may
create additional issues for practices and regions that face a provider
shortage and/or limited capacity to regularly complete these
requirements. Evidence indicates that there is less access to OTPs in
rural areas,\191\ and also that nearly 60 percent of all mental health
professional shortage areas are located in rural areas.\192\
Additionally, we recognize that evidence has shown physicians spend up
to one-fifth of working hours per week on administrative tasks with
psychiatrists spending the highest proportion of their time on
administration compared to other types of physicians.\193\ We also
understand that other non-physician practitioners, including but not
limited to, clinical social workers, psychologists, nurse
practitioners, mental health counselors, and marriage and family
therapists, have increasingly played a critical role in
interdisciplinary care teams and filling important gaps in care.
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\191\ https://pubmed.ncbi.nlm.nih.gov/35512612/.
\192\ Designated Health Professional Shortage Areas Statistics,
Third Quarter of Fiscal Year 2023, Designated HPSA Quarterly
Summary: https://data.hrsa.gov/default/generatehpsaquarterlyreport quarterlyreport.
\193\ https://pubmed.ncbi.nlm.nih.gov/25626223/.
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We note that section 4124 of the CAA, 2023 includes provisions for
physician certification and plan of care requirements that require a
physician to certify a need for IOP services. However, while the CAA,
2023 does not address IOP services furnished in OTP settings, our
proposals to pay for IOP services in OTP settings were made under the
statutory authority of sections 1861(jjj)(1) and 1834(w)(2) of the Act.
We are persuaded by the commenters that practitioners other than
physicians can appropriately conduct the certification,
recertification, and plan of care requirements, and we agree that
allowing additional practitioner types to perform the certification,
recertification, and plan of care requirements will likely help to
expand access to care. We believe we have statutory flexibility to
finalize that the certification, recertification, and plan of care
requirements may be performed by non-physician practitioners, as
permitted by state law and consistent with scope of practice
requirements. Additionally, we note that certain non-physician
practitioners are authorized under Medicare to perform certification
activities.\194\ Therefore, we are finalizing that in addition to
physicians, the following non-physician practitioners may perform the
required certification and plan of care requirements for IOP services
furnished in the OTP setting: nurse practitioners, physician
assistants, clinical psychologists, clinical social workers, mental
health counselors, marriage and family therapists, and any other non-
physician practitioners as defined in section 1842(b)(18)(C) of the
Act, as permitted by state law and consistent with scope of practice
requirements. These flexibilities would also be extended to any
physician requirements, pertaining to the individual being under the
care of a physician and to a physician's diagnosis, as described in
Sec. 424.24(d)(1)(ii) and (d)(2)(A), so that they could also be
performed by non-physician practitioners.
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\194\ https://www.cms.gov/medicare/enrollment-renewal/providers-suppliers/chain-ownership-system-pecos/ordering-certifying#eligible-specialty-types.
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Comment: We received comments on several topics that were outside
the scope of the proposed rule. Those topics included the following: a
recommendation that CMS develop crosswalk codes that enable IOP to be
delivered in freestanding community-based SUD treatment facilities; a
request that CMS allow structured outpatient addiction programs to bill
the add-on payment adjustment for OTP intensive outpatient services;
and a request that CMS develop an add-on code for contingency
management services in OTPs for individuals with a stimulant use
disorder.
Response: While some of these comments are either outside of our
statutory authority and/or out of scope for this final rule because
they do not relate to the specific proposals included in the proposed
rule, we appreciate the feedback and may consider these recommendations
for future rulemaking.
After consideration of the public comments received, we are
finalizing our proposed definition of OTP intensive outpatient services
in paragraph (ix) of definition of ``opioid use disorder treatment
service'' at 42 CFR 410.67(b), with modifications to specify that non-
physician practitioners, in addition to physicians, may perform the
required certification that the individual has a need for such
services, plan of treatment requirements, and recertification
requirements, as permitted by state law and consistent with scope of
practice requirements. These non-physician practitioners may include,
but are not limited to, nurse practitioners, physician assistants,
clinical psychologists, clinical social workers, mental health
counselors, licensed marriage and family therapists, and other non-
physician practitioners, as defined in section 1842(b)(18)(C) of the
Act.
We are finalizing a modification to our proposal for certification
and plan of care requirements for OTP intensive outpatient services at
proposed new paragraph (c)(5) at Sec. 410.67 by specifying that, for
the standards set forth in the proposed Sec. 424.24(d)(1) through (3),
a physician and/or non-physician practitioner could perform the
requirements for certification, plan of care, and recertification for
the purposes of furnishing OTP intensive outpatient services, as
permitted by state law and scope of practice requirements. We are also
striking language that states ``in which the 30th day from the start of
IOP services falls'' for consistency with policies in other care
settings under Medicare. We are finalizing that the first
recertification and subsequent recertifications for OTP intensive
outpatient services must occur no less frequently than every 60 days,
consistent with Sec. 424.24(d)(3)(ii). Accordingly, we are finalizing
at Sec. 410.67(c)(5) that OTPs that provide OTP intensive outpatient
services must meet the requirements set forth in Sec. 424.24(d)(1)
through (3) related to content of certification, plan of treatment, and
recertification for the purposes of furnishing OTP intensive outpatient
services, except that the recertification required under Sec.
424.24(d)(3)(ii) may occur any time during an episode of care.
d. Correction to the OTP Regulation Text
We also proposed to correct a typographical error at Sec.
410.67(d)(3), which currently states ``At least one OUD treatment
service described in paragraphs (b)(1) through (5) of this section must
be furnished to bill for the bundled payment for an episode of care.''
This provision should refer to paragraphs (i) through (v) of the
definition of OUD treatment service in paragraph (b). Accordingly, we
propose to correct this sentence to read, ``At least one OUD treatment
service described in paragraphs (i) through (v) of the definition of
opioid use disorder treatment service in paragraph (b) of this section
must be furnished to bill for the
[[Page 81858]]
bundled payment for an episode of care.''
We did not receive any public comments on our proposal to correct a
typographical error at Sec. 410.67(d)(3). We are finalizing our
proposal to revise Sec. 410.67(d)(3) to instead state ``At least one
OUD treatment service described in paragraphs (i) through (v) of the
definition of opioid use disorder treatment service in paragraph (b) of
this section must be furnished to bill for the bundled payment for an
episode of care.''
H. Payment Rates Under the Medicare Physician Fee Schedule for
Nonexcepted Items and Services Furnished by Nonexcepted Off-Campus
Provider-Based Departments of a Hospital
1. Background
In the CY 2017 OPPS/ASC final rule with comment period (81 FR
79727) in the discussion of the proposed implementation of section 603
of the Bipartisan Budget Act (BBA) of 2015 (Pub. L. 114-74, November 2,
2015), we established the PHP payment rate under the Medicare Physician
Fee Schedule (MPFS) for nonexcepted off-campus PBDs as equivalent to
the level of payment made to CMHCs for furnishing three or more PHP
services per day. We noted that when a beneficiary received outpatient
services in an off-campus department of a hospital, the total Medicare
payment for those services is generally higher than when those same
services are provided in a physician's office. Similarly, when partial
hospitalization services are provided in a hospital-based PHP, Medicare
pays more than when those same services are provided by a CMHC. Our
rationale for adopting the CMHC per diem rate for APC 5853 as the MPFS
payment amount for nonexcepted PBDs providing PHP services was because
CMHCs are freestanding entities that are not part of a hospital, but
they provide the same PHP services as hospital-based PHPs. This is
similar to the differences between freestanding entities paid under the
MPFS that furnish other services also provided by hospital-based
entities. Similar to other entities currently paid for their technical
component services under the MPFS, we believe CMHCs would typically
have lower cost structures than hospital-based PHPs, largely due to
lower overhead costs and other indirect costs such as administration,
personnel, and security. We explained that we believe that paying for
nonexcepted hospital-based partial hospitalization services at the
lower CMHC per diem rate aligns with section 603 of the BBA of 2015,
while also preserving access to PHP services.
2. Payment for PHP and IOP Furnished by Nonexcepted Off-Campus Hospital
Outpatient Departments
As discussed in section VIII.D of the CY 2024 OPPS/ASC proposed
rule, we proposed to change our methodology for calculating PHP payment
rates by establishing separate payment rates for 3-service and 4-
service days. We also proposed to establish IOP payment rates for 3-
service and 4-service days beginning in CY 2024. Because CMHCs have
different cost structures than hospitals, we proposed to establish
separate CMHC and hospital rates for 3-service and 4-service PHP and
IOP days. We proposed to utilize the CMHC rates for PHP and IOP as the
payment rates for PHP and IOP services furnished by nonexcepted off-
campus hospital outpatient departments. Specifically, we proposed to
utilize the separate CMHC rates for 3-service and 4-service PHP days as
the MPFS rates, depending upon whether a nonexcepted off-campus
hospital outpatient department furnishes 3 or 4 PHP services in a day.
Similarly, we also proposed to utilize the CMHC rates for 3-service and
4-service IOP days as the MPFS rates, depending upon whether a
nonexcepted hospital outpatient department furnishes 3 or 4 IOP
services in a day.
As discussed in section VIII.D of the CY 2024 OPPS/ASC proposed
rule, we solicited comment on our proposed payment rates for PHP and
IOP services, as well as whether commenters believe it would be
appropriate to consider establishing a combined rate for 3-service days
in hospitals and CMHCs, and a combined rate for 4-service days in
hospitals and CMHCs. We also considered whether it would be appropriate
to apply a different methodology for calculating the PHP and IOP rates
for nonexcepted off-campus hospital outpatient departments and we
solicited comments on alternative methodologies commenters believed
would be appropriate. For example, we considered whether it would be
appropriate to apply the PFS Relativity Adjuster of 40 percent, which
was established in the CY 2018 PFS rule (82 FR 53030) and which applies
to most other nonexcepted OPPS services furnished by a nonexcepted off-
campus hospital outpatient department.
Comment: Several commenters urged CMS to implement a site-neutral
payment for nonexcepted off-campus provider-based hospital departments
(PBDs). Commentors argued that Congress' goal for enacting section 603
of the Bipartisan Budget Act (BBA) of 2015 (Pub. L. 114-74, November 2,
2015) and CMS's 2017 transition to PFS payment rates for PBDs was
motivated by a desire to move to a site-neutral payment methodology.
Furthermore, commenters stated that providing reduced payment for PHP
and IOP services furnished by excepted off-campus PBDs could reduce
beneficiaries' access to behavioral health services.
Response: We appreciate the concerns that commenters raised about
Medicare beneficiaries' access to behavioral and mental health
services. We note that our longstanding policy to pay nonexcepted off-
campus provider-based departments at the CMHC rate for PHP services
aligns with section 603 of the BBA of 2015, while also preserving
access to PHP services. We do not believe that this policy reduces
access to behavioral health services, because similar to other entities
currently paid for their technical component services under the MPFS,
we believe CMHCs would typically have lower cost structures than
hospital-based PHPs, largely due to lower overhead costs and other
indirect costs such as administration, personnel, and security.
After consideration of the public comments we received, we are
finalizing our proposal to apply the CMHC PHP and IOP per diem rates as
the MPFS rates for PHP and IOP services furnished by nonexcepted off-
campus PBDs.
IX. Services That Will Be Paid Only as Inpatient Services
A. Background
Established in rulemaking as part of the initial implementation of
the OPPS, the inpatient only (IPO) list identifies services for which
Medicare will only make payment when the services are furnished in the
inpatient hospital setting because of the invasive nature of the
procedure, the underlying physical condition of the patient, or the
need for at least 24 hours of postoperative recovery time or monitoring
before the patient can be safely discharged (70 FR 68695). The IPO list
was created based on the premise (rooted in the practice of medicine at
that time), that Medicare should not pay for procedures furnished as
outpatient services that are performed on an inpatient basis virtually
all of the time for the Medicare population, for the reasons described
above, because performing these procedures on an outpatient basis would
not be safe or appropriate, and therefore not reasonable and necessary
under Medicare rules (63 FR 47571). Services
[[Page 81859]]
included on the IPO list were those determined to require inpatient
care, such as those that are highly invasive, result in major blood
loss or temporary deficits of organ systems (such as neurological
impairment or respiratory insufficiency), or otherwise require
intensive or extensive postoperative care (65 FR 67826). There are some
services designated as inpatient only that, given their clinical
intensity, would not be expected to be performed in the hospital
outpatient setting. For example, we have traditionally considered
certain surgically invasive procedures on the brain, heart, and
abdomen, such as craniotomies, coronary-artery bypass grafting, and
laparotomies, to require inpatient care (65 FR 18456). Designation of a
service as inpatient only does not preclude the service from being
furnished in a hospital outpatient setting but rather means that
Medicare will not make payment for the service if it is furnished to a
Medicare beneficiary in the hospital outpatient setting (65 FR 18443).
Conversely, the fact that a procedure is not on the IPO list should not
be interpreted to mean the procedure is only appropriately performed in
the hospital outpatient setting (70 FR 68696).
As part of the annual update process, we have historically worked
with interested parties, including professional societies, hospitals,
surgeons, hospital associations, and beneficiary advocacy groups, to
evaluate the IPO list and to determine whether services should be added
to or removed from the list. Interested parties are encouraged to
request reviews for a particular code or group of codes; and we have
asked that their requests include evidence that demonstrates that the
procedure was performed on an outpatient basis in a safe and
appropriate manner in a variety of different types of hospitals--
including but not limited to--operative reports of actual cases, peer-
reviewed medical literature, community medical standards and practice,
physician comments, outcome data, and post-procedure care data (67 FR
66740).
We traditionally have used five longstanding criteria to determine
whether a procedure should be removed from the IPO list. As noted in
the CY 2012 OPPS/ASC final rule with comment period (76 FR 74353), we
assessed whether a procedure or service met these criteria to determine
whether it should be removed from the IPO list and assigned to an APC
group for payment under the OPPS when provided in the hospital
outpatient setting. We have explained that while we only require a
service to meet one criterion to be considered for removal, satisfying
only one criterion does not guarantee that the service will be removed;
instead, the case for removal is strengthened with the more criteria
the service meets. The criteria for assessing procedures for removal
from the IPO list are as follows:
1. Most outpatient departments are equipped to provide the services
to the Medicare population.
2. The simplest procedure described by the code may be furnished in
most outpatient departments.
3. The procedure is related to codes that we have already removed
from the IPO list.
4. A determination is made that the procedure is being furnished in
numerous hospitals on an outpatient basis.
5. A determination is made that the procedure can be appropriately
and safely furnished in an ASC and is on the list of approved ASC
services or has been proposed by us for addition to the ASC covered
procedures list.
In the past, we have requested that interested parties submit
corresponding evidence in support of their claims that a code or group
of codes met the longstanding criteria for removal from the IPO list
and was safe to perform on the Medicare population in the hospital
outpatient setting--including, but not limited to case reports,
operative reports of actual cases, peer-reviewed medical literature,
medical professional analysis, clinical criteria sets, and patient
selection protocols. Our clinicians then thoroughly review all
information submitted within the context of the established criteria
and if, following this review, we determine that there is sufficient
evidence to confirm that the code could be safely and appropriately
performed on an outpatient basis, we assign the service to an APC and
include it as a payable procedure under the OPPS (67 FR 66740). We
determine the APC assignment for services removed from the IPO list by
evaluating the clinical similarity and resource costs of the service
compared to other services paid under the OPPS and by reviewing the
Medicare Severity Diagnosis Related Groups (MS-DRG) rate for the
service under the IPPS, though we note we would generally expect the
cost to provide a service in the outpatient setting to be less than the
cost to provide the service in the inpatient setting.
We stated in prior rulemaking that, over time, given advances in
technology and surgical technique, we would continue to evaluate
services to determine whether they should be removed from the IPO list.
Our goal is to ensure that inpatient only designations are consistent
with the current standards of practice. We have asserted in prior
rulemaking that, insofar as advances in medical practice mitigate
concerns about these procedures being performed on an outpatient basis,
we would be prepared to remove procedures from the IPO list and provide
for payment for them under the OPPS (65 FR 18443). Further, CMS has at
times had to reclassify codes as inpatient only services with the
emergence of new information.
We refer readers to the CY 2012 OPPS/ASC final rule with comment
period (76 FR 74352 and 74353) for a full discussion of our historic
policies for identifying services that are typically provided only in
an inpatient setting and that, therefore, will not be paid by Medicare
under the OPPS, as well as the criteria we have used to review the IPO
list to determine whether any services should be removed.
B. Changes to the Inpatient Only (IPO) List
As stated above, we encourage interested parties to request reviews
for a particular code or group of codes for removal from the IPO list.
For CY 2024, we received several requests from interested parties
recommending particular services to be removed from the IPO list.
Following our clinical review, we did not find sufficient evidence
that, using the five criteria listed above, these services meet the
criteria to be removed from the IPO list for CY 2024. Therefore, we did
not propose to remove any services from the IPO list for CY 2024.
We proposed to add nine services for which codes were newly created
by the AMA CPT Editorial Panel for CY 2024 to the IPO list. These new
services are described by the CPT codes 0790T, 22836, 22837, 22838,
61889, 76984, 76987, 76988, and 76989 (described by placeholder codes
X114T, 2X002, 2X003, 2X004, 619X1, 7X000, 7X001, 7X002, and 7X003
respectively in the CY 2024 OPPS/ASC proposed rule) which will be
effective on January 1, 2024. After clinical review of these services,
we found that they require a hospital inpatient admission or stay and
thus, we believe they are not appropriate for payment under the OPPS.
We proposed to assign these services to status indicator ``C''
(Inpatient Only) for CY 2024. Additionally, we proposed to reassign CPT
code 0646T from status indicator ``E1'' (not payable by Medicare) to
``C,'' effective CY 2024. The CPT codes, long descriptors, and the
proposed CY 2024
[[Page 81860]]
payment indicators are displayed in Table 102.
Table 102 below contains the proposed changes to the IPO list for
CY 2024. The complete list of codes describing services that we
proposed to designate as inpatient only services beginning in CY 2024
was also included as Addendum E to the CY 2024 OPPS/ASC proposed rule,
which is available via the internet on the CMS website.
BILLING CODE 4150-28-P
[GRAPHIC] [TIFF OMITTED] TR22NO23.143
BILLING CODE 4150-28-C
Comment: We received several comments in support of our proposal to
add the ten services listed in Table 102 above to the IPO list for CY
2024.
Response: We thank the commenters for their support.
[[Page 81861]]
Comment: We received one comment requesting that we remove CPT
codes 49596 (Repair of anterior abdominal hernia(s) (i.e., epigastric,
incisional, ventral, umbilical, spigelian), any approach (i.e., open,
laparoscopic, robotic), initial, including placement of mesh or other
prosthesis when performed, total length of defect(s); greater than 10
cm, incarcerated or strangulated), 49616 (Repair of anterior abdominal
hernia(s) (i.e., epigastric, incisional, ventral, umbilical,
spigelian), any approach (i.e., open, laparoscopic, robotic),
recurrent, including placement of mesh or other prosthesis when
performed, total length of defect(s); 3 cm to 10 cm, incarcerated or
strangulated), 49617 (Repair of anterior abdominal hernia(s) (i.e.,
epigastric, incisional, ventral, umbilical, spigelian), any approach
(i.e., open, laparoscopic, robotic), recurrent, including placement of
mesh or other prosthesis when performed, total length of defect(s);
greater than 10 cm, reducible), 49618 (Repair of anterior abdominal
hernia(s) (ie, epigastric, incisional, ventral, umbilical, spigelian),
any approach (i.e., open, laparoscopic, robotic), recurrent, including
placement of mesh or other prosthesis when performed, total length of
defect(s); greater than 10 cm, incarcerated or strangulated), 49621
(Repair of parastomal hernia, any approach (i.e., open, laparoscopic,
robotic), initial or recurrent, including placement of mesh or other
prosthesis, when performed; reducible), and 49622 (Repair of parastomal
hernia, any approach (i.e., open, laparoscopic, robotic), initial or
recurrent, including placement of mesh or other prosthesis, when
performed; incarcerated or strangulated) from the IPO list for CY 2024.
The commenter stated that these codes were related to predecessor codes
that were not on the IPO list. The commenter also stated that while
patients will typically be admitted to the hospital as inpatients for
these services, there are instances when it will be appropriate for the
patient to undergo these procedures on an outpatient basis.
Response: We thank the commenter for their recommendation. Our
clinical analysis of these services indicates that they require a
hospital inpatient admission or stay. While these services are
associated with predecessor codes that were not on the IPO list, our
OPPS claims review found that many of those predecessor codes had
lengths of stay greater than 2 days. Without further evidence that
these procedures can be safely performed in the outpatient setting on
the majority of the Medicare population, we do not believe that these
services can be appropriately removed from the IPO list at this time.
Additionally, as we stated in the CY 2022 OPPS/ASC final rule with
comment period, while we recognize that there are services currently
classified as inpatient only that may be appropriate in the hospital
outpatient setting for some Medicare beneficiaries, we continue to
strive to balance the goals of increasing physician and patient choice
of setting of care with consideration for patient safety for all
Medicare beneficiaries (86 FR 63673). Therefore, we are finalizing our
proposal to continue to assign these services to status indicator ``C''
for CY 2024.
Comment: We received a few comments requesting that CMS consider
reinstating the elimination of the IPO list that was halted in the CY
2022 OPPS/ASC final rule with comment period.
Response: We thank the commenters for their feedback. We are not
considering eliminating the IPO list at this time. As stated in the CY
2022 OPPS/ASC final rule with comment period, we believe the IPO list
is a valuable tool for ensuring that the OPPS only pays for services
that can safely be performed in the hospital outpatient setting and
remains a necessary safeguard. In that final rule, we explained that we
recognized that while physicians are able to make safety determinations
for a specific beneficiary, CMS is in the position to make safety
determinations for the broader population of Medicare beneficiaries,
that is, the typical Medicare beneficiary. Furthermore, we explained
that while we want to afford physicians and hospitals the maximum
flexibility in choosing the most clinically appropriate site of service
for the procedure, as long as the characteristics of the procedure are
consistent with the criteria listed above. For further discussion on
our decision to halt the elimination of the IPO list, we refer readers
to the CY 2022 OPPS/ASC final rule with comment period (86 FR 63671
through 63711).
Comment: We received multiple comments requesting that we assign
services newly removed from the IPO list to New Technology APCs until
sufficient data is collected to assign these services to clinical APCs.
Response: We thank the commenters for their input. As we previously
stated in the CY 2021 OPPS/ASC final rule with comment period (85 FR
86093), consistent with our regulation at 42 CFR 419.31(a)(1), we
classify outpatient services and procedures that are comparable
clinically and in terms of resource use into APC groups. As we stated
in the CY 2012 OPPS/ASC final rule (76 FR 74224), the OPPS is a
prospective payment system that provides payment for groups of services
that share clinical and resource use characteristics. It should be
noted that for all codes newly paid under the OPPS, including codes
removed from the IPO list, our policy has been to assign the service or
procedure to an APC based on feedback from a variety of sources,
including but not limited to, review of the clinical similarity of the
service to existing procedures; advice from CMS medical advisors;
information from interested specialty societies; and review of all
other information available to us, including information provided to us
by the public, whether through meetings with stakeholders or additional
information that is mailed or otherwise communicated to us (84 FR
61229). Therefore, we believe assigning procedures removed from the IPO
list to existing clinical APCs that are similar in clinical
characteristics and resource costs is appropriate. We note that
procedures assigned to New Technology APCs cannot be placed in clinical
APCs due to insufficient clinical and cost data, unlike the procedures
transitioning from the IPO list.
Comment: One commenter wrote that the following statement in the CY
2024 OPPS/ASC proposed rule was incorrect: ``Designation of a service
as inpatient only does not preclude the service from being furnished in
a hospital outpatient setting but rather means that Medicare will not
make payment for the service if it is furnished to a Medicare
beneficiary in the hospital outpatient setting'' (65 FR 18443). The
commenter stated that this was incorrect because in the Change Request
9097 published on March 13, 2015, CMS revised its billing instructions
to allow payment for procedures on the IPO list that are provided to a
patient in the outpatient setting on the date of the inpatient
admission or during the 3-calendar days preceding the date of inpatient
admission to be bundled into the billing of the inpatient admission.
Response: The commenter is correct services on the IPO list
performed in the outpatient setting can receive IPPS payment if the
patient is admitted on the day of the procedure or within the following
3-calendar days. However, services on the IPO list will not receive
payment under the OPPS.
In summary, after consideration of the public comments we received,
we are finalizing our proposal to assign CPT codes 0790T, 22836, 22837,
22838, 61889, 76984, 76987, 76988, 76989, and
[[Page 81862]]
0646T to status indicator ``C'' for CY 2024. Table 103 below contains
the changes to the IPO list for CY 2024. The complete list of codes
describing services that are designated as inpatient only services
beginning in CY 2024 is also included as Addendum E to this final rule
with comment period, which is available via the internet on the CMS
website.
BILLING CODE 4150-28-P
[GRAPHIC] [TIFF OMITTED] TR22NO23.144
[[Page 81863]]
BILLING CODE 4150-28-C
C. Solicitation of Public Comments on the Services Described by CPT
Codes 43775, 43644, 43645, and 44204
We solicited comments regarding whether the services described by
CPT codes 43775 (Laparoscopy, surgical, gastric restrictive procedure;
longitudinal gastrectomy (i.e., sleeve gastrectomy)), 43644
(Laparoscopy, surgical, gastric restrictive procedure; with gastric
bypass and roux-en-y gastroenterostomy (roux limb 150 cm or less)),
43645 (Laparoscopy, surgical, gastric restrictive procedure; with
gastric bypass and small intestine reconstruction to limit absorption),
and 44204 (Laparoscopy, surgical; colectomy, partial, with anastomosis)
are appropriate to be removed from the IPO list. At this time, we do
not believe that we have adequate information to determine whether the
services described by CPT codes 43775, 43644, 43645, and 44204 can be
safely performed in the hospital outpatient department setting on the
Medicare population. Therefore, we specifically requested information
or evidence that these services can be performed safely on the Medicare
population in the outpatient setting. We also sought public comments on
whether the services described by CPT codes 43775, 43644, 43645, and
44204 specifically meet any of the five criteria to be removed from the
IPO list mentioned above.
Comment: We received a significant number of comments in support of
maintaining CPT codes 43775, 43644, 43645, and 44204 on the IPO list,
many of which were from bariatric surgery healthcare providers and
societies. Commenters strongly recommended keeping these four services
on the IPO list, with safety being the primary concern. Some commenters
noted that while these services can be safely performed in the
outpatient setting, those patients are carefully selected and tend to
be a younger and healthier population. Commenters had great concern
about the safety of performing these services on the Medicare
population in the outpatient setting, noting that Medicare
beneficiaries tend to be an older population with more comorbidities,
even among those younger than 65. Commenters noted that performing
these procedures in the outpatient setting could lead to greater risks
and complications following the procedures. Many commenters also noted
logistical concerns. Commenters wrote that receiving these services in
the outpatient setting often requires additional follow-up appointments
and at-home care, which many Medicare beneficiaries may not have access
to. Patients may need to travel extended distances to receive these
surgeries and follow-up care, however transportation may be difficult
for some beneficiaries, especially in rural areas. Access to these
services for Medicare beneficiaries if they are removed from the IPO
list was another major concern among commenters, stating that if these
services are removed from the IPO list, access to these services at
their facilities in the inpatient setting may be limited, affecting
those who would require inpatient care. Additionally, several
commenters agreed that these services did not meet the criteria to be
removed from the IPO list.
Response: We thank the commenters for their feedback.
Comment: We received a few comments in support of removing the four
laparoscopic services from the IPO list for CY 2024, with commenters
stating that these procedures can be safely performed in the outpatient
setting. The commenters noted that advances in medical technology and
surgical techniques have increased the safety of these surgeries.
Response: We thank the commenters for their feedback. However, we
did not receive additional literature or evidence that these services
can be performed safely on the Medicare population in the outpatient
setting. We continue to believe that these services do not meet the
criteria to be removed from the IPO list. Therefore, after
consideration of the public comments we received, we are maintaining
CPT codes 43775, 43644, 43645, and 44204 on the IPO list for CY 2024.
X. Nonrecurring Policy Changes
A. Supervision by Nurse Practitioners, Physician Assistants, and
Clinical Nurse Specialists of Cardiac Rehabilitation, Intensive Cardiac
Rehabilitation, and Pulmonary Rehabilitation Services Furnished to
Hospital Outpatients
1. Background
Section 51008(a) of the Bipartisan Budget Act of 2018 (BBA of 2018)
(Pub. L. 115-123) amended section 1861(eee)(1) and (2) of the Act to
revise the definitions of cardiac rehabilitation (CR) program and
intensive cardiac rehabilitation (ICR) program, respectively, to
provide that services these programs furnish can be under the
supervision of a physician assistant (PA), nurse practitioner (NP), or
clinical nurse specialist (CNS). Section 51008(b) of the BBA of 2018
amended section 1861(fff)(1) of the Act similarly to revise the
definition of a pulmonary rehabilitation (PR) program to provide that
PR services can be furnished under the supervision of these same types
of practitioners. Section 51008(c) of the BBA of 2018 provides that
these amendments apply to items and services furnished on or after
January 1, 2024. Before the effective date of these amendments, only
physicians could supervise services furnished as part of CR, ICR, and
PR programs.
To implement these amendments, we proposed in the CY 2024 PFS
proposed rule to revise the regulations at 42 CFR 410.47 and 410.49,
which describe the conditions of coverage for the CR, ICR and PR
programs, to provide that physician assistants, nurse practitioners,
and clinical nurse specialists can supervise CR, ICR and PR program
services. Specifically, the CY 2024 PFS proposed rule proposed to amend
Sec. Sec. 410.47 and 410.49 to provide that supervision of PR, CR, and
ICR services can be provided by a physician, PA, NP, or CNS.
2. Conforming Revisions to Sec. 410.27
Correspondingly, to implement the amendments to section
1861(eee)(1) and (2) and (fff) of the Act, and to be consistent with
the proposed revisions to Sec. Sec. 410.47 and 410.49, we proposed to
make conforming revisions to Sec. 410.27, which describes the
conditions for coverage for therapeutic outpatient hospital or CAH
services and supplies provided incident to a physician's or
nonphysician practitioner's service.
We explained that currently, Sec. 410.27(a)(1)(iv)(B)(1) provides
that for PR, CR, and ICR services, direct supervision must be furnished
by a doctor of medicine or osteopathy as specified in Sec. Sec. 410.47
and 410.49. We proposed to delete the reference to a doctor of medicine
or osteopathy and retain the cross-reference to Sec. Sec. 410.47 and
410.49. As the text remaining following this deletion would consist
solely of cross-references to the newly revised Sec. Sec. 410.47 and
410.49, we explained that this would have the effect of expanding who
may provide supervision for CR, ICR and PR services under Sec. 410.27
to include PAs, NPs, and CNSs under Sec. 410.27.
In the interim final rule with comment period (IFC) titled ``Policy
and Regulatory Provisions in Response to the COVID-19 Public Health
Emergency,'' published on April 6, 2020 (the April 6th COVID-19 IFC)
(85 FR 19230, 19246, 19286), we changed the regulation at 42 CFR
410.27(a)(1)(iv)(D) to provide that, during a Public Health Emergency
as defined in 42 CFR 400.200, the presence of the physician for
purposes of the direct supervision
[[Page 81864]]
requirement for PR, CR, and ICR services includes virtual presence
through audio/video real-time communications technology when use of
such technology is indicated to reduce exposure risks for the
beneficiary or health care provider. Specifically, the required direct
physician supervision can be provided through virtual presence using
audio/video real-time communications technology (excluding audio-only)
subject to the clinical judgment of the supervising practitioner. We
further amended Sec. 410.27(a)(1)(iv)(D) in the CY 2021 OPPS/ASC final
rule with comment period to provide that this flexibility continues
until the later of the end of the calendar year in which the PHE as
defined in Sec. 400.200 ends or December 31, 2021 (85 FR 86113 and
86299). In the CY 2021 OPPS/ASC final rule with comment period we also
clarified that this flexibility excluded the presence of the
supervising practitioner via audio-only telecommunications technology
(85 FR 86113).
In the CY 2022 PFS final rule, CMS added CPT codes 93797 (Physician
or other qualified health care professional services for outpatient
cardiac rehabilitation; without continuous ECG monitoring (per
session)) and 93798 (Physician or other qualified health care
professional services for outpatient cardiac rehabilitation; with
continuous ECG monitoring (per session)) and HCPCS codes G0422
(Intensive cardiac rehabilitation; with or without continuous ecg
monitoring with exercise, per session) and G0423 (Intensive cardiac
rehabilitation; with or without continuous ecg monitoring; without
exercise, per session) to the Medicare Telehealth Services List on a
Category 3 basis (86 FR 65055).
In order to effectuate a similar policy under the OPPS, where PR,
CR, and ICR rehabilitation services could be furnished during the PHE
to beneficiaries in hospitals under direct supervision of a physician
where the supervising practitioner is immediately available to be
present via two-way, audio/video communications technology, in the CY
2023 OPPS/ASC final rule with comment period, we finalized a policy to
extend the revised definition of direct supervision to include the
presence of the supervising practitioner through two-way, audio/video
telecommunications technology until December 31, 2023 (87 FR 72019 and
72020). Under the telehealth flexibilities extended in the CAA, 2023,
these services will remain on the Medicare Telehealth Services List
through the end of CY 2024. In the interest of maintaining similar
policies for direct supervision of PR, CR, and ICR under the OPPS and
PFS, we proposed to further revise Sec. 410.27(a)(1)(iv)(B)(1) to
allow for the direct supervision requirement for CR, ICR, and PR to
include virtual presence of the physician through audio-video real-time
communications technology (excluding audio-only) through December 31,
2024 and to extend this policy to the nonphysician practitioners, that
is NPs, PAs, and CNSs, who are eligible to supervise these services in
CY 2024. We solicited comments on whether there are safety and/or
quality of care concerns regarding adopting this policy beyond the
current or proposed extensions and what policies CMS could adopt to
address those concerns if the policy were extended beyond 2023.
For the complete discussion of the final revisions to Sec. Sec.
410.47 and 410.49, we refer readers to the CY 2024 PFS final rule.
The following is a summary of the comments we received and our
responses to those comments.
Comment: All commenters supported our proposal to make conforming
revisions to Sec. 410.27 to expand who may provide supervision for CR,
ICR, and PR to include Pas, NPs, and CNSs and to allow for the direct
supervision requirement for CR, ICR, and PR to include the virtual
presence of the physician/nonphysician practitioner through audio-video
real-time communications technology (excluding audio-only) through
December 31, 2024. These commenters indicated that these changes will
improve patient access to historically underutilized services, reduce
burden on providers, and be of particular value in rural and other
underserved areas where workforce shortages remain acute.
Response: We thank commenters for their support.
Comment: Many of these commenters requested that the availability
of virtual direct supervision of these services be made permanent. One
of these commenters additionally requested that once the policy is made
permanent that CMS retire the requirement for a service-level modifier
to identify when direct supervision is provided via appropriate
telehealth technology.
Response: We appreciate the commenters' suggestions to make the
virtual direct supervision of ICR, CR, and PR permanent. One of our
motives for extending the availability of virtual direct supervision of
these services until the end of CY 2024 is to allow us to continue to
evaluate safety, quality of care, and other considerations related to
virtual direct supervision. As such, we will take commenter's
suggestions into account in future rulemaking.
Comment: One commenter requested clarity as to how a hospital
registered patient could continue to receive CR and PR remotely in
their home. The commenter suggested that CMS create a separate HCPCS
code for remote cardiac and/or remote pulmonary rehabilitation
services, which would temporarily permit hospitals to continue to
furnish these services remotely to patients in their homes and receive
reimbursement under the OPPS. Another commenter requested that CMS
reinstate the PHE flexibilities that allowed a beneficiary's home to
serve as a provider-based department of a hospital for cardiac and
pulmonary rehabilitation services. Acknowledging that the waiver
related to the PHE allowing for this flexibility has ended, this
commenter suggested that CMS rely on other waiver authority (such as
section 402 demonstration authority) to ensure the continuation of the
flexibility.
Response: We appreciate commenters' interest in providing cardiac
and pulmonary rehabilitation services remotely to a patient in their
home. However, a hospital registered patient cannot currently receive
CR or PR remotely in their home. The flexibility to provide CR, PR, and
ICR services remotely to a beneficiary in his or her home ended with
the expiration of the PHE on May 11, 2023.
Comment: One commenter requested that CMS revise the definition of
``physician prescribed exercise'' under Sec. Sec. 410.47(a) and
410.49(a) to include Pas. Citing the 2014 final decision memorandum for
Cardiac Rehabilitation (CR) Programs--Chronic Heart Failure,\195\ this
commenter stated that CMS previously declined to modify language in
this manner because the Act specifies that the program is under the
supervision of a physician. This commenter believed that since this
section of the Act has been revised to allow Pas to supervise these
programs, CMS should now modify this language accordingly to ``provider
prescribed exercise.'' This commenter further requested that if the
exact wording cannot be modified due to statutory constraints, CMS
should reinterpret the intent of this section to indicate that health
professionals authorized to supervise may also prescribe exercise.
Additionally, this commenter urged CMS to work with Congress to modify
physician-centric language in U.S. Code that prohibits Pas and other
health
[[Page 81865]]
professionals from ordering PR, CR, and ICR. Another commenter noted
that under the Accountable Care Organization Realizing Equity, Access,
and Community Health (ACO REACH) model, NPs are allowed to establish,
review and sign a written care plan for PR and CR and requested that
this waiver be standardized across all relevant payment models and that
CMS should explore regulatory avenues to remove the barrier for
patients to be seen by NPs to increase PR and CR participation.
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\195\ https://www.cms.gov/medicare-coverage-database/view/ncacal-decision-memo.aspx?proposed=N&NCAId=270.
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Response: In the 2014 final decision memorandum for Cardiac
Rehabilitation (CR) Programs--Chronic Heart Failure \196\ public
comment section, CMS responded to a similar request that the language
describing CR be changed from ``physician prescribed'' to ``provider
prescribed.'' In response to this comment, CMS reiterated that per the
Act a CR program (at the time) ``means a physician-supervised program''
at section 1861(eee)(1) of the Act. CMS then further explained that
``physician-prescribed exercise'' is one of the required items listed
in section 1861(eee)(3). While the BBA of 2018 expanded the types of
practitioners that may supervise PR in section 1861(fff)(1) and CR/ICR
in section 1861(eee)(1), it did not amend the items and services that
these programs must furnish to also include exercise prescribed by
other practitioners in addition to physicians, as section
1861(fff)(2)(A) for PR and section 1861(eee)(3)(A) for CR/ICR were not
amended. We understand commenters' requests to expand the role for NPPs
in prescribing and ordering these services, and establishing,
reviewing, and signing plans of care, however the statutory language
does not support the requested changes and CMS does not interpret the
statutory changes to allow for such modifications using only a
regulatory pathway. We encourage interested parties to work with
Congress to explore further statutory changes to support these
requests.
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\196\ https://www.cms.gov/medicare-coverage-database/view/ncacal-decision-memo.aspx?proposed=N&NCAId=270.
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Comment: One commenter objected to the term ``nonphysician
provider'' and encouraged CMS to fully transition to the use of the
practitioner's professional title or to utilize the term ``advanced
practice providers'' (APPs) when necessary and to remove all references
to ``nonphysician practitioner'' within regulations, guidance, and
information collection instruments. The commenter argues that CMS
should do so because the term ``nonphysician provider'' fails to
recognize the established scope of practice for APPs and their
authority to practice to the full extent of their education and
clinical preparation.
Response: We appreciate the commenter's concerns and agree with the
importance of employing the appropriate designations for practitioners.
We note that Sec. 410.27(g) specifically lists the individual
practitioners (clinical psychologist, licensed clinical social worker,
PA, NP, CNS, or certified nurse-midwife) that are included in the term
``nonphysician practitioner'' for purposes of Sec. 410.27 and
Sec. Sec. 410.47(a) and 410.49(a), which Sec. 410.27, as finalized,
now cross-references, specifically lists the individual practitioners
(PA, NP, and CNS) that are included in the term ``nonphysician
practitioner'' for the purposes of the supervision of ICR, CR and PR.
It is therefore unnecessary and would be impractical to replace all
instances of ``nonphysician practitioner'' throughout each regulation
with a list of each practitioner's professional titles. With respect to
replacing ``nonphysician practitioner'' with ``advance practice
providers,'' we understand the importance of using the most relevant
and up to date terminology to describe these practitioners. However, as
acknowledged by the commenter, ``nonphysician practitioner'' is used in
multiple regulations, guidance, and other documents and any change in
terminology would need to be considered in light of ensuring
consistency across these authorities. We will take this suggestion into
consideration for future rulemaking.
Comment: One commenter requested clarification as to whether the
flexibility for Pas, NPs, and CNSs to directly supervise ICR, CR and PR
applies to both PPS hospitals and CAHs.
Response: Yes, the flexibility for Pas, NPs, and CNSs to directly
supervise ICR, CR and PR applies to ICR, CR and PR services furnished
by CAHs.
Comment: One commenter requested that CMS not restrict direct
supervision through virtual presence to a subset of services. In the
commenter's view, the decision whether to provide direct supervision
through virtual presence via real-time, two-way audio/virtual
telecommunications should be left up to the practitioner overseeing the
patient's care.
Response: We thank the commenter for their comment and note that
for therapeutic services under Sec. 410.27, ICR, CR and PR, are the
only services that are subject to direct supervision requirements when
furnished to hospital outpatients. For a full discussion of the change
in the generally applicable minimum required level of supervision for
hospital outpatient therapeutic services from direct supervision to
general supervision for services furnished by hospitals and CAHs, we
refer readers to the CY 2020 OPPS final rule (84 FR 61359 through
61363) and the CY 2021 OPPS final rule with comment period (85 FR 86110
and 86111).
Comment: Several commenters provided input in response to our
comment solicitation as to the existence of safety and/or quality of
care concerns regarding the adoption of virtual supervision beyond the
current (end of 2023) or proposed (end of 2024) extensions and what
policies CMS might adopt to address any such concerns if the policy
were extended beyond 2023. One commenter opined that requiring the
physician or other supervising professional to be physically present in
the same building has negligible patient-safety benefits because a
physician's office, clinic, or hospital outpatient department typically
has many other practitioners on site who would be available to assist
if a physical presence was required. This commenter further contended
that a virtually available supervisor might actually enhance patient
safety in an emergency because the most appropriate course of action in
an emergency is to transfer the patient to an emergency department, not
wait for the supervising physician or other practitioner to arrive. The
commenter noted that a virtually available supervisor may facilitate a
faster transfer of the patient to the emergency department.
Another commenter indicated that they and other interested parties
had previously provided CMS with literature on the absence of safety
issues when supervision is provided virtually and offered to provide
additional information to this effect for CMS's consideration for 2025
rulemaking.
A third commenter stated that because the option to provide direct
supervision virtually has only become available recently as a
consequence of the PHE, it is unlikely there are any peer-reviewed
studies that focus on this aspect of virtual care. However, the
commenter indicated that they had included with their comment numerous
studies demonstrating the effectiveness and safety of virtual CR and PR
services. In the commenter's view, the studies demonstrate that virtual
and hybrid delivery of CR and PR services provided by staff are safe,
improve health outcomes and adherence, and address barriers to access.
[[Page 81866]]
Finally, a commenter, prefacing their remarks with a statement that
they do not share CMS's concern that virtual supervision inherently
gives rise to patient safety issues, indicated that in their
experience, numerous clinical staff and auxiliary personnel perform a
wide range of tasks easily supervised virtually. The commenter argues
that such staff categorically do not perform ``complex, high-risk,
surgical, interventional, or endoscopic procedures, or anesthesia
procedures'' that CMS has described in the past to explain its concerns
with virtual direct supervision and that nonphysician practitioners, to
the extent that they assist with such procedures, are subject to higher
standards, certifications, and oversight.
Response: We thank commenters for their input regarding safety and/
or quality of care concerns related to virtual direct supervision. We
will take these comments into consideration for future rulemaking.
Comment: Several commenters appeared to assume that our proposal to
extend the availability of virtual direct supervision until the end of
2024 included both outpatient hospital therapeutic services (under
Sec. 410.27) and outpatient hospital diagnostic services (under Sec.
410.28), in the same way that the PFS proposed rule proposed to extend
the availability of virtual direct supervision to both therapeutic and
diagnostic services (under Sec. 410.32) furnished by physicians (88 FR
52302).
One commenter encouraged CMS to extend ``virtual direct
supervision'' through the end of 2024, if not beyond, ``and in a manner
comparable to the physician fee schedule,'' to ensure that patients
continued to have access to robust healthcare choices.
Another commenter submitted complementary comments to both the CY
2024 proposed PFS rule and CY 2024 proposed OPPS rule, referring to the
two rules' overlap with respect to certain policies and using nearly
identical language to describe its endorsement of both rules' proposals
relating to the extension of the availability of virtual direct
supervision through 2024. In its comment to the CY 2024 proposed PFS
rule, this commenter stated: ``The Agency proposes extending through
CY2024 several PHE-era policies not directly addressed by CAA2023,
including permitting virtual Direct Supervision of auxiliary personnel
by physicians and/or non-physician practitioners. We support the
Agency's proposal to extend the present Direct Supervision waiver
policies through CY2024.'' In the commenter's corresponding comment to
the CY 2024 proposed OPPS rule, they similarly stated: ``The Agency
also proposes extending through CY2024 several PHE-era virtual care
policies not directly addressed by The Consolidated Appropriations Act
of 2023 (``CAA2023''), including permitting virtual Direct Supervision
of auxiliary personnel by physicians and/or non-physician
practitioners. . . [commenter] strongly supports extending all of those
policies in their present state through CY2024. We direct the Agency to
our public response to the 2024 MPFS proposed rule for a full
discussion.''
Another commenter, in support of their suggestion to make the
flexibility to provide direct supervision through real-time audio/video
technology permanent, attested to their experience of successfully
providing ``clinically appropriate supervision for impacted services
such as diagnostic tests and incident-to services through synchronous
audio-visual telehealth.''
Response: We appreciate commenters' support and would like to make
a clarification with respect to the availability of the virtual direct
supervision of hospital and CAH diagnostic services furnished to
outpatients in CY 2024. Historically, our policy has been to require
that all hospital diagnostic services that are provided directly or
under arrangement, whether provided in the main buildings of the
hospital, in a PBD of a hospital, or at a nonhospital location, follow
the physician supervision requirements adopted in the annual PFS
rulemaking (74 FR 60590). Consistent with this policy, until CY 2023
the regulation at 42 CFR 410.28 regarding diagnostic tests furnished to
hospital outpatients cross-referenced the definition of supervision
levels for diagnostic services in the regulation at 42 CFR
410.32(b)(3), thereby incorporating the definitions of levels of
supervision for diagnostic tests for which payment is made under the
PFS. This policy--to align the supervision levels for diagnostic
services furnished to hospital outpatients with those provided for in
the regulation at 42 CFR 410.32(b)(3)--is also reflected in section
20.4.4 of Chapter 6 of the Medicare Benefit Policy Manual,\197\ which
provides that the supervision levels listed in the quarterly updated
Medicare PFS Relative File apply to individual outpatient diagnostic
tests.
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\197\ Available at https://www.cms.gov/regulations-and-guidance/guidance/manuals/downloads/bp102c06.pdf.
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In the CY 2023 OPPS/ASC final rule with comment period, we revised
the regulation at Sec. 410.28 to remove the cross-reference to Sec.
410.32 and include within the regulation text in that provision the
definitions of different levels of supervision. Although we removed the
cross-reference to section Sec. 410.32, our intent was to continue to
align the rules regarding the supervision levels for diagnostic
services furnished to hospital outpatients with the rules for
supervision levels for diagnostic services described in section Sec.
410.32.
When we removed the cross-references in 42 CFR 410.28 to 42 CFR
410.32, we anticipated continuing to make changes to Sec. 410.28 to
ensure that the definitions of the supervision levels remained
consistent between the two provisions. Consequently, when the CY 2024
PFS proposed rule proposed to revise Sec. 410.32 to extend the
availability of the virtual supervision of direct supervision until the
end of 2024, we intended to propose a corresponding revision to Sec.
410.28 in the proposed 2024 OPPS rule to provide for this flexibility
for diagnostic services furnished to hospital outpatients.
Unfortunately, we inadvertently failed to propose this revision.
Because until CY 2023, an update to the supervision requirements
under Sec. 410.32 applied to diagnostic services furnished to hospital
outpatients because of the cross-reference to Sec. 410.32 in the
regulation at Sec. 410.28, we believe it is possible that the public,
long accustomed to section Sec. 410.28 incorporating the definitions
in Sec. 410.32 through the cross-reference to that provision, did not
realize that an update to Sec. 410.28 had not been proposed and thus
did not comment on our unintended failure to update Sec. 410.28. This
is supported by comments we received that suggested that commenters
were unaware that we had not proposed a revision to the regulation at
Sec. 410.28 to extend the virtual supervision of outpatient diagnostic
services through the end of 2024. Instead, commenters seemed to assume
that our proposal to extend the ability of practitioners to meet the
direct supervision requirement through virtual presence included all
diagnostic services, whether furnished in a hospital outpatient
department or otherwise. Because our intention was to propose a
corresponding revision to the regulation text at Sec. 410.28 for
consistency with the proposed revision to Sec. 410.27 and commenters
supported such a policy, we are812inalizingg a revision to Sec.
410.28(e)(2)(iii) to allow for the direct supervision of diagnostic
services to include the virtual presence of the physician or
nonphysician practitioner through audio/video real-time communications
technology
[[Page 81867]]
(excluding audio-only) through December 31, 2024.
After consideration of the public comments we received, we are also
finalizing, without modification, our proposal to revise Sec.
410.27(a)(1)(iv)(B)(1) to expand the practitioners who may supervise
CR, ICR, and PR services to include NPs, Pas, and CNSs and to allow for
the direct supervision requirement for CR, ICR, and PR to include the
virtual presence of the physician, NP, PA or CNS through audio-video
real-time communications technology (excluding audio-only) through
December 31, 2024.
B. Payment for Intensive Cardiac Rehabilitation Services (ICR) Provided
by an Off-Campus, Non-Excepted Provider Based Department (PBD) of a
Hospital
1. Background on Intensive Cardiac Rehabilitation
Section 144(a) of the Medicare Improvements for Patients and
Providers Act of 2008 (MIPPA) (Pub. L. 110-275) made a number of
changes to the Act related to coverage and payment for pulmonary and
cardiac rehabilitation services furnished to beneficiaries with chronic
obstructive pulmonary disease and certain other conditions, effective
January 1, 2010. Specifically, section 144(a)(1)(A) of MIPPA amended
section 1861(s)(2) of the Act by adding new subparagraphs (CC) and (DD)
to provide for Medicare Part B coverage of items and services furnished
under a cardiac rehabilitation (CR) program (as defined in a new
section 1861(eee)(1) of the Act); a pulmonary rehabilitation (PR)
program (as defined in a new section 1861(fff)(1) of the Act); and an
intensive cardiac rehabilitation (ICR) program (as defined in a new
section 1861(eee)(4) of the Act). The amendments made by section 144(a)
of MIPPA provide for coverage of CR, PR, and ICR program services
provided in a physician's office, in a hospital on an outpatient basis,
and in other settings determined appropriate by the Secretary.
Section 144(a)(2) of MIPPA amended section 1848(j)(3) of the Act to
provide for payment for services furnished in an ICR program under the
PFS and also added a new paragraph (5) to section 1848(b) of the Act.
Section 1848(b)(5)(A) requires the Secretary for ICR program services
to substitute the Medicare OPD fee schedule amount established under
the OPPS for cardiac rehabilitation (under HCPCS codes 93797 and 93798
for calendar year 2007, or any succeeding HCPCS codes for cardiac
rehabilitation). For a full discussion of implementation of the MIPPA
amendments related to coverage and payment for PR, CR, and ICR programs
under the OPPS, we refer readers to the CY 2010 OPPS/ASC final rule
with comment period (74 FR 60566 through 60574).
2. Background on Section 603 of the Bipartisan Budget Act of 2015 and
the PFS Relativity Adjuster
Section 603 of the Bipartisan Budget Act of 2015 (Pub. L. 114-74)
(BBA, 2015) (hereinafter referred to as ``section 603'') amended
section 1833(t) of the Act by adding a new clause (v) to paragraph
(1)(B) and adding a new paragraph (21). As a general matter, under
sections 1833(t)(1)(B)(v) and (t)(21) of the Act, applicable items and
services furnished by certain off-campus outpatient departments of a
provider on or after January 1, 2017, are not considered covered OPD
services as defined under section 1833(t)(1)(B) of the Act for purposes
of payment under the OPPS and are instead paid ``under the applicable
payment system'' under Medicare Part B if the requirements for such
payment are otherwise met. Section 603 amended section 1833(t)(1)(B) of
the Act by adding a new clause (v), which excludes from the definition
of ``covered OPD services'' applicable items and services (defined in
paragraph (21)(A) of the section) that are furnished on or after
January 1, 2017, by an off-campus PBD, as defined in paragraph (21)(B)
of the section.
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79699
through 79719), we adopted a number of policies to implement section
603. Broadly, we: (1) defined applicable items and services in
accordance with section 1833(t)(21)(A) of the Act for purposes of
determining whether such items and services are covered OPD services
under section 1833(t)(1)(B)(v) of the Act or whether payment for such
items and services will instead be made under the applicable payment
system designated under section 1833(t)(21)(C) of the Act; (2) defined
off-campus PBD for purposes of sections 1833(t)(1)(B)(v) and (t)(21) of
the Act; and (3) established policies for payment for applicable items
and services furnished by an off-campus PBD (nonexcepted items and
services) under section 1833(t)(21)(C) of the Act. To do so, we
finalized policies that define whether certain items and services
furnished by a given off-campus PBD may be considered excepted and,
thus, continue to be paid under the OPPS; established the requirements
for the off-campus PBDs to maintain excepted status (both for the
excepted off-campus PBDs and for the items and services furnished by
such excepted off-campus PBDs); and described the applicable payment
system for nonexcepted items and services (generally, the PFS).
To effectuate payment for nonexcepted items and services, in the CY
2017 interim final rule with comment period (81 FR 79720 through
79729), we established a new set of payment rates under the PFS that
reflected the relative resource costs of furnishing the technical
component of a broad range of services to be paid under the PFS
specific to the nonexcepted off-campus PBDs of a hospital.
Specifically, we established a PFS Relativity Adjuster that is applied
to the OPPS rate for the billed nonexcepted items and services
furnished in a nonexcepted off-campus PBD in order to calculate payment
rates under the PFS. The PFS Relativity Adjuster reflects the estimated
overall difference between the payment that would otherwise be made to
a hospital under the OPPS for the nonexcepted items and services
furnished in nonexcepted off-campus PBDs and the resource-based payment
under the PFS for the technical aspect of those services with reference
to the difference between the facility and nonfacility (office) rates
and policies under the PFS. Nonexcepted items and services furnished by
nonexcepted off-campus PBDs are generally paid under the PFS at the
applicable OPPS payment rate adjusted by the PFS Relativity Adjuster of
40 percent (that is, 60 percent less than the OPPS rate) (82 FR 53030).
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79719
and 79725), we created modifier ``PN'' to collect data for purposes of
implementing section 603 but also to trigger payment under the newly
adopted PFS-equivalent rates for nonexcepted items and services.
Nonexcepted off-campus PBDs bill for nonexcepted items and services on
the institutional claim utilizing modifier ``PN'' to indicate that an
item or service is a nonexcepted item or service.
For a full discussion of our initial implementation of section 603,
we refer readers to the CY 2017 OPPS/ASC final rule with comment period
(81 FR 79699 through 79719) and the interim final rule with comment
period (79720 through 79729). For a detailed discussion of the current
PFS Relativity Adjuster related to payments under section 603, we refer
readers to the CY 2018 OPPS/ASC final rule with comment period (82 FR
52356 through 52637) and the CY 2019 PFS final rule with comment period
(82 FR 59505 through 59513).
[[Page 81868]]
3. Proposal To Modify Claims Processing of HCPCs Codes G0422 and G0423
To Address an Unintended Payment Disparity Caused by Application of the
PFS Relativity Adjuster to ICR Services Furnished by Off-Campus Non-
Excepted PBDs Hospitals
Since 2010, ICR services provided in the physician's office have
been paid at 100 percent of the OPPS rate for CR services as required
by 1848(b)(5). Since 2017, ICR services provided by an off-campus, non-
excepted PBD of a hospital have been paid at the above-described ``PFS-
equivalent'' rate through application of the PFS Relativity Adjuster,
which was 50 percent of the OPPS rate in CY 2017 and 40 percent of the
OPPS rate in CY 2018 and thereafter, consistent with the above-
described implementation of section 603.
This has produced an outcome inconsistent with the text of section
1848(a)(5)(A) and at odds with the intent of section 603, which was to
remove the significant disparity in payment rates for the same services
depending on whether they were furnished in a physician's office or an
off-campus, non-excepted PBD of a hospital. When the PFS Relativity
Adjuster was implemented in 2017, payment for the ICR service provided
in a physician's office and a PBD of an off-campus, non-excepted
hospital was already the same pursuant to section 1848(b)(5)(A), which
requires ICR services provided in a physician's office to be paid at
the OPPS rate for cardiac rehabilitation. Consequently, application of
the 40 percent PFS Relativity Adjuster to payment for ICR provided by
an off-campus, non-excepted PBD has resulted in an unintended
reimbursement disparity between the two sites of the service, as shown
in Table 104.
[GRAPHIC] [TIFF OMITTED] TR22NO23.145
This disparity creates a significant barrier to beneficiary access
to an already underutilized service. To eliminate this unintended
outcome and for consistency with the requirement in section
1848(b)(5)(A) of the Act to substitute the OPPS rate for CR services
for the PFS rate for ICR services, we proposed to pay for ICR services
provided by an off-campus, non-excepted provider-based department of a
hospital at 100 percent of the OPPS rate for CR services (which is also
100 percent of the PFS rate) rather than at 40 percent of the OPPS
rate. Effective January 1, 2024, we proposed to exclude ICR from the 40
percent PFS Relativity Adjuster policy at the code level by modifying
the claims processing of HCPCS codes G0422 (Intensive cardiac
rehabilitation; with or without continuous ECG monitoring with
exercise, per session) and G0423 (Intensive cardiac rehabilitation;
with or without continuous ECG monitoring without exercise, per
session) so that 100 percent of the OPPS rate for CR is paid
irrespective of the presence of the ``PN'' modifier (signifying a
service provided in a non-excepted off-campus provider-based department
of a hospital) on the claim. We solicited comment on whether there are
other services for which the OPPS rate is unconditionally used under
the PFS, such that these services should be treated similarly for
purposes of payment to off-campus, non-excepted provider-based
departments of hospitals.
The following is a summary of the comments we received and our
responses to those comments.
Comment: All commenters supported our proposal to exclude ICR from
the 40 percent PFS Relativity Adjuster at the code level by modifying
the claims processing of HCPCS codes G0422 and G0423 so that 100
percent of the OPPS rate for CR is paid irrespective of the presence of
the ``PN'' modifier on the claim. These commenters indicated that this
change will increase patient access to an underutilized program,
particularly in rural and underserved areas.
Response: We thank commenters for their support.
Comment: Many commenters requested that we retroactively review
payments made from CY 2017 through CY 2023 for ICR services (HCPCS
codes G0422 and G0423) provided by a non-excepted, off-campus PBD and
prospectively adjust payment rates to reimburse off-campus PBDs the
difference between what was paid what should have been paid.
Response: We appreciate commenters' suggestion and will consider it
for future rulemaking.
Comment: Several commenters provided input in response to our
request for comment on whether there are other services for which the
OPPS rate is unconditionally used under the PFS, such that these
services should be treated similarly for purposes of payment to off-
campus, non-excepted provider-based departments of hospitals.
One commenter stated that the OPPS rate is unconditionally used
under the PFS for the technical component of all diagnostic services
subject to the OPPS imaging cap mandated by section 1848(b)(4) of the
Act, which limits the
[[Page 81869]]
PFS rate to no more than the OPPS rate. The commenter contends that it
is illogical to apply a PFS Relative Adjustor to the OPPS rates for
these services when doing so results in payment that is lower than what
a physician's office would receive, particularly since the OPPS payment
rates include packaging of drugs, devices, laboratory, and other
ancillary services that are all separately billed by an office. This
commenter requested that CMS exempt all imaging tests whereby the OPPS
imaging cap is applied and pay these services at 100 percent of the
OPPS rate when furnished in a non-excepted, off-campus location.
Response: We do not agree that the OPPS rate is unconditionally
used under the PFS for the technical component of all diagnostic
services subject to the OPPS imaging cap mandated by section
1848(b)(4), such that these services should be treated similarly for
purposes of payment to off-campus, non-excepted provider-based
departments of hospitals. There is a fundamental difference between
section 1848(j)(3), which is intended to ensure site neutrality between
the PFS and the OPPS for payment for ICR rehabilitation services, and
section 1848(b)(4), which is intended to impose a limit on the PFS
payment for certain imaging services if the payment rate for a
particular imaging service exceeds the OPPS payment rate for the same
service in a given year.
Comment: The remaining responses to our comment solicitation did
not identify any other services for which the OPPS rate is
unconditionally used under the PFS but instead suggested services that
commenters believed should be excluded from the 40 percent PFS
Relativity Adjuster based on payment rate comparisons and other
considerations. One commenter, while acknowledging that CR services
were not included in the original MIPPA statute that directs coverage
and payment of ICR, argued that since CR services are clinically very
similar to ICR services and are also underutilized services with a
proven record of improving patient quality of life and
rehospitalization outcomes, that it would be appropriate for CMS to
also exclude CPT codes 93797 (Physician or other qualified health care
professional services for outpatient cardiac rehabilitation; without
continuous ECG monitoring (per session)) and 93798 (Physician or other
qualified health care professional services for outpatient cardiac
rehabilitation; with continuous ECG monitoring (per session)) from the
40 percent PFS Relativity Adjuster. Another commenter requested that
CMS consider exempting both CR and PR. Two commenters referred CMS to a
recent report by MedPAC which stated that some services are more safely
provided in the PBD setting and that limiting payment for these
services could limit beneficiary access. These commenters suggested
that CMS identify the ambulatory payment classifications for these
services and exclude them from the 40 percent PFS Relativity Adjuster.
Additionally, these commenters requested that CMS identify payment
codes for which payment to freestanding physician offices under the PFS
is higher than 40 percent of the OPPS rate and exclude them from the 40
percent PFS Relativity Adjuster. One of these commenters also requested
that CMS conduct a comprehensive review of services provided in the
physician office and PBD settings to identify other services that
should be paid at the OPPS rate to ``preserve beneficiary access.''
Finally, one commenter reported that they compared the non-facility
practice expense (PE) national payment amounts to 40 percent of the
OPPS rate for the service and discovered 602 HCPCS services for which
40 percent of the OPPS rate is less than the non-facility PE rate.
Acknowledging that many of these codes are the imaging codes previously
discussed, the commenter stated that the list also included codes for
services that are not covered or allowed to be paid in the non-facility
setting and for which facility resources are not included in the non-
facility PE RVUs. The commenter stated that these procedures should be
paid 100 percent of OPPS and not be subject to the PFS Relatively
Adjustor because they are not allowed to be performed in physicians'
offices. The commenter additionally requested that CMS review a
selection of services included in an appendix to the comment, which
highlights instances where 40 percent of the OPPS payment rate is less
than the non-facility PE payment rate and requests that, where the PFS
Relatively Adjustor is less than the non-facility PE payment rate from
the MPFS, that CMS pay either 100 percent of the OPPS rate or, at a
minimum, use the non-facility PE payment rate as a floor.
Response: We appreciate commenters' many thoughtful responses to
our comment solicitation as well as their many nominations of services
that they believe should be excluded from the 40 percent PFS Relativity
Adjuster based on payment rate comparisons and other non-statutory
considerations. While we will take these suggestions into consideration
in future rulemaking, we emphasize that our primary rationale for
making this change was adherence to the statute which explicitly
requires the PFS rate for ICR services be the same as the OPPS rate for
CR services.
After consideration of the public comments we received, we are
finalizing, without modification, our proposal to exclude ICR from the
40 percent PFS Relativity Adjuster at the code level by modifying the
claims processing of HCPCS codes G0422 and G0423 so that 100 percent of
the OPPS rate for CR is paid irrespective of the presence of the ``PN''
modifier on the claim.
C. OPPS Payment for Specimen Collection for COVID-19 Tests
In the May 8, 2020 COVID-19 interim final rule with comment period
titled ``Additional Policy and Regulatory Revisions in Response to the
COVID-19 Public Health Emergency and Delay of Certain Reporting
Requirements for the Skilled Nursing Facility Quality Reporting
Program'', we created a new E/M code to support COVID-19 testing during
the PHE: HCPCS code C9803 (Hospital outpatient clinic visit specimen
collection for severe acute respiratory syndrome coronavirus 2 (sars-
cov-2) (coronavirus disease [covid-19]), any specimen source) (85 FR
27604). In our review of available HCPCS and CPT codes for the May 8,
2020 COVID-19 IFC, we did not identify a prior code that explicitly
described the exact services of symptom assessment and specimen
collection that HOPDs were undertaking to facilitate widespread testing
for COVID-19. We believed that HCPCS code C9803 was necessary to meet
the resource requirements for HOPDs to provide extensive testing for
the duration of the COVID-19 PHE. This code was created only to meet
the need of the COVID-19 PHE and we stated that we expected to retire
this code at the conclusion of the COVID-19 PHE (85 FR 27604).
We assigned HCPCS code C9803 to APC 5731--Level 1 Minor Procedures
effective March 1, 2020, for the duration of the COVID-19 PHE. In
accordance with section 1833(t)(2)(B) of the Act, APC 5731--Level 1
Minor Procedures contains services similar to HCPCS code C9803. APC
5731--Level 1 Minor Procedures has a payment rate of $24.96 for CY
2023. HCPCS code C9803 was also assigned a status indicator of ``Q1.''
The Q1 status indicator indicates that the OPPS will package services
billed under HCPCS code C9803 when billed with a separately payable
primary service in the same encounter. When HCPCS code C9803 is billed
without
[[Page 81870]]
another separately payable primary service, we explained that we will
make separate payment for the service under the OPPS. The OPPS also
makes separate payment for HCPCS code C9803 when it is billed with a
clinical diagnostic laboratory test with a status indicator of ``A'' on
Addendum B of the OPPS. On May 11, 2023, the COVID-19 PHE
concluded.\198\ As stated above, we created HCPCS code C9803 to meet
the need of the COVID-19 PHE and the resource requirements for HOPDs
during the PHE and planned to retire the code following the conclusion
of the PHE. While the code will remain active for the remainder of CY
2023 for technical reasons, we do not believe it is necessary for the
code remain active in CY 2024 now that the PHE has concluded.
Therefore, we proposed to delete HCPCS code C9803 effective January 1,
2024; and we solicited comment on our proposal to delete this code for
CY 2024.
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We received two comments in support of maintaining the code for
purposes of reporting and reimbursement. One commenter requested that
if we do retire the code, that we implement a similar code for ongoing
nasopharyngeal swab specimen collection. After consideration of the
public comments we received, we do not believe it is necessary for the
code to remain active in CY 2024 with the conclusion of the COVID-19
PHE. We continue to believe that the utility of HCPCS code C9803 ended
when the COVID-19 PHE ended. Therefore, we believe it appropriate to
delete HCPCS code C9803 effective January 1, 2024. However, we will
continue to explore coding opportunities for nasopharyngeal swab
specimen collection, where appropriate.
D. Remote Services
1. Mental Health Services Furnished Remotely by Hospital Staff to
Beneficiaries in Their Homes
In the CY 2023 OPPS final rule with comment period (87 FR 72012
through 72017), we finalized creation of three HCPCS C-codes to
describe mental health services furnished by hospital staff to
beneficiaries in their homes through communications technology. See
Table 105 for the C-code numbers and their descriptors.
[GRAPHIC] [TIFF OMITTED] TR22NO23.146
When we created HCPCS codes C7900 through C7902, we did not specify
whether they should be used for individual or group services,
preferring to keep the coding more general while we gathered
information about the use of these new codes. However, we have heard
from interested parties that, in instances when a beneficiary is
receiving multiple units of group therapy a day, it is administratively
burdensome to report and document each unit of time using multiple
codes. Instead, interested parties requested that we create a single,
untimed code that can be reported when a beneficiary receives multiple
hours of group therapy per day. In order to reduce administrative
burden and enhance access to these services, we proposed to create a
new, untimed, HCPCS C-code describing group therapy. Please see Table
106 for the proposed C-code and long descriptor.
[[Page 81871]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.147
As we stated in the CY 2023 OPPS final rule with comment period,
when beneficiaries are in their homes and not physically within the
hospital, the hospital is not accruing all the costs associated with an
in-person service; and the full OPPS rate would not accurately reflect
these reduced costs. We believe that the costs associated with hospital
clinical staff remotely furnishing a mental health service to a
beneficiary who is in their home using communications technology more
closely resembles the PFS payment amount for similar services when
performed in a facility, which reflects the time and intensity of the
professional work associated with performing the mental health service
but does not reflect certain practice expense costs, such as clinical
labor, equipment, or supplies (87 FR 72015).
In keeping with that methodology, we proposed to assign HCPCS code
C79XX to an APC based on the facility payment amount for a clinically
similar service, CPT code 90853 (Group psychotherapy (other than of a
multiple-family group)) under the PFS. See Table 107 for the proposed
SI and APC assignments and payment rates for HCPCS code C79XX.
[GRAPHIC] [TIFF OMITTED] TR22NO23.148
We sought comment on whether HCPCS code C79XX sufficiently
describes group psychotherapy to the extent that group psychotherapy
would no longer be reported with HCPCS codes C7900-C7902, in which case
we would need to refine the code descriptors for HCPCS codes C7900-
C7902 to stipulate that they are solely for services furnished to an
individual beneficiary. Alternatively, we sought comment on whether or
there are circumstances where interested parties believe it would be
appropriate to bill for group services using HCPCS codes C7900-C7902.
We also sought comment on any further refinements to the code
descriptors, valuation, or billing guidance.
We have also heard from interested parties that there is confusion
about the presence of the word ``initial'' in the descriptors for HCPCS
codes C7900 and C7901 and that this is preventing billing for remote
behavioral health services furnished subsequent to either the first 15
to 29 minutes or 30 to 60 minutes. In order to facilitate accurate
billing, regardless of whether the remote mental health service is
being furnished as an initial or subsequent service, we proposed to
revise the code descriptors to remove the word ``initial.'' We also
proposed to revise the descriptor for HCPCS code C7902 to limit billing
with HCPCS code C7901. See Table 108 for revised code descriptors.
[[Page 81872]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.149
The following is a summary of the comments we received and our
responses to those comments.
Comment: Most commenters supported our proposal to create to a new,
untimed, HCPCS C-code (C79XX) describing group therapy, citing reduced
confusion and administrative burden, and ensuring appropriate patient
access to the services.
Response: We thank commenters for their support.
Comment: Several commenters opposed the creation of the group
therapy code, objecting to our proposal to assign the code to an APC
based on the facility payment amount for a similar service (CPT code
90853 Group Psychotherapy (other than of a multiple-family group))
under the PFS. Several other commenters neither supported nor objected
to the creation of the group therapy code but expressed concern with
basing reimbursement on the facility PFS payment for remote mental
health services generally. These commenters disagreed with CMS's
assumption that when beneficiaries are in their homes and not
physically within the hospital, the hospital is not accruing all the
costs associated with an in-person service. These commenters pointed to
many factors in support of their contention, including investments in
infrastructure, equipment, and technology to provide remote services,
the clinical and administrative staff necessary to provide remote
services while maintaining access to in-person care, the staff time and
resources necessary to make the remote visit run smoothly (scheduling
and setting up the appointment, assisting patients with connecting to
the appointment, screening patients, making referrals and scheduling
follow ups), the fact that salaries and operating costs do not decrease
simply because some services are provided remotely and that the only
cost savings are for supplies, which are negligible because the
services being provided remotely are mental health services. In
recognition of these costs, these commenters requested payment for
remote mental health services at the full OPPS rate. One commenter
supported CMS's conclusion that mental health services provided
remotely cost less than mental health services provided in-person,
noting that even though the work RVU remains the same, the practice
expenses are significantly reduced.
Response: We continue to believe that when beneficiaries are in
their homes and not physically within the hospital, that the hospital
is not accruing all the costs associated with an in-person service and
as such the full OPPS rate would not accurately reflect these costs.
However, we do agree that the non-facility payment rate is likely a
better reflection of the resources associated with furnishing these
services than the facility payment rate. However, as demonstrated in
Table 109 below, using the non-facility rate to inform the APC
assignment still results in assignment to the same APCs.
[[Page 81873]]
[GRAPHIC] [TIFF OMITTED] TR22NO23.150
We appreciate commenters insights and will consider further updates
to the payment rates as needed in future rulemaking.
Comment: All commenters supported our proposal to revise the code
descriptors C7900 and C7901 to remove the word ``initial.''
Response: We thank commenters for their support.
Comment: One commenter, in response to CMS's request for comment on
the HCPCS codes C7900-7902, stated that because the nomenclature and
minutes in these codes are similar to other HCPCS codes, the commenter
would support keeping the codes as currently written.
Response: We thank the commenter for this input.
Comment: One commenter encouraged CMS to clearly define a
beneficiary's home as broadly as possible, in recognition that not all
beneficiaries own, rent, or occupy a space that might traditionally be
considered a ``home.'' This commenter points out that shelters, tents,
parked vehicles, and other settings may well be considered a ``home''
to some or might offer a safe environment that is necessary for the
beneficiary to openly engage with their clinician during a mental
health disorder, or other, visit.
Response: We appreciate commenter's suggestion and agree that one's
home can cover a wide breadth of settings and arrangements. As we have
previously explained, our definition of ``home,'' both in general and
in terms of a mental healthcare delivery site, is broad and includes
temporary lodging such as hotels and homeless shelters (86 FR 65048 and
65049).
Comment: One commenter stated that the new remote mental health
services are not fully understood by many providers and therefore not
utilized as often as they could be. The commenter expressed concern
that there will be significant confusion in the community between these
services (which are sometimes used to bill for remote IOP services) and
the new IOS services covered by Medicare. The commenter requests that
CMS issue informational materials to smaller rural providers (like
CAHs) to help them to understand the circumstances under which each
service is appropriate and how each option would help them to meet the
needs of their patient populations.
Response: We appreciate the commenter's suggestion and will
consider the creation of additional informational materials related to
remote mental health services.
Comment: One commenter emphasized the importance of CMS providing
explicit billing guidance when clinicians in hospitals furnish
telehealth services to patients in their homes. The commenter requested
that CMS confirm the appropriate billing and payment for telehealth
services when the clinician is in the hospital and the patient is in
the home and asked several specific billing questions.
Response: We direct the commenter to the CY 2024 PFS final rule for
specific information relating to billing for telehealth services
furnished to patients in their homes. We will consider additional sub-
regulatory clarifications, as needed, in the future.
Comment: One commenter emphasized that remote monitoring tools must
play a central role in CMS's efforts to make its OPPS more efficient
and effective and encouraged CMS to fully support the use of remote
monitoring (both physiologic and therapeutic) through its OPPS
policies. This commenter also requested that CMS ensure that critical
access hospitals (CAHs) and REHs be able to provide services via the
most appropriate and accessible modality, whether live voice/video or
asynchronous modalities, including remote monitoring. The commenter
[[Page 81874]]
argued that CAHs and REHs should enjoy the same fee-for-service carve
out that FQHCs and RHCs already enjoy for Chronic Care Management
(CCM), Transitional Care Management (TCM), and Behavioral Health
Integration (BHI) services. The commenter urged CMS to act to support
the use of Remote Patient Monitoring (RPM) and Remote Therapeutic
Management (RTM) by CAHs and REHs. Finally, the commenter notes that
CMS has proposed to provide new support for RPM and RTM to FQHCs and
RHCs, and requests that the OPPS rules provide similar support for CAHs
and REHs.
Response: We appreciate the commenter's input and recommendations
with respect to remote monitoring tools and we will consider them for
future rulemaking. After consideration of the public comments we
received, we are finalizing, without modification, our proposal to
create a new, untimed, HCPCS C-code, specifically, C7903, describing
group therapy and to assign that code to an APC based on the facility
payment amount for a clinically similar service, CPT code 90853 (Group
psychotherapy (other than of a multiple-family group)) under the PFS.
We are also finalizing our proposal to revise the code descriptors for
HCPCS codes C7900 and C7901 to remove the word ``initial'' and HCPCS
code C7902 to limit billing with HCPCS code C7901.
2. Periodic In-Person Visits
In the CY 2023 OPPS final rule with comment period (87 FR 72017),
we finalized a requirement that payment for mental health services
furnished remotely to beneficiaries in their homes using
telecommunications technology may only be made if the beneficiary
receives an in-person service within 6 months prior to the first time
the hospital clinical staff provides the mental health services
remotely; and that there must be an in-person service without the use
of telecommunications technology within 12 months of each mental health
service furnished remotely by the hospital clinical staff. We also
finalized that we would permit exceptions to the requirement that there
be an in-person service without the use of communications technology
within 12 months of each remotely furnished mental health service when
the hospital clinical staff member and beneficiary agree that the risks
and burdens of an in-person service outweigh the benefits of it. We
stated that exceptions to the in-person visit requirement should
involve a clear justification documented in the beneficiary's medical
record including the clinician's professional judgement that the
patient is clinically stable and/or that an in-person visit has the
risk of worsening the person's condition, creating undue hardship on
the person or their family, or would otherwise result in disengaging
with care that has been effective in managing the person's illness. We
also finalized that hospitals must document that the patient has a
regular source of general medical care and has the ability to obtain
any needed point of care testing, including vital sign monitoring and
laboratory studies. We finalized that these requirements would not go
into effect until the 152nd day after the PHE for COVID-19 ends to
maintain consistency with similar policies implemented for professional
services paid under the PFS, and for RHCs/FQHCs (87 FR 72018).
Section 4113(d) of the Consolidated Appropriations Act (CAA), 2023
(Pub. L. 117-328), extended the delay in implementing the in-person
visit requirements until January 1, 2025, for both professionals
billing for mental health services via Medicare telehealth and for
RHCs/FQHCs furnishing remote mental health visits. As previously
stated, we believe it is important to maintain consistent requirements
for these policies across payment systems; therefore, we proposed to
delay the in-person visit requirements for mental health services
furnished remotely by hospital staff to beneficiaries in their homes
until January 1, 2025. The following is a summary of the comments we
received and our responses to those comments.
Comment: All commenters supported our proposal to delay the in-
person requirements and the majority of those commenters requested that
CMS work with Congress to eliminate the in-person requirements
altogether. These commenters stated that the in-person requirements
should be eliminated because the requirements are arbitrary and not
based upon any clinical guidelines or evidence, they create logistical
hurdles for patients and providers, they perpetuate stigma related to
receiving mental health care, they are problematic for those in rural
communities and those with inconsistent transportation accessibility,
remote mental health services were overwhelmingly successful during the
PHE when there were no in-person visit requirements, and clinicians,
rather than the government, should make the determination of the need
for an in-person visit on a patient-by-patient basis.
Response: We thank commenters for their support and appreciate
their concerns related to the in-person requirements. As acknowledged
by commenters, Congressional legislation would be required to eliminate
these requirements.
Comment: One of these commenters requested that in future
rulemaking CMS consider changing the in-person visit requirements to
allow a broader array of practitioners to fulfill the in-person
obligation. Another commenter requested that CMS implement a broad
exception to the in-person visit requirements criteria based on
clinical discretion, as well as an expansive view of the types of in-
person visits that can meet the requirements.
Response: We thank commenters for their suggestions and will take
them into consideration for future rulemaking. We note, however, that
in the CY 2023 final OPPS rule (87 FR 72017), we finalized an exception
to the requirement that there be an in-person service within 12 months
of each remotely furnished mental health service. This exception may be
exercised when the hospital clinical staff member and beneficiary agree
that the risks and burdens of an in-person service outweigh the
benefits of it and a clear justification for the exception is
documented in the beneficiary's medical record, including the
clinician's professional judgement that the patient is clinically
stable and/or that an in-person visit has the risk of worsening the
person's condition, creating undue hardship on the person or their
family, or would otherwise result in disengaging with care that has
been effective in managing the person's illness. Hospitals must also
document that the patient has a regular source of general medical care
and has the ability to obtain any needed point of care testing,
including vital sign monitoring and laboratory studies.
After consideration of the public comments we received, we are
finalizing, without modification, our proposal to delay the in-person
visit requirements for mental health services furnished remotely by
hospital staff to beneficiaries in their homes until January 1, 2025.
3. Payment for Outpatient Therapy Services, Diabetes Self-Management
Training, and Medical Nutrition Therapy When Furnished by Hospital
Staff to Beneficiaries in Their Homes Through Communication Technology
The CAA, 2023 extended most flexibilities for Medicare telehealth
services, including retention of physical and occupational therapists
and speech-language pathologists as telehealth distant site
practitioners, through the end of CY 2024. In the CY 2024 PFS proposed
rule, we proposed to continue
[[Page 81875]]
to make payment for outpatient therapy (physical therapy (PT),
occupational therapy (OT), and speech-language pathology (SLP))
services, Diabetes Self-Management Training (DSMT), and Medical
Nutrition Therapy (MNT) when furnished via telehealth by qualified
employed staff of institutional providers through the end of CY 2024.
We note that the proposal includes outpatient therapy, DSMT, and MNT
services furnished via telehealth by staff of hospital outpatient
departments. For further discussion, please see the CY 2024 PFS final
rule. The following is a summary of the comments we received and our
responses to those comments.
Comment: All commenters supported our proposal to make payment for
outpatient therapy, DSMT, and MNT when furnished via telehealth by
qualified employed staff of institutional providers, including staff of
hospital outpatient departments, through the end of 2024. One commenter
stated that the extension would provide the flexibility needed to offer
these outpatient therapy services to patients, especially those who
have difficulty traveling to a hospital and otherwise would not have
access to these critical services. Another commenter opined that
enabling Medicare beneficiaries to engage with their hospital's
dietary/nutrition staff from the comfort of their homes allows more
frequent and productive communication that helps ensure patients
persevere through the difficult dietary and lifestyle changes necessary
to manage endemic chronic conditions associated with obesity and
malnutrition alike, diabetes in particular. The commenter further
stated that permitting hospitals to bill for these services delivered
via telehealth helps ensure their availability, especially in rural
communities where the local hospital may be the only available
provider. Another commenter stated that it finds the inclusion of these
therapists as eligible telehealth provider types to be particularly
representative of CMS's stated goals of building in health equity and
access measures to its program offerings.
Response: We thank commenters for their support and note that
additional comments on the proposal to make payment for PT, OT, SLP,
DSMT, and MNT when furnished via telehealth by qualified employed staff
of institutional providers, including staff of hospital outpatient
departments, through the end of 2024 are discussed in the CY 2024 PFS
final rule.
Comment: One commenter requested that CMS provide billing
instructions to hospitals about how PT, OT, SLP, DSMT, and MNT
therapists are allowed to furnish rehabilitation and that hospitals can
receive Part B MPFS payment.
Response: We direct the commenter to the CY 2024 PFS final rule for
specific information relating to billing for telehealth services
furnished to patients in their homes. We will consider additional sub-
regulatory clarifications, as needed, in the future.
We refer readers to the CY 2024 PFS final rule for details relating
to the final policy for payment for outpatient therapy (PT, OT, and
SLP) services, DSMT, and MNT when furnished via telehealth by qualified
employed staff of institutional providers, including staff of hospital
outpatient departments, through the end of CY 2024.
E. OPPS Payment for Dental Services
1. Background
Section 1862(a)(12) of the Act generally precludes payment under
Medicare Parts A or B for any expenses incurred for services in
connection with the care, treatment, filling, removal, or replacement
of teeth or structures directly supporting teeth. (Collectively here,
we will refer to ``the care, treatment, filling, removal, or
replacement of teeth or structures directly supporting teeth'' as
``dental services.'') In the CY 2023 Physician Fee Schedule (PFS) final
rule (87 FR 69663), we explained that we believe there are instances
where dental services are so integral to other medically necessary
services that they are not in connection with the care, treatment,
filling, removal, or replacement of teeth or structures directly
supporting teeth within the meaning of section 1862(a)(12) of the Act.
Rather, such dental services are inextricably linked to the clinical
success of an otherwise covered medical service, and therefore, are
instead substantially related and integral to that primary medical
service. To provide greater clarity to our current policies and respond
to issues raised by interested parties, in the CY 2023 PFS final rule,
we finalized: (1) a clarification of our interpretation of section
1862(a)(12) of the Act to permit payment for dental services that are
inextricably linked to, and substantially related and integral to the
clinical success of, other covered medical services (hereafter in this
discussion, ``inextricably linked to other covered services''); (2)
clarification and codification of certain longstanding Medicare Fee-
For-Service (FFS) payment policies for inextricably linked dental
services; (3) that, beginning for CY 2023, Medicare Parts A and B
payment can be made for certain dental services inextricably linked to
Medicare-covered organ transplant, cardiac valve replacement, or
valvuloplasty procedures; (4) for CY 2024, that Medicare Part A and B
payment can be made for certain dental services inextricably linked to
Medicare-covered services for treatment of head and neck cancers; and
(5) beginning for CY 2023, the establishment of a process to submit for
our consideration and review additional dental services that are
inextricably linked to other covered medical services (87 FR 69670 and
69671). The CY 2023 PFS final rule specified that Medicare payment for
these dental services may be made regardless of whether the services
are furnished in an inpatient or outpatient setting. We directed
readers to the CY 2023 PFS final rule (87 FR 69663 through 69688) for a
full discussion of these policies as well as to the CY 2024 PFS
proposed rule for proposals related to dental services.
In the CY 2023 PFS final rule, CMS identified various examples of
HCPCS codes, mostly Current Dental Terminology (CDT[supreg]) codes,
that could be used to describe the types of dental services identified
in the CY 2023 PFS final rule for which Medicare payment can be made
when coverage and payment policy requirements are met (87 FR 69667). We
refer readers to the PFS Relative Value Files that are released
quarterly on the CMS website for a comprehensive list of HCPCS codes,
including D-codes, that may be payable under the PFS, available at
https://www.cms.gov/medicare/medicare-fee-for-service-payment/physicianfeesched/pfs-relative-value-files.
We explained that the policies adopted in the CY 2023 PFS final
rule allow payment for certain dental services performed in outpatient
settings. However, the current dental codes assigned to APCs for CY
2023 do not fully describe the dental services that may be inextricably
linked to covered medical services and payable under Medicare Part B.
Specifically, for the OPPS for CY 2023, only 57 CDT codes are assigned
to APCs and payable under the OPPS when coverage and payment conditions
are met. In addition to the small number of CDT codes assigned to APCs
for CY 2023, there is also a limited number of CPT codes that may
describe dental services, including CPT code 41899 (Unlisted px
dentalvlr strux), that are currently assigned to APCs and payable under
the OPPS.
In the CY 2023 OPPS/ASC final rule with comment period, we created
HCPCS code G0330 to describe facility
[[Page 81876]]
services for dental rehabilitation procedure(s) furnished to patients
who require monitored anesthesia (e.g., general, intravenous sedation
(monitored anesthesia care)) and use of an operating room. We finalized
this code based on extensive public comments expressing the need for a
coding and payment mechanism to improve access to covered dental
procedures under anesthesia, especially dental rehabilitation
procedures, an issue that commenters to the CY 2023 OPPS proposed rule
explained is caused by barriers to securing sufficient operating room
time to furnish these services. We further noted that HCPCS code G0330
must only be used to describe facility fees for dental rehabilitation
services that meet Medicare payment and coverage requirements as
interpreted in the CY 2023 PFS final rule. We explained that HCPCS code
G0330 cannot be used to describe or bill the facility fee for
noncovered dental professional services. We assigned HCPCS code G0330
to APC 5871 (Dental Procedures) for CY 2023. We directed readers to the
CY 2023 OPPS/ASC final rule with comment period for a full discussion
on HCPCS code G0330 (87 FR 71882 and 71883). For CY 2024, we proposed
to continue to assign HCPCS code G0330 to APC 5871 (Dental Procedures).
Comment: We received several comments requesting clarification on
the billing of HCPCS code G0330 in light of our proposal to price
additional dental codes. Commenters stated that CMS should provide
guidance as to whether HCPCS code G0330 should also be reported when
one or more of the 229 dental codes are performed in an operating room
under anesthesia. A few commenters asked whether G0330 should be billed
under the OPPS similarly to how we proposed for the code to be billed
when the service is performed in an ASC setting.
Response: We appreciate the opportunity to provide clarification
regarding billing of HCPCS code G0330 under the OPPS. Under the OPPS,
HCPCS code G0330 is payable without requiring the billing of any other
code on the same day, so long as the service performed meets all
Medicare coverage and payment requirements. We are clarifying that
providers should bill any other more specific CPT and/or CDT codes
assigned to APCs that describe the service performed, instead of HCPCS
code G0330, whenever possible. HCPCS code G0330 should only be billed
when no other, more specific code is available to describe the service
performed. For instance, if a dentist performs a prophylactic cleaning
(CPT code D1110), several imaging services (e.g., D705-D709), and
alveoloplasty with extraction (D7310), each of these codes are assigned
to APCs, and, therefore, even if the services meet the description of
HCPCS code G0330, hospital outpatient departments should only bill the
more specific codes without HCPCS code G0330. We believe that as we
continue to price additional codes describing dental services, the
situations where it is necessary to bill HCPCS code G0330 will be
increasingly limited. However, we believe HCPCS code G0330 is still
necessary to fill the need for a billing and payment mechanism for
dental rehabilitation services performed under monitored anesthesia in
an operating room that meets Medicare coverage and payment
requirements, but has not been assigned to an APC. Finally, the
clarification regarding billing of HCPCS code G0330 provided here only
applies to billing and payment under the OPPS. For information
regarding the billing and payment for HCPCS code G0330 in the ASC
setting, we refer readers to our discussion on this issue in section
XIII.D of this final rule with comment period.
Comment: We received several comments expressing concern over the
impact of the proposed payment rate for HCPCS code G0330 for CY 2024.
One commenter requested that we recalculate the payment rate for the
APC. Another commenter stated that because the proposed G0330 payment
rate for HCPCS code G0330 is 45 percent lower than the CY 2023 payment
rate, and even lower for the ASC payment, the payment rate may be
insufficient in light of specialized dental equipment and personnel
required to furnish these services in hospital outpatient departments
and ASCs. Another commenter stated that the inadequacy of the proposed
payment rates for HCPCS code G0330 for both hospital and ASC settings
is likely to stymie use of the code. Several commenters urged CMS to
not finalize our proposal to continue to assign HCPCS code G0330 to APC
5871 due to concerns over the APC's payment rate. Some commenters
requested that CMS finalize an APC reassignment for HCPCS code G0330
from APC 5871 to APC 5164 (Level 4 ENT Procedures) with a proposed
payment rate of $3,087.88 for CY 2024. One commenter stated that
reassignment to APC 5164 would be consistent with available cost and
charge data for dental procedures likely to be reported using HCPCS
code G0330. To support their request for reassignment to APC 5164,
commenters stated that prior to CMS's establishment of HCPCS code
G0330, these same dental rehabilitation procedures were reported using
unlisted CPT code 41899, with a geometric mean cost of approximately
$2,200, which is within the range of costs for procedures classified
into APC 5164. Another commenter stated that CMS's proposal to allow
for multiple procedure discounting for HCPCS code G0330 by proposing to
assign status indicator ``T'' to the code would further lower the
payment rate for services described by the code.
Response: We thank the commenters for their input. First, we note
that APC geometric mean costs can change from year to year as a result
of data updates and policy changes. In this case, we proposed to assign
229 dental procedures to APCs, with many proposed for assignment to APC
5871, the same APC to which HCPCS code G0330 was proposed to be
assigned. Additionally, we proposed to change the APC assignments of
some codes that were previously paid under the OPPS based on clinical
similarity, including codes describing dental imaging services. We also
note, APC 5871 is an APC with a low volume of claims and, therefore, is
more prone to volatility in its geometric mean cost and payment rate
changes from year to year based on the claims data available for
ratesetting. The proposed coding changes, as well as the fact that APC
5871 has a low volume of claims, resulted in an unintentional reduction
to APC 5871's geometric mean cost and payment rate for CY 2024. As we
explained in our proposal for CY 2024, we encountered various
challenges in securing accurate cost information for the hospital
outpatient setting for the dental codes we proposed to assign to APC
payment rates. We believe that as utilization increases and we receive
claims data on the codes that we proposed to assign to various APCs for
CY 2024, we will make changes to APC assignments and APC groups,
including considering creating additional APC levels and new clinical
APCs in future rulemaking, based on clinical and resource needs.
We reiterate that the proposed payment rate for the services
assigned to the Dental Procedures APC was the result of our ratesetting
process, which we apply consistently to set the payment rates for other
clinical APCs. With that said, we are sympathetic to commenters'
concerns regarding the reduction in the proposed payment rate for HCPCS
code G0330 from CY 2023 to CY 2024, especially without having claims
data for the code that would indicate that the proposed payment rate
[[Page 81877]]
is appropriate. Based on comments received stating that CPT code 41899
was used to describe the services currently described by HCPCS code
G0330 prior to the code's effective date of January 1, 2023, we
analyzed the available claims data for surgical claims for CPT code
41899 in CY 2021 to get a benchmark for the geometric mean costs of
services that are described by HCPCS code G0330. While CPT code 41899
is an unlisted code describing unlisted procedures on the dentoalveolar
structures that may or may not be surgical in nature and performed
under the same conditions as described by HCPCS code G0330, we ran a
study to isolate the claims performed with monitored anesthesia codes
to more closely mimic the conditions required for services billed under
HCPCS code G0330. Based on this analysis, we believe that the proposed
APC assignment for HCPCS code G0330 for CY 2024 would be inappropriate
in terms of estimated resource costs. Therefore, for CY 2024, we are
not finalizing the APC assignment of HCPCS code G0330 to APC 5871 as
proposed.
Although we believe isolating the surgical claims gives us a better
idea of the geometric mean costs of HCPCS code G0330, we also believe
that the approximation using surgical services billed with CPT code
41899 will not be as accurate as the claims information we will receive
for HCPCS code G0330 in future years. We also note the crosswalk to CPT
code 41899 is not a perfect comparator given that it is an unlisted
code, which, per our billing instructions, should only be used when
there is no other more specific code available. Therefore, we will
determine whether the APC assignment we are finalizing for HCPCS code
G0330 is appropriate based on claims data received in future years and
consider further APC assignment changes in future rulemaking. However,
based on the comments received, the fact that we do not have existing
claims data for HCPCS code G0330 at this time, and our analysis of
surgical claims using CPT code 41899, which demonstrate that the
geometric mean costs for surgical claims for CPT code 41899 are notably
higher than the proposed payment rate for procedures assigned to APC
5871 for CY 2024, we believe reassigning HCPCS code G0330 from APC 5871
to APC 5164 is appropriate for CY 2024.
After consideration of the public comments we received, we are
finalizing an APC reassignment for HCPCS code G0330 from APC 5871 to
APC 5164 with status indicator ``J1'' for CY 2024. We refer readers to
Addendum B to this final rule with comment period rule for the final CY
2024 APC assignment and associated payment rate for HCPCS code G0330.
Addendum B is available via the internet on the CMS website. We also
refer readers to Addendum D1 for a definition of status indicators
including ``J1.''
2. OPPS Payment for Additional Dental Codes Beginning in CY 2024
To ensure that dental services can be paid under the OPPS when
consistent with the policies and clarifications included in the CY 2023
PFS final rule, we proposed to assign additional dental codes to APCs
for CY 2024. Specifically, for CY 2024, we proposed to assign 229
additional dental codes to clinical APCs to enable them to be paid for
under the OPPS when payment and coverage requirements are met. We
explained that assigning additional dental codes to clinical APCs would
result in greater consistency in Medicare payment for different sites
of service and help ensure patient access to dental services for which
payment can be made when performed in the hospital outpatient setting.
Prior to detailing our proposals, we noted two things for readers'
awareness. First, OPPS payment will only be made for a dental code that
we proposed to assign to an APC for CY 2024 if it is among the types of
dental services for which payment can be made as described in the
regulation at Sec. 411.15(i)(3)(i). As we have consistently stated in
past rules (87 FR 71879) and quarterly change requests to assign new
codes to APCs (see, e.g., Pub 100-04 Medicare Claims Processing,
Transmittal 11937), the fact that a drug, device, procedure or service
is assigned a HCPCS code and a payment rate under the OPPS does not
imply coverage by the Medicare program, but indicates only how the
product, procedure, or service may be paid if covered by the program.
Medicare Administrative Contractors (MACs) determine whether a drug,
device, procedure, or other service meets all program requirements and
conditions for coverage and payment. Accordingly, we emphasize that
HOPDs would only receive payment for a dental service assigned to an
APC when the appropriate MAC determines that the service meets the
relevant conditions for coverage and payment.
Second, we anticipate that we would continue to assess our policies
for OPPS payment for dental services in future rulemaking. We believe
that as we collect claims data, gather input from the public and
interested parties, and learn more about the services performed in the
HOPD setting, we will be able to make more informed decisions regarding
payment rates, APC assignments, and status indicators for dental
services.
The dental services for which we proposed APC assignments in the CY
2024 OPPS/ASC proposed rule are those dental services described in the
CY 2023 PFS final rule for which Medicare Part B payment can be made
when they are inextricably linked to other covered services. Based on
the dental services identified in that final rule, we generated a list
of codes that describe those services for which we believed we needed
to propose APC assignments to ensure payment is available under the
OPPS. To generate this list, we reviewed the dental codes that were
specifically listed as examples of payable dental services in the CY
2023 PFS final rule (87 FR 69676). We also reviewed the clinical
vignettes provided in the CY 2023 PFS final rule to identify whether
there are other dental codes in addition to the dental code examples
already identified for which we should propose APC assignments.
The CY 2023 PFS final rule amended Sec. 411.15(i)(3)(i) to allow
for payment under Medicare Part A and Part B for dental services,
furnished in an inpatient or outpatient setting, that are inextricably
linked to, and substantially related and integral to the success of,
certain other covered medical services, including, but not limited to:
(1) dental or oral examination as part of a comprehensive workup prior
to a Medicare covered organ transplant, cardiac valve replacement, or
valvuloplasty procedures; and the necessary diagnostic and treatment
services to eliminate an oral or dental infection prior to, or
contemporaneously with, the organ transplant, cardiac valve
replacement, or valvuloplasty procedure; (2) reconstruction of a dental
ridge performed as a result of, and at the same time as, the surgical
removal of a tumor; (3) the stabilization or immobilization of teeth in
connection with the reduction of a jaw fracture, and dental splints
only when used in conjunction with covered treatment of a covered
medical condition such as dislocated jaw joints; and (4) the extraction
of teeth to prepare the jaw for radiation treatment of neoplastic
disease. For CY 2024, we established that Medicare Parts A and B
payment may also be made for dental services, such as dental
examinations, including necessary treatments, performed as part of a
comprehensive workup prior to treatment for head and neck cancers. We
included a proposal in the CY 2024 PFS proposed rule to codify this
example
[[Page 81878]]
under Sec. 411.15(i)(3)(i). We identified dental services described in
the regulation at Sec. 411.15(i)(3)(i) and those that may be part of a
comprehensive workup prior to treatment for head and neck cancers that
could be payable under the OPPS if payment and coverage requirements
are met. For example, consistent with Sec. 411.15(i)(3)(i)(A), which
describes dental or oral examinations as part of a comprehensive workup
prior to a Medicare covered organ transplant, cardiac valve
replacement, or valvuloplasty procedure, we identified several codes
describing dental examinations for which we proposed APC assignments
(e.g., D0120, D0140, D0150, D0160, D0170, D0180, D0191, D0171). Section
411.15(i)(3)(i)(C) describes services for the stabilization or
immobilization of the teeth in connection with the reduction of a jaw
fracture, and dental splints only when used with a covered treatment of
a covered medical condition. We identified an additional 16 dental
codes (e.g., D7670-D7671; D4322; D5988) that we believe identify these
services and for which we proposed APC assignments.
While it is appropriate for CMS to assign certain dental codes to
APCs for payment under the OPPS, we explained that we do not believe
that every dental code should be assigned to an APC and made payable
under the OPPS. For instance, there are services described by CDT codes
that may already be described by existing CPT codes assigned to
clinical APCs. When this is the case, we proposed that HOPDs would use
the existing CPT codes to bill for the services performed. We also did
not propose APC assignments for all dental codes, even if they describe
dental services that are payable consistent with the policies and
clarifications included in the CY 2023 PFS final rule. This is because
under our regulation at 42 CFR 419.22, the following services are not
paid under the OPPS (except when packaged as part of a bundled
payment): physician services that meet the requirements of 42 CFR
415.102(a); nurse practitioner or clinical nurse specialist services,
as defined in section 1861(s)(2)(K)(ii) of the Act; physician assistant
services, as defined in section 1861(s)(2)(K)(i) of the Act; and
services of an anesthetist as defined in Sec. 410.9. We note that
dentists are considered physicians for purposes of Medicare payment
policy, including this regulation. There are a number of existing CDT
codes that describe the professional services of dentists that could be
paid under the PFS (e.g., D9990-D9997), but that we do not believe are
appropriate for payment under the OPPS. Therefore, we did not propose
to assign CDT codes that describe professional services of dentists and
other dental professionals to clinical APCs.
Finally, there are dental codes that we believe would not meet our
current interpretation of dental services that may be inextricably
linked to other covered medical services. For instance, there are CDT
codes that describe removable prosthodontic procedures, including codes
that describe complete or partial denture procedures (e.g., D5110;
D5120; D5211-D5214). Because denture procedures are not covered medical
procedures under Medicare, we did not propose to assign any dental
codes describing denture procedures to clinical APCs.
In sum, in consultation with medical experts, we identified 229
dental codes as appropriate for payment under the OPPS when relevant
conditions for payment and coverage are met. In addition to the dental
codes already assigned to APCs, we proposed to assign the 229
additional dental codes listed in Table 110 below to various clinical
APCs for CY 2024:
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We requested comments on the list of 229 dental codes that we
proposed to assign to APCs for OPPS payment for CY 2024. We also
requested comments on any additional dental codes that may fall within
the scope of dental services for which payment is permitted as
explained in the CY 2023 PFS final rule and provided in Sec.
411.14(i)(3)(i), and for which payment should be made available under
the OPPS when payment and coverage requirements are met.
Comment: Commenters supported our proposal to assign 229 dental
codes to various APCs and considered it a positive step towards
increased access to dental services for Medicare beneficiaries.
Commenters requested that CMS continue to expand Medicare coverage of
dental services. Many commenters expressed support for the dental
proposals regarding Medicare payment for dental services in the CY 2024
PFS proposed rule. Other commenters suggested additional covered
medical services for which they believe Medicare should pay for dental
care.
Response: We appreciate the support from commenters but want to
make a few clarifications on the policy proposal. First, we are
clarifying that our proposal to assign additional dental codes to APCs
is not a coverage determination. Billed services will only be paid
under the OPPS when the applicable payment and coverage requirements
are met. That said, we appreciate commenters' support for our proposal
to assign additional dental codes to APCs, to enable payment when
Medicare coverage and payment requirements are met. The comments
received on the payment proposals in the CY 2024 PFS proposed rule are
outside of the scope of this final rule with comment period. We direct
readers to the discussion of dental services in the CY 2024 PFS
proposed and final rules (88 FR 52371 through 52384) for more
information on Medicare payment for dental services.
Comment: We received one comment requesting CMS assign an
additional 18 CDT codes to APCs for CY 2024. The commenter explained
that it would be appropriate to assign the 18 additional codes to APCs
because they may be necessary to treat oral or dental infections for
patients with certain acute conditions.
Response: We thank the commenter for their suggestion. We reviewed
the list of codes recommended and believe some of the codes commenters
suggested identify services that would be payable consistent with the
dental payment policies specified in the CY 2023 PFS final rule,
provided conditions for payment and coverage are met. Specifically, we
believe some of the codes recommended for APC assignment describe
dental services that may be considered medically necessary diagnostic
and treatment services immediately necessary to eliminate or eradicate
an oral or dental infection prior to, or contemporaneously with,
certain Medicare-covered medical services specified in the CY 2023 PFS
final rule, including organ transplant, cardiac valve replacement, or
valvuloplasty procedures (42 CFR 411.15). The recommended codes that we
believe are consistent with the dental payment policies specified in
the CY 2023 PFS final rule are the following: CDT codes D7251
(Coronectomy), D7280 (Exposure of unerupted tooth), D7410 (Rad exc
lesion up to 1.25 cm), D7411 (Excision benign lesion>1.25c), D7412
(Excision benign lesion compl), D7413 (Excision malig lesion<=1.25c),
D7414 (Excision malig lesion>1.25cm), D7415 (Excision malig les
complicat), D7440 (Malig tumor exc to 1.25 cm), D7441 (Malig tumor
>1.25 cm), D7450 (Rem odontogen cyst to 1.25cm), D7451 (Rem odontogen
cyst >1.25 cm), D7530 (Removal fb skin/areolar tiss), and D7540
(Removal of fb reaction). We note that Medicare would only pay for
these services when all payment and coverage requirements are met but
we are finalizing APC assignments for these codes to make payment
available in circumstances when those requirements are met. We would
need additional information on how certain codes the commenter
recommended for APC assignment, including CDT codes D7471 (Rem
exostosis any site), D7283 (Place device impacted tooth), D7320
(Alveoplasty w/o extraction), and D7321 (Alveoloplasty not w/extracts),
are consistent with the dental payment policies provided in the CY 2023
PFS final rule, and will revisit the issue in future rulemaking. We
refer readers to Addendum B to this final rule with comment period for
the finalized CY 2024 APC assignments and associated payment rates for
the dental codes. Addendum B is available via the internet on the CMS
website.
Comment: Some commentors requested additional information regarding
how CMS arrived at its dental proposal. One commenter stated that CMS
did not specify the criteria used to determine which dental procedures
to assign to APCs.
Response: We thank the commenters for their feedback but disagree
that we did not specify how we determined which dental procedures to
assign to APCs for CY 2024. The dental services we proposed to assign
to APCs in the CY 2024 OPPS/ASC proposed rule are those dental services
described in the CY 2023 PFS final rule for which Medicare Part B
payment can be made when they are inextricably linked to
[[Page 81885]]
other covered services. As we stated in our proposal, we generated a
list of codes to assign to APCs based on the specific dental services
and clinical vignettes provided in the CY 2023 PFS final rule. This
list was reviewed by our medical experts to ensure that the codes
identified would be appropriate for payment under the OPPS when
relevant conditions for payment and coverage are met.
After consideration of the public comments we received, we are
finalizing our initial list of proposed dental codes for assignment to
clinical APCs as well as assigning additional dental codes to APCs for
CY 2024. Specifically, we are assigning the following CDT codes to APCs
for CY 2024: D7251, D7280, D7410, D7411, D7412, D7413, D7414, D7415,
D7440, D7441, D7450, D7451, D7530, and D7540. Table 111 contains the
list of dental codes assigned to a clinical APC for CY 2024. We note
that the assignment of these codes to APCs is not a determination of
Medicare coverage or payment. We refer readers to Addendum B to this
final rule with comment period for the finalized CY 2024 APC
assignments and associated payment rates for the dental codes. Addendum
B is available via the internet on the CMS website.
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3. APC Assignments for Additional Dental Codes
In accordance with section 1833(t)(2)(B) of the Act, services
classified within each APC must be comparable clinically and with
respect to the use of resources. Accordingly, when considering the
appropriateness of an APC assignment for a code, we consider the
clinical characteristics and resource costs of the service described by
the code compared to other services in a clinical APC.
Consistent with our existing processes, we were able to crosswalk
many of the dental codes to existing CPT codes assigned to APCs for
purposes of assessing clinical similarity. For instance, we crosswalked
certain tissue graft procedures (e.g., D4270) to CPT code 41870 (gum
graft). Because both are surgical procedures where gum tissue near the
area of recession is used to cover and protect the exposed tooth root,
the codes are clinically similar and we believe are appropriate for
grouping within the same clinical APC (that is, APC 5163 (Level 3 ENT
Procedures)). We also found clinical similarities between several
dental imaging services and the services assigned to the various levels
of the Imaging without Contrast APC series (that is, APCs 5521 (Level
1, Imaging without Contrast); 5522 (Level 2, Imaging without Contrast);
and 5523 (Level 3, Imaging without Contrast)). For example, we
crosswalked D0210 (Intraor complete film series) to CPT code 70320
(Full mouth x-ray of teeth) and therefore proposed to assign D0210 to
APC 5523 based on the crosswalk analysis.
With regard to resource similarity, because the 229 dental codes we
proposed to assign to APCs for CY 2024 were not previously paid under
the OPPS, we do not have existing claims information to inform proposed
APC placements based on resource costs. We considered gathering cost
information from several non-Medicare data sources to aid in assigning
the dental codes to APCs. For instance, we considered requesting cost
information from the Department of Veterans Affairs (VA). However, the
VA's dental reimbursement rates are proprietary and are not publicly
available.
We also considered requesting data from State Medicaid agencies but
found the available data too inconsistent and limited to be useful
given that payment rates vary between states. Additionally, not every
State Medicaid Agency provides the same dental benefits, so not every
state would have cost information for each of the dental codes we
propose for OPPS payment. Lastly, while many State Medicaid Agencies
provide robust information on the dental benefits covered for Medicaid
beneficiaries in their state, the fee schedules published by State
Medicaid Agencies most likely include payments to practitioners only
and would not be informative for our purposes of assigning payment
rates under the OPPS.
Finally, we considered analyzing private insurance claims from
third-party databases but determined that the
[[Page 81892]]
cost information available would also not be relevant for OPPS
ratesetting. For example, because most dental services covered by
private insurance are provided in the office setting, there is a very
limited number of claims that would be relevant for OPPS ratesetting
purposes. Of the limited dental claims performed in the hospital
setting, we learned that many of the dental services are performed in
combination with several other services; therefore, it would be
extremely difficult to isolate the facility fee payment for the dental
services performed.
Although specific cost information is informative for making
proposed APC assignments, it is not essential. For example, each
quarter, after consultation with clinical experts, CMS assigns new CPT
codes for which no cost information is available to APCs using
crosswalk code analyses. Similar to our process for assigning new codes
to APCs, we used a crosswalk code analysis and consulted with clinical
experts to propose appropriate APC assignments for the 229 dental
codes. In our conversations with the clinical experts, we discussed the
clinical aspects of each dental service and learned about the
resources, including supplies, used to perform each dental service, in
order to more accurately identify crosswalk codes and propose APC
assignments for them. We solicited comments regarding the proposed APC
assignments for the dental codes for CY 2024. We refer readers to
Addendum B to the CY 2024 OPPS/ASC proposed rule for the proposed CY
2024 APC assignments and associated payment rates for the dental codes.
Addendum B is available via the internet on the CMS website.
Comment: One commenter asked for clarification on which crosswalks
were used to determine the proposed APC assignments, and for data
validation on these crosswalks. The commenter provided two examples of
proposed APC assignments that they believed did not reflect relative
clinical complexity and resource use. Specifically, the commenter
disagreed with the proposed APC assignment for CDT code D4240 (Gingival
flap proc w/planin) because they believed that the clinical intensity,
resource utilization, and supply costs for CDT code D4240 would be
expected to be greater than CDT code D4210 (Gingivectomy/plasty 4 or
mor), which was proposed to be assigned to a higher paying APC.
Similarly, the commenter disagreed with the proposed APC assignment for
CDT code D7210 (Rem imp tooth w mucoper flp) because they believed that
the clinical intensity, and resource use would be similar to those for
CDT code D7310 (Alveoplasty w/extraction), which was proposed to be
assigned to a higher paying APC.
Response: We appreciate the opportunity to provide additional
information on our proposed APC assignments for dental services for CY
2024. Our proposals for APC assignments for the 229 dental codes were
made using a process that is consistent with our processes for
assigning non-dental codes and services for which we do not have
pricing information to clinical APCs. As we stated in our proposal, we
do not yet have claims data or pricing information available for the
dental codes we proposed to assign to APCs for CY 2024. As is our
policy for all new HCPCS codes for which we lack pricing information,
we proposed to assign the dental codes to existing APCs based on input
from a variety of sources, including, but not limited to, review of the
clinical similarity of the service to existing procedures including by
using CPT crosswalk analyses, input from CMS medical advisors, and
review of all other information available to us. The OPPS is a
prospective payment system that provides payment for groups of services
that share clinical and resource use characteristics. Therefore, we
proposed to assign the dental codes to various APCs based on our
evaluation of their clinical and resource similarities to other codes
using the information available to us. Regarding releasing the
crosswalks for all 229 dental codes we proposed to assign to APCs for
CY 2024, it is not our policy to release crosswalks for every single
code we assign to APCs in either our quarterly updates or in annual
rulemaking. Additionally, as we have stated, CPT crosswalk analyses are
just one method we use to assign codes to APCs for which we have no
pricing information, and therefore, releasing CPT crosswalk codes would
not fully explain our reasons for proposing to assign every dental code
to a clinical APC.
Regarding the specific examples of inaccurate proposed APC
assignments and the explanations provided by the commenter regarding
resource and clinical similarities to codes in different clinical APCs
than proposed, we agree with the commenter's concerns. Therefore, based
on the commenter's arguments explaining the clinical and resource
similarities to codes assigned to other clinical APCs than what was
proposed we will finalize APC assignments according to the commenter's
suggestions.
Comment: We received comments requesting that a dentist or dental
specialist serve on the Advisory Panel on Hospital Outpatient Payment
to be able to issue recommendations to CMS on dental issues brought
forth to the Panel, including the appropriate APC assignments for
dental services.
Response: We welcome nominations for representatives of providers
to serve on the Advisory Panel on Hospital Outpatient Payment through
the MEARISTM module. We direct readers and interested
parties to the CMS website for additional information regarding the
purpose, responsibilities of the Advisory Panel on Hospital Outpatient
Payment, and member requirements at: https://www.cms.gov/medicare/regulations-guidance/advisory-committees/hospital-outpatient-payment.
Comment: We received a comment from an organization representing
the interests of people with disabilities expressing concern that our
CY 2024 dental proposal may have the impact of ultimately prohibiting
people with disabilities, particularly those residing in rural
communities or who are otherwise unable to access a hospital outpatient
department, from getting the dental procedures they need for their
health and wellbeing.
Response: We appreciate the comment. It is unclear whether the
commenter's concern was that the proposal to assign additional dental
codes to APCs or the proposed payment rates for certain dental codes
would have the negative effects described in their comment.
Nonetheless, we take the concerns raised by the commenter seriously but
reiterate that we believe our proposal to set payment rates for over
200 dental services, which would allow for payment under the OPPS when
Medicare payment and coverage requirements are met, will improve access
to dental services for Medicare beneficiaries, including beneficiaries
with disabilities. As we stated in the CY 2023 PFS final rule (87 FR
69675), the policy changes for payment under Medicare Parts A and B for
dental services that meet the conditions specified in that rule have
the potential to advance health equity for people who are medically
underserved. Finally, CMS will continue to consider how our dental
policies may impact beneficiaries with disabilities.
Comment: We received two comments requesting that we remain
vigilant and aware of unintended consequences that may occur if we were
to finalize the proposed APC assignments for dental codes in the CY
2024 OPPS proposed rule. One commenter stated that CMS should
diligently monitor the impacts the proposed APC assignments would have
on APCs. Another commenter
[[Page 81893]]
cautioned CMS that if the OPPS payment rate for dental services is
higher than other settings of care, our policies may have the
unintended effect of shifting procedures that have traditionally been
done in a dentist's office to the hospital outpatient setting. The
commenter encouraged CMS to ensure that we are not creating a financial
incentive to shift dental care services to the hospital outpatient
department.
Response: We understand and appreciate the commenters' concerns and
agree that the potential for higher payments in the hospital outpatient
setting may incentivize providing dental care in the hospital
outpatient department setting rather than dental offices. In an effort
to control costs and promote more efficient care, our proposal for CY
2024 would package payment and implement multiple procedure discounting
for almost every code that was proposed to be assigned to an APC. As we
do every year, we will review the APC assignments for all services and
items paid under the OPPS, including dental services, and make changes
as appropriate. We anticipate that we will make adjustments in APC code
assignments and APC groups to more accurately pay for dental services
in future rulemaking based on claims data we collect. Finally, we
encourage interested parties to continue to communicate their concerns
and ideas with CMS so that we may address adverse incentives.
Comment: We received one comment requesting additional changes to
the proposed APC assignments for dental codes. The commenter submitted
a list of over 40 dental codes for which they requested different APC
assignments than the ones we proposed. The commenter included CPT
crosswalks for some of the dental codes to justify their suggested APC
assignment changes, but not all. The commenter also did not provide a
justification or their reasoning for why their suggested APC
assignments were appropriate.
Response: We thank the commenter for their suggestions. However,
based on the comment received, we do not have sufficient information to
make the suggested APC assignment changes because minimal or sometimes
no justification for the changes was provided. For example, additional
information, including why a certain CPT crosswalk was chosen as well
as the clinical or resource appropriateness of the suggested APC
assignment change is necessary for us to assess the suggested APC
assignments.
After consideration of the public comments we received, we are
finalizing our proposed APC assignments for the dental codes as
proposed with slight modifications. Specifically, for CY 2024, we are
reassigning CDT code D7210 from APC 5871 to APC 5163, and CDT code
D4240 to APC 5164. We refer readers to Addendum B to this final rule
with comment period for the finalized CY 2024 APC assignments and
status indicators for the dental codes. Addendum B is available via the
internet on the CMS website.
4. Packaged Payment and Associated Status Indicators for Dental Codes
For CY 2024, we proposed to package payments for dental services
when they are performed with another covered dental or medical service
to promote clinical resource efficiencies, a strategic goal of the
OPPS. Given our understanding of the nature of dental practice and in
consultation with our clinical experts, we explained that we believe
packaged payments are appropriate for dental services paid under the
OPPS. We noted that we are aware that it is common for several dental
services to be performed together, or alongside other medical services,
and submitted on one claim. Unlike medical specialties where often only
one procedure is performed at a time, it is our understanding that it
is common for a patient to undergo several surgical and non-surgical
dental procedures on multiple teeth in one day, or for dental services
to be performed contemporaneously with other medical services. For
example, there are several non-invasive, non-surgical dental services,
including a dental exam or X-ray, which would most likely be performed
together with other more invasive dental services in the HOPD setting,
rather than on their own. Because a dental exam or X-ray is likely to
be performed in addition to other more invasive dental services in the
HOPD setting, we stated we believe packaging payment for dental codes
describing dental exams and X-rays (e.g., D0380-D0386) when performed
with another service is appropriate and would further our strategic
goal of encouraging hospitals to furnish services most efficiently and
to manage their resources with maximum flexibility. We explained that
we also are aware that there are several dental services that are
performed as part of a primary service, and therefore, we believe would
also result in resource efficiencies if paid under the OPPS as a
packaged payment. For example, CDT codes D3110 (pulp cap-direct
(excluding final restoration)) and D3120 (pulp cap-indirect (excluding
final restoration)) are typically performed as part of a restorative
procedure (e.g., a crown or amalgam). Thus, we stated that we believe
it is appropriate to propose to package payment for CDT codes D3110 and
D3120 with payment for the associated restorative procedures.
We believe our proposal to package payment for dental services
under the OPPS is consistent with existing packaging payment principles
in the OPPS. The OPPS regularly packages payments for multiple
interrelated items and services into a single payment to create
incentives for hospitals to furnish services most efficiently and to
manage their resources with maximum flexibility. We believe applying
these principles to the furnishing of dental services in the OPPS is
appropriate and would incentivize clinical resource efficiencies.
In addition to proposing to package payment for dental services to
promote clinical resource efficiencies, there are also several dental
services that would nevertheless be packaged under our regulation at 42
CFR 419.2(b). For example, payment for dental services described by
add-on codes, like CDT code D2953 (each addtnl cast post) would be
packaged under the OPPS consistent with Sec. 419.2(b)(18). Therefore,
we proposed to package payment for CDT code D2953 with the procedures
with which it is performed. We refer readers to the regulation at Sec.
419.2(b) for a full list of items and services for which payment is
packaged or conditionally packaged.
For CY 2024, we proposed packaging payment for dental services
under the OPPS by assigning the dental codes to packaged status
indicators. We believe there are clinical resource efficiencies to be
gained by packaging payments rather than separately paying for each
dental service performed. We refer readers to Addendum B to the CY 2024
OPPS/ASC proposed rule for the proposed CY 2024 status indicators for
the dental codes. Addendum B is available via the internet on the CMS
website. For more information on all of the proposed status indicators
for CY 2024, including explanations of the payment status for each
proposed status indicator, we refer readers to Addendum D1 to the CY
2024 OPPS/ASC proposed rule.
Comment: We received one comment supporting the proposal to assign
``N'' and ``Q1'' status indicators for certain dental services. The
commenter stated that they believed the codes identified to be packaged
with a primary service were appropriate.
Response: We thank the commenter for their support of our proposal
to
[[Page 81894]]
assign ``N'' and ``Q1'' status indicators to certain dental codes.
Comment: We received one comment regarding finalizing proposed
status indicator ``T'' for HCPCS code G0330. The commenter stated that
since HCPCS code G0330 is used to report the performance of multiple
procedures that otherwise would be separately billable, it is
inappropriate to apply the multiple surgical procedure discount by
assigning status indicator ``T'' to hospital dental rehabilitation
claims.
Response: For CY 2024, we are not finalizing the APC assignment for
HCPCS code G0330 as proposed. Based on our discussion of the final
policy in this final rule with comment period, we are assigning HCPCS
code G0330 to APC 5164 with status indicator ``J1.'' As stated in
Addendum D1 to this final rule with comment period, services that are
assigned a status indicator ``J1'' are paid under the OPPS. All covered
Part B services on the same claim as a service with status indicator
``J1'' are packaged with the primary ``J1'' on the claim, with certain
exceptions. We direct readers to Addendum D1 to this final rule with
comment period for more information on the ``J1'' status indicator.
Comment: A few commenters stated that they did not support
assigning status indicators that would package payments for any of the
dental codes we proposed to assign to APCs due to concerns that
packaged payments may not be appropriate for dental services and may
result in lower payments.
Response: We disagree with commenters and continue to believe that
packaging payment for certain dental services is appropriate. As stated
in our proposal, there are certain packaging principles that are
applied to all services paid under the OPPS, whether dental or medical.
Additionally, we believe packaging payments will promote clinical
resource efficiencies. We direct readers to our discussion on packaged
payments for dental services in this final rule with comment for more
information.
Comment: One commenter stated that there may be significant room
for interpretation in terms of packaging. The commenter also stated
they did not believe that when a dentist performs dental procedures
described by add-on codes, like CPT code D2953 (each addtnl cast post),
on the same patient that other dentists are similarly engaging in the
same activity.
Response: We believe that the commenter is trying to explain that
they do not believe providing a single payment for multiple services,
including those described by add-on codes, would be appropriate because
when multiple services are performed by multiple dentists on the same
patient, the dentists are furnishing separate services, which should be
paid for individually. First, we are clarifying that the OPPS is the
Medicare payment system for hospital outpatient department services,
not for the services of individual physicians, dentists, or other
practitioners. Medicare payment for physicians' services is made
through the PFS to the physicians, health care practitioners, and other
suppliers that furnish these services. Second, we reiterate that it is
our policy to package payment for most add-on codes, whether dental or
medical, as these are codes that describe a procedure or service always
performed in addition to a primary service or procedure. Since whenever
CPT code D2953 is performed, it would always be performed with a
primary service, its payment would always be packaged even though it
may not be furnished every time the primary service is performed.
Finally, we direct the commenter to section XI ``CY 2024 Payment Status
and Comment Indicators'' of this final rule with comment period for a
discussion of the various status indicators, including the packaged
status indicator ``N,'' used under the OPPS. The complete list of the
final status indicators and their definitions is provided in Addendum
D1 to this final rule with comment period.
After consideration of the public comments we received, we are
finalizing our proposal to package payment for certain dental services
under the OPPS. We refer readers to Addendum B to this final rule with
comment period for the finalized CY 2024 APC assignments and status
indicators for the dental codes. Addendum B is available via the
internet on the CMS website.
In summary, we are finalizing the following dental policy changes
for CY 2024. First, after consideration of the public comments we
received, we are finalizing the proposed list of dental codes for
assignments to APCs for CY 2024 as well as some of the additional codes
commenters suggested we make payable under the OPPS when coverage and
payment requirements are met. Specifically, in addition to the codes we
proposed to assign to APCs for CY 2024, we are assigning the following
additional CDT codes to APCs for CY 2024: D7251, D7280, D7410, D7411,
D7412, D7413, D7414, D7415, D7440, D7441, D7450, D7451, D7530, and
D7540. We note that the assignment of these codes to APCs is not a
determination of coverage or Medicare payment.
Second, we are finalizing our proposed APC assignments for the
dental codes as proposed with slight modifications. Specifically, for
CY 2024, we are assigning CDT code D7210 to APC 5163 and assigning CDT
code D4240 to APC 5164, rather than finalizing their proposed APC
assignments. Additionally, we are finalizing an APC reassignment for
HCPCS code G0330 from APC 5871 to APC 5164 for CY 2024. We refer
readers to Addendum B to this final rule with comment period for the
finalized CY 2024 APC assignments and status indicators for the dental
codes. Addendum B is available via the internet on the CMS website.
Finally, we are finalizing our proposal to package payments for
certain dental services under the OPPS. We refer readers to Addendum B
to this final rule with comment period for the specific finalized CY
2024 APC assignments and status indicators for the dental codes.
Addendum B is available via the internet on the CMS website.
F. Use of Claims and Cost Report Data for CY 2024 OPPS and ASC Payment
System Ratesetting Due to the PHE
As described in section I.A of the CY 2024 OPPS/ASC proposed rule,
section 1833(t) of the Act requires the Secretary to annually review
and update the payment rates for services payable under the Hospital
OPPS. Specifically, section 1833(t)(9)(A) of the Act requires the
Secretary to review not less often than annually and to revise the
groups, the relative payment weights, and the wage and other
adjustments described in paragraph (2) of the Act to take into account
changes in medical practice, changes in technology, the addition of new
services, new cost data, and other relevant information and factors.
When updating the OPPS payment rates and system for each rulemaking
cycle, we primarily use two sources of information: the outpatient
Medicare claims data and Healthcare Cost Report Information System
(HCRIS) cost report data. The claims data source is the Outpatient
Standard Analytic File, which includes final action Medicare outpatient
claims for services furnished in a given calendar year. For the OPPS
ratesetting process, our goal is to use the best available data for
ratesetting to accurately estimate the costs associated with furnishing
outpatient services and to set appropriate payment rates. Ordinarily,
the best available claims data are the data from 2 years prior to the
calendar year that is the subject of rulemaking. For the CY 2024 OPPS/
ASC
[[Page 81895]]
proposed rule ratesetting, the best available claims data would
typically be the CY 2022 calendar year outpatient claims data processed
through December 31, 2022. The cost report data source is typically the
Medicare hospital cost report data files from the most recently
available quarterly HCRIS file as we begin the ratesetting process. The
best available cost report data used in developing the OPPS relative
weights would ordinarily be from cost reports beginning three fiscal
years prior to the year that is the subject of the rulemaking. For CY
2024 OPPS ratesetting, that would be cost report data from HCRIS
extracted in December 2022, which would contain many cost reports
ending in FY 2020 and 2021 based on each hospital's cost reporting
period.
As discussed in the CY 2022 OPPS/ASC final rule with comment
period, the standard hospital data we would have otherwise used for
purposes of CY 2022 ratesetting included significant effects from the
COVID-19 PHE, which led to a number of concerns with using this data
for CY 2022 ratesetting (86 FR 63751 through 63754). In section X.E of
the CY 2022 OPPS/ASC proposed rule (86 FR 42188 through 42190), we
noted a number of changes in the CY 2020 OPPS claims data we would
ordinarily have used for ratesetting, likely as a result of the PHE.
These changes included overall aggregate decreases in claims volume
(particularly those associated with visits); significant increases in
HCPCS code Q3014 (Telehealth originating site facility fee) in the
hospital outpatient claims; and increases in certain PHE-related
services, such as HCPCS code C9803, which describes COVID-19 specimen
collection, and services assigned to APC 5801 (Ventilation Initiation
and Management). As a result of the effects, we observed from COVID-19
PHE-related factors in our claims and cost report data, as well as the
increasing number of Medicare beneficiaries vaccinated against COVID-
19, which we believed might make the CY 2022 outpatient experience
closer to CY 2019 rather than CY 2020, we believed that CY 2020 data
were not the best overall approximation of expected outpatient hospital
services in CY 2022. Instead, we believed that CY 2019 data, as the
most recent complete calendar year of data prior to the COVID-19 PHE,
were a better approximation of expected CY 2022 hospital outpatient
services. Therefore, in the CY 2022 OPPS/ASC final rule with comment
period, we established a policy of using CY 2019 claims data and cost
reports prior to the PHE in ratesetting for the CY 2022 OPPS with
certain limited exceptions, such as where CY 2019 data were not
available (86 FR 63753 and 63754).
For the CY 2023 OPPS proposed rule ratesetting, we conducted a
review similar to the one we conducted for the CY 2022 OPPS ratesetting
to determine the degree to which the effects of the COVID-19 PHE had
continued or subsided in our claims data as well as what claims and
cost report data would be appropriate for CY 2023 OPPS ratesetting. In
general, we saw that the PHE had limited effect on the service and
aggregate levels of volume as well as changes in the site of service of
care, suggesting that, while clinical and billing patterns had not
quite returned to their pre-PHE levels, they were beginning to do so.
For the CY 2023 OPPS/ASC final rule, while the effects of the
COVID-19 PHE remained at both the aggregate and service levels for
certain services, as discussed in that final rule with comment period
(87 FR 48795 through 48798) and in FY 2023 IPPS proposed rule (87 FR
28123 through 28125), we recognized that future COVID-19 variants may
have potentially varying effects. Therefore, we explained that we
believed it was reasonable to assume that there would continue to be
some effects of the COVID-19 PHE on the outpatient claims that we use
for OPPS ratesetting, similar to the CY 2021 claims data. As a result,
we proposed and finalized the use of CY 2021 claims for CY 2023 OPPS
ratesetting.
We also used cost report data for the CY 2023 OPPS/ASC final rule
(87 FR 72021) from the same set of cost reports we originally used in
the CY 2021 OPPS/ASC final rule for ratesetting, which included cost
reporting periods beginning in CY 2018 in most cases. We typically
would have used the most updated available cost reports available in
HCRIS in determining the CY 2023 OPPS/APC relative weights, which would
have included cost reports with reporting periods that overlap with
parts of CY 2020. However, noting that we observed significant impact
at the service level when incorporating these cost reports into
ratesetting and the effects on billing/clinical patterns, we finalized
a policy to continue to use the same set of cost reports that we used
in developing CY 2022 OPPS ratesetting.
For CY 2024 OPPS rulemaking, we continue to observe some
differences at the aggregate and service level volumes in the CY 2022
claims data, relative to the pre-PHE period. However, we believe that
it is reasonable to assume that there will be minor variations as a
result of the COVID-19 PHE in claims data we use for ratesetting for
the foreseeable future. As we have found that the effects are less
pronounced, even relative to CY 2021 claims data used in CY 2023 OPPS
ratesetting, we anticipate that most of the changes we observe
represent a moderate continued return to pre-PHE volume and ongoing
changes in clinical practice. As a result, we believe the CY 2022
claims data are appropriate for setting CY 2024 OPPS rates.
For CY 2024, we also evaluated the impact of using our standard
update for cost reports. If we were to resume our typical process of
using the most updated cost reports available, we would predominantly
use cost report data from CY 2021, with some portion of the cost
reports including cost reporting periods from prior years. While there
are some differences compared to pre-PHE data, we generally observed
limited impacts. Similar to the claims data approach, we believe it is
reasonable to assume there will continue to be a limited influence of
the COVID-19 PHE on the cost report data. However, as we continue to
receive more updated cost report data, we believe that data will better
reflect changes in provider charge and cost reporting structures. Given
these factors, we believe that using the most recent cost report data
available and resuming our regular cost report update process is
appropriate for CY 2024 OPPS ratesetting.
As a result of our expectation that the CY 2022 claims that we
would typically use are appropriate for establishing the CY 2024 OPPS
rates, we proposed to use the CY 2022 claims for the CY 2024 OPPS/ASC
ratesetting process. In addition, we proposed to resume our typical
cost report update process of including the most recently available
cost report data (primarily including cost reports with cost reporting
periods including CY 2021). For the reasons previously discussed, we
generally do not propose any modifications to our usual OPPS
ratesetting methodologies with regard to the use of updated claims and
cost report data to account for the impact of COVID-19 on the
ratesetting data.
We did not receive any public comments on our proposal, and we are
finalizing our proposal without modification to resume our typical data
update process, using CY 2022 claims data and the most recently
available cost report data, in the CY 2024 OPPS ratesetting process.
[[Page 81896]]
G. Comment Solicitation on Payment for High-Cost Drugs Provided by
Indian Health Service and Tribal Facilities
In the CY 2000 OPPS final rule (65 FR 18433), CMS implemented the
prospective payment system for hospital outpatient services furnished
to Medicare beneficiaries, as set forth in section 1833(t) of the Act.
In this rule, we noted that the Outpatient Prospective Payment System
(OPPS) applies to covered hospital outpatient services furnished by all
hospitals participating in the Medicare program with a few exceptions.
We identified one of these exceptions as ``outpatient services provided
by hospitals of the Indian Health Service (IHS).'' While we stated that
these services would ``continue to be paid under separately established
rates which are published annually in the Federal Register,'' we
indicated that our intent was ``to develop a plan that will help these
facilities transition to the [O]PPS and will consult with the IHS to
develop this plan.'' In the CY 2002 OPPS final rule (66 FR 59855), we
finalized our revision to Sec. 419.20 (Hospitals subject to the
hospital outpatient prospective payment system) by adding paragraph
(b)(4), which specifies that hospitals of the IHS are excluded from the
OPPS. However, we reiterated that this exclusion would only be in place
until we developed a plan to include IHS hospitals under the OPPS.
In the intervening years, IHS and tribal facilities have been paid
under the separately established All-Inclusive Rate (AIR). On an annual
basis, the IHS calculates and publishes, in the Federal Register,
calendar year reimbursement rates. Due to the higher cost of living in
Alaska, separate rates are calculated for Alaska and the lower 48
States. For CY 2023, the Medicare Outpatient per Visit Rate is $620 for
the lower 48 States and $801 for Alaska.
IHS and tribal facilities have continued to expand the breadth of
services that they provide to their communities. Increasingly, this has
meant providing higher-cost drugs along with more complex and expensive
services. While the majority of IHS and tribal facilities appear to be
well served by the AIR, there are specialty facilities where the AIR
might not be an adequate representation of the Medicare share of costs.
If providing a drug or service costs a specialty facility exponentially
more than the payment they receive through the AIR, it may not be
financially feasible for these facilities to provide that drug or
service. For example, the cost of providing expensive cancer drugs or
oncology services could greatly exceed payment a specialty IHS facility
receives through the AIR. We are concerned that, if payments under the
AIR are inadequate for high-cost drugs, this could potentially threaten
the viability of the few IHS and tribal hospital outpatient specialty
programs currently in operation and provide less incentive to IHS
hospitals and tribal facilities not currently offering specialty
services to begin doing so.
Consequently, we sought comment on a number of potential policies
to address payment to IHS and tribal facilities for certain high-cost
drugs and services. We sought comment on whether Medicare should pay
separately for high-cost drugs provided by IHS and tribal facilities.
We requested input on the following:
What universe of drugs would be appropriate for separate
payment? How could CMS maintain that list and add or remove drugs from
it?
Would paying separately for all drugs over a certain cost
threshold be easier to operationalize than paying separately for a
specified list of drugs, while achieving the same policy objective? If
so, what would be an appropriate cost threshold and how should it be
updated?
What would be the appropriate payment rate for any
separately paid drugs? How should these rates be updated and should
these rates be updated on an annual basis?
Would the standard Average Sales Price (ASP) plus 6
percent payment methodology rate be too high of a payment rate if
tribal and IHS facilities are able to acquire drugs at a discounted
rate through the Federal Supply Schedule? Would a payment rate
equivalent to the acquisition cost of the drug through the Federal
Supply Schedule be a more appropriate approximation of the cost of
these drugs?
Should IHS remove the cost of any separately paid drugs
from the calculation of the AIR? If the cost of these drugs was not
removed from the AIR, would the government be paying twice for these
drugs?
How would IHS and tribal facilities bill for separately
paid drugs? Could they use the UB-04 form like standard OPPS hospitals?
The OPPS provides outlier payments to hospitals to help mitigate
the financial risk associated with high-cost and complex procedures,
where a very costly service could present a hospital with significant
financial loss. We sought comment on whether an outlier policy might be
an appropriate mechanism for addressing high-cost drugs and services
provided by IHS and tribal facilities.
We welcomed input from interested parties on these policy ideas and
any additional payment approaches that would enhance our ability to
provide equitable payment for high-cost drugs and services provided by
IHS and tribal facilities.
Comment: We received a total of nine comments in response to this
comment solicitation, including from a tribal facility, organizations
representing IHS and tribal healthcare providers, pharmaceutical
companies, and other interested parties. All of the commenters
supported establishing a payment methodology that would allow IHS and
Tribal healthcare facilities to receive separate payment outside of the
AIR for oncology drugs and services whose costs exceed the AIR.
Commenters discussed the different payment approaches that would
cover the cost of oncology drugs and services above the AIR payment
rate. The preferred approach of the commenters was to treat the AIR
payment amount as a payment threshold. If the cost of a drug or service
is less than the AIR, the provider would be paid the AIR. If the cost
of the drug or service is more than the AIR, then the provider would
receive separate payment for the drug or service. Commenters noted that
this payment approach is currently being used for drugs receiving
payment through Arizona Medicaid (AHCCCS) for IHS and tribal facilities
located in Arizona. The commenters explained that the AHCCCS payment
methodology was established through a state plan amendment to the
AHCCCS program that was approved by CMS.
There was less enthusiasm for other possible payment approaches to
cover the costs of high-cost oncology drugs and services. One commenter
opposed establishing a fixed list of medications that would be eligible
for separate payment because of frequent changes in treatment and
therapy approaches and the entry of new drugs onto the market. Instead,
the commenter would support separate payment for defined classes of
drugs using HCPCS coding that would remain stable over several years.
The commenter noted that this payment approach would not accommodate
separate payment for radiation oncology services. The commenter also
was skeptical about using outlier payments for high-cost oncology drugs
and services. They stated that while this approach may cover costs that
are not currently covered by the AIR, the high threshold to initiate an
outlier payment and the limited additional payment would still leave
IHS and Tribal
[[Page 81897]]
facilities who provide high-cost oncology drugs and other high-cost
services with significant uncompensated expenditures.
Multiple commenters requested that separately payable drugs
furnished by IHS and tribal facilities be paid at a rate of ASP + 6
percent rather than using the Federal Supply Schedule rate. Commenters
assert that the IHS is chronically underfunded and that paying ASP + 6
percent for high-cost drugs could help with remedying those funding
issues.
Commenters also wanted to ensure the integrity of the AIR if there
is separate payment for high-cost oncology drugs and other high-cost
services. They did not support applying offsets to the AIR to avoid
double payment to IHS and tribal healthcare providers for separately
payable high-cost oncology drugs or for high-cost services that may
receive separate payment.
Response: We appreciate the suggestions and feedback from the
interested parties who responded to this comment solicitation. We will
consider the public comments for potential future rulemaking.
H. Technical Changes to Hospital Billing for Marriage and Family
Therapist Services and Mental Health Counselor Services
Section 4121(a) of Division FF, Title IV, Subtitle C of the
Consolidated Appropriations Act of 2023 (CAA, 2023) (Pub. L. 117-328,
December 29, 2022), Coverage of Marriage and Family Therapist Services
and Mental Health Counselor Services under Part B of the Medicare
Program, provides for Medicare coverage of and payment for the services
of mental health care professionals who meet the qualifications for
marriage and family therapists (MFTs) and mental health counselors
(MHCs) when billed by these professionals.
Specifically, section 4121(a)(1) of the CAA, 2023 amended section
1861(s)(2) of the Act by adding a new benefit category under Medicare
Part B in new subparagraph (II) to include marriage and family
therapist services (as defined in an added section 1861(lll)(1) of the
Act) and mental health counselor services (as defined in an added
section 1861(lll)(3) of the Act).
Section 4121(a)(2) of the CAA, 2023 added a new subsection (lll) to
section 1861 of the Act, which defines marriage and family therapist
services, marriage and family therapist (MFT), mental health counselor
services, and mental health counselor (MHC). Section 1861(lll)(1) of
the Act defines ``marriage and family therapist services'' as services
furnished by an MFT for the diagnosis and treatment of mental illnesses
(other than services furnished to an inpatient of a hospital), which
the MFT is legally authorized to perform under State law (or the State
regulatory mechanism provided by State law) of the State in which such
services are furnished, as would otherwise be covered if furnished by a
physician or as an incident to a physician's professional service.
Section 1861(lll)(2) of the Act defines the term MFT to mean an
individual who:
Possesses a master's or doctor's degree which qualifies
for licensure or certification as a MFT pursuant to State law of the
State in which such individual furnishes marriage and family therapist
services;
Is licensed or certified as a MFT by the State in which
such individual furnishes such services;
After obtaining such degree has performed at least 2 years
of clinical supervised experience in marriage and family therapy; and
Meets such other requirements as specified by the
Secretary.
Section 1861(lll)(3) of the Act defines ``mental health counselor
services'' as services furnished by a mental health counselor (MHC) for
the diagnosis and treatment of mental illnesses (other than services
furnished to an inpatient of a hospital), which the MHC is legally
authorized to perform under State law (or the State regulatory
mechanism provided by the State law) of the State in which such
services are furnished, as would otherwise be covered if furnished by a
physician or as incident to a physician's professional service. Section
1861(lll)(4) of the Act defines MHC as an individual who:
Possesses a master's or doctor's degree which qualifies
for licensure or certification as a mental health counselor, clinical
professional counselor, or professional counselor under State law of
the State in which such individual furnishes MHC services;
Is licensed or certified as a mental health counselor,
clinical professional counselor, or professional counselor by the State
in which the services are furnished;
After obtaining such degree has performed at least 2 years
of clinical supervised experience in mental health counseling; and
Meets such other requirements as specified by the
Secretary.
In the CY 2024 Physician Fee Schedule proposed rule, we proposed to
create two new regulation sections at Sec. Sec. 410.53 and 410.54 to
codify the coverage provisions for MFTs and MHCs, respectively. We
proposed a number of changes (88 FR 52361 through 52364) to implement
the amendments made by section 4121 of CAA, 2023. Generally, these
amendments added MFTs and MHCs as types of non-physician practitioners
who can enroll in Medicare and bill for their professional services to
diagnose and treat mental illnesses and specified that payment is made
for these services at 80 percent of the lesser of the actual charges
for the services or 75 percent of the amount determined under the PFS
for services of a clinical psychologist (CP).
We received public comments in response to the OPPS proposed rule
regarding section 4121 of the CAA, 2023. The following is a summary of
the comments we received and our responses.
Comment: Several commenters requested that CMS amend the
regulations at Sec. 419.22 to add the services of MFTs and MHCs to the
list of services that are not paid for under the Hospital Outpatient
Prospective Payment System (OPPS) (except when packaged as part of a
bundled payment) in order to clarify that MHC and MFT services are
excluded from payment under the OPPS. This subject regulation at Sec.
419.22 lists those services that are authorized by Medicare law to be
paid under payment systems other than the OPPS, such as the Physician
Fee Schedule (PFS), the Skilled Nursing Facility Prospective Payment
System (SNF PPS), and the End Stage Renal Disease Prospective Payment
System (ESRD PPS).
Response: We thank the commenters for bringing this inadvertent
omission to our attention. As noted above, we proposed a number of
changes (88 FR 52361 through 52364) to implement the amendments made by
section 4121 of the CAA, 2023. Generally, these amendments added MFTs
and MHCs as types of non-physician practitioners who can enroll in
Medicare and bill for their professional services to diagnose and treat
mental illnesses and specified that payment is made for these services
at 80 percent of the lesser of the actual charges for the services or
75 percent of the amount determined under the PFS for services of a
clinical psychologist (CP).
In proposing to implement section 4121, we inadvertently did not
discuss excluding MFT and MHC services from payment under the hospital
outpatient prospective payment system (OPPS). Services paid under fee
schedules or other payment systems, including the professional services
of physicians or nonphysician practitioners, are not paid
[[Page 81898]]
under the OPPS (69 FR 65685). The regulation at 42 CFR 419.22 lists the
services excluded from payment under the OPPS and includes services of
qualified psychologists, as defined in section 1861(ii) of the Act.
Because MHC and MFT services are professional services of nonphysician
practitioners for which payment is made under the PFS at 75 percent of
the amount of payment for services of a psychologist, we believe that
in implementing the amendments to the Act made by section 4121 of the
CAA, 2023, we must also exclude these services from payment under the
OPPS. Accordingly, we are amending the regulation at 42 CFR 419.22 to
add the services of MFTs as defined in 1861(lll)(1) and the services of
MHCs as defined in section 1861(lll)(3) to the list of hospital
services excluded from payment under the OPPS, at new sections (w) and
(x), respectively.
Comment: A few commenters requested that the regulation at 42 CFR
410.27, which permits certain hospital services to be furnished
incident to a physician or nonphysician practitioner's service, be
updated to expand the definition of ``nonphysician practitioner'' to
include MFTs and MHCs.
Response: We thank the commenters for bringing this inadvertent
omission to our attention. We are amending the regulation at 42 CFR
410.27(g) to revise the definition of ``nonphysician practitioner'' to
include MFTs and MHCs, consistent with section 4121 of the CAA, 2023,
and the amendments to the regulations at Sec. Sec. 410.53 and 410.54
that we are adopting in the CY 2024 PFS final rule.
After consideration of the public comments, we are amending the
regulations at Sec. Sec. 410.27 and 419.22, as described above.
XI. CY 2024 OPPS Payment Status and Comment Indicators
A. CY 2024 OPPS Payment Status Indicator Definitions
Payment status indicators (SIs) that we assign to HCPCS codes and
APCs serve an important role in determining payment for services under
the OPPS. They indicate whether a service represented by a HCPCS code
is payable under the OPPS or another payment system and whether
particular OPPS policies apply to the code.
For CY 2024, we proposed to change the definition of status
indicator ``P'' from ``Partial Hospitalization'' to ``Partial
Hospitalization or Intensive Outpatient Program'' in order to account
for the proposed payment of intensive outpatient services beginning
January 1, 2024, as discussed in section VIII.B of the CY 2024 OPPS/ASC
proposed rule. We did not propose to make any other changes to the
existing definitions of status indicators that were listed in Addendum
D1 to the CY 2023 OPPS/ASC final rule with comment period, which is
available on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices.
We solicited public comments on the proposed definitions of the
OPPS payment status indicators for 2024. We did not receive any public
comments on our proposal, and we are finalizing our proposal to change
the definition of status indicator ``P'' from ``Partial
Hospitalization'' to ``Partial Hospitalization or Intensive Outpatient
Program''.
The complete list of CY 2024 payment status indicators and their
definitions is displayed in Addendum D1 to this final rule with comment
period, which is available on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices.
The CY 2024 payment status indicator assignments for APCs and HCPCS
codes are shown in Addendum A and Addendum B, respectively, to this
final rule with comment period, which are available on the CMS website
at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices.
B. CY 2024 Comment Indicator Definitions
We proposed to use four comment indicators for the CY 2024 OPPS/
ASC. These comment indicators, ``CH,'' ``NC,'' ``NI,'' and ``NP,'' are
in effect for CY 2023; and we proposed to continue their use in CY
2024. The proposed CY 2024 OPPS comment indicators are as follows:
``CH''--Active HCPCS code in current and next calendar
year, status indicator and/or APC assignment has changed; or active
HCPCS code that will be discontinued at the end of the current calendar
year.
``NC''--New code for the next calendar year or existing
code with substantial revision to its code descriptor in the next
calendar year, as compared to current calendar year for which we
requested comments in the CY 2024 OPPS/ASC proposed rule, final APC
assignment; comments will not be accepted on the final APC assignment
for the new code.
``NI''--New code for the next calendar year or existing
code with substantial revision to its code descriptor in the next
calendar year, as compared to current calendar year, interim APC
assignment; comments will be accepted on the interim APC assignment for
the new code.
``NP''--New code for the next calendar year or existing
code with substantial revision to its code descriptor in the next
calendar year, as compared to current calendar year, proposed APC
assignment; comments will be accepted on the proposed APC assignment
for the new code.
The definitions of the OPPS comment indicators for CY 2024 are
listed in Addendum D2 to this final rule with comment period, which is
available on the CMS website at: https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices.
We explained that we believe that the existing CY 2024 definitions
of the OPPS/ASC comment indicators continue to be appropriate for CY
2024. Therefore, we proposed to use those definitions without
modification for CY 2024. We solicited public comments on our proposed
definitions of the OPPS/ASC comment indicators for 2024.
We did not receive any public comments on our proposal and are
finalizing those definitions without modification for CY 2024.
XII. MedPAC Recommendations
The Medicare Payment Advisory Commission (MedPAC) was established
under section 1805 of the Act in large part to advise the U.S. Congress
on issues affecting the Medicare program. As required under the
statute, MedPAC submits reports to the Congress no later than March and
June of each year that present its Medicare payment policy
recommendations. The March report typically provides discussion of
Medicare payment policy across different payment systems and the June
report typically discusses selected Medicare issues. We are including
this section to make stakeholders aware of certain MedPAC
recommendations for the OPPS and ASC payment systems as discussed in
its March 2023 report.
A. OPPS Payment Rates Update
The March 2023 MedPAC ``Report to the Congress: Medicare Payment
Policy,'' recommended that Congress update Medicare OPPS payment rates
by the amount specified in current law plus 1 percent. We refer readers
to the March 2023 report for a complete discussion of this
recommendation.\199\
[[Page 81899]]
We appreciate MedPAC's recommendation and, as discussed further in
section II.B of the CY 2024 OPPS/ASC proposed rule, we proposed to
increase the OPPS payment rates by the amount specified in current law.
Comments received from MedPAC for other OPPS policies are discussed in
the applicable sections of this final rule with comment period.
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\199\ Medicare Payment Advisory Committee. March 2023 Report to
the Congress. Chapter 3: Hospital inpatient and outpatient services,
p.57. Available at: https://www.medpac.gov.
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B. Medicare Safety Net Index
The March 2023 MedPAC ``Report to the Congress: Medicare Payment
Policy,'' recommended that Congress should begin a transition to
redistribute disproportionate share hospital and uncompensated care
payments through the Medicare Safety-Net Index (MSNI). Additionally,
MedPAC recommended that Congress add $2 billion to the MSNI pool of
funds and distribute such funds through a percentage add-on to payments
under the IPPS and OPPS.
In light of these recommendations, and in particular those
concerning safety net hospitals, in the CY 2024 OPPS/ASC proposed rule,
we stated that we look forward to working with Congress and sought
comments on approaches CMS could take. We did not receive any public
comments in response to our comment solicitation regarding MedPAC's
MSNI recommendation.
C. ASC Cost Data
In the March 2023 MedPAC ``Report to the Congress: Medicare Payment
Policy,'' MedPAC reiterated its longstanding recommendation that
Congress require ASCs to report cost data to enable the Commission to
examine the growth of ASCs' costs over time and analyze Medicare
payments relative to the costs of efficient providers. MedPAC suggested
that such cost data would allow CMS to examine whether an existing
Medicare price index is an appropriate proxy for ASC costs or whether
an ASC-specific market basket should be developed, stating both the
CPI-U and hospital market basket update likely do not reflect an ASC's
cost structure. MedPAC contended that it is feasible for small
facilities, such as ASCs, to provide cost information since other small
facilities, such as home health agencies, hospices, and rural health
clinics, currently furnish cost data to CMS. Further, ASCs in
Pennsylvania submit cost and revenue data annually to a state agency to
estimate margins for those ASCs, and that, as businesses, ASCs keep
records of their costs for filing taxes and other purposes.\200\
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\200\ Medicare Payment Advisory Committee. March 2023 Report to
the Congress. Chapter 5: Ambulatory surgical center services, p.163.
Available at: https://www.medpac.gov/wp-content/uploads/2023/03/Ch5_Mar23_MedPAC_Report_To_Congress_SEC.pdf.
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While we recognize that the submission of cost data could place
additional administrative burden on most ASCs, and we did not propose
any cost reporting requirements for ASCs in the CY 2024 OPPS/ASC
proposed rule, as in previous years, we sought public comment on
methods that would mitigate the burden of reporting costs on ASCs while
also collecting enough data to reliably use such data in the
determination of ASC costs. Such cost data would be beneficial in
establishing an ASC-specific market basket index for updating payment
rates under the ASC payment system. We did not receive any public
comments on our comment solicitation regarding methods to mitigate the
burden of ASC cost reporting and data collection. Comments received
from MedPAC for other ASC payment system policies are discussed in the
applicable sections of this final rule with comment period.
XIII. Updates to the Ambulatory Surgical Center (ASC) Payment System
A. Background, Legislative History, Statutory Authority, and Prior
Rulemaking for the ASC Payment System
For a detailed discussion of the legislative history and statutory
authority related to payments to ASCs under Medicare, we refer readers
to the CY 2012 OPPS/ASC final rule with comment period (76 FR 74377 and
74378) and the June 12, 1998 proposed rule (63 FR 32291 through 32292).
For a discussion of prior rulemaking on the ASC payment system, we
refer readers to the CYs 2012 to 2023 OPPS/ASC final rules with comment
period (76 FR 74378 and 74379; 77 FR 68434 through 68467; 78 FR 75064
through 75090; 79 FR 66915 through 66940; 80 FR 70474 through 70502; 81
FR 79732 through 79753; 82 FR 59401 through 59424; 83 FR 59028 through
59080; 84 FR 61370 through 61410; 85 FR 86121 through 86179; 86 FR
63761 through 63815; and 87 FR 72054 through 72096).
B. ASC Treatment of New and Revised Codes
1. Background on Process for New and Revised HCPCS Codes
We update the lists and payment rates for covered surgical
procedures and covered ancillary services in ASCs in conjunction with
the annual proposed and final rulemaking process to update the OPPS and
the ASC payment systems (Sec. 416.173; 72 FR 42535). We base ASC
payment and policies for most covered surgical procedures, drugs,
biologicals, and certain other covered ancillary services on the OPPS
payment policies and we use quarterly change requests (CRs) to update
services paid for under the OPPS. We also provide quarterly update CRs
for ASC covered surgical procedures and covered ancillary services
throughout the year (January, April, July, and October). We release new
and revised Level II HCPCS codes and recognize the release of new and
revised CPT codes by the American Medical Association (AMA) and make
these codes effective (that is, the codes are recognized on Medicare
claims) via these ASC quarterly update CRs. We recognize the release of
new and revised Category III CPT codes in the July and January CRs.
These updates implement newly created and revised Level II HCPCS and
Category III CPT codes for ASC payments and update the payment rates
for separately paid drugs and biologicals based on the most recently
submitted ASP data. New and revised Category I CPT codes, except
vaccine codes, are released only once a year, and are implemented only
through the January quarterly CR update. New and revised Category I CPT
vaccine codes are released twice a year and are implemented through the
January and July quarterly CR updates. We refer readers to Table 41 in
the CY 2012 OPPS/ASC proposed rule for an example of how this process
is used to update HCPCS and CPT codes, which we finalized in the CY
2012 OPPS/ASC final rule with comment period (76 FR 42291; 76 FR 74380
through 74384).
In our annual updates to the ASC list of, and payment rates for,
covered surgical procedures and covered ancillary services, we
undertake a review of excluded surgical procedures, new codes, and
codes with revised descriptors, to identify any that we believe meet
the criteria for designation as ASC covered surgical procedures or
covered ancillary services. Updating the lists of ASC covered surgical
procedures and covered ancillary services, as well as their payment
rates, in association with the annual OPPS rulemaking cycle, is
particularly important because the OPPS relative payment weights and,
in some cases, payment rates, are used as the basis for the payment of
many covered surgical procedures and covered ancillary services under
the revised ASC payment system. This joint update process ensures that
the ASC
[[Page 81900]]
updates occur in a regular, predictable, and timely manner.
Payment for ASC procedures, services, and items are generally based
on medical billing codes, specifically, HCPCS codes, that are reported
on ASC claims. The HCPCS is divided into two principal subsystems,
referred to as Level I and Level II. Level I is comprised of CPT
(Current Procedural Terminology) codes, a numeric and alphanumeric
coding system maintained by the AMA, and includes Category I, II, and
III CPT codes. Level II of the HCPCS, which is maintained by CMS, is a
standardized coding system that is used primarily to identify products,
supplies, and services not included in the CPT codes. Together, Level I
and II HCPCS codes are used to report procedures, services, items, and
supplies under the ASC payment system. Specifically, we recognize the
following codes on ASC claims:
Category I CPT codes, which describe surgical procedures,
diagnostic and therapeutic services, and vaccine codes;
Category III CPT codes, which describe new and emerging
technologies, services, and procedures; and
Level II HCPCS codes (also known as alpha-numeric codes),
which are used primarily to identify drugs, devices, supplies,
temporary procedures, and services not described by CPT codes.
We finalized a policy in the August 2, 2007 final rule (72 FR 42533
through 42535) to evaluate each year all new and revised Category I and
Category III CPT codes and Level II HCPCS codes that describe surgical
procedures, and to make preliminary determinations during the annual
OPPS/ASC rulemaking process regarding whether or not they meet the
criteria for payment in the ASC setting as covered surgical procedures
and, if so, whether or not they are office-based procedures. In
addition, we identify new and revised codes as ASC covered ancillary
services based upon the final payment policies of the revised ASC
payment system. In prior rulemakings, we refer to this process as
recognizing new codes. However, this process has always involved the
recognition of new and revised codes. We consider revised codes to be
new when they have substantial revision to their code descriptors that
necessitate a change in the current ASC payment indicator. To clarify,
we refer to these codes as new and revised in this CY 2024 OPPS/ASC
proposed rule.
We have separated our discussion below based on when the codes are
released and whether we propose to solicit public comments in the
proposed rule (and respond to those comments in this final rule with
comment period) or whether we will be soliciting public comments in
this CY 2024 OPPS/ASC final rule with comment period (and responding to
those comments in the CY 2025 OPPS/ASC final rule with comment period).
2. April 2023 HCPCS Codes Proposed Rule Comment Solicitation
For the April 2023 update, there were no new CPT codes; however,
there were several new Level II HCPCS codes. In the April 2023 ASC
quarterly update (Transmittal 11927, dated March 24, 2023, CR 13143),
we added several new Level II HCPCS codes to the list of covered
ancillary services. Table 54 (New Level II HCPCS Codes for Ancillary
Services Effective April 1, 2023) of the CY 2024 OPPS/ASC proposed rule
(88 FR 49745) displayed the new Level II HCPCS codes that were
implemented April 1, 2023. These new codes that were effective April 1,
2023, were assigned to comment indicator ``NP'' in Addendum BB to the
proposed rule to indicate that the codes were assigned to an interim
APC assignment and that comments would be accepted on their interim APC
assignments. In addition, we note that the entire ASC addenda, which
consist of the addenda listed below, are available via the internet on
the CMS website, specifically, at https://www.cms.gov/medicare/payment/prospective-payment-systems/hospital-outpatient/regulations-notices:
ASC Addendum AA: ASC Covered Surgical Procedures
(Including Surgical Procedures for Which Payment is Packaged)
ASC Addendum BB: Covered Ancillary Services Integral to
Covered Surgical Procedures (Including Ancillary Services for Which
Payment is Packaged)
ASC Addendum DD1: ASC Payment Indicators (PI)