2/1/2013

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February 2013

Jean C. Russell, MS, RHIT jrussell@epochhealth.com

Richard Cooley, BA, CCS rcooley@epochhealth.com

518-430-1144

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Agenda

• APC Reimbursement Impact

• Outpatient Status/Observation Comment Request

• Physician Supervision

• Today’s CDM Update

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APC Reimbursement

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Payment Impact� Hospitals that met the quality indicator reporting

requirements will get the full 1.8% (1.9% in 2012) increase

� 2.0% reduction in payment update factor if hospital did not meet the quality indicator reporting requirements

� Conversion factor 1.8% increase:

� $71.313 ($70.016 in 2012) for hospitals that meet quality reporting standards

� Medicare spending to 4,000+ facilities under OPPS increased approximately $4.6 billion in the past year

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Cancer Centers�The 11 cancer centers continue to receive

a payment adjustment to ensure they do not receive a lower payment under OPPS than what they received prior to 2000

�The per hospital percentage increases range from 10% to a high of 45% (Table 9, page 68295)

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Outlier Calculations� Calculation methodology unchanged

� 1st Threshold:

� Line-item cost exceeds 1.75 times APC payment

� 2nd Threshold:

� Line-item cost exceeds APC payment plus $2,025

� The threshold is higher compared to $1,900 last year

� When both thresholds met

� Outlier payment = 50% * Cost – 1.75 * APC payment

� 50% of the cost that exceeds 1.75 times APC payment

[cost = charges * RCC]

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Hold Harmless TOPs�Rural Hospitals and Sole Community

Hospitals (SCH) will no longer be eligible for hold-harmless transitional outpatient payments (TOPs)

�CMS is applying a 7.1% payment adjustment to rural SCHs, including EACH (essential access community hospitals) for most services

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Geometric Mean�For 2013, CMS is using geometric mean

costs instead of median costs to calculate APC weights

�By using geometric means, CMS can more readily compare costs between IPPS and OPPS

�As a result of this change, there may be additional APC payment rate fluctuations

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Deductible Changes� Inpatient deductible has increased from

$1,132 (2011) to $1,156 (2012) to $1,184 (2013)

�Part B deductible has changed from $166 (2011) to $140 (2012) to $147 (2013)

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Packaging�No major changes to any Status

Indicators

�Unconditionally packaged services

�Status Indicator N

�Always considered integral to the primary service

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Packaging� Conditionally packaged services - Composites

� Review of the Composite Status Indicators:

� “Q1” - “STVX-packaged codes”

� “Q2” - “T-packaged codes”

� “Q3” – Procedure codes that may be paid through a composite APC based on composite-specific criteria or separately through single code APCs when composite criteria is not met

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Original Composite APCs1. Mental Health Services – Partial

Hospitalization

2. Low dose prostate brachytherapy

3. Cardiac EP (electrophysiologic) evaluation and ablation services

4. Extended ED observation and monitoring

5. Extended Clinic observation and monitoring

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Multiple Imaging Services� Added in 2009 - five imaging composite APCs

� Single APC payment for two or more imaging procedures provided using same imaging modality

� The imaging composite APCs are: 1. Ultrasound

2. CT and CTA w/o contrast

3. CT and CTA with contrast

4. MRI and MRA w/o contrast

5. MRI and MRA w/contrast

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Cardiac Resynchonization Therapy Defibrillator (CRT-D)

�New composite created in 2012 (APC 108)

�Composite payment when 33249 (insert an ICD) is reported with 33225 (insert pacing electrode for left ventricular pacing)

� Note that CPT definition of 33225 has been changed in 2013

�33225 reported without primary procedure will be returned to the provider (“RTP’d”)

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Composite Rate Change

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Outpatient Status –Request for Comments

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OPPS Proposed Rule 2013� CMS requested comments on defining whether a

patient is an inpatient or outpatient

� May redefine “inpatient” using parameters in addition to medical necessity and a physician order (as used now)

� Such as length of stay or other variable

� Currently “anticipated LOS is a factor in determining admission status, but it is not the only factor”

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OPPS Proposed Rule 2013� CMS instructions states that, “typically, the decision

to admit should be made within 24 to 48 hours, and that expectation of an overnight stay may be a factor in the admission decision.”

� However, they are interested in hearing whether it would be appropriate / useful to establish a point in time after which the encounter becomes an inpatient if the patient is still receiving medically necessary care to treat his condition.

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OPPS Proposed Rule 2013� CMS would still audit to ensure the program only

pays for reasonable and necessary care (i.e., they will still audit)

� Another option is more specific clinical criteria for admission, such as adopting specific clinical measures or requiring prior-authorization

� Comments were requested during the comment period, the comments were displayed in the final rule

Source: Federal Register /Vol. 77, No. 146 /Monday, July 30, 2012 / Proposed Rules,Page 45157, http://www.gpo.gov/fdsys/pkg/FR-2012-07-30/pdf/2012-16813.pdf

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Part A to Part B Demonstration Project

� “AB Rebilling Demonstration”

� This 3 year project started in 2012

� Accepted 380 hospitals from across the country

� Designed to assist in helping CMS to evaluate the possibility of making some changes, such as allowing Part A denied claims to be billed as Part B

� Participating hospitals waived their right to appeal the cases

� CMS will conduct an evaluation of this project during and after it is completed

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Clarification� Clarification of billing when condition code 44 criteria

have not been met

� For example, the inpatient stay has been deemed not medically necessary after the beneficiary has been discharged

� This could be due to a number of things – a RAC denial, a MAC denial, CERT denial, a prepayment review, or the provider review itself

Source: Page 68426, Federal Register / Vol. 77, No. 221 / Thursday, November 15, 2012 / Rules and Regulations and NGS website release 5/7/2012

http://www.ngsmedicare.com/wps/portal/ngsmedicare/!ut/p/c4/VU27DsIwDPwWhsxJoRMbdIClHSgSj800pli0cZW65fdJUjEgSz77znfWdx3KwUwtCLGDTl_17dP02wHkpbINKFMd6hItNeCxYCfo5I9T5oQjT77BUZkzczeqbG3A2QglC

HqCwJmiA0_PYIl_orb0enr0JEKujVs4oj4FXF6Y9PDS0s9SsMWIeZ42Tyk9zkeYk1KxRNjj4i5R9PDerb6jtAtv/

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The Beneficiary� Beneficiaries are entitled to receive information

about coinsurance and deductibles

� Inform beneficiaries in writing that the inpatient stay is not going to be billed to Medicare as a covered claim and why

� Beneficiary may be responsible for coinsurance (for the 12X bill and for the 13X bill) instead of an inpatient deductible

� If the inpatient deductible has already been paid, it is the responsibility of the provider to make a refund as appropriate

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Clarification� According to CMS this has always been the case

(i.e., “clarification”)

� Chapter 3 of the Medicare Claims Processing Manual states that hospitals have to bundle most outpatient services performed within 72 hours of an inpatient stay “when Part A payment can be made on the inpatient stay”

� Thus concluding that “it does not apply when no Part A payment can be made on the inpatient claim”

� Reiterated in the APC 2013 final rule (page 68426-68427)

Source: http://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/MM7672.pdf

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In “real words”� So, if a hospital finds that a inpatient has been

discharged that does not meet medical necessity for inpatient admission, the hospital now has some options for recovering more reimbursement

� Prior to this clarification the only clear consideration was billing the ancillary services as Inpatient Part B (bill type 12x), resulting in little reimbursement

� Now the services provided prior to the order to admit may be submitted an outpatient claim (bill type 13x)

� This may include a surgery, ED visit or a clinic visit

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Physician Supervision

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Types of Outpatient Services�Diagnostic

�Therapeutic

�When a service is not diagnostic it is assumed to be therapeutic

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Physician Supervision� Three levels of supervision in the hospital

outpatient setting have been defined as:

� General – Overall direction of physician, but presence is not required during the performance

� Direct – Physician is present on-site and “immediately” available if needed

� Personal – Physician is present in the room

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Physician Supervision –of Diagnostic Services

� Each procedure code has a level of supervision defined in the Medicare Physician Fee Schedule Relative Value File, for example:

� 01 = Procedure must be performed under the general supervision of a physician

� 02 = Procedure must be performed under the direct

supervision of a physician

� 03 = Procedure must be performed under the personal supervision of physician

[https://www.cms.gov/PhysicianFeeSched/PFSRVF/list.asp#TopOfPage]

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Physical Supervision of PT/OT/ST

� Clarified supervision requirements for the therapies:

� Services reimbursed under the MPFS (i.e., therapy performed by a therapist under a plan of care, which most therapy is) are not subject to the supervision requirements published in § 410.27

� Services reimbursed under OPPS (i.e., “sometimes therapy”) are subject to the supervision requirements published in § 410.27

� Not furnished as therapy under a therapy plan of care

� Not billed with therapy modifiers (GN, GO, GP)

� Performed by non-therapists

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CAH Exception�Non-enforcement of the direct supervision

requirement for CAHs and small rural hospitals (100 beds or less) for one more year

�But “we expect that CY 2013 will be the final year for the instruction [exception]” (page 68426 Federal Register / Vol. 77, No. 221 / Thursday, November 15, 2012 / Rules and Regulations)

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Other Changes

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Inpatient-Only Procedures

�APC Status C

�CMS requires admission for reimbursement of these procedures

�Paid as outpatient only if performed on an emergency case where the patient expired prior to being admitted (Modifier - CA)

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Criteria for ChangeCriteria for removing from IP-only list

� Procedure related to codes that have already been removed from the inpatient list

� Determination is made that the procedure is being performed in numerous hospitals on an outpatient basis

� Determination is made that the procedure can be appropriately and safely performed in an ASC

Addendum E in the Final Rule

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New IP Codes for 2013HCPCS Code Short Descriptor SI CI

22586 Prescrl fuse w/ instr l5/s1 C NI

23474 Revis reconst shoulder joint C NI

33361 Replace aortic valve perq C NI

33362 Replace aortic valve open C NI

33363 Replace aortic valve open C NI

33364 Replace aortic valve open C NI

33365 Replace aortic valve open C NI

33367 Replace aortic valve w/byp C NI

33368 Replace aortic valve w/byp C NI

33369 Replace aortic valve w/byp C NI

33990 Insert vad artery access C NI

33991 Insert vad art&vein access C NI

33992 Remove vad different session C NI

33993 Reposition vad diff session C NI

0309T Prescrl fuse w/ instr l4/l5 C NI

0312T Laps impltj nstim vagus C NI

0318T Replace aortic valve tthorac C NI

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Codes removed from the IP Only list

HCPCS Short Descriptor CI 2012 SI 2013 SI

22856 Cerv artific diskectomy CH C T

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Today’s CDM Program

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What is Being Covered�2013 CPT and HCPCS updates

�OPPS (hospital) APC changes

�DOH and OMH (Medicaid) changes

�CDM potential issues / suggestions

�Focus on CDM charged codes, as opposed to coded procedures

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General StrategiesInteraction / Discussion Encouraged

– As long as time permits� Cannot cover all changes, but will try to cover the

most significant changes

� Suggestions/strategies for charging and utilizing the CDM will be addressed through-out

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Assumptions� Assumes everyone has a back-ground in:

� APC and APG reimbursement and status indicators

� CPT and HCPCS codes

� Revenue codes

� Rate codes

� Modifiers

� Basic CDM maintenance

� Stop us for more information if needed

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CDM Sessions�Follow-up webinars may be scheduled to

cover specific topics, such as:

�Split billing to Medicare and Medicaid

�Outpatient billing edits and reporting of modifiers

�Other topics

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Agenda for the Day

� Session 1 Introduction and Summary of significant changes from the OPPS and the MPFS Final Rule

� Session 2 Psychiatry – Including OMH

� Session 3 Laboratory – Including molecular pathology

� Session 4 The Therapies (PT, OT, SLP)

� Session 5 Neurology

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Agenda for the Day

� Session 6 Cardiology

� Session 7 Radiology, Nuclear Medicine and Radiation Oncology

� Session 8 Drugs/Biologicals and Vaccines and Devices/Prosthetics/Orthotics

� Session 9 Evaluation and Management/ Professional/Clinic Services

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Excel File of 2012-13 Changes

� “CDM Update 2013 - Compare2013to2012 - For Distribution”

� Emailed to attendees prior to today’s session

� Email us if you didn’t get it and want a copy

� Background reference information

� Includes:

� Listing of new, changed, deleted codes

� Compares APC rates for 2012 to 2013

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Epoch Outpatient Resource� Complied by Epoch for our clients

� Complimentary, Updated once per quarter

� Send us an email to be included on the distribution

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Epoch Outpatient Resource� CMS Addendum B combined with the MPFS,

Indicators, Clinical Lab and other fees – includes 26/TC modifiers, PC/TC indicator, Work RVU

� Addendum A and M

� APC Status Indicator Description

� APG RW Table

� Revenue Codes and Description

� Listing of Current CMS OCE Edits

� Simple APC Rate Calculator

� Listing of CMS APC Inpatient Only Procedures

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Questions and Discussion

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Contact UsRichard Cooley

Phone: 518-430-1144

Email: RCooley@EpochHealth.Com

Jean Russell

Phone: 518-369-4986

Email: JRussell@EpochHealth.Com

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http://www.EpochHealth.com/

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CPT®

Current Procedural Terminology (CPT®)

Copyright 2012 American Medical AssociationAll Rights ReservedRegistered trademark of the AMA

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DisclaimerInformation and opinions included in this presentation are provided based on our interpretation of current available regulatory resources. No representation is made as to the completeness or accuracy of the information. Please

refer to your payer or specific regulatory guidelines as necessary.