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cms proposed rule

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The Centers for Medicare and Medicaid Services (CMS) published the proposed hospital outpatient prospective payment system (OPPS) payment rule for calendar year (CY) 2017 in the July 14, 2016 Federal Register. A key proposal in the rule is to implement Section 603 of the Bipartisan Budget Act of 2015 (also known as the Site Neutral Payments Provision), which provides that certain hospital off-campus outpatient departments would no longer be paid under OPPS. Currently, Medicare pays for the same services at a higher rate if those services are provided in a hospital outpatient department, rather than a physician’s office. This payment differential has encouraged hospitals to acquire physician offices in order to receive the higher rates. This acquisition trend and difference in payment has been highlighted as a long-standing issue of concern by congress, the Medicare Payment Advisory Commission, and the Department of Health and Human Services Office of Inspector General.

In addition, based on concerns raised by health care providers on the patient experience survey questions about pain management, CMS is proposing to remove the pain management dimension of the Hospital Consumer Assessment of Healthcare Providers and Systems survey, for purposes of the Hospital Value Based Purchasing Program. The goal is to eliminate any potential financial pressure clinicians may feel to overprescribe pain medications.

CMS has also included a provision to increase flexibility for hospitals that participate in the Medicare electronic health records (EHR) incentive program. Earlier this year, CMS conducted a review of the Medicare EHR Incentive Program for clinicians as part of the implementation of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), with the aim of reconsidering the program so we move closer to achieving the full potential that health information technology offers. Based on that review, CMS streamlined EHR reporting requirements under the proposed rule to implement certain provisions of MACRA, to increase flexibility and support improved patient outcomes. CMS is proposing to take a similar step for hospitals participating in the Medicare EHR Incentive Program. These changes include a proposal for clinicians, hospitals, and critical access hospitals to use a 90-day EHR reporting period in 2016 (down from a full calendar year for returning participants). This increases flexibility and lowers the reporting burden for hospital providers.

Finally, CMS proposes to add new quality measures to the Hospital Outpatient Quality Reporting Program that are focused on improving patient outcomes and experience of care. Other changes in the proposed rule would enhance the outcome requirements for organ transplant programs, so that the programs may help more beneficiaries accept more grafts, while maintaining compliance with Medicare standards for patient and graft survival.

CMS estimates that the updates in the proposed rule would increase OPPS payments by 1.6 percent. Comments on the proposed rule will be accepted through Tuesday, September 6, 2016.

Today, the Centers for Medicare and Medicaid Services (CMS) released the proposed rule, Revisions to Requirements for Discharge Planning for Hospitals, Critical Access Hospitals, and Home Health Agencies. This revises the discharge planning requirements for hospitals (including inpatient rehabilitation facilities and long term care hospitals), critical access hospitals, and home health agencies; these requirements must be met in order to participate in the Medicare and Medicaid programs. The proposed rule also implements the discharge planning requirements of the Improving Medicare Post-Acute Care Transformation (IMPACT) Act of 2014, which strives to improve consumer transparency and beneficiary experience during the discharge planning process, by developing a discharge plan based on the goals, preferences, and needs of each patient.


Under the proposed rule, hospitals would be required to develop a discharge plan within 24 hours of admission or registration and complete a discharge plan before the patient is discharged home or transferred to another facility. These requirements will apply to all inpatients, and certain types of outpatients, including patients receiving observation services, patients undergoing surgery (or other same-day procedures where anesthesia or moderate sedation is used), and emergency department patients who have been identified as needing a discharge plan. In addition, hospitals will be required to:

  • Provide discharge instructions to patients who are discharged home;
  • Have a medication reconciliation process with the goal of improving patient safety by enhancing medication management;
  • For patients who are transferred to another facility, send specific medical information to the receiving facility; and
  • Establish a post-discharge follow-up process.

The proposed rule is scheduled to be published in the November 3, 2015 Federal Register with a 60-day comment period.