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6 takeaways for cancer programs from the 2020 HOPPS Proposed Rule

August 19, 2019

    CMS has been busy this summer. The agency released its 2020 HOPPS Proposed Rule a couple weeks ago—less than a month after releasing a proposal for the first-ever mandatory radiation oncology bundle. But rest assured, we poured through the 819-page rule so you don't have to. Here are six implications for cancer programs—from big changes to physician supervision, to site neutrality, to the ongoing 340B saga—plus bonus updates on inpatient CAR T-cell therapy coverage.   

    1. Loosening physician supervision requirements for outpatient therapeutic services

    Physician supervision has been a hot topic for years—especially in oncology, where it can often be challenging to ensure direct supervision for chemotherapy and radiation at all sites. It's been a while since CMS has revisited the topic of supervision in depth, but this year CMS has proposed changing the minimum required level of supervision from direct supervision to general supervision for all hospital outpatient therapeutic services provided by hospitals. CMS proposed this change to reduce the burden that the direct supervision requirement places on providers and increase their flexibility to provide medical care.

    For more on what these supervision levels mean and the current requirements, check out our blog, "What you need to know about Medicare's physician supervision requirements."

    Get the Insight

    While the proposal currently applies to all hospital outpatient therapeutic services, CMS is seeking public comments on whether specific types of services, such as chemotherapy administration and radiation therapy, should be excepted from this proposal. You can submit comments on the Federal Register website until September 27, 2019.

    2. Full steam ahead with phase 2 of site neutrality rate cuts for G0463

    CMS plans to complete the second phase of the payment reduction for off-campus HOPD clinic visits that started last year. In an effort to equalize payments across off-campus HOPDs and physician offices, CMS will cut an additional 30% from the reimbursement for G0463 in 2020 to bring payment for all off-campus HOPDs down from $116 to about $46, which is 40% of what it pays on-campus HOPDs.

    3. CMS struggling to develop contingency plan if its 340B appeal is denied

    Despite the December 2018 district court ruling that HHS exceeded its authority by adjusting the Medicare payment rates for drugs acquired under the 340B Program to ASP-22.5%, CMS is fighting back. The agency plans to appeal the ruling and wants to continue paying ASP-22.5% for all 340B-acquired drugs.

    However, CMS is crowdsourcing a contingency plan in case its appeal is denied. It has requested public comment on how much to pay for 340B-acquired drugs and how to remedy underpayments in calendar years (CYs) 2018 and 2019. As a starting point, CMS suggested paying ASP+3% for CY 2020. It also suggested two potential ways to make up for the reduced reimbursement 340B-eligible providers received in 2018 and 2019: retrospective (e.g., made on a claim-by-claim basis) or prospective (e.g., upward adjustment to 340B claims in the future to account for underpayments in the past), but welcomed any other budget-neutral suggestions from the public.

    4. Hospitals may be required to post standard charges for services online

    In an effort to increase price transparency, CMS is proposing that all hospitals—whether or not they are enrolled in Medicare (except federally-owned or operated hospitals)—be required to publish a "machine-readable file" with their gross charges (what's reflected in a hospital's chargemaster) and payer-specific negotiated charges for all items and services they provide in inpatient and outpatient settings. And they must display payer-specific negotiated charges for at least 300 common "shoppable" services (defined as a service that can be scheduled in advance) in a consumer-friendly format online. CMS would specify 70 of the services hospitals must include in the list, and hospitals would choose the remaining services necessary to hit 300.

    While this is the biggest news for many hospitals, we expect the impact on cancer programs to be less significant at the start because expensive cancer treatments, such as chemo and radiation therapy, are not included on the list of 70 required services. More than half of the list relates to E&M, lab, pathology, and radiology services. The only medical and surgery services included that relate to cancer are various types of biopsies and surgical prostate removal. Still, this signals CMS' commitment to increasing price transparency, and cancer patients are no exception when it comes to wanting to know what they will owe for their treatment. Make sure you're helping patients manage financial toxicity—and use Cancer Patient Financial Navigation to help.

    5. Favorable reimbursement outlook for radiation therapy (for providers who will not be enrolled in Radiation Oncology Model), drug administration holds steady

    Reimbursement for radiation therapy APCs is slated to increase across the board, with proposed payment increases ranging from 5% for Levels 3 and 7 to 11% for Level 5.

    We wonder if this bump in radiation payments is CMS' attempt to proactively offset the reimbursement cuts providers will face if they're enrolled in the Radiation Oncology Model. Make sure you're up to speed on what CMS is planning by reading our initial takeaways and answer to top questions from your peers.

    Read the Takeaways Get the Answers

    Proposed reimbursement for drug administration APCs remain largely the same as last year with the exception of Level 4, which CMS is proposing to increase by almost 10%.

    6. Sunsetting radiation therapy OQR measure, chemo measure still set to affect 2020 payment

    CMS proposes removing the External Beam Radiotherapy for Bone Metastases quality measure (OP-33) from the Hospital Outpatient Quality Reporting (OQR) Program because the costs associated with the measure outweigh the benefit of its continued inclusion in the program. If finalized, this change will begin with October 2020 encounters for CY 2022 payment determination.

    Your playbook for maximizing oncology margins

    No plans to add any measures to the Hospital OQR Program this year, but reporting on OP-35 is still set to impact payment rates in fiscal year (FY) 2020. OP-35 looks at cancer patient ED visits and inpatient admissions for 10 potentially preventable conditions within 30 days of receiving chemo. Because the Hospital OQR Program is a pay-for-reporting program (not pay-for-performance), there is no financial penalty tied to individual hospital performance on this measure. The only way to get a penalty (fixed 2% reduction in payment) is if your hospital does not:

    1. Collect and submit the required data for this measure or any of the other 20 measures included in the program; or
    2. Meet other administrative, validation, and publication requirements associated with the OQR Program.

    The good news is that OP-35 is a claims-based measure, so you don't need to collect or submit any additional data to CMS to check the box on this measure. That said, CMS will publish individual hospital performance on OP-35 on the Hospital Compare website alongside data for the other Hospital OQR Program measures, so patients, referring providers, and payers will be able to see your cancer patient ED visit and inpatient admission rates when choosing a cancer care provider.

    How to keep your cancer patients out of the ED

    Bonus update: CAR T-cell reimbursement increase and national coverage determination finalized

    As if there wasn't enough excitement this summer, CMS also finalized proposed updates to CAR T-cell therapy reimbursement in the 2020 IPPS/LTCH Final Rule released earlier this month. For emerging technologies and therapies like CAR T, CMS will increase the extra amount it pays on top of the diagnosis related group (DRG) payment from 50% to 65% of the technology's cost starting in FY 2020. For CAR T, that's an increase from $186,500 to $242,450.

    Just days after this, CMS finalized its National Coverage Determination for Medicare coverage of CAR T-cell therapy specifically. Although CMS abandoned its proposal to require providers to enroll CAR T patients in a registry or clinical trial for at least two years to assess the treatment's long-term effects as part of its policy, it did stipulate that it will only cover the procedure when it’s:

    • Administered at health care facilities enrolled in the FDA risk evaluation and mitigation strategies (REMS); and
    • Used for a medically accepted indication (either an FDA-approved indication or other uses when the product has been FDA-approved and the use is supported in one or more CMS-approved compendia).

    However, this decision doesn't change how much CMS will reimburse hospitals for the procedure, leaving them on the hook for $130,550 of the $373,000 average cost of the therapy (not including the cost of hospitalization, labor, or supplies).

    Read our take: Why we don’t expect a spike in CAR T treatment providers


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