Our team analyzed the more than 2,200 pages so you don't have to. Keep reading for the five biggest takeaways for imaging leaders and radiology programs:
5 key takeaways
1. Hospital and clinician payments remain flat, but independent diagnostic testing facility payments decrease, again
Hospital outpatient payments: CMS proposed a 1.25% increase in payment for hospital outpatient services, an even smaller increase than last year's 1.35%.
Clinician payments: CMS proposed a $36.05 conversion factor for 2019, only 6 cents greater than the 2018 conversion factor. CMS estimates that in aggregate reimbursement for radiology specialties will not change from 2018. The notable exception is for independent diagnostic testing facilities (IDTFs), which may experience a 4% reimbursement reduction due to a drop in practice expense RVUs. If finalized, this will be the second year in a row IDTFs see significant cuts.
Our guidance: While payment rates aren't increasing for imaging providers, many internal costs are—meaning that programs face mounting financial pressures. Imaging programs must focus on controlling costs and securing revenue to prepare for margin pressure that will likely increase in future years.
2. An expansion of site-neutral payment policy brings off-campus HOPD payment closer in line with freestanding sites
CMS first implemented site-neutral payments in 2017 to level the payment discrepancy between hospital outpatient departments (HOPDs) and provider-based sites. Currently, newer HOPDs that do not meet site-neutral payment exemption criteria, are paid at 40% of the hospital outpatient (HOPPS) rate. While CMS has proposed to maintain the current site-neutral payment rate, the agency put forth two key changes that would significantly expand the number of services that are paid at this reduced rate.
New services no longer exempt. Currently, site-neutral payment exemptions are granted at the facility-level. Off-campus sites built or acquired before November 2, 2015 are exempt from site-neutral payments and may continue to bill at the full HOPPS rate. This exemption covers the entire site, meaning even newly added services and will receive HOPPS reimbursement.
CMS proposed to shift exemptions from facility-wide to procedure-specific. If finalized, facilities that were previously exempt would receive the site-neutral rate for "new" service offerings. Services offered between November 1, 2014 and November 1, 2015 will remain exempted—in other words, receive the full HOPPS rate. But any newly offered services (after the November 1, 2015 date) will be impacted by site-neutral payments and therefore paid at 40% of HOPPS. For more information on how the agency has proposed to organize services into clinical families and implement this change, review our recent blog on site-neutral payment policies.
Routine clinic visits now site-neutral. CMS proposed to make the code GO463, hospital outpatient clinic visit for assessment and management of a patient, site-neutral at all sites. In other words, clinic visits will be billed at the site-neutral rate at all off campus HOPDs, even those sites previously exempted.
Based on Advisory Board analysis, 78% of diagnostic radiology claims for this code are provided at currently-exempt off-campus sites. That means if finalized, imaging programs will see a significant payment reduction for these clinic visits.
Our guidance: Regardless of what exactly is finalized, these proposals demonstrate that CMS views off-campus HOPDs as a significant source of future Medicare savings. Imaging leaders should prepare for continued payment level at these sites.
3. CDS program still set to begin in 2020 with new clarification around CDS documentation, consultation
Starting January 1, 2020 ordering providers will be required to consult CDS for all outpatient advanced imaging exams, and furnishing providers required to document that consultation for reimbursement. This first year, though mandatory, will be an "educational and testing" period, meaning claims will be paid regardless of proper documentation. Beginning January 1, 2021, Medicare will deny claims that do not include necessary information.
In the proposed rule, CMS announced their plan to establish G-codes and modifiers for reporting CDS consultation on Medicare claims.
Additionally, CMS answered one of the most frequently asked questions: Who can consult CDS? CMS proposed allowing clinical staff "working under the direction of the ordering professional" to consult CDS. We interpret this to mean that ordering providers may have their staff (but not radiology staff) consult CDS on their behalf.
Other proposals include expanding the policy to independent diagnostic testing facilities and creating new hardship exemptions. For a detailed summary of the AUC program proposals, review our policy blog dedicated to CDS updates.
Our guidance: Regardless of whether or not these proposals are finalized, imaging leaders must begin CDS implementation today. For support, check out our tools and resources designed to help imaging leaders throughout the implementation process.
4. Inclusion of square feet methodology for MRI, CT cost centers delayed another year to avoid reimbursement reductions
Currently, CMS uses "dollar assignment" and "dollar value" cost allocation methods to estimate payment for MRI and CT Ambulatory Payment Classifications (APCs). Over the past five years, CMS has excluded a third method, the "square feet" methodology. Although many imaging programs currently report cost allocations using "square feet," if CMS included this method when calculating APC payment, reimbursement would go down.
CMS proposed to delay including the "square feet" cost allocation method until 2020 to give providers more time to switch to one of the preferred methods ("dollar assignment" or "dollar value"). The agency emphasized this is the last year it will make this exclusion.
Our guidance: Before 2020, imaging leaders should adopt either the "dollar assignment" or "dollar value" cost allocation methods to avoid significant CT and MRI payment reductions. The chart below shows the impact excluding "square foot" methodology has on CT and MRI rate calculations:
5. E&M coding, documentation, and payments streamlined
Under the current system, CMS uses five levels to determine physician reimbursement for E&M visits. CMS proposed to replace levels two through five with a single level. In the current system, higher levels correspond with more complex visits and higher reimbursement, while the proposal sets a single payment rate for all visits regardless of complexity. This updated rate is higher than the previous level 2 payment level but lower than the level 5 rate, so the impact of this change will depend on a provider's case mix.
Many providers have voiced concerns that the proposals will financially harm those that care for more acute, complex patients, which include interventional radiologists.
Other notable proposals impacting imaging:
- Relaxed supervision requirements for radiologist assistants (RAs): CMS proposed to change the supervision requirements for diagnostic tests furnished by an RA from "personal" to "direct." This means that instead of requiring physicians to be in the room during the tests, the physician now just must be immediately available. This proposal more closely aligns with many state supervision requirements.
- Continued shift toward outpatient payment bundling with three new Comprehensive-APCs (C-APCs): Currently there are 62 C-APCs, which packages payment for a procedure and related items and services. CMS proposed three new C-APCS, including Level 3 ENT Procedures, Level 3 Vascular Procedures, and Level 4 Vascular Procedures, the latter two of which contain interventional radiology procedures.
- Removed three imaging related measures from the Hospital OQR Program: The OQR Program is a quality payment program that helps CMS create hospital ratings on Hospital Compare. Failure to meet program requirements will result in a 2% payment decrease for hospital outpatient departments. The imaging measures removed were use of contrast material for CT (OP-11), simultaneous brain and sinus CT (OP-14), and Mammography follow up rates (OP-9).
- Requests for information demonstrate continued interest in price transparency and technological interoperability: We expect CMS to include more policies related to these two areas in future years.
Medicare will accept comments on both proposed rules through September and release the final rules in November 2018. We encourage you to submit your thoughts and concerns to CMS. For more general information on the rules, read our colleague's blogs on the HOPD and clinician payment proposed changes.