Hospital Price Transparency Penalties to Increase Under OPPS Rule

November 03, 2021 - Starting January 1, CMS will increase penalties for noncompliance with hospital price transparency requirements under the newly released Calendar Year (CY) 2022 Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System Final Rule.

The Final Rule sets the minimum civil monetary penalty of $300 per day for smaller hospitals with a bed count of 30 or fewer, and a penalty of $10 per bed per day for hospitals with a bed count greater than 30. However, the penalty is not to exceed a maximum daily dollar amount of $5,500.

Under the new approach, hospitals could be responsible for paying a maximum of over $2 million if they fail to comply with the requirements. Research has shown that over 90 percent of hospitals have yet to comply with the requirements, which mandate hospitals to publish a wide range of pricing information to their public websites.

“CMS is committed to promoting and driving price transparency, and we take seriously concerns we have heard from consumers that hospitals are not making clear, accessible pricing information available online, as they have been required to do since January 1, 2021,” CMS Administrator Chiquita Brooks-LaSure said in announcement.  “We are also taking actions to enhance patient safety and quality care.”

The CY 2022 Hospital OPPS and ASC Payment System Final Rule will also increase hospital outpatient reimbursement under the Medicare program by 2.0 percent starting next year. The increase only applies to hospitals that meet quality reporting requirements and reflects a projected hospital market basket increase of 2.7 percent reduced by 0.7 percentage point for the productivity adjustment.

ASC reimbursement will also increase by 2.0 percent for centers that meet quality reporting requirements, according to the Final Rule.

In addition, CMS finalized a proposal to halt the elimination of the Inpatient Only (IPO) list. The Final Rule will add back the services removed in 2021 except for a handful of codes. Those codes include 22630 (Lumbar spine fusion), 23472 (Reconstruct shoulder joint), 27702 (Reconstruct ankle joint), and their corresponding anesthesia codes. 

CMS also said in the rule that it is reinstating the ASC Covered Procedures List criteria that went into effect in CY 2020. The agency will adopt a process for stakeholders to nominate procedures they think should be added to the list.

Other policies addressed in the rule include 340B drug reimbursement, which will remain at average sales price minus 22.5 percent for most program participants, and the OPPS transitional payment for drug and biological pass-through.

CMS also updated Medicare reimbursement for the Partial Hospitalization Program and set a start date for the Radiation Oncology Model for January 1, 2022.

The rule has not been published on the Federal Register. An unpublished version can be viewed in full here. More coverage on the final rule to come.

UPDATE 11/03/2021: Healthcare industry groups are reacting to the CY 2022 Hospital OPPS and ASC Payment System Final Rule.

In a statement, the American Hospital Association (AHA) applauded several policies in the Final Rule, such as the reinstating of the IPO list and safety criteria for allowing procedures to occur in ASCs. The Association hailed the finalized proposals as “a win for patients’ safety, health and quality of care.”

However, the AHA expressed disappointment with ongoing cuts to hospital reimbursement under the 340B Drug Pricing Program.

“However, we remain disappointed that CMS will continue deep payment cuts to 340B hospitals, which threatens their ability to care for their patients and communities and goes against Congress’ intent in establishing the 340B program nearly 30 years ago,” said Stacey Hughes, executive vice president of the AHA.

Hughes attributed the ongoing payment cuts to a lower court’s “government’s inaccurate interpretation of the law.” AHA has petitioned the Supreme Court to review the decision, which the Court has decided to take up later this month.

340B Health, an association of over 1,400 hospitals, also slammed the 340B payment cuts in the Final Rule. The group’s president and CEO Maureen Testoni said the cuts make “it more difficult for hospitals to meet” their “patient care mission.”

This article was originally published on 11/02/2021.