CMS shuffles the deck in 2016 hospital OPPS rules

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On November 13, 2015, the U.S. Centers for Medicare and Medicaid Services (CMS) posted the 2016 final rules for the hospital outpatient prospective payment system (OPPS) and ambulatory surgical centers (ASCs). The new rules contain -- as always -- policy changes, quality provisions, and payment rates. CMS continues to update the payments and make changes necessary to maintain consistency between the OPPS and ASC payment system regarding the packaged or separately payable status of services.

In addition to the regular updates, there are several changes to the OPPS that take effect on January 1 that may be of interest to radiology providers. These are summarized below.

APCs for imaging

As a part of its 2016 comprehensive review of the structure of the ambulatory payment classifications (APCs) and procedure code assignments, CMS examined codes that contain imaging services. As always, its goal was to restructure the APCs to more appropriately reflect the costs and clinical characteristics of the procedures within each grouping in the context of the OPPS.

CMS explained that APCs for imaging services are currently divided based on type of imaging service and organ or physiologic system. They also are divided at the highest level between diagnostic radiology (for example, x-ray, CT, MRI, and ultrasound) and nuclear medicine imaging.

However, for 2016, CMS restructured and consolidated the APCs that include radiology and nuclear medicine services to "more appropriately reflect a PPS based on payment for clinically consistent APC groupings and not code-specific payment rates, while maintaining clinical and resource homogeneity," CMS stated. The new groupings also would more accurately accommodate and align new services into clinical APCs with similar resource costs, the agency explained.

One key change was to move PET tests into a separate APC because they involve higher resource costs and are of a clinically distinct imaging modality from non-PET or SPECT imaging services. Specifically, CMS added a fourth level to the APC group that covers nuclear medicine and related services. APC 5594 -- level 4 nuclear medicine and related services -- contains all of the PET scan procedures, but it is not necessarily limited only to these services. Nuclear medicine tests apart from PET may be assigned to this APC as appropriate, according to the final rule. The payment rate for this new APC is $1,285.17.

In general, CMS finalized its proposal to reconfigure the imaging-related procedures into 26 APCs, which can be found in table 32 of the final rule.

Multiple imaging composite APCs

CMS made no changes to the multiple imaging composite APCs (listed below) that it has used in the scenario described below since 2009. Each of the following APCs has a status indicator (SI) of S, which indicates that payment is not reduced when appearing on the same claim with other significant procedures:

  • 8004: Ultrasound composite
  • 8005: CT and CT angiography (CTA) without contrast composite
  • 8006: CT and CTA with contrast composite
  • 8007: MRI and MRA without contrast composite
  • 8008: MRI and MRA with contrast composite

For procedures grouped into the multiple imaging APCs, CMS provides one payment when a hospital bills more than one procedure described by Healthcare Common Procedure Coding System (HCPCS) codes within an imaging family on a single date of service. If the hospital performs a procedure without contrast during the same session as at least one other procedure with contrast using the same imaging modality, then the hospital would receive payment for the "with contrast" composite APC. When these conditions do not apply, CMS uses the standard (sole service) imaging APCs described in the previous section.

Lung cancer screening with low-dose CT

CMS issued a national coverage determination (NCD) in early February 2015 announcing that it would allow annual lung cancer screening with low-dose CT (LDCT) under Medicare. If appropriate, the beneficiary would receive a written order for LDCT at his or her first counseling and shared decision-making visit.

In the final OPPS rule and in subsequently issued transmittal 3374, the agency announced that the following HCPCS level II codes should be reported:

  • G0296: Counseling visit to discuss need for lung cancer screening LDCT (service is for eligibility determination and shared decision-making)
  • G0297: LDCT for lung cancer screening

Addendum A of the 2016 final OPPS rule shows that code G0296 has been assigned to APC 5822 -- level 2 health and behavior services -- with a payment rate of $125.04. G0297 is assigned to APC 5570 -- CT without contrast -- with a payment rate of $112.49.

CMS emphasizes that Medicare will deny G0296 and G0297 for claims that do not contain one of the following diagnosis codes:

  • For services provided until September 30, 2015, assign ICD-9 code V15.82.
  • For service provided October 1, 2015, and after, assign ICD-10 code Z87.891 -- personal history of tobacco use/personal history of nicotine dependence.

According to the claim instructions, these new codes are effective from the February 5, 2015, NCD effective date and may be billed under OPPS starting January 4, 2016.

Packaged drugs

In 2016, CMS will continue its policy to package the following:

  • Anesthesia drugs
  • Contrast agents
  • Stress agents
  • Diagnostic radiopharmaceuticals
  • Drugs, biologicals, and radiopharmaceuticals that function as supplies when used in a diagnostic test or procedure
  • Drugs and biologicals that function as supplies when integral to, dependent on, supportive of, or adjunctive to a surgical procedure

On this last point, CMS defines "supplies" as anything that is not equipment. It includes not only minor, inexpensive, or commodity-type items but also a wide range of products used in the hospital outpatient setting, including certain implantable medical devices, drugs, biologicals, or radiopharmaceuticals.

The packaging policy applies both to "necessary ingredients," meaning that the test or procedure cannot be performed without the product, and to products that are optional and only occasionally used with a procedure.

Pass-through status

In future years, there is a slight possibility of a change in pass-through payment based on several public comments recommending that CMS continue this status for new drugs, specifically diagnostic radiopharmaceuticals and contrast agents, for a full three years (instead of the current two). They asserted that doing so would help provide a more current and accurate dataset on which to base payment amounts of the procedure when the diagnostic radiopharmaceutical or contrast agent is subsequently packaged.

Although CMS did not accept this recommendation for 2016, it said it would take it "under consideration" as it reviews its OPPS pass-through payment policy for 2017.

There also are new technology services that are not eligible for transitional pass-through payments, and there isn't enough clinical information and cost data to appropriately assign them to a clinical APC group. For these, CMS has established special new technology APCs based on costs. Like pass-through payments, an assignment to a new technology APC is temporary. A service remains in this category until the agency acquires sufficient data, and in table 20 of the final rule CMS lists four additional categories.

The final payment rates for HCPCS codes are included in Addendum B of the final rule, and Addendum A lists the payments for all ambulatory payment classifications. The final rule is available here.

Catherine Huyghe is a senior healthcare consultant for Panacea Healthcare Solutions. Cathy has more than 30 years of experience in the interventional radiology and cardiology auditing, revenue cycle, and management industry. She performs coding audits, chargemaster assessments, and reviews for regulatory agency compliance; evaluates administrative policies and procedures; and assists in the development of compliance programs. In addition, she conducts interventional radiology and cardiology educational training seminars. Cathy can be reached at [email protected], or visit Panacea Healthcare Solutions at

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