CMS issues final rule updating payment rates

November 3, 2016

The Centers for Medicare & Medicaid Services (CMS) on November 1 issued a final rule updating the Medicare payment rates for hospital outpatient services and finalizing its policy related to services furnished in off-campus, provider-based hospital outpatient departments. Newly established departments (those established on or after November 2, 2015) will no longer be paid a separate hospital-based fee, but will be paid under the physician fee schedule for services beginning January 1.

This will be a significant cut in payment, with Medicare rates on average 50 percent lower than previous amounts. WSHA has been very concerned about the impact of this reduction on many of our hospitals and has been working to inform our Congressional delegation about its impact on care.

WSHA, the AHA, and other hospital associations have asked CMS for flexibility in defining a newly established hospitals. In a significant positive change in the new rule, CMS will not apply the new payment reductions to hospital based departments that expand services. Unfortunately, CMS adopted a policy that a relocation of an existing hospital outpatient department or a change in ownership results in its losing its status as an established facility. (Claudia Sanders)


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