The proposed rules are a mixed package, but important steps to strengthen primary care

Over the past week, Medicare rights have submitted comments on two proposed rules for Medicare & Medicaid Services (CMS): Outpatient Expected Payment System (OPPS) and Physician Fee Program (PFS). These rules appear every year and are very technical documents on how physicians, hospitals and other providers get paid. However, payment policies often drive incentives and beneficiaries to access affordable care.

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In the case of OPPS, CMS establishes payment rates for hospital outpatient departments and outpatient surgical centers. Two items in the proposed rules may have lasting effects on beneficiaries.

Nursing facilities nursing needs complicate the elimination of hospitalization (IPO) inventory

The decision to treat a patient as an inpatient versus an outpatient patient can be complicated. One aspect of this decision is whether insurance requires certain procedures to be provided in an environment. Currently, the Medicare IPO list requires only one set of more than a thousand programs. The process on the list changed slightly over time, but under the proposed rules, the CMS stipulates plans to completely eliminate the IPO.

Historically, IPOs have been controversial, with some deeming it obsolete and preventing providers from using medical judgments, while others point out security issues, provider burdens and confusion when the program is removed from the list.

While Medicare rights generally support allowing trained medical professionals to use their judgment, we object to the wholesale elimination of IPO lists in comments. Instead, we urge caution and remove procedures on a case-by-case basis. We also mark people’s risk of losing necessary postoperative care, as skilled nursing facilities and insurance for certain home care depends on the first three days of inpatient inpatient stays.

Going neutral toward a larger location

The cost of care for a person usually varies greatly depending on his/her location, and sometimes this difference is not obvious to the patient. This could lead to unexpectedly high medical expenses and Medicare overspending. On-site payments will end this practice.

In the OPP, CMS recommends creating a higher competitive environment between the hospital outpatient department and the office of independent physicians by reducing payments for drug management services in certain outpatient departments that are not part of the hospital’s campus. We support important steps towards greater field neutrality.

PFS

PFS is an annual update for Medicare payments to physicians and other practitioners for the services of original Medicare. The rule usually contains important policy changes, and this year is no exception. CMS recommends strengthening primary and behavioral health care through payment adjustments and seeking information on how to better support prevention and management of chronic diseases, including self-management. We urge the government to recognize and support access to programs such as Medicaid and Supplementary Nutrition Assistance Program (SNAP), as well as entities such as the Community Living Government (ACL). These programs and institutions have come under fire and face drastic cuts that will undermine people’s ability to access care and food.

Payment changes may improve primary care and behavioral health

Similar to the site neutrality part of OPP discussed above, PFS may also lead to Medicare's overpaid service of facility setup services, thereby inspiring integration. CMS recommends trimming overhead payments in facility settings such as outpatient departments to prevent this shift toward more expensive environments.

CMS also recommends pruning certain types of code that can be highly paid due to outdated data distortions. We support these two payment changes.

A mixed bag

In our comments, we commend CMS’s efforts to clarify and implement medically necessary dental coverage over the past few years. Unfortunately, this year’s rules will not extend the medically necessary dental services to include important conditions such as diabetes, sickle cell anemia or autoimmune diseases.

The rule also eliminates important language by continuing to revolve around social determinants of equity and health, while often trying to capture the same concepts as other less-understood terms, such as “upstream drivers.”

Outlook

On Medicare rights, we will continue to support good payment policies and administrative changes that will help seniors and people with disabilities get the care and support they need. We will also talk about threats, including areas where the Trump administration damages programs or hinders progress on a larger equity stake in our health system.

Read the rules proposed by OPPS and PFS.

Read our reviews on OPPS and PFS.

Read more about website neutrality.