In a follow-up to our previous alert, we would like to provide our readers with additional takeaways from the 2024 Outpatient Prospective Payment System (OPPS) final rule, that was published earlier this month by the Centers for Medicare and Medicaid Services (CMS). Based on a fact sheet provided by CMS that summarizes the key provisions of the final rule, hospitals officers will want to be aware of the issues highlighted below.
For 2024, CMS is finalizing Medicare payment rates for over 240 dental codes to align with the dental payment provisions in the 2023 Physician Fee Schedule final rule by assigning them to clinical APCs. This is intended to bring greater consistency in Medicare payment for different sites of service and help ensure patient access to dental services performed in the hospital outpatient setting.
CMS is reassigning HCPCS code G0330 from the Dental Procedures APC (APC 5871) to Level 4 ENT Procedures (APC 5164) for 2024. HCPCS code G0330 is used to describe facility services for dental rehabilitation procedures performed on a patient who requires anesthesia (e.g., general, monitored anesthesia care) and use of an operating room. The final APC assignments and status indicators for the dental codes can be found in the CY 2024 OPPS Addendum B.
Rural Emergency Hospitals
As you will recall, the 2023 OPPS final rule established the Rural Emergency Hospital (REH) provider type. A hospital is eligible to convert to an REH if it is a critical access hospital or rural hospital with no more than 50 beds, participating in Medicare as of the date of enactment of the Consolidated Appropriations Act (CAA), 2021. Eligible hospitals that convert to an REH receive an enhanced rate for REH services and a fixed monthly facility payment.
While some Tribal and IHS hospitals have expressed interest in converting to an REH, they have expressed significant reservations about transitioning from their existing payment methodology under the All-Inclusive-Rate (AIR), published annually by the IHS in the Federal Register, to the REH payment methodology. In response, the 2024 OPPS final rule implements a policy where IHS and Tribal facilities that convert to REHs will be paid for hospital outpatient services under the same AIR that would otherwise apply if these services were performed by an IHS or Tribal hospital that is not an REH. The existing beneficiary coinsurance policies applicable to such services under the AIR would remain the same. Per the rule, IHS and Tribal facilities that convert to REHs would receive the REH monthly facility payment consistent with how this payment is applied to REHs that are not tribally or IHS operated.
340B Drug Program
Section 340B of the Public Health Service Act allows participating hospitals to purchase certain covered outpatient drugs from manufacturers at discounted prices. For 2024, CMS will continue to pay for 340B acquired drugs and biologicals at the statutory default rate, which is generally ASP plus six percent. The payment for 340B-acquired drugs and biologicals will not differ from the payment rate for drugs and biologicals not acquired through the 340B program.
CMS issued a final rule prior to the release of this 2024 OPPS final rule on November 2, 2023, discussing the remedy for payment for 340B acquired drugs for CYs 2018 to 2022. We will be providing information on this topic in an upcoming alert.
The American Hospital Association was quick to weigh in on its overall assessment of the 2024 OPPS final rule. In a press release earlier this month, the organization’s executive vice president, Stacey Hughes, expressed concern that the government had once again provided an inadequate update to hospital payments for Medicare services. The 3.1 percent increase for next year was seen as insufficient given the financial difficulties still facing many of America’s frontline medical facilities. She expressed hope that the U.S. Congress would step in to provide additional funding before the end of the year.
On a separate issue, the AHA’s executive vice president expressed a desire to cooperate with CMS in its effort to increase price transparency, stating:
The AHA will be carefully reviewing the changes to the Hospital Price Transparency Rule to ensure they continue to advance our shared objective with CMS of making it easier for patients to access pricing and cost information while reducing unnecessary administrative burden and costs on hospitals and health systems.
We will be providing an additional alert in the coming weeks addressing the quality incentive programs for outpatient hospital services, as well as a treatment of the separate 340B drug final rule also released this month.
With best wishes,
Senior Vice President—BPO