CMS proposes rising penalties for hospitals not assembly value transparency rule

The Biden administration desires to incorporate a per-bed financial penalty for bigger hospitals that don’t adjust to a value transparency rule after a number of analyses have proven widespread noncompliance amongst amenities.

The administration included the availability within the proposed 2022 Outpatient Potential Cost System (OPPS) proposed rule launched Monday by the Facilities for Medicare & Medicaid Companies. The regulation particulars fee charges for hospitals and ambulatory surgical procedure facilities (ASCs). It features a pay hike for hospitals and ASCs however a dramatic reversal on the variety of procedures that ambulatory surgical procedure facilities can carry out.

The proposed rule requires an replace to OPPS fee charges for hospitals that meet high quality reporting necessities by 2.3%. The company additionally plans to replace fee charges for ASCs by 2.3% as nicely.

However a significant proposal within the rule is to extend penalties for hospitals not making certain value transparency.

“With as we speak’s proposed rule, we’re merely exhibiting hospitals via stiffer penalties: concealing the prices of providers and procedures is not going to be tolerated by this administration,” CMS Administrator Chiquita Brooks-LaSure stated in a press release.

A controversial rule required hospitals to put up on-line payer-negotiated charges and meet different value transparency thresholds beginning on Jan. 1, 2021.

Nonetheless, a number of research and analyses have proven that many hospitals are usually not complying with the necessities. Specialists have stated {that a} main motive is that there’s a minimal payment for noncompliance, which is $300 for every day the hospital doesn’t meet the necessities.

The proposed rule retains the $300 per day penalty, however just for hospitals which have fewer than 30 beds. Any hospital with extra beds faces a $10 per mattress, per day penalty as much as $5,500 a day.

“Underneath this proposed strategy, for a full calendar yr of noncompliance, the minimal complete penalty quantity can be $109,500 per hospital, and the utmost complete penalty quantity can be $2,007,500 per hospital,” the company stated in a truth sheet.

CMS does need feedback on different potential avenues for scaling the financial penalties, together with factoring within the hospital’s causes for noncompliance and the severity of the scenario.

The company can be in search of feedback on greatest practices for on-line value estimator instruments that hospitals can use in lieu of posting commonplace expenses for 300 shoppable providers. CMS’ rule additionally clarified that any value estimator should take note of a person’s insurance coverage data when figuring out a value.

Scaling again ASC growth

The 2021 closing fee rule revised the factors used to guage what procedures could be carried out in an ASC. This transfer ensured that an extra 267 surgical procedures have been added to the ASC-covered procedures checklist this yr.

However that dramatic growth could also be curbed in 2022. CMS can be proposing to take away 258 out of the 267 procedures added final yr.

The company does need extra feedback on any of the procedures that ought to keep on the checklist.

If the growth is curtailed within the closing rule, it might influence some main acquisition tendencies within the hospital trade. The foremost hospital chain Tenet Healthcare offered off most of its pressing care enterprise final yr and bought 45 ASCs.

CMS additionally goals to maintain across the Inpatient Solely Listing, which is the providers that Medicare will solely pay for in a hospital setting because of their complexity. The Trump administration removed the checklist within the 2021 OPPS rule, beginning with almost 300 musculoskeletal providers in 2021 and extra providers over the subsequent couple of years.

However CMS stated on Monday that it acquired numerous feedback from stakeholders nervous in regards to the influence on affected person security if the inpatient-only checklist goes away.

If finalized, the proposed rule would return these 298 providers to the checklist in 2022 and make sure that any service faraway from the checklist be reviewed towards longstanding standards to protect security, a truth sheet on the rule stated.

Different key provisions within the proposed rule, which is open for remark for 60 days, embrace:

• Not utilizing information from 2020 when figuring out the most effective information for setting charges. The COVID-19 pandemic brought on an enormous shift in using healthcare providers and procedures. As an alternative, the company will use 2019 healthcare information that will likely be a greater approximation of “anticipated prices” for 2022.
• Preserving a greater than 20% minimize to drug reimbursements for many lined entities below the 340B program. The Trump-era cuts have been upheld by a federal appellate court docket final yr. The Supreme Courtroom will hear a hospital trade problem to the cuts throughout its subsequent time period.
• A request for data on how a brand new supplier kind referred to as Rural Emergency Hospitals will work. A spending bundle handed earlier this yr creates the brand new supplier kind in January 2023. Rural hospitals and important entry hospitals can apply to transform to be an emergency hospital. The aim is to spice up the variety of amenities that present emergency providers to rural areas after a number of years of speedy hospital closures. The RFI desires data on well being and security requirements in addition to fee and high quality insurance policies.