In early July, the Centers for Medicare & Medicaid Services (CMS) proposed Hospital Outpatient Prospective Payment System (OPPS) reimbursement rule changes that will impact reimbursement payment amounts and requirements for certain hospital outpatient providers – view our prior alert on that portion of the rule here. The proposed OPPS rules also seek to add additional quality assessment criteria and make quality assessment data available to the public—a change that will impact how hospital outpatient providers meet quality assessment measures as well as how the media and public might portray and perceive outpatient facilities.

The Proposed Rule provides notice of CMS' intent to propose alterations to OPPS requirements and reimbursements for 2017, including the following:

• Hospital payment increase of 1.6 percent in 2017, which was determined based on the projected hospital market basket increase minus several adjustments required by law.

• 1.2 percent payment increase in 2017 for ambulatory surgical centers, which is based on the consumer price index minus Medicare statutory adjustments.

• Establishment of 25 new Comprehensive Ambulatory Payment Classifications (C-APCs) — an alternative payment methodology commonly used for the implantation of costly medical devices — and three new clinical families to accommodate the new C-APCs. Additionally, CMS proposes to develop a new C-APC and dedicated cost center for bone marrow transplants.

• Due to the APC reorganization, change to the calculation for the device offset amount at the Healthcare Common Procedure Coding System level, instead of the APC level. CMS also proposed changes to the payment rate for APC procedures with less than 100 total claims from the geometric mean cost to a median cost.

• Adjustment to CMS' packaged services policy to ensure that more ancillary services are included in the OPPS packaged payment. CMS proposes to discontinue packaged payments based on date, and instead, would shift to a new packaging logic that would occur at the claim level, which ensures that all services are captured in a single package for hospital stays exceeding one day. CMS also proposes to discontinue separate coverage for "unrelated" laboratory tests.

• Removal of six procedures from the Medicare inpatient-only list — four spine procedures and two laryngoplasty procedures.

• Removal of the Pain Management dimension of the hospital value-based Hospital Consumer Assessment of Healthcare Provider and Systems (HCAHPS) survey. Stakeholders have alleged that the Pain Management dimension of the HCAHPS survey incentivizes hospital staff to prescribe higher levels of opioids in order to increase patient satisfaction with pain management issues, and out of an abundance of caution, CMS has removed this element from the survey.

• Addition of seven new assessment measures to the Hospital Outpatient Quality Reporting Program (OQR Program) for 2020 and subsequent years. The new assessment measures include, but are not limited to, an assessment of admissions and emergency department visits by patients who have received chemotherapy or undergone an outpatient surgery. CMS also is seeking comments on potential OQR Program quality measures that it could adopt to decrease preventable deaths and reduce costs related to the prescribing of opioids and benzodiazepines. Finally, CMS proposes to display OQR Program data on its website beginning in 2018.

• Due to improvements in organ transplant outcomes, CMS proposes to change the outcome threshold for one-year patient and graft survival from 1.5 to 1.85. CMS also will align its definitions, criteria, and outcome measures for an "eligible death" consistently with the Scientific Registry of Transplant Recipients requirements.

• Adoption of a 90-day electronic health record (EHR) reporting incentive program for 2016. CMS also proposed additional leniency for new EHR participants in 2017.

• Addition of seven measures to the Ambulatory Surgical Center Quality Reporting (ASCQR) Program, including, but not limited to, tracking normothermia outcomes and unplanned anterior vitrectomy events. CMS also proposes to make available ASCQR Program survey results available on its website beginning in 2018. CMS is seeking comment on quality measures that may address and decrease Toxic Anterior Segment Syndrome events in the ambulatory surgical center environment.

The deadline to submit comments regarding the Proposed Rule is September 6, 2016, at 5:00 p.m. Eastern.