2007 OPPS Final Rule

Highlights of the 2007 OPPS Final Rule Affecting Emergency Departments and Overview of AHA/AHIMA Guidelines Discussion

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The 2007 Outpatient Prospective Payment System (OPPS) Final Rule was put on public display on November 1, 2006, and will be published in the November 24, 2006 issue of the Federal Register. The full text can be found at the CMS website in document CMS-1506-FC under Hospital Outpatient PPS, Hospital Outpatient Regulations and Notices or via the following link:

http://www.cms.hhs.gov/HospitalOutpatientPPS/Downloads/CMS1506FC.pdf

The Final Rule will be effective for services provided on and after January 1, 2007. The following are relevant points in the Final Rule that affect ED facility coding and the page where the citation is found in the 1,328 page document (page numbers refer to the public display copy):

Visits

• For 2007, hospital EDs (and clinics) will continue to use their own systems for calculating visit levels. Providers are instructed to follow CMS previously published general guidelines that state the methodology should be based on facility resources, be clear to facilitate accurate payments and be usable for compliance purposes and audits, meet the HIPAA requirements, only require documentation that is clinically necessary for patient care, not facilitate upcoding or gaming, and result in a normal curve when measuring visit level distribution (p. 616, 620).
• CMS finalized their decision to define and distinguish between two types of EDs for OPPS payment purposes (p. 631, 637):
  
  
  • Type A EDs are open 24/7 per the AMA-CPT definition and meet one of the following requirements: the ED is licensed by the state as an emergency room or emergency department or it is held out to the public as a facility that provides emergency care on an urgent basis and does not require previously scheduled appointments (p. 628).
  • Type B EDs are considered “dedicated” EDs, but they are not open 24/7. To be considered a Type B ED, the facility must meet at least one of the following requirements: the ED is licensed by the state as an emergency room or emergency department or it is held out to the public as a facility that provides emergency care on an urgent basis and does not require previously scheduled appointments or if during the prior year, in a representative sample of patients, the ED provided at least one-third of its outpatient visits for treatment of emergency medical conditions without requiring a previously scheduled appointment (p. 628).
• CMS concurred with providers’ comments and decided they would not implement all of the proposed new G codes for ED visit levels without national guidelines (p. 616).
• CMS however did establish five new HCPCS G codes to code type B EDs (G0380-G0384), CMS rationale for implementing these G codes is to provide data—there is currently no data to analyze to determine resource utilization or costs in these EDs. Type A EDs will continue to be coded using CPT codes 99281-99285 (p. 631, 636, 637).
• One commenter requested clarification on Type B EDs noting that many hospitals have “fast tracks” or separate areas in or near the ED that are open less than 24 hours. Would these fall under the Type B ED definition and require coding with the new G codes and be reimbursed the same as clinic visits? CMS responded that: Where a hospital maintains a separately identifiable area or part of a facility which does not operate on the same schedule (24/7) as its emergency department, the area would not be considered an integral part of the ED that operates 24 hours a day for the purpose of determining its ED type for reporting emergency visits. Instead, the facility or area would be evaluated separately to determine if it is a type A or type B ED or a clinic. We would expect the hospital to evaluate services in those areas and bill accordingly. In general, it is not appropriate to consider a satellite ED or an area of the ED as if it were available 24 hours a day simply because the main ED is available 24 hours. It may be appropriate for a Type A ED to “carve out” portions of the emergency department that are not available 24 hours a day, where visits would be more appropriately billed with type B ED codes (p. 639, 640).
• There will be five APCs for each of the two types of EDs and five for clinic visits replacing the current three APCs for each. Clinic visits and Type B ED visits group to the same APC and payment rate (p. 645, 650, 656, 1239).

Critical Care

• Critical care will be coded for services meeting the critical care CPT descriptor including documentation of a minimum duration of 30 minutes. If critical care time is less than 30 minutes, ED visit levels should be charged. Both 99291 and 99292 will be coded with CPT codes rather than HCPCS codes, but 99292 is packaged and will not be separately paid (p. 643, 644).
• CMS clarified that since the inception of OPPS in year 2000, it has always been a requirement to perform 30 minutes of critical care in order to bill a critical care code (p. 643).
• If critical care of fewer than 30 minutes duration is documented the appropriate clinic or ED visit code should be billed (p. 644).
• A new critical care HCPCS code, G0390, may be coded in addition to 99291 when a trauma team response is activated (p. 646, 661). The 2007 payment rate for Critical Care, 99291, is $405, and for the Trauma Response associated with Critical Care, G0390, it is $495 (p. 1239).

Procedures

• CMS again discussed the issue of including separately billable procedures in the calculation of the ED visit level. They will continue to look at this issue as national guidelines are developed. One of the concerns is that CMS changes procedure packaging rules each year and as a result visit level guidelines would have to change accordingly if CMS rules required exclusion of separately billable procedures (p. 666).
• CMS states that there may be advantages to including separately billable procedures in national coding guidelines as examples (p. 680).
• Many ED procedures will have revised APCs, relative weights, and payment rates in 2007(see Addendum A, p. 1016-1256).

Drug Administration

• CMS will adopt the full set of CPT codes for drug administration coding in 2007 and delete the current set of injection and infusion C codes. One exception will be C8957, IV infusion for therapy/diagnosis, initiation of prolonged infusion (> 8 hours) requiring use of a portable or implantable pump. This HCPCS code will be retained, as currently there is no CPT code to describe this service. Medicare drug administration code usage will follow the CPT descriptors (p. 585, 586).
• CMS will pay for the initial hour of infusion as well as subsequent hours, which is new for 2007. Payment rates will be $111.20 and $24.25 respectively (p. 592, 593, 1210).
• Each CPT drug administration service will carry a status indicator of S (separate procedure not discounted with multiple occurrences) with the exception of 90768, concurrent infusion, which will be a packaged procedure, status indicator N, and therefore not separately payable (p. 586).
• Despite an APC Advisory Panel recommendation, CMS will not make payments for more than one IV injection of the same substance/drug. CMS rationale is that they want to be consistent with CPT definitions (p. 595, 607).

Observation

• Facility Observation will continue to be coded using HCPCS G codes, the same as in 2006, and the OCE editor will determine if the encounter meets CMS reimbursement guidelines (p. 695).
• CMS will continue to pay for Observation for only the following three conditions: CHF, chest pain and asthma, but agreed to evaluate the possibility of adding the diagnoses for syncope and dehydration later as well as cases where minor status indicator T procedures were performed in addition to Observation (Observation is currently bundled into procedures that have a status indicator of T) (p. 695).
• The direct admit to Observation HCPCS code, G0379, will group to the same APC as a low level clinic visit (p.695).

Inpatient Procedures

• CMS maintains a list of inpatient procedures that are excluded from OPPS payment when performed in the outpatient setting. Each year procedures are considered for removal from the list and possible payment under OPPS. Twenty procedures were removed for 2007 including 16035, Escharotomy; initial incision, which may be performed in some high acuity EDs, especially those where the hospital provides burn unit services (p. 714).
• Inpatient procedures may be reimbursed in the ED if the service was performed to resuscitate or stabilize a patient with an emergent or life threatening condition and the patient dies before admission. This service maps to a single new technology APC payment of $3,549 in 2007. In 2006, the reimbursement was $2,717 (p. 715).

Financial Changes

• The 2006 conversion factor is $59.511 and in 2007 will increase to $61.468 (154).
• The maximum patient co-pay will remain at 40% of the APC payment rate; the range of co-pays is and will be 20-40% of the APC payment rate (p. 186, 660).
• Non pass through drugs will be paid separately with an APC if the median cost exceeds $55 per day. This threshold was $50 in 2006. Drugs costing $55 or less will be packaged into the procedure or service associated with the drug (p. 465).
• Outlier status will be invoked when ED costs for a service exceed the APC payment rate by 1.75 and at least $1825. 2006 thresholds are 1.75 and $1250. The outlier payment would be 50% of the difference between 1.75 times the APC payment rate and the facility’s actual costs. This outlier payment would be paid in addition to the APC payment rate for the service or procedure provided (p. 174, 182).

Outpatient Quality Measures

• In the proposed rule, CMS discussed implementing a reduction of 2% in the 2007 OPPS conversion factor for those hospitals that were required to report inpatient quality indicators and failed to do so. Several commenters expressed concerns that CMS would impose a payment reduction on outpatient services based on the failure to report quality data for inpatient care. CMS agreed and will not implement this conversion factor reduction (p. 862, 865, 879).
• CMS stated that they are developing and will implement a set of hospital outpatient-specific quality and cost of care indicators at the earliest possible date. This could occur in CY 2009 (p. 868, 881).

Draft AHA/AHIMA ED and Clinic Coding Guidelines

In addition to the final 2007 OPPS rule changes, CMS further discussed the AHA/AHIMA guidelines for coding ED and Clinic services. CMS is still considering these guidelines for future implementation and reiterated their eight primary concerns (p. 664). CMS will continue to review comments throughout 2007 and stated it will give providers 6-12 months prior notice before implementing any new outpatient coding guidelines (p. 682). CMS restated that they do not expect to implement national guidelines prior to calendar year 2008 (p. 682).

Other important inclusions:

• CMS noted that several organizations expressed interest in working with CMS as well as the AHA/AHIMA expert panel in the development of national guidelines, including ACEP and LYNX Medical Systems (p. 674).
• Many commenters supported using separately billable interventions because they serve as a proxy for resource utilization (p. 675).
• The AHA/AHIMA panel has requested that CMS release the detailed analysis of the AHA/AHIMA guidelines that was performed by the Iowa Foundation so the panel can review their concerns. CMS agreed to investigate this possibility (p. 678).
• CMS again discussed that in the interim, before national coding guidelines are implemented, hospitals should continue to use their own guidelines, even if CMS has expressed reservations about the type of guidelines being used (p. 678).
• CMS acknowledged that it does not expect individual hospitals to experience a normal distribution of visit levels, but that the agency would expect a normal distribution of visits across all hospitals after national guidelines are implemented (p. 679).

Note: LYNX will continue to work with CMS, AHA, ACEP and others in the development of national coding guidelines. The LYNX ED Facility Algorithm and its problem based approach are compliant with each of CMS’s guidelines and they provide an effective and efficient means to code outpatient visit levels.