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Medicare Program: Changes to Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; Revisions of Organ Procurement Organizations Conditions of Coverage; Prior Authorization Process and Requirements for Certain Covered Outpatient Department Services; Potential Changes to the Laboratory Date of Service Policy; Changes to Grandfathered Children's Hospitals-Within-Hospitals; Notice of Closure of Two Teaching Hospitals and Opportunity To Apply for Available Slots

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Start Preamble Start Printed Page 61142

AGENCY:

Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION:

Final rule with comment period.

SUMMARY:

This final rule with comment period revises the Medicare hospital outpatient prospective payment system (OPPS) and the Medicare ambulatory surgical center (ASC) payment system for Calendar Year 2020 based on our continuing experience with these systems. In this final rule with comment period, we describe the changes to the amounts and factors used to determine the payment rates for Medicare services paid under the OPPS and those paid under the ASC payment system. Also, this final rule with comment period updates and refines the requirements for the Hospital Outpatient Quality Reporting (OQR) Program and the ASC Quality Reporting (ASCQR) Program. In addition, this final rule with comment period establishes a process and requirements for prior authorization for certain covered outpatient department services; revise the conditions for coverage of organ procurement organizations; and revise the regulations to allow grandfathered children's hospitals-within-hospitals to increase the number of beds without resulting in the loss of grandfathered status; and provides notice of the closure of two teaching hospitals and the opportunity to apply for available slots for purposes of indirect medical education (IME) and direct graduate medical education (DGME) payments.

DATES:

Effective date: This final rule is effective on January 1, 2020.

Comment period: To be assured consideration, comments on the payment classifications assigned to the interim APC assignments and/or status indicators of new or replacement Level II HCPCS codes in this final rule with comment period must be received at one of the addresses provided in the ADDRESSES section no later than 5 p.m. EST on December 2, 2019.

ADDRESSES:

In commenting, please refer to file code CMS-1717-FC when commenting on the issues in this final rule with comment period. Because of staff and resource limitations, we cannot accept comments by facsimile (FAX) transmission.

Comments, including mass comment submissions, must be submitted in one of the following three ways (please choose only one of the ways listed):

1. Electronically. You may (and we encourage you to) submit electronic comments on this regulation to http://www.regulations.gov. Follow the instructions under the “submit a comment” tab.

2. By regular mail. You may mail written comments to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-1717-FC, P.O. Box 8013, Baltimore, MD 21244-1850.

Please allow sufficient time for mailed comments to be received before the close of the comment period.

3. By express or overnight mail. You may send written comments via express or overnight mail to the following address ONLY: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-1717-FC, Mail Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.

b. For delivery in Baltimore, MD—Centers for Medicare & Medicaid Services, Department of Health and Human Services, 7500 Security Boulevard, Baltimore, MD 21244-1850.

For information on viewing public comments, we refer readers to the beginning of the SUPPLEMENTARY INFORMATION section.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

2-Midnight Rule (Short Inpatient Hospital Stays), contact Lela Strong-Holloway via email Lela.Strong@cms.hhs.gov or at 410-786-3213.

Advisory Panel on Hospital Outpatient Payment (HOP Panel), contact the HOP Panel mailbox at APCPanel@cms.hhs.gov.

Ambulatory Surgical Center (ASC) Payment System, contact Scott Talaga via email Scott.Talaga@cms.hhs.gov or at 410-786-4142 or Mitali Dayal via email Mitali.Dayal2@cms.hhs.gov or at 410-786-4329.

Ambulatory Surgical Center Quality Reporting (ASCQR) Program Administration, Validation, and Reconsideration Issues, contact Anita Bhatia via email Anita.Bhatia@cms.hhs.gov or at 410-786-7236.

Ambulatory Surgical Center Quality Reporting (ASCQR) Program Measures, contact Nicole Hewitt via email Nicole.Hewitt@cms.hhs.gov or at 410-786-7778.

Blood and Blood Products, contact Josh McFeeters via email Joshua.McFeeters@cms.hhs.gov or at 410-786-9732.

Cancer Hospital Payments, contact Scott Talaga via email Scott.Talaga@cms.hhs.gov or at 410-786-4142.

CMS Web Posting of the OPPS and ASC Payment Files, contact Chuck Braver via email Chuck.Braver@cms.hhs.gov or at 410-786-6719.

Control for Unnecessary Increases in Volume of Outpatient Services, contact Elise Barringer via email Elise.Barringer@cms.hhs.gov or at 410-786-9222.

Composite APCs (Low Dose Brachytherapy and Multiple Imaging), contact Elise Barringer via email Elise.Barringer@cms.hhs.gov or at 410-786-9222.

Comprehensive APCs (C-APCs), contact Lela Strong-Holloway via email Lela.Strong@cms.hhs.gov or at 410-786-3213, or Mitali Dayal via email at Mitali.Dayal2@cms.hhs.gov or at 410-786-4329.

CPT and Level II HCPCS Codes, contact Marjorie Baldo via email Marjorie.Baldo@cms.hhs.gov or at 410-786-4617.

Grandfathered Children's Hospitals-within-Hospitals, contact Michele Hudson via email Michele.Hudson@cms.hhs.gov or 410-786-4487.

Hospital Cost Reporting and Chargemaster Comment Solicitation, contact Dr. Terri Postma at 410-786-4169.

Hospital Outpatient Quality Reporting (OQR) Program Administration, Validation, and Reconsideration Issues, contact Anita Bhatia via email Anita.Bhatia@cms.hhs.gov or at 410-786-7236.

Hospital Outpatient Quality Reporting (OQR) Program Measures, contact Vinitha Meyyur via email Vinitha.Meyyur@cms.hhs.gov or at 410-786-8819.

Hospital Outpatient Visits (Emergency Department Visits and Critical Care Visits), contact Elise Barringer via email Start Printed Page 61143 Elise.Barringer@cms.hhs.gov or at 410-786-9222.

Inpatient Only (IPO) Procedures List, contact Lela Strong-Holloway via email Lela.Strong@cms.hhs.gov or at 410-786-3213, or Au'Sha Washington via email at Ausha.Washington@cms.hhs.gov or at 410-786-3736.

New Technology Intraocular Lenses (NTIOLs), contact Scott Talaga via email Scott.Talaga@cms.hhs.gov or at 410-786-4142.

No Cost/Full Credit and Partial Credit Devices, contact Scott Talaga via email Scott.Talaga@cms.hhs.gov or at 410-786-4142.

Notice of Closure of Two Teaching Hospitals and Opportunity to Apply for Available Slots, contact Michele Hudson via email Michele.Hudson@cms.hhs.gov or 410-786-4487.

OPPS Brachytherapy, contact Scott Talaga via email Scott.Talaga@cms.hhs.gov or at 410-786-4142.

OPPS Data (APC Weights, Conversion Factor, Copayments, Cost-to-Charge Ratios (CCRs), Data Claims, Geometric Mean Calculation, Outlier Payments, and Wage Index), contact Erick Chuang via email Erick.Chuang@cms.hhs.gov or at 410-786-1816, or Scott Talaga via email Scott.Talaga@cms.hhs.gov or at 410-786-4142, or Josh McFeeters via email at Joshua.McFeeters@cms.hhs.gov or at 410-786-9732.

OPPS Drugs, Radiopharmaceuticals, Biologicals, and Biosimilar Products, contact Josh McFeeters via email Joshua.McFeeters@cms.hhs.gov or at 410-786-9732.

OPPS New Technology Procedures/Services, contact the New Technology APC mailbox at NewTechAPCapplications@cms.hhs.gov.

OPPS Packaged Items/Services, contact Lela Strong-Holloway via email Lela.Strong@cms.hhs.gov or at 410-786-3213, or Mitali Dayal via email at Mitali.Dayal2@cms.hhs.gov or at 410-786-4329.

OPPS Pass-Through Devices, contact the Device Pass-Through mailbox at DevicePTapplications@cms.hhs.gov.

OPPS Status Indicators (SI) and Comment Indicators (CI), contact Marina Kushnirova via email Marina.Kushnirova@cms.hhs.gov or at 410-786-2682.

Organ Procurement Organization (OPO) Conditions for Coverage (CfCs), contact Alpha-Banu Wilson via email at AlphaBanu.Wilson@cms.hhs.gov or at 410-786-8687, or Diane Corning via email at Diane.Corning@cms.hhs.gov or at 410-786-8486.

Partial Hospitalization Program (PHP) and Community Mental Health Center (CMHC) Issues, contact the PHP Payment Policy Mailbox at PHPPaymentPolicy@cms.hhs.gov.

Prior Authorization Process and Requirements for Certain Hospital Outpatient Department Services, contact Thomas Kessler via email at Thomas.Kessler@cms.hhs.gov or at 410-786-1991.

Rural Hospital Payments, contact Josh McFeeters via email at Joshua.McFeeters@cms.hhs.gov or at 410-786-9732.

Skin Substitutes, contact Josh McFeeters via email Joshua.McFeeters@cms.hhs.gov or at 410-786-9732.

Supervision of Outpatient Therapeutic Services in Hospitals and CAHs, contact Josh McFeeters via email Joshua.McFeeters@cms.hhs.gov or at 410-786-9732.

All Other Issues Related to Hospital Outpatient and Ambulatory Surgical Center Payments Not Previously Identified, contact Elise Barringer via email Elise.Barringer@cms.hhs.gov or at 410-786-9222.

End Further Info End Preamble Start Supplemental Information

SUPPLEMENTARY INFORMATION:

Inspection of Public Comments: All comments received before the close of the comment period are available for viewing by the public, including any personally identifiable or confidential business information that is included in a comment. We post all comments received before the close of the comment period on the following website as soon as possible after they have been received: http://www.regulations.gov/​. Follow the search instructions on that website to view public comments.

Addenda Available Only Through the Internet on the CMS Website

In the past, a majority of the Addenda referred to in our OPPS/ASC proposed and final rules were published in the Federal Register as part of the annual rulemakings. However, beginning with the CY 2012 OPPS/ASC proposed rule, all of the Addenda no longer appear in the Federal Register as part of the annual OPPS/ASC proposed and final rules to decrease administrative burden and reduce costs associated with publishing lengthy tables. Instead, these Addenda are published and available only on the CMS website. The Addenda relating to the OPPS are available at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​index.html. The Addenda relating to the ASC payment system are available at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​index.html.

Current Procedural Terminology (CPT) Copyright Notice

Throughout this final rule with comment period, we use CPT codes and descriptions to refer to a variety of services. We note that CPT codes and descriptions are copyright 2018 American Medical Association. All Rights Reserved. CPT is a registered trademark of the American Medical Association (AMA). Applicable Federal Acquisition Regulations (FAR and Defense Federal Acquisition Regulations (DFAR) apply.

Table of Contents

I. Summary and Background

A. Executive Summary of This Document

B. Legislative and Regulatory Authority for the Hospital OPPS

C. Excluded OPPS Services and Hospitals

D. Prior Rulemaking

E. Advisory Panel on Hospital Outpatient Payment (the HOP Panel or the Panel)

F. Public Comments Received in Response to the CY 2020 OPPS/ASC Proposed Rule

G. Public Comments Received on the CY 2019 OPPS/ASC Final Rule With Comment Period

II. Updates Affecting OPPS Payments

A. Recalibration of APC Relative Payment Weights

B. Conversion Factor Update

C. Wage Index Changes

D. Statewide Average Default Cost-to-Charge Ratios (CCRs)

E. Adjustment for Rural Sole Community Hospitals (SCHs) and Essential Access Community Hospitals (EACHs) Under Section 1833(t)(13)(B) of the Act for CY 2020

F. Payment Adjustment for Certain Cancer Hospitals for CY 2020

G. Hospital Outpatient Outlier Payments

H. Calculation of an Adjusted Medicare Payment From the National Unadjusted Medicare Payment

I. Beneficiary Copayments

III. OPPS Ambulatory Payment Classification (APC) Group Policies

A. OPPS Treatment of New and Revised HCPCS Codes

B. OPPS Changes—Variations Within APCs

C. New Technology APCs

D. APC-Specific Policies

IV. OPPS Payment for Devices

A. Pass-Through Payments for Devices

B. Device-Intensive Procedures

V. OPPS Payment Changes for Drugs, Biologicals, and Radiopharmaceuticals

A. OPPS Transitional Pass-Through Payment for Additional Costs of Drugs, Biologicals, and Radiopharmaceuticals

B. OPPS Payment for Drugs, Biologicals, and Radiopharmaceuticals Without Pass-Through Payment Status

VI. Estimate of OPPS Transitional Pass-Through Spending for Drugs, Biologicals, Radiopharmaceuticals, and Devices

A. Background

B. Estimate of Pass-Through Spending

VII. OPPS Payment for Hospital Outpatient Visits and Critical Care ServicesStart Printed Page 61144

VIII. Payment for Partial Hospitalization Services

A. Background

B. PHP APC Update for CY 2020

C. Outlier Policy for CMHCs

D. Update to PHP Allowable HCPCS Codes

IX. Procedures That Will Be Paid Only as Inpatient Procedures

A. Background

B. Changes to the Inpatient Only (IPO) List

X. Nonrecurring Policy Changes

A. Changes in the Level of Supervision of Outpatient Therapeutic Services in Hospitals and Critical Access Hospitals (CAHs)

B. Short Inpatient Hospital Stays

C. Method To Control Unnecessary Increases in the Volume of Clinic Visit Services Furnished in Excepted Off-Campus Provider-Based Departments (PBDs)

XI. CY 2020 OPPS Payment Status and Comment Indicators

A. CY 2020 OPPS Payment Status Indicator Definitions

B. CY 2020 Comment Indicator Definitions

XII. MedPAC Recommendations

A. OPPS Payment Rates Update

B. ASC Conversion Factor Update

C. ASC Cost Data

XIII. Updates to the Ambulatory Surgical Center (ASC) Payment System

A. Background

B. ASC Treatment of New and Revised Codes

C. Update to the List of ASC Covered Surgical Procedures and Covered Ancillary Services

D. Update and Payment for ASC Covered Surgical Procedures and Covered Ancillary Services

E. New Technology Intraocular Lenses (NTIOLs)

F. ASC Payment and Comment Indicators

G. Calculation of the ASC Payment Rates and the ASC Conversion Factor

XIV. Requirements for the Hospital Outpatient Quality Reporting (OQR) Program

A. Background

B. Hospital OQR Program Quality Measures

C. Administrative Requirements

D. Form, Manner, and Timing of Data Submitted for the Hospital OQR Program

E. Payment Reduction for Hospitals That Fail To Meet the Hospital OQR Program Requirements for the CY 2020 Payment Determination

XV. Requirements for the Ambulatory Surgical Center Quality Reporting (ASCQR) Program

A. Background

B. ASCQR Program Quality Measures

C. Administrative Requirements

D. Form, Manner, and Timing of Data Submitted for the ASCQR Program

E. Payment Reduction for ASCs That Fail To Meet the ASCQR Program Requirements

XVI. Requirements for Hospitals To Make Public a List of Their Standard Charges and Request for Information (RFI): Quality Measurement Relating to Price Transparency for Improving Beneficiary Access to Provider and Supplier Charge Information

XVII. Organ Procurement Organizations (OPOs) Conditions for Coverage (CfCs): Revision of the Definition of “Expected Donation Rate”

A. Background

B. Revision of the Definition of “Expected Donation Rate”

C. Request for Information Regarding Potential Changes to the Organ Procurement Organization and Transplant Center Regulations

XVIII. Clinical Laboratory Fee Schedule: Potential Revisions to the Laboratory Date of Service Policy

A. Background on the Medicare Part B Laboratory Date of Service Policy

B. Medicare DOS Policy and the “14-Day Rule”

C. Billing and Payment for Laboratory Services Under the OPPS

D. ADLTs Under the New Private Payor Rate-Based CLFS

E. Additional Laboratory DOS Policy Exception for the Hospital Outpatient Setting

F. Potential Revisions to Laboratory DOS Policy and Request for Public Comments

XIX. Prior Authorization Process and Requirements for Certain Hospital Outpatient Department (OPD) Services

A. Background

B. Prior Authorization Process for Certain OPD Services

C. List of Outpatient Department Services Requiring Prior Authorization

XX. Comments Received in Response to Comment Solicitation on Cost Reporting, Maintenance of Hospital Chargemasters, and Related Medicare Payment Issues

XXI. Changes to Requirements for Grandfathered Children's Hospitals-Within-Hospitals (HwHs)

XXII. Notice of Closure of Two Teaching Hospitals and Opportunity To Apply for Available Slots

XXIII. Files Available to the Public via the Internet

XXIV. Collection of Information Requirements

A. Statutory Requirement for Solicitation of Comments

B. ICRs for the Hospital OQR Program

C. ICRs for the ASCQR Program

D. ICRs for Revision of the Definition of “Expected Donation Rate” for Organ Procurement Organizations

E. ICR for Prior Authorization Process and Requirements for Certain Hospital Outpatient Department (OPD) Services

F. Potential Revisions to Laboratory Date of Service (DOS) Policy

G. Total Reduction in Burden Hours and in Costs

XXV. Response to Comments

XXVI. Economic Analyses

A. Statement of Need

B. Overall Impact for the Provisions of This Final Rule

C. Detailed Economic Analyses

D. Effects of Prior Authorization Process and Requirements for Certain Hospital Outpatient Department (OPD) Services

E. Effects of Requirement Relating to Changes in the Definition of Expected Donation Rate for Organ Procurement Organizations

F. Potential Revisions to the Laboratory Date of Service Policy

G. Effect of Changes to Requirements for Grandfathered Children's Hospitals-Within-Hospitals (HwHs)

H. Regulatory Review Costs

I. Regulatory Flexibility Act (RFA) Analysis

J. Unfunded Mandates Reform Act Analysis

K. Reducing Regulation and Controlling Regulatory Costs

L. Conclusion

XXVII. Federalism Analysis

Regulation Text

I. Summary and Background

A. Executive Summary of This Document

1. Purpose

In this final rule with comment period, we are updating the payment policies and payment rates for services furnished to Medicare beneficiaries in hospital outpatient departments (HOPDs) and ambulatory surgical centers (ASCs), beginning January 1, 2020. Section 1833(t) of the Social Security Act (the Act) requires us to annually review and update the payment rates for services payable under the Hospital Outpatient Prospective Payment System (OPPS). Specifically, section 1833(t)(9)(A) of the Act requires the Secretary to review certain components of the OPPS not less often than annually, and to revise the groups, the relative payment weights, and the wage and other adjustments that take into account changes in medical practices, changes in technologies, and the addition of new services, new cost data, and other relevant information and factors. In addition, under section 1833(i) of the Act, we annually review and update the ASC payment rates. This final rule with comment period also includes additional policy changes made in accordance with our experience with the OPPS and the ASC payment system. We describe these and various other statutory authorities in the relevant sections of this final rule with comment period. In addition, this final rule with comment period updates and refines the requirements for the Hospital Outpatient Quality Reporting (OQR) Program and the ASC Quality Reporting (ASCQR) Program.

In this final rule with comment period, we establish a process and requirements for prior authorization for certain covered outpatient department services; revise the conditions for coverage for organ procurement organizations; and revise the regulations to allow grandfathered children's hospitals-within-hospitals to increase Start Printed Page 61145the number of beds without resulting in the loss of grandfathered status.

2. Summary of the Major Provisions

  • OPPS Update: For CY 2020, we are increasing the payment rates under the OPPS by an Outpatient Department (OPD) fee schedule increase factor of 2.6 percent. This increase factor is based on the final hospital inpatient market basket percentage increase of 3.0 percent for inpatient services paid under the hospital inpatient prospective payment system (IPPS), minus the multifactor productivity (MFP) adjustment required by the Affordable Care Act of 0.4 percentage point. Based on this update, we estimate that total payments to OPPS providers (including beneficiary cost-sharing and estimated changes in enrollment, utilization, and case-mix) for calendar year (CY) 2020 will be approximately $79.0 billion, an increase of approximately $6.3 billion compared to estimated CY 2019 OPPS payments.

We are continuing to implement the statutory 2.0 percentage point reduction in payments for hospitals failing to meet the hospital outpatient quality reporting requirements, by applying a reporting factor of 0.981 to the OPPS payments and copayments for all applicable services.

  • 2-Midnight Rule (Short Inpatient Hospital Stays): For CY 2020, we are establishing a 2-year exemption from Beneficiary and Family-Centered Care Quality Improvement Organizations (BFCC-QIOs) referrals to Recovery Audit Contractors (RACs) and RAC reviews for “patient status” (that is, site-of-service) for procedures that are removed from the inpatient only (IPO) list under the OPPS beginning on January 1, 2020.
  • Comprehensive APCs: For CY 2020, we are creating two new comprehensive APCs (C-APCs). These new C-APCs include the following: C-APC 5182 (Level 2 Vascular Procedures) and C-APC 5461 (Level 1 Neurostimulator and Related Procedures). This increases the total number of C-APCs to 67.
  • Changes to the Inpatient Only (IPO) List: For CY 2020, we are removing Total Hip Arthroplasty, six spinal procedure codes, and five anesthesia codes from the inpatient only list.
  • Method to Control Unnecessary Increases in the Volume of Clinic Visit Services Furnished in Excepted Off-Campus Provider-Based Departments (PBDs): For CY 2020, we are completing the phase-in of the reduction in payment for the clinic visit services described by HCPCS code G0463 furnished in expected off-campus provider based departments as a method to control unnecessary increases in the volume of this service. We acknowledge that the district court vacated the volume control policy for CY 2019 and we are working to ensure affected 2019 claims for clinic visits are paid consistent with the court's order. We do not believe it is appropriate at this time to make a change to the second year of the two-year phase-in of the clinic visit policy. The government has appeal rights, and is still evaluating the rulings and considering, at the time of this writing, whether to appeal from the final judgment.
  • Device Pass-Through Payment Applications: For CY 2020, we evaluated seven applications for device pass-through payments and based on public comments received, we are approving four of these applications for device pass-through payment status. Additionally, we are approving an additional application that was not discussed in the CY 2020 OPPS/ASC proposed rule, but has received a Breakthrough Devices designation from the Food and Drug Administration (FDA) and qualifies for the alternative pathway to the OPPS device pass-through substantial clinical improvement criterion.
  • Changes to Substantial Clinical Improvement Criterion: For CY 2020, we are finalizing an alternative pathway to the substantial clinical improvement criterion for devices approved under the FDA Breakthrough Devices Program to qualify for device pass-through status beginning with determinations effective on or after January 1, 2020.
  • Cancer Hospital Payment Adjustment: For CY 2020, we are continuing to provide additional payments to cancer hospitals so that a cancer hospital's payment-to-cost ratio (PCR) after the additional payments is equal to the weighted average PCR for the other OPPS hospitals using the most recently submitted or settled cost report data. However, section 16002(b) of the 21st Century Cures Act requires that this weighted average PCR be reduced by 1.0 percentage point. Based on the data and the required 1.0 percentage point reduction, we are providing that a target PCR of 0.89 will be used to determine the CY 2020 cancer hospital payment adjustment to be paid at cost report settlement. That is, the payment adjustments will be the additional payments needed to result in a PCR equal to 0.89 for each cancer hospital.
  • Rural Adjustment: For 2020 and subsequent years, we are continuing the 7.1 percent adjustment to OPPS payments for certain rural SCHs, including essential access community hospitals (EACHs). We intend to continue the 7.1 percent adjustment for future years in the absence of data to suggest a different percentage adjustment should apply.
  • 340B-Acquired Drugs: We are continuing to pay ASP-22.5 percent for 340B-acquired drugs including when furnished in nonexcepted off-campus PBDs paid under the PFS. In light of ongoing litigation, we also summarized comments received on a potential remedy for 2018 and 2019. CMS announced in the Federal Register (84 FR 51590) its intent to conduct a 340B hospital survey to collect drug acquisition cost data for CY 2018 and 2019. Such survey data may be used in setting the Medicare payment amount for drugs acquired by 340B hospitals for cost years going forward, and also may be used to devise a remedy for prior years in the event of an adverse decision on appeal. In the event 340B hospital survey data are not used to devise a remedy, we intend to consider the suggestions commenters submitted in response to the comment solicitation in the proposed rule to propose a remedy in the CY 2021 OPPS/ASC proposed rule.
  • ASC Payment Update: For CYs 2019 through 2023, we adopted a policy to update the ASC payment system using the hospital market basket update. Using the hospital market basket methodology, for CY 2020, we are increasing payment rates under the ASC payment system by 2.6 percent for ASCs that meet the quality reporting requirements under the ASCQR Program. This increase is based on a hospital market basket percentage increase of 3.0 percent minus a proposed multifactor productivity adjustment required by the Affordable Care Act of 0.4 percentage point. Based on this update, we estimate that total payments to ASCs (including beneficiary cost-sharing and estimated changes in enrollment, utilization, and case-mix) for CY 2020 will be approximately $4.96 billion, an increase of approximately $230 million compared to estimated CY 2019 Medicare payments.
  • Changes to the List of ASC Covered Surgical Procedures: For CY 2020, we are adding several procedures to the ASC list of covered surgical procedures. Additions to the list include a total knee arthroplasty procedure, a mosaicplasty procedure, as well as six coronary intervention procedures, as well as 12 surgical procedures with new CPT codes for CY 2020.
  • Changes to the Level of Supervision of Outpatient Therapeutic Services in Hospitals and Critical Access Hospitals: For CY 2020, we are changing the Start Printed Page 61146minimum required level of supervision from direct supervision to general supervision for all hospital outpatient therapeutic services provided by all hospitals and CAHs. This ensures a standard minimum level of supervision for each hospital outpatient service furnished incident to a physician's service.
  • Hospital Outpatient Quality Reporting (OQR) Program: For the Hospital OQR Program, we are removing OP-33: External Beam Radiotherapy for Bone Metastases for the CY 2022 payment determination and subsequent years with modification.
  • Ambulatory Surgical Center Quality Reporting (ASCQR) Program: For the ASCQR Program, we are adopting one new measure, ASC-19: Facility-Level 7-Day Hospital Visits after General Surgery Procedures Performed at Ambulatory Surgical Centers, beginning with the CY 2024 payment determination and for subsequent years.
  • Prior Authorization Process and Requirements for Certain Hospital Outpatient Department (OPD) Services: We are finalizing a prior authorization process using the authority at section 1833(t)(2)(F) of the Act as a method for controlling unnecessary increases in the volume of the following five categories of services: (1) Blepharoplasty, (2) botulinum toxin injections, (3) panniculectomy, (4) rhinoplasty, and (5) vein ablation.
  • Organ Procurement Organizations (OPOs) Conditions for Coverage (CfCs) Revision of the Definition of “Expected Donation Rate.” We are revising the definition of “expected donation rate” that is included in the second outcome measure to match the Scientific Registry of Transplant Recipients (SRTR) definition. In conjunction with this change, we are also temporarily suspending the requirement that OPOs meet two of three outcome measures for the 2022 recertification cycle only.
  • Request for Information Regarding Potential Changes to the Organ Procurement Organization and Transplant Center Regulations: We solicited public comments regarding what revisions may be appropriate for the current OPO CfCs and the current transplant center CoPs. In addition, we solicited public comments on two potential outcome measures for OPOs.

3. Summary of Costs and Benefits

In sections XXVI. and XXVII. of this final rule with comment period, we set forth a detailed analysis of the regulatory and federalism impacts that the changes will have on affected entities and beneficiaries. Key estimated impacts are described below.

a. Impacts of All OPPS Changes

Table 70 in section XXV.B of this final rule with comment period displays the distributional impact of all the OPPS changes on various groups of hospitals and CMHCs for CY 2020 compared to all estimated OPPS payments in CY 2019. We estimate that the policies in this final rule with comment period will result in a 1.3 percent overall increase in OPPS payments to providers. We estimate that total OPPS payments for CY 2020, including beneficiary cost-sharing, to the approximately 3,732 facilities paid under the OPPS (including general acute care hospitals, children's hospitals, cancer hospitals, and CMHCs) will increase by approximately $1.21 billion compared to CY 2019 payments, excluding our estimated changes in enrollment, utilization, and case-mix.

We estimated the isolated impact of our OPPS policies on CMHCs because CMHCs are only paid for partial hospitalization services under the OPPS. Continuing the provider-specific structure we adopted beginning in CY 2011, and basing payment fully on the type of provider furnishing the service, we estimate a 3.7 percent increase in CY 2020 payments to CMHCs relative to their CY 2019 payments.

b. Impacts of the Updated Wage Indexes

We estimate that our update of the wage indexes based on the FY 2020 IPPS proposed rule wage indexes will result in no estimated payment change for urban hospitals under the OPPS and an estimated increase of 0.7 percent for rural hospitals. These wage indexes include the continued implementation of the OMB labor market area delineations based on 2010 Decennial Census data, with updates, as discussed in section II.C. of this final rule with comment period.

c. Impacts of the Rural Adjustment and the Cancer Hospital Payment Adjustment

There are no significant impacts of our CY 2020 payment policies for hospitals that are eligible for the rural adjustment or for the cancer hospital payment adjustment. We are not making any change in policies for determining the rural hospital payment adjustments. While we are implementing the required reduction to the cancer hospital payment adjustment required by section 16002 of the 21st Century Cures Act for CY 2020, the target payment-to-cost ratio (PCR) for CY 2020 is 0.89, compared to 0.88 for CY 2019, and therefore has a slight impact on budget neutrality adjustments.

d. Impacts of the OPD Fee Schedule Increase Factor

For the CY 2020 OPPS/ASC, we are establishing an OPD fee schedule increase factor of 2.6 percent and applying that increase factor to the conversion factor for CY 2020. As a result of the OPD fee schedule increase factor and other budget neutrality adjustments, we estimate that urban hospitals will experience an increase of approximately 2.7 percent and that rural hospitals will experience an increase of 2.8 percent. Classifying hospitals by teaching status, we estimate nonteaching hospitals will experience an increase of 2.8 percent, minor teaching hospitals will experience an increase of 2.9 percent, and major teaching hospitals will experience an increase of 2.4 percent. We also classified hospitals by the type of ownership. We estimate that hospitals with voluntary ownership will experience an increase of 2.6 percent in payments, while hospitals with government ownership will experience an increase of 2.8 percent in payments. We estimate that hospitals with proprietary ownership will experience an increase of 3.2 percent in payments.

e. Impacts of the ASC Payment Update

For impact purposes, the surgical procedures on the ASC list of covered procedures are aggregated into surgical specialty groups using CPT and HCPCS code range definitions. The percentage change in estimated total payments by specialty groups under the CY 2020 payment rates, compared to estimated CY 2019 payment rates, generally ranges between an increase of 1 and 5 percent, depending on the service, with some exceptions. We estimate the impact of applying the hospital market basket update to ASC payment rates will increase payments by $230 million under the ASC payment system in CY 2020.

f. Impact of the Changes to the Hospital OQR Program

Across 3,300 hospitals participating in the Hospital OQR Program, we estimate that our requirements will result in the following changes to costs and burdens related to information collection for the Hospital OQR Program compared to previously adopted requirements: There is a net reduction of one measure reported by hospitals, which results in a minimal net reduction in burden of $21,379.Start Printed Page 61147

g. Impacts of the Revision of the Definition of “Expected Donation Rate” for Organ Procurement Organizations

We are finalizing our revision to the definition of “expected donation rate” used in the second outcome measure of the OPO CfCs at 42 CFR 486.318(a) and (b) to eliminate the potential for confusion in the OPO community due to different definitions of the same term; however, due to comments received on the CY 2020 OPPS/ASC proposed rule we are finalizing a policy that would not require all OPOs to meet the standards of the second outcome measure for the 2022 recertification cycle only. As a result, OPOs will only have to meet one of the remaining outcome measures, which may provide temporary relief for a small number of OPOs that, absent this waiver, might have faced de-certification and the appeal process due to only meeting one outcome measure.

For subsequent recertification cycles, all 58 OPOs will once again be required to meet two out of three outcome measures detailed in the OPO CfCs. The revised definition of “expected donation rate” used in the second outcome measure will not affect data collection or reporting by the OPTN and SRTR, nor their statistical evaluation of OPO performance; therefore, it will not result in any quantifiable financial impact.

B. Legislative and Regulatory Authority for the Hospital OPPS

When Title XVIII of the Act was enacted, Medicare payment for hospital outpatient services was based on hospital-specific costs. In an effort to ensure that Medicare and its beneficiaries pay appropriately for services and to encourage more efficient delivery of care, the Congress mandated replacement of the reasonable cost-based payment methodology with a prospective payment system (PPS). The Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33) added section 1833(t) to the Act, authorizing implementation of a PPS for hospital outpatient services. The OPPS was first implemented for services furnished on or after August 1, 2000. Implementing regulations for the OPPS are located at 42 CFR parts 410 and 419.

The Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999 (BBRA) (Pub. L. 106-113) made major changes in the hospital OPPS. The following Acts made additional changes to the OPPS: The Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA) (Pub. L. 106-554); the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) (Pub. L. 108-173); the Deficit Reduction Act of 2005 (DRA) (Pub. L. 109-171), enacted on February 8, 2006; the Medicare Improvements and Extension Act under Division B of Title I of the Tax Relief and Health Care Act of 2006 (MIEA-TRHCA) (Pub. L. 109-432), enacted on December 20, 2006; the Medicare, Medicaid, and SCHIP Extension Act of 2007 (MMSEA) (Pub. L. 110-173), enacted on December 29, 2007; the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) (Pub. L. 110-275), enacted on July 15, 2008; the Patient Protection and Affordable Care Act (Pub. L. 111-148), enacted on March 23, 2010, as amended by the Health Care and Education Reconciliation Act of 2010 (Pub. L. 111-152), enacted on March 30, 2010 (these two public laws are collectively known as the Affordable Care Act); the Medicare and Medicaid Extenders Act of 2010 (MMEA, Pub. L. 111-309); the Temporary Payroll Tax Cut Continuation Act of 2011 (TPTCCA, Pub. L. 112-78), enacted on December 23, 2011; the Middle Class Tax Relief and Job Creation Act of 2012 (MCTRJCA, Pub. L. 112-96), enacted on February 22, 2012; the American Taxpayer Relief Act of 2012 (Pub. L. 112-240), enacted January 2, 2013; the Pathway for SGR Reform Act of 2013 (Pub. L. 113-67) enacted on December 26, 2013; the Protecting Access to Medicare Act of 2014 (PAMA, Pub. L. 113-93), enacted on March 27, 2014; the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015 (Pub. L. 114-10), enacted April 16, 2015; the Bipartisan Budget Act of 2015 (Pub. L. 114-74), enacted November 2, 2015; the Consolidated Appropriations Act, 2016 (Pub. L. 114-113), enacted on December 18, 2015, the 21st Century Cures Act (Pub. L. 114-255), enacted on December 13, 2016; the Consolidated Appropriations Act, 2018 (Pub. L. 115-141), enacted on March 23, 2018; and the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (Pub. L. 115-271), enacted on October 24, 2018.

Under the OPPS, we generally pay for hospital Part B services on a rate-per-service basis that varies according to the APC group to which the service is assigned. We use the Healthcare Common Procedure Coding System (HCPCS) (which includes certain Current Procedural Terminology (CPT) codes) to identify and group the services within each APC. The OPPS includes payment for most hospital outpatient services, except those identified in section I.C. of this final rule with comment period. Section 1833(t)(1)(B) of the Act provides for payment under the OPPS for hospital outpatient services designated by the Secretary (which includes partial hospitalization services furnished by CMHCs), and certain inpatient hospital services that are paid under Medicare Part B.

The OPPS rate is an unadjusted national payment amount that includes the Medicare payment and the beneficiary copayment. This rate is divided into a labor-related amount and a nonlabor-related amount. The labor-related amount is adjusted for area wage differences using the hospital inpatient wage index value for the locality in which the hospital or CMHC is located.

All services and items within an APC group are comparable clinically and with respect to resource use, as required by section 1833(t)(2)(B) of the Act. In accordance with section 1833(t)(2)(B) of the Act, subject to certain exceptions, items and services within an APC group cannot be considered comparable with respect to the use of resources if the highest median cost (or mean cost, if elected by the Secretary) for an item or service in the APC group is more than 2 times greater than the lowest median cost (or mean cost, if elected by the Secretary) for an item or service within the same APC group (referred to as the “2 times rule”). In implementing this provision, we generally use the cost of the item or service assigned to an APC group.

For new technology items and services, special payments under the OPPS may be made in one of two ways. Section 1833(t)(6) of the Act provides for temporary additional payments, which we refer to as “transitional pass-through payments,” for at least 2 but not more than 3 years for certain drugs, biological agents, brachytherapy devices used for the treatment of cancer, and categories of other medical devices. For new technology services that are not eligible for transitional pass-through payments, and for which we lack sufficient clinical information and cost data to appropriately assign them to a clinical APC group, we have established special APC groups based on costs, which we refer to as New Technology APCs. These New Technology APCs are designated by cost bands which allow us to provide appropriate and consistent payment for designated new procedures that are not yet reflected in our claims data. Similar to pass-through payments, an assignment to a New Technology APC is temporary; that is, we retain a service within a New Technology APC until we acquire sufficient data to assign it to a clinically appropriate APC group.Start Printed Page 61148

C. Excluded OPPS Services and Hospitals

Section 1833(t)(1)(B)(i) of the Act authorizes the Secretary to designate the hospital outpatient services that are paid under the OPPS. While most hospital outpatient services are payable under the OPPS, section 1833(t)(1)(B)(iv) of the Act excludes payment for ambulance, physical and occupational therapy, and speech-language pathology services, for which payment is made under a fee schedule. It also excludes screening mammography, diagnostic mammography, and effective January 1, 2011, an annual wellness visit providing personalized prevention plan services. The Secretary exercises the authority granted under the statute to also exclude from the OPPS certain services that are paid under fee schedules or other payment systems. Such excluded services include, for example, the professional services of physicians and nonphysician practitioners paid under the Medicare Physician Fee Schedule (MPFS); certain laboratory services paid under the Clinical Laboratory Fee Schedule (CLFS); services for beneficiaries with end-stage renal disease (ESRD) that are paid under the ESRD prospective payment system; and services and procedures that require an inpatient stay that are paid under the hospital IPPS. In addition, section 1833(t)(1)(B)(v) of the Act does not include applicable items and services (as defined in subparagraph (A) of paragraph (21)) that are furnished on or after January 1, 2017 by an off-campus outpatient department of a provider (as defined in subparagraph (B) of paragraph (21). We set forth the services that are excluded from payment under the OPPS in regulations at 42 CFR 419.22.

Under § 419.20(b) of the regulations, we specify the types of hospitals that are excluded from payment under the OPPS. These excluded hospitals include:

  • Critical access hospitals (CAHs);
  • Hospitals located in Maryland and paid under Maryland's All-Payer or Total Cost of Care Model;
  • Hospitals located outside of the 50 States, the District of Columbia, and Puerto Rico; and
  • Indian Health Service (IHS) hospitals.

D. Prior Rulemaking

On April 7, 2000, we published in the Federal Register a final rule with comment period (65 FR 18434) to implement a prospective payment system for hospital outpatient services. The hospital OPPS was first implemented for services furnished on or after August 1, 2000. Section 1833(t)(9)(A) of the Act requires the Secretary to review certain components of the OPPS, not less often than annually, and to revise the groups, relative payment weights, and the wage and other adjustments that take into account changes in medical practices, changes in technologies, and the addition of new services, new cost data, and other relevant information and factors.

Since initially implementing the OPPS, we have published final rules in the Federal Register annually to implement statutory requirements and changes arising from our continuing experience with this system. These rules can be viewed on the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​Hospital-Outpatient-Regulations-and-Notices.html.

E. Advisory Panel on Hospital Outpatient Payment (the HOP Panel or the Panel)

1. Authority of the Panel

Section 1833(t)(9)(A) of the Act, as amended by section 201(h) of Public Law 106-113, and redesignated by section 202(a)(2) of Public Law 106-113, requires that we consult with an external advisory panel of experts to annually review the clinical integrity of the payment groups and their weights under the OPPS. In CY 2000, based on section 1833(t)(9)(A) of the Act, the Secretary established the Advisory Panel on Ambulatory Payment Classification Groups (APC Panel) to fulfill this requirement. In CY 2011, based on section 222 of the Public Health Service Act, which gives discretionary authority to the Secretary to convene advisory councils and committees, the Secretary expanded the panel's scope to include the supervision of hospital outpatient therapeutic services in addition to the APC groups and weights. To reflect this new role of the panel, the Secretary changed the panel's name to the Advisory Panel on Hospital Outpatient Payment (the HOP Panel or the Panel). The HOP Panel is not restricted to using data compiled by CMS, and in conducting its review, it may use data collected or developed by organizations outside the Department.

2. Establishment of the Panel

On November 21, 2000, the Secretary signed the initial charter establishing the Panel, and, at that time, named the APC Panel. This expert panel is composed of appropriate representatives of providers (currently employed full-time, not as consultants, in their respective areas of expertise) who review clinical data and advise CMS about the clinical integrity of the APC groups and their payment weights. Since CY 2012, the Panel also is charged with advising the Secretary on the appropriate level of supervision for individual hospital outpatient therapeutic services. The Panel is technical in nature, and it is governed by the provisions of the Federal Advisory Committee Act (FACA). The current charter specifies, among other requirements, that the Panel—

  • May advise on the clinical integrity of Ambulatory Payment Classification (APC) groups and their associated weights;
  • May advise on the appropriate supervision level for hospital outpatient services;
  • Continues to be technical in nature;
  • Is governed by the provisions of the FACA;
  • Has a Designated Federal Official (DFO); and
  • Is chaired by a Federal Official designated by the Secretary.

The Panel's charter was amended on November 15, 2011, renaming the Panel and expanding the Panel's authority to include supervision of hospital outpatient therapeutic services and to add critical access hospital (CAH) representation to its membership. The Panel's charter was also amended on November 6, 2014 (80 FR 23009), and the number of members was revised from up to 19 to up to 15 members. The Panel's current charter was approved on November 19, 2018, for a 2-year period (84 FR 26117).

The current Panel membership and other information pertaining to the Panel, including its charter, Federal Register notices, membership, meeting dates, agenda topics, and meeting reports, can be viewed on the CMS website at: https://www.cms.gov/​Regulations-and-Guidance/​Guidance/​FACA/​AdvisoryPanelonAmbulatoryPaymentClassificationGroups.html.

3. Panel Meetings and Organizational Structure

The Panel has held many meetings, with the last meeting taking place on August 19, 2019. Prior to each meeting, we publish a notice in the Federal Register to announce the meeting and, when necessary, to solicit nominations for Panel membership, to announce new members, and to announce any other changes of which the public should be aware. Beginning in CY 2017, we have transitioned to one meeting per year (81 Start Printed Page 61149FR 31941). Further information on the 2019 summer meeting can be found in the meeting notice titled “Medicare Program: Announcement of the Advisory Panel on Hospital Outpatient Payment (the Panel) Meeting on August 19 through 20, 2019” (84 FR 26117).

In addition, the Panel has established an operational structure that, in part, currently includes the use of three subcommittees to facilitate its required review process. The three current subcommittees include the following:

  • APC Groups and Status Indicator Assignments Subcommittee, which advises the Panel on the appropriate status indicators to be assigned to HCPCS codes, including but not limited to whether a HCPCS code or a category of codes should be packaged or separately paid, as well as the appropriate APC assignment of HCPCS codes regarding services for which separate payment is made;
  • Data Subcommittee, which is responsible for studying the data issues confronting the Panel and for recommending options for resolving them; and
  • Visits and Observation Subcommittee, which reviews and makes recommendations to the Panel on all technical issues pertaining to observation services and hospital outpatient visits paid under the OPPS.

Each of these subcommittees was established by a majority vote from the full Panel during a scheduled Panel meeting, and the Panel recommended at the August 19, 2019, meeting that the subcommittees continue. We accepted this recommendation.

For discussions of earlier Panel meetings and recommendations, we refer readers to previously published OPPS/ASC proposed and final rules, the CMS website mentioned earlier in this section, and the FACA database at http://facadatabase.gov.

Comment: One commenter supported CMS' extension of the HOP Panel meeting presentation submission deadline when there is a truncated submittal timeframe due to delayed publication of the OPPS/ASC proposed rule. However, to avoid the need to modify the submission deadline in the future, the commenter suggested that CMS revise the submission deadline in the Federal Register notice from a firm date to a fluid 21 days from the proposed rule display date to avoid this deadline issue in the future.

Response: We appreciate the commenter's request to modify the HOP Panel meeting submission deadline format. However, frequency, timing, and presentation deadlines are outside the scope of the proposed rule and are generally announced through either a separate Federal Register notice or subregulatory channel such as the CMS website, or both.

F. Public Comments Received in Response to the CY 2020 OPPS/ASC Proposed Rule

We received over 3400 timely pieces of correspondence on the CY 2020 OPPS/ASC proposed rule that appeared in the Federal Register on August 9, 2019 (84 FR 39398). We note that we received some public comments that were outside the scope of the CY 2020 OPPS/ASC proposed rule. Out-of-scope-public comments are not addressed in this CY 2020 OPPS/ASC final rule with comment period. Summaries of those public comments that are within the scope of the proposed rule and our responses are set forth in the various sections of this final rule with comment period under the appropriate headings.

G. Public Comments Received on the CY 2019 OPPS/ASC Final Rule With Comment Period

We received over 540 timely pieces of correspondence on the CY 2019 OPPS/ASC final rule with comment period that appeared in the Federal Register on November 30, 2018 (83 FR 61567), some of which contained comments on the interim APC assignments and/or status indicators of new or replacement Level II HCPCS codes (identified with comment indicator “NI” in OPPS Addendum B, ASC Addendum AA, and ASC Addendum BB to that final rule). Summaries of the public comments on new or replacement Level II HCPCS codes are set forth in the CY 2020 OPPS/ASC proposed rule and this final rule with comment period under the appropriate subject matter headings.

II. Updates Affecting OPPS Payments

A. Recalibration of APC Relative Payment Weights

1. Database Construction

a. Database Source and Methodology

Section 1833(t)(9)(A) of the Act requires that the Secretary review not less often than annually and revise the relative payment weights for APCs. In the April 7, 2000 OPPS final rule with comment period (65 FR 18482), we explained in detail how we calculated the relative payment weights that were implemented on August 1, 2000 for each APC group.

In the CY 2020 OPPS/ASC proposed rule (84 FR 39406), for CY 2020, we proposed to recalibrate the APC relative payment weights for services furnished on or after January 1, 2020, and before January 1, 2021 (CY 2020), using the same basic methodology that we described in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58827 through 58828), using updated CY 2018 claims data. That is, as we proposed, we recalibrate the relative payment weights for each APC based on claims and cost report data for hospital outpatient department (HOPD) services, using the most recent available data to construct a database for calculating APC group weights.

For the purpose of recalibrating the APC relative payment weights for CY 2020, we began with approximately 164 million final action claims (claims for which all disputes and adjustments have been resolved and payment has been made) for HOPD services furnished on or after January 1, 2018, and before January 1, 2019, before applying our exclusionary criteria and other methodological adjustments. After the application of those data processing changes, we used approximately 88 million final action claims to develop the proposed CY 2020 OPPS payment weights. For exact numbers of claims used and additional details on the claims accounting process, we refer readers to the claims accounting narrative under supporting documentation for the CY 2020 OPPS/ASC proposed rule on the CMS website at: http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​index.html.

Addendum N to the proposed rule (which is available via the internet on the CMS website) included the proposed list of bypass codes for CY 2020. The proposed list of bypass codes contained codes that were reported on claims for services in CY 2018 and, therefore, included codes that were in effect in CY 2018 and used for billing, but were deleted for CY 2019. We retained these deleted bypass codes on the proposed CY 2020 bypass list because these codes existed in CY 2018 and were covered OPD services in that period, and CY 2018 claims data were used to calculate CY 2020 payment rates. Keeping these deleted bypass codes on the bypass list potentially allows us to create more “pseudo” single procedure claims for ratesetting purposes. “Overlap bypass codes” that are members of the proposed multiple imaging composite APCs were identified by asterisks (*) in the third column of Addendum N to the proposed rule. HCPCS codes that we proposed to add for CY 2020 were identified by asterisks (*) in the fourth column of Addendum N.

Table 1 contains the list of codes that we proposed to remove from the CY 2020 bypass list.

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b. Calculation and Use of Cost-to-Charge Ratios (CCRs)

For CY 2020, in the CY 2020 OPPS/ASC proposed rule (84 FR 39407), we proposed to continue to use the hospital-specific overall ancillary and departmental cost-to-charge ratios (CCRs) to convert charges to estimated costs through application of a revenue code-to-cost center crosswalk. To calculate the APC costs on which the CY 2020 APC payment rates are based, we calculated hospital-specific overall ancillary CCRs and hospital-specific departmental CCRs for each hospital for which we had CY 2018 claims data by comparing these claims data to the most recently available hospital cost reports, which, in most cases, are from CY 2017. For the proposed CY 2020 OPPS payment rates, we used the set of claims processed during CY 2018. We applied the hospital-specific CCR to the hospital's charges at the most detailed level possible, based on a revenue code-to-cost center crosswalk that contains a hierarchy of CCRs used to estimate costs from charges for each revenue code. That crosswalk is available for review and continuous comment on the CMS website at: http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​index.html.

To ensure the completeness of the revenue code-to-cost center crosswalk, we reviewed changes to the list of revenue codes for CY 2018 (the year of claims data we used to calculate the proposed CY 2020 OPPS payment rates) and found that the National Uniform Billing Committee (NUBC) did not add any new revenue codes to the NUBC 2018 Data Specifications Manual.

In accordance with our longstanding policy, we calculate CCRs for the standard and nonstandard cost centers accepted by the electronic cost report database. In general, the most detailed level at which we calculate CCRs is the hospital-specific departmental level. For a discussion of the hospital-specific overall ancillary CCR calculation, we refer readers to the CY 2007 OPPS/ASC final rule with comment period (71 FR 67983 through 67985). The calculation of blood costs is a longstanding exception (since the CY 2005 OPPS) to this general methodology for calculation of CCRs used for converting charges to costs on each claim. This exception is discussed in detail in the CY 2007 OPPS/ASC final rule with comment period and discussed further in section II.A.2.a.(1) of the proposed rule and this final rule with comment period.

In the CY 2014 OPPS/ASC final rule with comment period (78 FR 74840 through 74847), we finalized our policy of creating new cost centers and distinct CCRs for implantable devices, magnetic resonance imaging (MRIs), computed tomography (CT) scans, and cardiac catheterization. However, in response to the CY 2014 OPPS/ASC proposed rule, commenters reported that some hospitals used a less precise “square feet” allocation methodology for the costs of large moveable equipment like CT scan and MRI machines. They indicated that while CMS recommended using two alternative allocation methods, “direct assignment” or “dollar value,” as a more accurate methodology for directly assigning equipment costs, industry analysis suggested that approximately only half of the reported cost centers for CT scans and MRIs rely on these preferred methodologies. In response to concerns from commenters, we finalized a policy for the CY 2014 OPPS to remove claims from providers that use a cost allocation method of “square feet” to calculate CCRs used to estimate costs associated with the APCs for CT and MRI (78 FR 74847). Further, we finalized a transitional policy to estimate the imaging APC relative payment weights using only CT and MRI cost data from providers that do not use “square feet” as the cost allocation statistic. We provided that this finalized policy would sunset in 4 years to provide a sufficient time for hospitals to transition to a more accurate cost allocation method and for the related data to be available for ratesetting purposes (78 FR 74847). Therefore, beginning CY 2018, with the sunset of the transition policy, we would estimate the imaging APC relative payment weights using cost data from all providers, regardless of the cost allocation statistic employed. However, in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59228 and 59229) and in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58831), we finalized a policy to extend the transition policy for 1 additional year and we continued to remove claims from providers that use a cost allocation method of “square feet” to calculate CT and MRI CCRs for the CY 2018 OPPS and the CY 2019 OPPS.

As we discussed in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59228), some stakeholders have raised concerns regarding using claims from all providers to calculate CT and MRI CCRs, regardless of the cost allocations statistic employed (78 FR 74840 through 74847). Stakeholders noted that providers continue to use the “square feet” cost allocation method and that including claims from such providers would cause significant reductions in the imaging APC payment rates.

Table 2 demonstrates the relative effect on imaging APC payments after removing cost data for providers that report CT and MRI standard cost centers using “square feet” as the cost allocation method by extracting HCRIS data on Worksheet B-1. Table 3 provides statistical values based on the CT and MRI standard cost center CCRs using the different cost allocation methods.

Start Printed Page 61151

Our analysis shows that since the CY 2014 OPPS in which we established the transition policy, the number of valid MRI CCRs has increased by 18.8 percent to 2,207 providers and the number of valid CT CCRs has increased by 16.0 percent to 2,291 providers. However, as shown in Table 2, nearly all imaging APCs would see an increase in payment rates for CY 2020 if claims from providers that report using the “square feet” cost allocation method were removed. This can be attributed to the generally lower CCR values from providers that use a “square feet” cost allocation method as shown in Table 2.

We noted in the CY 2020 OPPS/ASC proposed rule that the CT and MRI cost center CCRs have been available for ratesetting since the CY 2014 OPPS in which we established the transition policy. Since the initial 4-year transition, we have extended the transition an additional 2 years to offer provider flexibility in applying cost allocation methodologies for CT and MRI cost centers other than “square feet.” We noted that we believed we had provided sufficient time for providers to adopt an alternative cost allocation methodology for CT and MRI cost centers if they intended to do so. However, many providers continue to use the “square feet” cost allocation methodology, which we believe indicates that these providers believe this methodology is a sufficient method for attributing costs to this cost center. Additionally, we generally believe that increasing the amount of claims data available for use in ratesetting improves our ratesetting process. Therefore, we proposed that for the CY 2020 OPPS we would use all claims with valid CT and MRI cost center CCRs, including those that use a “square feet” cost allocation method, to estimate costs for the APCs for CT and MRI identified in Table 2. We noted that we did not believe another extension was warranted and expected to determine the imaging APC relative payment weights for CY 2020 using cost data from all providers, regardless of the cost allocation method employed.

Comment: One commenter noted that approximately half of all hospitals paid under the OPPS had CT and/or MRI cost centers that were reporting CCRs using the preferred methods (“dollar value” or “direct assignment”). This commenter further suggested that hospitals not using these preferred methods are either unable or unwilling to make the change to using these preferred methods. This commenter stated that some CT and Start Printed Page 61152MRI procedures show a significant number of CCRs that are close to zero, and that the commenter believed that these hospitals are likely unable to accurately reallocate these costs across hospital departments to new CT and MRI departmental cost centers. This commenter acknowledged that the number of valid CT and MRI CCRs has increased over time, but noted that incorrect cost allocation has negative effects on payment rates for almost all imaging APCs.

Several commenters recommended that CMS continue to exclude “square feet” cost allocation data and continue to educate hospitals on the importance of reporting direct CT and MRI services. Several commenters requested that CMS not use the CT and MRI-specific cost centers and instead estimate cost using the single diagnostic radiology cost center, believing this will solve the inaccurate reporting of costs for CT and MR services. They further suggested that we should advise hospitals through regulation and cost reporting instructions to no longer report costs separately for CT and MRI cost centers and make sure they review their diagnostic radiology cost center inclusive of CT and MR equipment, space, labor and over factors. This same commenter noted that the benefits of using a single diagnostic radiology cost center include consistency across hospitals, properly accounting for high-cost medical equipment, simplifying and standardizing cost reporting within the diagnostic radiology cost center, eliminating partial allocation of costs to CT and MRI cost centers, and reducing burden. One commenter requested that we work with various hospital organizations to help educate the hospital community on how to report these costs on the CT and MRI CCRs in hopes to transition to this policy over time.

Other commenters requested that we extend the transition to using all claims for one additional year. These same commenters requested that if extending the transition 1 additional year is not possible, that we phase in the payment impacts of this transition over 2 years. One commenter requested that CMS extend the transition for 2 additional years and stated that we should study the effects of this policy even further to better understand its payment impacts. One commenter noted that we should continue the transition policy of removing provider claims using the “square feet” cost allocation method to calculate cost-to-charge ratios (CCRs) associated with CT and MRI procedures into 2020 and require providers to report costs via the direct assignment or dollar value methodologies moving forward. Another commenter noted that the use of separate CT and MRI CCRs creates unintended consequences on the technical component of CT and MRI codes in the Medicare Physician Fee Schedule (MPFS). The commenter noted the resulting reductions in hospital payments would also affect the physician office practice setting. They believed that the OPPS technical payments would fall below the payment rates in the MPFS causing further cuts as mandated by the Deficit Reduction Act of 2005 (DRA), which mandates CMS pay the lesser of MPFS or OPPS rate.

One commenter suggested that, because CMS has various APC groupings for MRI and CT, the individual MRI and CT cost centers are no longer needed. This commenter suggested that, at the time separate cost centers for these services were established, the classification of imaging procedures into APCs was very specific, but that CMS is now “intermingling” the MRI and CT costs with other imaging services.

Response: We appreciate the comments regarding the use of CT and MRI cost center CCRs. As we stated in prior rulemaking, we recognize the concerns with regard to the application of the CT and MRI standard cost center CCRs and their use in the OPPS ratesetting. We understand that there is greater sensitivity to the cost allocation method being used on the cost report forms for these relatively new standard imaging cost centers under the OPPS due to the limited size of the OPPS payment bundles and because the OPPS applies the CCRs at the departmental level for cost estimation purposes. However, it is important to note that since we initially established the transition policy in the OPPS in CY 2014, we have continued to develop the OPPS as a prospective payment system. This includes greater packaging and the development of comprehensive APCs. As we have packaged a greater number of items and services with imaging payment under the OPPS, we believe imaging payments are somewhat less sensitive to the cost allocation method being used than they previously were. We also note that we still find value in obtaining more specific cost data and that the CT and MRI-specific cost centers provide useful cost and charge data for ratesetting purposes.

However, to address concerns in the comments about the amount of the decrease in imaging payment in CY 2020 due to ending of the transition period, we are finalizing a 2-year phased-in approach, as suggested by some commenters, that will apply 50 percent of the payment impact from ending the transition in CY 2020 and 100 percent of the payment impact from ending the transition in CY 2021. For CY 2020, we will calculate the imaging payment rates using both the transition methodology (excluding providers that use a “square feet” cost allocation method) and the standard methodology (including all providers, regardless of cost allocation method) and will assign the imaging APCs a payment rate that includes data representing 50 percent of the transition methodology payment rate and includes data representing 50 percent of the standard methodology payment rate. Beginning in CY 2021, we will set the imaging APC payment rates at 100 percent of the payment rate using the standard payment methodology (including all providers, regardless of cost allocation method). Table 4 below illustrates the estimated impact on geometric mean costs for CT and MRI APCs under our blended approach of utilizing 50 percent of the transitional payment methodology and 50 percent of the standard payment methodology for CY 2020.

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As noted earlier, the Deficit Reduction Act (DRA) of 2005 requires Medicare to limit Medicare payment for certain imaging services covered by the physician fee schedule to not exceed what Medicare pays for these services under the OPPS. As required by law, for certain imaging series paid for under the MPFS, we cap the technical component of the PFS payment amount for the applicable year at the OPPS payment amount (71 FR 69659 through 69661). As we stated in the CY 2014 OPPS/ASC final rule with comment period (78 FR 74845), we have noted the potential impact the CT and MRI CCRs may have on other payment systems. We understand that payment reductions for imaging services under the OPPS could have significant payment impacts under the Physician Fee Schedule (PFS) where the technical component payment for many imaging services is capped at the OPPS payment amount. We will continue to monitor OPPS imaging payments in the future and consider the potential impacts of payment changes on the PFS and the ASC payment system.

2. Data Development and Calculation of Costs Used for Ratesetting

In this section of this final rule with comment period, we discuss the use of claims to calculate the OPPS payment rates for CY 2020. The Hospital OPPS page on the CMS website on which this final rule with comment period is posted (http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​index.html) provides an accounting of claims used in the development of the final payment rates. That accounting provides additional detail regarding the number of claims derived at each stage of the Start Printed Page 61154process. In addition, below in this section, we discuss the file of claims that comprises the data set that is available upon payment of an administrative fee under a CMS data use

agreement. The CMS website http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​index.html, includes information about obtaining the “OPPS Limited Data Set,” which now includes the additional variables previously available only in the OPPS Identifiable Data Set, including ICD-10-CM diagnosis codes and revenue code payment amounts. This file is derived from the CY 2018 claims that were used to calculate the final payment rates for this CY 2020 OPPS/ASC final rule with comment period.

Previously, the OPPS established the scaled relative weights, on which payments are based using APC median costs, a process described in the CY 2012 OPPS/ASC final rule with comment period (76 FR 74188). However, as discussed in more detail in section II.A.2.f. of the CY 2013 OPPS/ASC final rule with comment period (77 FR 68259 through 68271), we finalized the use of geometric mean costs to calculate the relative weights on which the CY 2013 OPPS payment rates were based. While this policy changed the cost metric on which the relative payments are based, the data process in general remained the same, under the methodologies that we used to obtain appropriate claims data and accurate cost information in determining estimated service cost. For CY 2020, in the CY 2020 OPPS/ASC proposed rule (84 FR 39409), we proposed to continue to use geometric mean costs to calculate the proposed relative weights on which the CY 2020 OPPS payment rates are based.

We used the methodology described in sections II.A.2.a. through II.A.2.c. of this final rule with comment period to calculate the costs we used to establish the relative payment weights used in calculating the OPPS payment rates for CY 2020 shown in Addenda A and B to this final rule with comment period (which are available via the internet on the CMS website). We refer readers to section II.A.4. of this final rule with comment period for a discussion of the conversion of APC costs to scaled payment weights.

We note that under the OPPS, CY 2019 was the first year in which claims data containing lines with the modifier “PN” were available, which indicate nonexcepted items and services furnished and billed by off-campus provider-based departments (PBDs) of hospitals. Because nonexcepted services are not paid under the OPPS, in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58832), we finalized a policy to remove those claim lines reported with modifier “PN” from the claims data used in ratesetting for the CY 2019 OPPS and subsequent years. For the CY 2020 OPPS, we will continue to remove these claim lines with modifier “PN” from the ratesetting process.

Comment: Several commenters noted a potential issue with missing lines with the PN modifier. Specifically, these commenters believed that the CY 2020 proposed rule data, based on CY 2018 claims, excluded approximately 400,000 lines with Healthcare Common Procedure Coding System (HCPCS) codes and the PN modifier. They noted that this would mean that there was over an 80 percent decline from the CY 2017 claims data, which had approximately 2.8 million lines with HCPCS and the PN modifier. These commenters reviewed the 2018 Outpatient Standard Analytic File (SAF) and noted that they found approximately 3.5 million lines with HCPCS codes and the PN modifier. These commenters asserted that the ratesetting data included substantially less PN modifiers than in the SAF file for the same time period. These same commenters assert that if the PN lines were not included in the ratesetting process then the OPPS payment weights are accurate. They noted that, conversely, if the PN lines were included in the payment weights then payments would be inaccurate. These commenters wanted CMS to explain what occurred in the proposed rule data files to ensure that the APC payment weights correctly reflect the exclusion of PN modifier claims in the final rule.

Response: We thank the commenters for their input. First, we would like to note that claim lines with the PN modifier are excluded from the ratesetting process. Please note that the difference between the 2019 OPPS Final Rule and the 2020 OPPS Proposed rule is the following: We processed the claim lines with the PN modifier differently between the two rules, which resulted in the decrease in the number of PN lines in the OPPS limited data set as noted above. Specifically, the programs used for the CY 2020 proposed rule were modified to not factor in those lines as being OPPS lines, which resulted in more lines, and potentially, more total claims being categorized as non-OPPS claims. Previously, even though those lines were excluded from OPPS for ratesetting purposes, they were still considered OPPS in categorizing the claims for the limited data set. This change in processing logic had no effect on ratesetting and all of the lines with modifier “PN” are excluded from the OPPS ratesetting process for both CY 2019 and CY 2020. We are including these lines as non-OPPS claims in the CY 2020 OPPS final rule limited data set, but as discussed, are continuing to exclude them for ratesetting purposes.

For details of the claims accounting process used in this final rule with comment period, we refer readers to the claims accounting narrative under supporting documentation for this CY 2020 OPPS/ASC final rule with comment period on the CMS website at: http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​index.html.

2. Final Data Development and Calculation of Costs Used for Ratesetting

a. Calculation of Single Procedure APC Criteria-Based Costs

(1) Blood and Blood Products

(a) Methodology

Since the implementation of the OPPS in August 2000, we have made separate payments for blood and blood products through APCs rather than packaging payment for them into payments for the procedures with which they are administered. Hospital payments for the costs of blood and blood products, as well as for the costs of collecting, processing, and storing blood and blood products, are made through the OPPS payments for specific blood product APCs.

In the CY 2020 OPPS/ASC proposed rule (84 FR 39409), we proposed to continue to establish payment rates for blood and blood products using our blood-specific CCR methodology, which utilizes actual or simulated CCRs from the most recently available hospital cost reports to convert hospital charges for blood and blood products to costs. This methodology has been our standard ratesetting methodology for blood and blood products since CY 2005. It was developed in response to data analysis indicating that there was a significant difference in CCRs for those hospitals with and without blood-specific cost centers, and past public comments indicating that the former OPPS policy of defaulting to the overall hospital CCR for hospitals not reporting a blood-specific cost center often resulted in an underestimation of the true hospital costs for blood and blood products. Specifically, in order to address the differences in CCRs and to better reflect hospitals' costs, we proposed to continue to simulate blood CCRs for each hospital that does not report a Start Printed Page 61155blood cost center by calculating the ratio of the blood-specific CCRs to hospitals' overall CCRs for those hospitals that do report costs and charges for blood cost centers. We also proposed to apply this mean ratio to the overall CCRs of hospitals not reporting costs and charges for blood cost centers on their cost reports in order to simulate blood-specific CCRs for those hospitals. We proposed to calculate the costs upon which the proposed CY 2020 payment rates for blood and blood products are based using the actual blood-specific CCR for hospitals that reported costs and charges for a blood cost center and a hospital-specific, simulated blood-specific CCR for hospitals that did not report costs and charges for a blood cost center.

We continue to believe that the hospital-specific, simulated blood-specific, CCR methodology better responds to the absence of a blood-specific CCR for a hospital than alternative methodologies, such as defaulting to the overall hospital CCR or applying an average blood-specific CCR across hospitals. Because this methodology takes into account the unique charging and cost accounting structure of each hospital, we believe that it yields more accurate estimated costs for these products. We stated in the proposed rule that we continue to believe that this methodology in CY 2020 would result in costs for blood and blood products that appropriately reflect the relative estimated costs of these products for hospitals without blood cost centers and, therefore, for these blood products in general.

We note that, as discussed in section II.A.2.b.(1). of the CY 2019 OPPS/ASC final rule with comment period (82 FR 58837 through 58843), we defined a comprehensive APC (C-APC) as a classification for the provision of a primary service and all adjunctive services provided to support the delivery of the primary service. Under this policy, we include the costs of blood and blood products when calculating the overall costs of these C-APCs. In the CY 2020 OPPS/ASC proposed rule (84 FR 39410), we proposed to continue to apply the blood-specific CCR methodology described in this section when calculating the costs of the blood and blood products that appear on claims with services assigned to the C-APCs. Because the costs of blood and blood products would be reflected in the overall costs of the C-APCs (and, as a result, in the payment rates of the C-APCs), we proposed to not make separate payments for blood and blood products when they appear on the same claims as services assigned to the C-APCs (we refer readers to the CY 2015 OPPS/ASC final rule with comment period (79 FR 66796)).

We also referred readers to Addendum B to the CY 2020 OPPS/ASC proposed rule (which is available via the internet on the CMS website) for the proposed CY 2020 payment rates for blood and blood products (which are identified with status indicator “R”). For a more detailed discussion of the blood-specific CCR methodology, we refer readers to the CY 2005 OPPS proposed rule (69 FR 50524 through 50525). For a full history of OPPS payment for blood and blood products, we refer readers to the CY 2008 OPPS/ASC final rule with comment period (72 FR 66807 through 66810).

We did not receive any comments on our proposal to establish payment rates for blood and blood products using our blood-specific CCR methodology and we are finalizing this policy as proposed.

(b) Pathogen-Reduced Platelets Payment Rate

In the CY 2016 OPPS/ASC final rule with comment period (80 FR 70322 through 70323), we reiterated that we calculate payment rates for blood and blood products using our blood-specific CCR methodology, which utilizes actual or simulated CCRs from the most recently available hospital cost reports to convert hospital charges for blood and blood products to costs. Because HCPCS code P9072 (Platelets, pheresis, pathogen reduced or rapid bacterial tested, each unit), the predecessor code to HCPCS code P9073 (Platelets, pheresis, pathogen-reduced, each unit), was new for CY 2016, there were no claims data available on the charges and costs for this blood product upon which to apply our blood-specific CCR methodology. Therefore, we established an interim payment rate for HCPCS code P9072 based on a crosswalk to existing blood product HCPCS code P9037 (Platelets, pheresis, leukocytes reduced, irradiated, each unit), which we believed provided the best proxy for the costs of the new blood product. In addition, we stated that once we had claims data for HCPCS code P9072, we would calculate its payment rate using the claims data that should be available for the code beginning in CY 2018, which is our practice for other blood product HCPCS codes for which claims data have been available for 2 years.

We stated in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59233) that, although our standard practice for new codes involves using claims data to set payment rates once claims data become available, we were concerned that there may have been confusion among the provider community about the services that HCPCS code P9072 described. That is, as early as 2016, there were discussions about changing the descriptor for HCPCS code P9072 to include the phrase “or rapid bacterial tested”, which is a less costly technology than pathogen reduction. In addition, effective January 2017, the code descriptor for HCPCS code P9072 was changed to describe rapid bacterial testing of platelets and, effective July 1, 2017, the descriptor for the temporary successor code (HCPCS code Q9988) for HCPCS code P9072 was changed again back to the original descriptor for HCPCS code P9072 that was in place for 2016.

Based on the ongoing discussions involving changes to the original HCPCS code P9072 established in CY 2016, we believed that claims from CY 2016 for pathogen reduced platelets may have potentially reflected certain claims for rapid bacterial testing of platelets. Therefore, we decided to continue to crosswalk the payment amount for services described by HCPCS code P9073 (the successor code to HCPCS code P9072 established January 1, 2018) to the payment amount for services described by HCPCS code P9037 for CY 2018 (82 FR 59232), to determine the payment rate for services described by HCPCS code P9072. In the CY 2019 OPPS/ASC proposed rule (83 FR 37058), for CY 2019, we discussed that we had reviewed the CY 2017 claims data for the two predecessor codes to HCPCS code P9073 (HCPCS codes P9072 and Q9988), along with the claims data for the CY 2017 temporary code for pathogen test for platelets (HCPCS code Q9987), which describes rapid bacterial testing of platelets. We found that there were over 2,200 claims billed with either HCPCS code P9072 or Q9988 in the CY 2017 claims data available for CY 2019 rulemaking. Accordingly, we believed that there were a sufficient number of claims to calculate a payment rate for HCPCS code P9073 for CY 2019 without using a crosswalk.

We also performed checks to estimate the share of claims that may have been billed for rapid bacterial testing of platelets as compared to the share of claims that may have been billed for pathogen-reduced, pheresis platelets (based on when HCPCS code P9072 was an active procedure code from January 1, 2017 to June 30, 2017). First, we found that the geometric mean cost for pathogen-reduced, pheresis platelets, as reported by HCPCS code Q9988 when billed separately from rapid bacterial testing of platelets, was $453.87, and Start Printed Page 61156that over 1,200 claims were billed for services described by HCPCS code Q9988. Next, we found that the geometric mean cost for rapid bacterial testing of platelets, as reported by HCPCS code Q9987 on claims, was $33.44, and there were 59 claims reported for services described by HCPCS code Q9987, of which 3 were separately paid.

These findings implied that almost all of the claims billed for services reported with HCPCS code P9072 were for pathogen-reduced, pheresis platelets. In addition, the geometric mean cost for services described by HCPCS code P9072, which may have contained rapid bacterial testing of platelets claims, was $468.11, which was higher than the geometric mean cost for services described by HCPCS code Q9988 of $453.87, which should not have contained claims for rapid bacterial testing of platelets. Because the geometric mean for services described by HCPCS code Q9987 was only $33.44, it would be expected that if a significant share of claims billed for services described by HCPCS code P9072 were for the rapid bacterial testing of platelets, the geometric mean cost for services described by HCPCS code P9072 would be lower than the geometric mean cost for services described by HCPCS code Q9988. Instead, we found that the geometric mean cost for services described by HCPCS code Q9988 was higher than the geometric mean cost for services described by HCPCS code P9072.

However, we received many comments from providers and other stakeholders including blood product industry stakeholder groups and the company who developed the pathogen-reduced platelets technology requesting that we not implement our proposal for CY 2019, and instead that we should once again establish the payment rate for HCPCS code P9073 by performing a crosswalk from the payment amount for services described by HCPCS code P9073 to the payment amount for services described by HCPCS code P9037. The commenters were concerned that the payment rate for HCPCS code P9073 calculated by using claims data for that service was too low. Several commenters believed the claim costs for pathogen-reduced platelets were lower than actual costs because of coding errors by providers, providers who did not use pathogen-reduced platelets when billing the service, and confusion over whether to use the hospital CCR or the blood center CCR to report charges for pathogen-reduced platelets. We considered the comments we received and decided not to finalize our proposal for CY 2019 to calculate the payment rate for services described by HCPCS code P9073 using claims payment history. Instead, for CY 2019, we established the payment rate for services described by HCPCS code P9073 by crosswalking the payment rate for the services described by HCPCS code P9073 from the payment rate for services described by HCPCS code P9037 (83 FR 58834).

For CY 2020 and subsequent years, we proposed to calculate the payment rate for services described by HCPCS code P9073 by using claims payment history, which is the standard methodology used under the OPPS to calculate payment rates for HCPCS codes with at least 2 years of claims history. Claims for HCPCS code P9073 and its predecessor codes have been billed under the OPPS for over 3 years and we believe providers have had sufficient time to become familiar with the services covered by the procedure code and the appropriate charges and CCRs used to report the service. Also, it has been more than a year and half since the issue in which payment for pathogen-reduced platelets and payment for rapid bacterial testing were combined under the same code was resolved. In our analysis of claims data from CY 2018, we found that approximately 4,700 claims have been billed for services described by HCPCS code P9073 and the estimated payment rate for services described by HCPCS code P9073 based on the claims data was approximately $585. The claims-based payment rate for services described by HCPCS code P9073 was approximately $60 less than the estimated crosswalked payment rate using HCPCS code P9037 of approximately $645. The claims data show that services described by HCPCS code P9073 have been reported regularly by providers during CY 2018 and the payment rate is close to the payment rate of the crosswalked payment rate for services described by HCPCS code P9037. Therefore, we believe that the payment rate for services described by HCPCS code P9073 can be determined using claims data without a crosswalk from the payment rate for services described by HCPCS code P9037.

We refer readers to Addendum B of the proposed rule for the proposed payment rate for services described by HCPCS code P9073 reportable under the OPPS. Addendum B is available via the internet on the CMS website.

Comment: We received comments that opposed the proposal to end the crosswalk between P9073 (Platelets, pheresis, pathogen-reduced, each unit) and P9037 (Platelets, pheresis, leukocytes reduced, irradiated, each unit) and calculate the payment rate for services described by HCPCS code P9073 using claims payment history. The commenters stated that the 2018 claims data used to establish the CY 2020 payment rate for pathogen-reduced platelets continue to include erroneous claims and is therefore inaccurate. The commenters further state, as an example of the inaccuracies of the 2018 claims data, that approximately 30 percent of the 2018 claims data for P9073 contain costs that are at least $100 lower than the costs of P9037, which is a less expensive technology. The commenters requested that we continue the crosswalk between these two codes for both CYs 2020 and 2021 to allow hospitals time to continue to correct errors in their chargemasters and to prevent underpayment to hospitals for pathogen-reduced platelets. The commenters also claim that hospitals may be reluctant to adopt a relatively new technology, such as pathogen-reduced platelets, if the payment is too low.

Response: We continue to believe that, beginning in CY 2020, it is appropriate to calculate the payment rate for services described by HCPCS code P9073 using the standard methodology (which involves using data from CY 2018 claims for the code). We have previously acknowledged (83 FR 58834) that there was confusion among the provider community surrounding the reporting and billing for P9073 and have made exceptions to our standard methodology for calculating payment rates for this service. At this time, we believe providers have had sufficient time to become familiar with the services covered by the procedure code and we believe the issue in which payment for pathogen-reduced platelets and payment for rapid bacterial testing was combined under the same code has been resolved. Additionally, in response to concerns that hospitals may be reluctant to adopt the pathogen-reduced platelet technology based on a payment rate that is too low, in our analysis of claims data from CY 2018, we found that approximately 5,300 claims have been billed for services described by HCPCS code P9073, which is significantly higher that the approximately 2,200 claims billed in 2017 for services described by the predecessor codes for HCPCS code P9073, HCPCS codes Q9988 and P9072. Also, the estimated CY 2020 payment rate for services described by HCPCS code P9073 based on the CY 2018 claims data is approximately $600 Start Printed Page 61157which is comparable to the CY 2020 estimated crosswalked payment rate using HCPCS code P9037 of approximately $620. These data suggest that a crosswalk is no longer necessary. Further, we have now used a cross-walk for P9073 and its predecessor codes for 4 years, which is longer than the typical 2-year period for which we normally cross-walk new HCPCS codes. We agreed with past commenters that an extended period of cross-walking payment for P9073 was necessary to address the coding confusion in 2016 that may have led to the claims data reflecting costs for services not described by HCPCS code P9073. However, the above-referenced coding issues were resolved in January 2018, so we have no reason to believe that the data may reflect the costs for services other than those described by P9073.

Accordingly, for CY 2020 and subsequent years, we are finalizing the policy to calculate the payment rate for services described by HCPCS code P9073 by using claims payment history and to end the crosswalk between HCPCS codes P9037 and P9073.

(2) Brachytherapy Sources

Section 1833(t)(2)(H) of the Act mandates the creation of additional groups of covered OPD services that classify devices of brachytherapy consisting of a seed or seeds (or radioactive source) (“brachytherapy sources”) separately from other services or groups of services. The statute provides certain criteria for the additional groups. For the history of OPPS payment for brachytherapy sources, we refer readers to prior OPPS final rules, such as the CY 2012 OPPS/ASC final rule with comment period (77 FR 68240 through 68241). As we have stated in prior OPPS updates, we believe that adopting the general OPPS prospective payment methodology for brachytherapy sources is appropriate for a number of reasons (77 FR 68240). The general OPPS methodology uses costs based on claims data to set the relative payment weights for hospital outpatient services. This payment methodology results in more consistent, predictable, and equitable payment amounts per source across hospitals by averaging the extremely high and low values, in contrast to payment based on hospitals' charges adjusted to costs. We believe that the OPPS methodology, as opposed to payment based on hospitals' charges adjusted to cost, also would provide hospitals with incentives for efficiency in the provision of brachytherapy services to Medicare beneficiaries. Moreover, this approach is consistent with our payment methodology for the vast majority of items and services paid under the OPPS. We refer readers to the CY 2016 OPPS/ASC final rule with comment period (80 FR 70323 through 70325) for further discussion of the history of OPPS payment for brachytherapy sources.

In the CY 2020 OPPS/ASC proposed rule, for CY 2020, we proposed to use the costs derived from CY 2018 claims data to set the proposed CY 2020 payment rates for brachytherapy sources because CY 2018 is the year of data we proposed to use to set the proposed payment rates for most other items and services that would be paid under the CY 2020 OPPS. We proposed to base the payment rates for brachytherapy sources on the geometric mean unit costs for each source, consistent with the methodology that we proposed for other items and services paid under the OPPS, as discussed in section II.A.2. of the proposed rule. We also proposed to continue the other payment policies for brachytherapy sources that we finalized and first implemented in the CY 2010 OPPS/ASC final rule with comment period (74 FR 60537). We proposed to pay for the stranded and nonstranded not otherwise specified (NOS) codes, HCPCS codes C2698 (Brachytherapy source, stranded, not otherwise specified, per source) and C2699 (Brachytherapy source, non-stranded, not otherwise specified, per source), at a rate equal to the lowest stranded or nonstranded prospective payment rate for such sources, respectively, on a per source basis (as opposed to, for example, a per mCi), which is based on the policy we established in the CY 2008 OPPS/ASC final rule with comment period (72 FR 66785). We also proposed to continue the policy we first implemented in the CY 2010 OPPS/ASC final rule with comment period (74 FR 60537) regarding payment for new brachytherapy sources for which we have no claims data, based on the same reasons we discussed in the CY 2008 OPPS/ASC final rule with comment period (72 FR 66786; which was delayed until January 1, 2010 by section 142 of Pub. L. 110-275). Specifically, this policy is intended to enable us to assign new HCPCS codes for new brachytherapy sources to their own APCs, with prospective payment rates set based on our consideration of external data and other relevant information regarding the expected costs of the sources to hospitals. The proposed CY 2020 payment rates for brachytherapy sources were included in Addendum B to the proposed rule (which is available via the internet on the CMS website) and were identified with status indicator “U”.

For CY 2018, we assigned status indicator “U” (Brachytherapy Sources, Paid under OPPS; separate APC payment) to HCPCS code C2645 (Brachytherapy planar source, palladium-103, per square millimeter) in the absence of claims data and established a payment rate using external data (invoice price) at $4.69 per mm2. For CY 2019, in the absence of sufficient claims data, we continued to establish a payment rate for C2645 at $4.69 per mm2. For CY 2020, we proposed to continue to assign status indicator “U” to HCPCS code C2645 (Brachytherapy planar source, palladium-103, per square millimeter). Our CY 2018 claims data available for the proposed CY 2020 rule, included two claims with over 9,000 units of HCPCS code C2645. Therefore, we stated our belief that the CY 2018 claims data were adequate to establish an APC payment rate for HCPCS code C2645 and to discontinue our use of external data for this brachytherapy source. Specifically, we proposed to set the proposed CY 2020 payment rate at the geometric mean cost of HCPCS code C2645 based on CY 2018 claims data, which is $1.02 per mm2.

Comment: One commenter stated that the reduction in the payment rate for HCPCS code C2645 (Brachytherapy planar source, palladium-103, per square millimeter) for CY 2020 will preclude outpatient use for an FDA-cleared, predominantly outpatient indication, for C2645. Additionally, the commenter argued that the two claims used to establish the payment rate for C2645 are not a sufficient volume for ratesetting and that the claims are most likely erroneous in that the brachytherapy source was used for procedures on the inpatient-only list.

Response: Claims that include brachytherapy sources along with procedures on the inpatient-only list are sufficient and appropriate to use for our ratesetting process as brachytherapy sources are line-item paid. However, given the limited number of claims for HCPCS C2645 for both CY 2020 and previous calendar years and the new FDA-approved outpatient indication for HCPCS code C2645, we are persuaded that the proposed CY 2020 payment rate, which is significantly lower than that of the rate in effect in prior years, may not adequately represent the costs associated with C2645. Therefore, we are using our equitable adjustment authority under section 1833(t)(2)(E) of the Act, which states that the Secretary shall establish, in a budget neutral manner, other adjustments as Start Printed Page 61158determined to be necessary to ensure equitable payments, to maintain the CY 2019 rate for this brachytherapy source, despite the lower geometric mean costs of $1.03 per mm2 available in the claims data used for this final rule with comment period. We believe this situation is unique, given the very limited number of claims for this brachytherapy source for both CY 2020 ratesetting purposes and previous calendar years.

After consideration of the public comment we received, we are not finalizing the proposed rate for C2645 and are instead assigning the brachytherapy source described by HCPCS code C2645 a payment rate of $4.69 mm2 for CY 2020 through use of our equitable adjustment authority.

Comment: Some commenters recommended that we reevaluate our approach to ratesetting HCPCS C2642 (Brachytherapy source, stranded, cesium-131, per source) and stated that our proposed CY 2020 payment rate of $67.29 per source for HCPCS code C2642 would be too low to ensure fair and adequate reimbursement. Additionally, one provider who billed C2642 stated there was a clerical error and that it may have inadvertently underreported the actual costs for C2642 incurred by the provider.

Response: Based on the most current available data for the CY 2020 OPPS/ASC final rule with comment period, the geometric mean for HCPCS code C2642 based on 85 claims from CY 2018 is $75.06 per source. We note that the CY 2019 payment rate for HCPCS Code C2642 was $79.94 per source. We believe that the variation in costs for HCPCS code C2642 does not appear unusual or erroneous and that the CY 2020 geometric mean for HCPCS code C2642 based on CY 2018 claims data is consistent with historical payment rates for this brachytherapy source.

Comment: One commenter stated that the geometric mean cost and payment for brachytherapy sources has fluctuated significantly since 2013. The commenter argued that such fluctuations may put financial pressure on providers and create access barriers for beneficiaries to receive brachytherapy. The commenter requested we review and consider removing outliers to ensure payment stability for low-volume brachytherapy sources in future rulemaking.

Response: We thank the commenter for their recommendation and will take it under consideration in future rulemaking. As discussed in the CY 2013 OPPS/ASC final rule with comment period (77 FR 68259 through 68271), geometric mean costs better encompass the variation in costs that occur when providing a service because, in addition to the individual cost values that are reflected by medians, geometric means reflect the magnitude of the cost measurements, and thus are more sensitive to changes in the data. OPPS relative payment weights based on geometric mean costs would better capture the range of costs associated with providing services. Further, geometric means capture cost changes that are introduced slowly into the system on a case-by-case or hospital-by-hospital basis. For these reasons, we believe it would be inappropriate to remove outliers when determining brachytherapy geometric mean costs and payment rates.

We continue to invite hospitals and other parties to submit recommendations to us for new codes to describe new brachytherapy sources. Such recommendations should be directed to the Division of Outpatient Care, Mail Stop C4-01-26, Centers for Medicare and Medicaid Services, 7500 Security Boulevard, Baltimore, MD 21244. We will continue to add new brachytherapy source codes and descriptors to our systems for payment on a quarterly basis.

b. Comprehensive APCs (C-APCs) for CY 2020

(1) Background

In the CY 2014 OPPS/ASC final rule with comment period (78 FR 74861 through 74910), we finalized a comprehensive payment policy that packages payment for adjunctive and secondary items, services, and procedures into the most costly primary procedure under the OPPS at the claim level. The policy was finalized in CY 2014, but the effective date was delayed until January 1, 2015, to allow additional time for further analysis, opportunity for public comment, and systems preparation. The comprehensive APC (C-APC) policy was implemented effective January 1, 2015, with modifications and clarifications in response to public comments received regarding specific provisions of the C-APC policy (79 FR 66798 through 66810).

A C-APC is defined as a classification for the provision of a primary service and all adjunctive services provided to support the delivery of the primary service. We established C-APCs as a category broadly for OPPS payment and implemented 25 C-APCs beginning in CY 2015 (79 FR 66809 through 66810). In the CY 2016 OPPS/ASC final rule with comment period (80 FR 70332), we finalized 10 additional C-APCs to be paid under the existing C-APC payment policy and added 1 additional level to both the Orthopedic Surgery and Vascular Procedures clinical families, which increased the total number of C-APCs to 37 for CY 2016. In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79584 through 79585), we finalized another 25 C-APCs for a total of 62 C-APCs. In the CY 2018 OPPS/ASC final rule with comment period, we did not change the total number of C-APCs from 62. In the CY 2019 OPPS/ASC final rule with comment period, we created 3 new C-APCs, increasing the total number to 65 (83 FR 58844 through 58846).

Under our C-APC policy, we designate a service described by a HCPCS code assigned to a C-APC as the primary service when the service is identified by OPPS status indicator “J1”. When such a primary service is reported on a hospital outpatient claim, taking into consideration the few exceptions that are discussed below, we make payment for all other items and services reported on the hospital outpatient claim as being integral, ancillary, supportive, dependent, and adjunctive to the primary service (hereinafter collectively referred to as “adjunctive services”) and representing components of a complete comprehensive service (78 FR 74865 and 79 FR 66799). Payments for adjunctive services are packaged into the payments for the primary services. This results in a single prospective payment for each of the primary, comprehensive services based on the costs of all reported services at the claim level.

Services excluded from the C-APC policy under the OPPS include services that are not covered OPD services, services that cannot by statute be paid for under the OPPS, and services that are required by statute to be separately paid. This includes certain mammography and ambulance services that are not covered OPD services in accordance with section 1833(t)(1)(B)(iv) of the Act; brachytherapy seeds, which also are required by statute to receive separate payment under section 1833(t)(2)(H) of the Act; pass-through payment drugs and devices, which also require separate payment under section 1833(t)(6) of the Act; self-administered drugs (SADs) that are not otherwise packaged as supplies because they are not covered under Medicare Part B under section 1861(s)(2)(B) of the Act; and certain preventive services (78 FR 74865 and 79 FR 66800 through 66801). A list of services excluded from the C-APC policy is included in Addendum J to this final rule with comment period Start Printed Page 61159(which is available via the internet on the CMS website).

The C-APC policy payment methodology set forth in the CY 2014 OPPS/ASC final rule with comment period for the C-APCs and modified and implemented beginning in CY 2015 is summarized as follows (78 FR 74887 and 79 FR 66800):

Basic Methodology. As stated in the CY 2015 OPPS/ASC final rule with comment period, we define the C-APC payment policy as including all covered OPD services on a hospital outpatient claim reporting a primary service that is assigned to status indicator “J1”, excluding services that are not covered OPD services or that cannot by statute be paid for under the OPPS. Services and procedures described by HCPCS codes assigned to status indicator “J1” are assigned to C-APCs based on our usual APC assignment methodology by evaluating the geometric mean costs of the primary service claims to establish resource similarity and the clinical characteristics of each procedure to establish clinical similarity within each APC.

In the CY 2016 OPPS/ASC final rule with comment period, we expanded the C-APC payment methodology to qualifying extended assessment and management encounters through the “Comprehensive Observation Services” C-APC (C-APC 8011). Services within this APC are assigned status indicator “J2”. Specifically, we make a payment through C-APC 8011 for a claim that:

  • Does not contain a procedure described by a HCPCS code to which we have assigned status indicator “T”
  • Contains 8 or more units of services described by HCPCS code G0378 (Hospital observation services, per hour);
  • Contains services provided on the same date of service or 1 day before the date of service for HCPCS code G0378 that are described by one of the following codes: HCPCS code G0379 (Direct admission of patient for hospital observation care) on the same date of service as HCPCS code G0378; CPT code 99281 (Emergency department visit for the evaluation and management of a patient (Level 1)); CPT code 99282 (Emergency department visit for the evaluation and management of a patient (Level 2)); CPT code 99283 (Emergency department visit for the evaluation and management of a patient (Level 3)); CPT code 99284 (Emergency department visit for the evaluation and management of a patient (Level 4)); CPT code 99285 (Emergency department visit for the evaluation and management of a patient (Level 5)) or HCPCS code G0380 (Type B emergency department visit (Level 1)); HCPCS code G0381 (Type B emergency department visit (Level 2)); HCPCS code G0382 (Type B emergency department visit (Level 3)); HCPCS code G0383 (Type B emergency department visit (Level 4)); HCPCS code G0384 (Type B emergency department visit (Level 5)); CPT code 99291 (Critical care, evaluation and management of the critically ill or critically injured patient; first 30-74 minutes); or HCPCS code G0463 (Hospital outpatient clinic visit for assessment and management of a patient); and
  • Does not contain services described by a HCPCS code to which we have assigned status indicator “J1”.

The assignment of status indicator “J2” to a specific combination of services performed in combination with each other allows for all other OPPS payable services and items reported on the claim (excluding services that are not covered OPD services or that cannot by statute be paid for under the OPPS) to be deemed adjunctive services representing components of a comprehensive service and resulting in a single prospective payment for the comprehensive service based on the costs of all reported services on the claim (80 FR 70333 through 70336).

Services included under the C-APC payment packaging policy, that is, services that are typically adjunctive to the primary service and provided during the delivery of the comprehensive service, include diagnostic procedures, laboratory tests, and other diagnostic tests and treatments that assist in the delivery of the primary procedure; visits and evaluations performed in association with the procedure; uncoded services and supplies used during the service; durable medical equipment as well as prosthetic and orthotic items and supplies when provided as part of the outpatient service; and any other components reported by HCPCS codes that represent services that are provided during the complete comprehensive service (78 FR 74865 and 79 FR 66800).

In addition, payment for hospital outpatient department services that are similar to therapy services and delivered either by therapists or nontherapists is included as part of the payment for the packaged complete comprehensive service. These services that are provided during the perioperative period are adjunctive services and are deemed not to be therapy services as described in section 1834(k) of the Act, regardless of whether the services are delivered by therapists or other nontherapist health care workers. We have previously noted that therapy services are those provided by therapists under a plan of care in accordance with section 1835(a)(2)(C) and section 1835(a)(2)(D) of the Act and are paid for under section 1834(k) of the Act, subject to annual therapy caps as applicable (78 FR 74867 and 79 FR 66800). However, certain other services similar to therapy services are considered and paid for as hospital outpatient department services. Payment for these nontherapy outpatient department services that are reported with therapy codes and provided with a comprehensive service is included in the payment for the packaged complete comprehensive service. We note that these services, even though they are reported with therapy codes, are hospital outpatient department services and not therapy services. We refer readers to the July 2016 OPPS Change Request 9658 (Transmittal 3523) for further instructions on reporting these services in the context of a C-APC service.

Items included in the packaged payment provided in conjunction with the primary service also include all drugs, biologicals, and radiopharmaceuticals, regardless of cost, except those drugs with pass-through payment status and SADs, unless they function as packaged supplies (78 FR 74868 through 74869 and 74909 and 79 FR 66800). We refer readers to Section 50.2M, Chapter 15, of the Medicare Benefit Policy Manual for a description of our policy on SADs treated as hospital outpatient supplies, including lists of SADs that function as supplies and those that do not function as supplies.

We define each hospital outpatient claim reporting a single unit of a single primary service assigned to status indicator “J1” as a single “J1” unit procedure claim (78 FR 74871 and 79 FR 66801). Line item charges for services included on the C-APC claim are converted to line item costs, which are then summed to develop the estimated APC costs. These claims are then assigned one unit of the service with status indicator “J1” and later used to develop the geometric mean costs for the C-APC relative payment weights. (We note that we use the term “comprehensive” to describe the geometric mean cost of a claim reporting “J1” service(s) or the geometric mean cost of a C-APC, inclusive of all of the items and services included in the C-APC service payment bundle.) Charges for services that would otherwise be separately payable are added to the charges for the primary service. This process differs from our traditional cost accounting methodology only in that all such services on the claim are packaged Start Printed Page 61160(except certain services as described above). We apply our standard data trims, which exclude claims with extremely high primary units or extreme costs.

The comprehensive geometric mean costs are used to establish resource similarity and, along with clinical similarity, dictate the assignment of the primary services to the C-APCs. We establish a ranking of each primary service (single unit only) to be assigned to status indicator “J1” according to its comprehensive geometric mean costs. For the minority of claims reporting more than one primary service assigned to status indicator “J1” or units thereof, we identify one “J1” service as the primary service for the claim based on our cost-based ranking of primary services. We then assign these multiple “J1” procedure claims to the C-APC to which the service designated as the primary service is assigned. If the reported “J1” services on a claim map to different C-APCs, we designate the “J1” service assigned to the C-APC with the highest comprehensive geometric mean cost as the primary service for that claim. If the reported multiple “J1” services on a claim map to the same C-APC, we designate the most costly service (at the HCPCS code level) as the primary service for that claim. This process results in initial assignments of claims for the primary services assigned to status indicator “J1” to the most appropriate C-APCs based on both single and multiple procedure claims reporting these services and clinical and resource homogeneity.

Complexity Adjustments. We use complexity adjustments to provide increased payment for certain comprehensive services. We apply a complexity adjustment by promoting qualifying paired “J1” service code combinations or paired code combinations of “J1” services and certain add-on codes (as described further below) from the originating C-APC (the C-APC to which the designated primary service is first assigned) to the next higher paying C-APC in the same clinical family of C-APCs. We apply this type of complexity adjustment when the paired code combination represents a complex, costly form or version of the primary service according to the following criteria:

  • Frequency of 25 or more claims reporting the code combination (frequency threshold); and
  • Violation of the 2 times rule, as stated in section 1833(t)(2) of the Act and section III.B.2. of this final rule, in the originating C-APC (cost threshold).

These criteria identify paired code combinations that occur commonly and exhibit materially greater resource requirements than the primary service. The CY 2017 OPPS/ASC final rule with comment period (81 FR 79582) included a revision to the complexity adjustment eligibility criteria. Specifically, we finalized a policy to discontinue the requirement that a code combination (that qualifies for a complexity adjustment by satisfying the frequency and cost criteria thresholds described above) also not create a 2 times rule violation in the higher level or receiving APC.

After designating a single primary service for a claim, we evaluate that service in combination with each of the other procedure codes reported on the claim assigned to status indicator “J1” (or certain add-on codes) to determine if there are paired code combinations that meet the complexity adjustment criteria. For a new HCPCS code, we determine initial C-APC assignment and qualification for a complexity adjustment using the best available information, crosswalking the new HCPCS code to a predecessor code(s) when appropriate.

Once we have determined that a particular code combination of “J1” services (or combinations of “J1” services reported in conjunction with certain add-on codes) represents a complex version of the primary service because it is sufficiently costly, frequent, and a subset of the primary comprehensive service overall according to the criteria described above, we promote the claim including the complex version of the primary service as described by the code combination to the next higher cost C-APC within the clinical family, unless the primary service is already assigned to the highest cost APC within the C-APC clinical family or assigned to the only C-APC in a clinical family. We do not create new APCs with a comprehensive geometric mean cost that is higher than the highest geometric mean cost (or only) C-APC in a clinical family just to accommodate potential complexity adjustments. Therefore, the highest payment for any claim including a code combination for services assigned to a C-APC would be the highest paying C-APC in the clinical family (79 FR 66802).

We package payment for all add-on codes into the payment for the C-APC. However, certain primary service add-on combinations may qualify for a complexity adjustment. As noted in the CY 2016 OPPS/ASC final rule with comment period (80 FR 70331), all add-on codes that can be appropriately reported in combination with a base code that describes a primary “J1” service are evaluated for a complexity adjustment.

To determine which combinations of primary service codes reported in conjunction with an add-on code may qualify for a complexity adjustment for CY 2020, in the CY 2020 OPPS/ASC proposed rule (84 FR 39414), we proposed to apply the frequency and cost criteria thresholds discussed above, testing claims reporting one unit of a single primary service assigned to status indicator “J1” and any number of units of a single add-on code for the primary “J1” service. If the frequency and cost criteria thresholds for a complexity adjustment are met and reassignment to the next higher cost APC in the clinical family is appropriate (based on meeting the criteria outlined above), we make a complexity adjustment for the code combination; that is, we reassign the primary service code reported in conjunction with the add-on code to the next higher cost C-APC within the same clinical family of C-APCs. As previously stated, we package payment for add-on codes into the C-APC payment rate. If any add-on code reported in conjunction with the “J1” primary service code does not qualify for a complexity adjustment, payment for the add-on service continues to be packaged into the payment for the primary service and is not reassigned to the next higher cost C-APC. We listed the complexity adjustments for “J1” and add-on code combinations for CY 2020, along with all of the other proposed complexity adjustments, in Addendum J to the CY 2020 OPPS/ASC proposed rule (which is available via the internet on the CMS website).

Addendum J to the proposed rule included the cost statistics for each code combination that would qualify for a complexity adjustment (including primary code and add-on code combinations). Addendum J to the proposed rule also contained summary cost statistics for each of the paired code combinations that describe a complex code combination that would qualify for a complexity adjustment and were proposed to be reassigned to the next higher cost C-APC within the clinical family. The combined statistics for all proposed reassigned complex code combinations were represented by an alphanumeric code with the first 4 digits of the designated primary service followed by a letter. For example, the proposed geometric mean cost listed in Addendum J for the code combination described by complexity adjustment assignment 3320R, which is assigned to C-APC 5224 (Level 4 Pacemaker and Start Printed Page 61161Similar Procedures), includes all paired code combinations that were proposed to be reassigned to C-APC 5224 when CPT code 33208 is the primary code. Providing the information contained in Addendum J to the proposed rule allowed stakeholders the opportunity to better assess the impact associated with the proposed reassignment of claims with each of the paired code combinations eligible for a complexity adjustment.

Comment: Several commenters requested that CMS alter the established C-APC complexity adjustment eligibility criteria to allow additional code combinations to qualify for complexity adjustments. Some commenters reiterated their request to allow clusters of procedures, consisting of a “J1” code-pair and multiple other associated add-on codes used in combination with that “J1” code-pair to qualify for complexity adjustments. Other commenters requested that CMS allow procedures assigned status indicator “S” or “T” to be eligible for complexity adjustments, to allow a C-APC to receive payment at the C-APC rate two levels higher within the clinical family when there is a violation of the two-times rule in the receiving C-APC and also to account for patient characteristics such as comorbidities and sociodemographic factors in the complexity adjustment policy. One commenter recommended that HCPCS code 0546T—Radiofrequency spectroscopy, real time, intraoperative margin assessment, at the time of partial mastectomy, with report—be assigned to APC 5091—Level 1 Breast/Lymphatic Surgery and Related Procedures and designated for complexity adjustment to APC 5092—Level 2 Breast/Lymphatic Surgery and Related Procedures for CY 2020.

We also received a comment requesting that CMS modify its complexity adjustment criteria and apply the complexity adjustment to all blue light cystoscopy with Cysview procedures in the HOPD, including eliminating the claim frequency requirement to determine eligibility for the complexity adjustment and expanding the eligibility for a complexity adjustment to other APCs besides C-APCs.

Response: We appreciate these comments. However, at this time, we do not believe changes to the C-APC complexity adjustment criteria are necessary or that we should make exceptions to the criteria to allow claims with the code combinations suggested by the commenters to receive complexity adjustments. As stated previously (81 FR 79582), we continue to believe that the complexity adjustment criteria, which require a frequency of 25 or more claims reporting a code combination and a violation of the 2 times rule in the originating C-APC in order to receive payment in the next higher cost C-APC within the clinical family, are adequate to determine if a combination of procedures represents a complex, costly subset of the primary service. If a code combination meets these criteria, the combination receives payment at the next higher cost C-APC. Code combinations that do not meet these criteria receive the C-APC payment rate associated with the primary “J1” service. A minimum of 25 claims is already a very low threshold for a national payment system. Lowering the minimum of 25 claims further could lead to unnecessary complexity adjustments for service combinations that are rarely performed.

We also do not believe that it is necessary to provide payment for claims including qualifying code combinations at two APC levels higher than the originating APC. As stated in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58842), we believe that payment at the next higher paying C-APC is adequate for code combinations that exhibit materially greater resource requirements than the primary service and that, in many cases, paying the rate assigned to two levels higher may lead to a significant overpayment. As mentioned previously, we do not create new APCs with a comprehensive geometric mean cost that is higher than the highest geometric mean cost C-APC in a clinical family just to accommodate potential complexity adjustments. The highest payment for any claim including a code combination for services assigned to a C-APC would be the highest paying C- APC in the clinical family (79 FR 66802). Therefore, a policy to pay for claims with qualifying code combinations at two C-APC levels higher than the originating APC is not always feasible.

Lastly, as stated in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58843), we do not believe that it is necessary to adjust the complexity adjustment criteria to allow claims that include more than two “J1” procedures, procedures that are not assigned to C-APCs, or procedures performed at certain hospitals with patients with more comorbidities, to qualify for a complexity adjustment. As mentioned earlier, we believe the current criteria are adequate to determine if a combination of procedures represents a complex, costly subset of the primary service.

With regard to the requests for further complexity adjustments for blue light cystoscopy procedures using the drug Cysview, as discussed in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59243-59246), we acknowledged that there are additional equipment, supplies, operating room time, and other resources required to perform blue light cystoscopy in addition to white light cystoscopy. We also acknowledged stakeholder concerns that the payment for blue light cystoscopy procedures involving Cysview® may be creating a barrier to beneficiaries receiving access to reasonable and necessary care for which there may not be a clinically comparable alternative. Based on these issues, in CY 2018, we created a HCPCS C-code (C9738—Adjunctive blue light cystoscopy with fluorescent imaging agent (list separately in addition to code for primary procedure)) to describe blue light cystoscopy with fluorescent imaging agent and allowed this code to be eligible for complexity adjustments when billed with procedure codes used to describe white light cystoscopy of the bladder, although this code is not a “J1” service or an add-on code for the primary “J1” service. For CY 2020, there are three code combinations of six total involving C9738 and procedure codes used to describe white light cystoscopy that will qualify for a complexity adjustment. At this time, we do not believe that further modifications to the C-APC policy are necessary.

After consideration of the public comments we received on the proposed complexity adjustment policy, we are finalizing the C-APC complexity adjustment policy for CY 2020, as proposed, without modification.

(2) Additional C-APCs for CY 2020

For CY 2020 and subsequent years, in the CY 2020 OPPS/ASC proposed rule (84 FR 39414), we proposed to continue to apply the C-APC payment policy methodology. We refer readers to the CY 2017 OPPS/ASC final rule with comment period (81 FR 79583) for a discussion of the C-APC payment policy methodology and revisions.

Each year, in accordance with section 1833(t)(9)(A) of the Act, we review and revise the services within each APC group and the APC assignments under the OPPS. As a result of our annual review of the services and the APC assignments under the OPPS, in the proposed rule (84 FR 39414), we proposed to add two C-APCs under the existing C-APC payment policy in CY 2020: Proposed C-APC 5182 (Level 2 Start Printed Page 61162Vascular Procedures); and proposed C-APC 5461 (Level 1 Neurostimulator and Related Procedures). These APCs were selected to be included in this proposal because, similar to other C-APCs, these APCs include primary, comprehensive services, such as major surgical procedures, that are typically reported with other ancillary and adjunctive services. Also, similar to other APCs that have been converted to C-APCs, there are higher APC levels within the clinical family or related clinical family of these APCs that have previously been assigned to a C-APC. Table 4 of the proposed rule listed the proposed C-APCs for CY 2020. All C-APCs were displayed in Addendum J to the proposed rule (which is available via the internet on the CMS website). Addendum J to the proposed rule also contained all of the data related to the C-APC payment policy methodology, including the list of proposed complexity adjustments and other information.

We also are considering developing an episode-of-care for skin substitutes and are interested in comments regarding a future C-APC for procedures using skin substitute products furnished in the hospital outpatient department setting. We note that this comment solicitation is discussed in section V.B.7. of the proposed rule and this final rule with comment period.

Comment: Several commenters supported the creation of the two new proposed C-APCs, encouraging CMS to continue to evaluate outpatient charge and cost data for additions to the list of C-APCs during future rulemaking periods. One commenter requested that CMS closely monitor payments for the proposed C-APC 5461 (Level 1 Neurostimulator and Related Products) relative to costs of the procedure to ensure accurate compensation and availability in the ASC setting.

Response: We appreciate the commenters' support and note that we annually review the most recent data available to determine costs associated with furnishing a service and update payment rates accordingly.

Comment: We received comments requesting that CMS create a C-APC for autologous hematopoietic stem cell transplant similar to the C-APC established for allogeneic hematopoietic stem cell transplant. The commenters stated CMS' APC rate-setting process of using single and pseudo-single procedure claims results in an inadequately low APC payment rate for autologous stem cell transplant and believed that the creation of a C-APC for autologous hematopoietic stem cell transplant would improve payment rates by allowing a greater number of claims to be used in the rate setting process. The Advisory Panel on Hospital Outpatient Payment (HOP Panel) also recommended that CMS consider creating a comprehensive APC for autologous stem cell transplantation and that CMS provide a rationale if it decides not to create such an APC.

Response: We thank the commenter for this comment. In order to determine whether it would be appropriate to create a C-APC for autologous hematopoietic stem cell transplant, we modeled this change with APC 5242—Level 2 Blood Product Exchange and Related Services, which includes CPT code 38241 Hematopoietic progenitor cell (hpc); autologous transplantation as well as APC 5243—Level 3 Blood Product Exchange and Related Services, in keeping with our practice of converting APCs to C-APCs that have higher APC levels within the clinical family that are assigned to a C-APC.

After analyzing the results, we found that creating a C-APC for APC 5242 would increase the number of single claims available for ratesetting for this APC by approximately 8 percent, however creating new C-APCs in the Stem Cell Transplant clinical family would decrease the geometric mean cost of C-APC 5244—Level 4 Blood Product Exchange and Related Services by approximately 75 percent due to complexity adjustments of code combinations within the clinical family, specifically complexity adjustments from C-APC 5243 to C-APC 5244. Therefore, at this time we do not believe it is appropriate to create a C-APC for autologous hematopoietic stem cell transplant.

Comment: Two manufacturers of drugs used in ocular procedures requested that CMS discontinue the C-APC payment policy for existing C-APCs that include procedures involving their drugs and instead provide separate payment for the drugs. The manufacturer commenters believed that the C-APC packaging policy, which packages payment for certain drugs that are adjunctive to the primary service, results in underpayment for the drugs and violates the 2 times rule.

Response: We continue to believe that the procedures assigned to the proposed C-APCs, including the procedures involving the drugs used in ocular procedures mentioned by the commenters, are appropriately paid through a C-APC and the costs of drugs (as well as other items or services furnished with the procedures) are reflected in hospital billing, and therefore the rates that are established for the ocular procedures. As stated in the CY 2017 OPPS/ASC final rule with comment period (81 FR 79584), procedures assigned to C-APCs are primary services (mostly major surgical procedures) that are typically the focus of the hospital outpatient stay. In addition, with regard to the packaging of the drugs based on the C-APC policy, as stated in previous rules (78 FR 74868 through 74869 and 74909 and 79 FR 66800), items included in the packaged payment provided with the primary “J1” service include all drugs, biologicals, and radiopharmaceuticals payable under the OPPS, regardless of cost, except those drugs with pass-through payment status. In accordance with section 1833(t)(2) of the Act and § 419.31 of the regulations, we annually review the items and services within an APC group to determine if there are any APC violations of the 2 times rule and whether there are any revisions to APC assignments that may be necessary or any exceptions that should be made.

Comment: Several commenters, including device manufacturer associations, expressed concern that the C-APC payment rates may not adequately reflect the costs associated with services and requested that CMS not establish any additional C-APCs. These comments questioned the broader C-APC payment methodology, ratesetting accuracy, the impact of C-APCs on broader agency objectives, and recommended methodological changes to better capture costs of providing comprehensive services before further expansion. Some commenters were concerned that hospital are not correctly charging for procedures assigned to C-APCs and urged CMS to invest in policies and education for hospitals regarding correct billing patterns. These commenters also requested that CMS provide an analysis of the impact of the C-APC policy on affected procedures and patient access to services.

Response: We appreciate the comments. We continue to believe that the proposed new C-APCs for CY 2020 are appropriate to be added to the existing C-APC payment policy. We also note that, in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59246), we conducted an analysis of the effects of the C-APC policy. The analysis looked at data from CY 2016 OPPS/ASC final rule with comment period, the CY 2017 OPPS/ASC final rule with comment period, and the CY 2018 OPPS/ASC proposed rule, which involved claims data from CY 2014 (before C-APCs became effective) to CY 2016. We looked at separately payable codes that were then assigned to C-APCs and, overall, we observed an increase in claim line frequency, units Start Printed Page 61163billed, and Medicare payment for those procedures, which suggest that the C-APC payment policy did not adversely affect access to care or reduce payments to hospitals.

Comment: One commenter requested that CMS discontinue the C-APC payment policy for single session stereotactic radiosurgery (SRS) procedures, stating concerns that the C-APC methodology does not account for the complexity of delivering radiation therapy and fails to capture appropriately coded claims. The commenters also requested that CMS continue to make separate payments for the 10 planning and preparation codes related to SRS and include the HCPCS code for IMRT planning (77301) on the list of planning and preparation codes, stating that the service has become more common in single fraction radiosurgery treatment planning.

Response: At this time, we do not believe that it is necessary to discontinue the C-APCs that include single session SRS procedures. We continue to believe that the C-APC policy is appropriately applied to these surgical procedures for the reasons cited when this policy was first adopted and note that the commenters did not provide any empirical evidence to support their claims that the existing C-APC policy does not adequately pay for these procedures. Also, we will continue in CY 2020 to pay separately for the 10 planning and preparation services (HCPCS codes 70551, 70552, 70553, 77011, 77014, 77280, 77285, 77290, 77295, and 77336) adjunctive to the delivery of the SRS treatment using either the Cobalt-60-based or LINAC based technology when furnished to a beneficiary within 1 month of the SRS treatment for CY 2020 (82 FR 59242 and 59243).

Comment: Several commenters requested that CMS discontinue the C-APC payment policy for all surgical insertion codes required for brachytherapy treatment. The commenters stated concerns about how the C-APC methodology impacts radiation oncology, particularly the delivery of brachytherapy for the treatment of cervical cancer. They also stated that they oppose C-APC payment for cancer care given the complexity of coding, serial billing for cancer care, and potentially different sites of service for the initial surgical device insertion and subsequent treatment delivery or other supportive services.

Response: While we continue to believe that the C-APC policy is appropriately applied to these surgical procedures, we will continue to examine these concerns and will determine if any modifications to this policy are warranted in future rulemaking.

Comment: We received requests for clarifications related to C-APC 8011 Comprehensive Observation Services (status indicator “J2”). One commenter requested that CMS clarify the distinction between status indicators for “V” and “J2”. Another commenter questioned the rationale for the established criteria for payment through C-APC 8011, specifically the requirement that the claim does not contain a procedure described by a HCPCS code to which we have assigned status indicator “T” that is reported with a date of service on the same day or 1 day earlier than the date of service associated with services described by HCPCS code G0378.

Response: The comprehensive observation services C-APC (C-APC 8011) was established in CY 2016 (80 FR 70333 through 70336) to provide payment for extended assessment and management encounters. C-APC 8011 is paid and status indicator “J2” is assigned when a specific combination of services is performed. This combination of services was described in previous rulemaking (80 FR 70333 through 70336) in detail and is repeated for clarity below. Specifically, we make a payment through C-APC 8011 for a claim that:

  • Does not contain a procedure described by a HCPCS code to which we have assigned status indicator “T;”
  • Contains 8 or more units of services described by HCPCS code G0378 (Hospital observation services, per hour);
  • Contains services provided on the same date of service or 1 day before the date of service for HCPCS code G0378 that are described by one of the following codes: HCPCS code G0379 (Direct admission of patient for hospital observation care) on the same date of service as HCPCS code G0378; CPT code 99281 (Emergency department visit for the evaluation and management of a patient (Level 1)); CPT code 99282 (Emergency department visit for the evaluation and management of a patient (Level 2)); CPT code 99283 (Emergency department visit for the evaluation and management of a patient (Level 3)); CPT code 99284 (Emergency department visit for the evaluation and management of a patient (Level 4)); CPT code 99285 (Emergency department visit for the evaluation and management of a patient (Level 5)) or HCPCS code G0380 (Type B emergency department visit (Level 1)); HCPCS code G0381 (Type B emergency department visit (Level 2)); HCPCS code G0382 (Type B emergency department visit (Level 3)); HCPCS code G0383 (Type B emergency department visit (Level 4)); HCPCS code G0384 (Type B emergency department visit (Level 5)); CPT code 99291 (Critical care, evaluation and management of the critically ill or critically injured patient; first 30-74 minutes); or HCPCS code G0463 (Hospital outpatient clinic visit for assessment and management of a patient); and
  • Does not contain services described by a HCPCS code to which we have assigned status indicator “J1'.'

The assignment of status indicator “J2” results in a single prospective payment for the comprehensive observation services based on the costs of all reported services on the claim. We make payment for all other items and services reported on the hospital outpatient claim as being adjunctive to the specific combination of observation services. The assignment of status indicator “V” describes a clinic or emergency department visit. It does not describe services paid through a comprehensive APC and it will not trigger payment through C-APC 8011.

With regard to the comment questioning the rationale for the requirement that the claim does not contain a procedure described by a HCPCS code to which we have assigned status indicator “T” that is reported with a date of service on the same day or 1 day earlier than the date of service associated with services described by HCPCS code G0378 in order to be paid through C-APC 8011, this criterion was incorrectly quoted as the final policy in the CY 2020 OPPS/ASC proposed rule (84 FR 39412). This language has been updated in this final rule with comment period. This criterion was proposed in the CY 2016 OPPS/ASC proposed rule, however a modification of this criterion was finalized. We refer readers to the discussion of the establishment of C-APC 8011 in the CY 2016 OPPS/ASC Final Rule with comment period (80 FR 70335-70336). In this rule, we stated in response to commenters' concerns regarding packaging payment for potentially high-cost surgical procedures into the payment for an observation C-APC, we finalized a policy that claims reporting procedures assigned status indicator “T” should not qualify for payment through C-APC 8011, regardless of whether the procedure assigned status indicator “T” was furnished before or after observation services (described by HCPCS code G0378) were provided. We state the final criteria for assignment for payment through C-APC 8011 in the CY 2016 OPPS/ASC final rule with comment period, including that the Start Printed Page 61164claims must not contain a procedure described by a HCPCS code to which we have assigned status indicator “T” (80 FR 70335).

After consideration of the public comments we received, we are finalizing the proposed C-APCs for CY 2020. Table 4 below lists the final C-APCs for CY 2020. All C-APCs are displayed in Addendum J to this final rule with comment period (which is available via the internet on the CMS website). Addendum J to this final rule with comment period also contains all of the data related to the C-APC payment policy methodology, including the list of complexity adjustments and other information for CY 2020.

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(3) Exclusion of Procedures Assigned to New Technology APCs from the C-APC Policy

Services that are assigned to New Technology APCs are typically new procedures that do not have sufficient claims history to establish an accurate payment for the procedures. Beginning in CY 2002, we retain services within New Technology APC groups until we gather sufficient claims data to enable us to assign the service to an appropriate clinical APC. This policy allows us to move a service from a New Technology APC in less than 2 years if sufficient data are available. It also allows us to retain a service in a New Technology APC for more than 2 years if sufficient data upon which to base a decision for reassignment have not been collected (82 FR 59277).

The C-APC payment policy packages payment for adjunctive and secondary items, services, and procedures into the most costly primary procedure under the OPPS at the claim level. Prior to CY 2019 when a procedure assigned to a New Technology APC was included on the claim with a primary procedure, identified by OPPS status indicator “J1”, payment for the new technology service was typically packaged into the payment for the primary procedure. Because the new technology service was not separately paid in this scenario, the overall number of single claims available to determine an appropriate clinical APC for the new service was reduced. This was contrary to the objective of the New Technology APC payment policy, which is to gather sufficient claims data to enable us to assign the service to an appropriate clinical APC.

For example, for CY 2017, there were seven claims generated for HCPCS code 0100T (Placement of a subconjunctival retinal prosthesis receiver and pulse generator, and implantation of intraocular retinal electrode array, with vitrectomy), which involves the use of the Argus® II Retinal Prosthesis System. However, several of these claims were not available for ratesetting because HCPCS code 0100T was reported with a “J1” procedure and, therefore, payment was packaged into the associated C-APC payment. If these services had been separately paid under the OPPS, there would be at least two additional single claims available for ratesetting. As mentioned previously, the purpose of the new technology APC policy is to ensure that there are sufficient claims data for new services, which is particularly important for services with a low volume such as procedures described by HCPCS code 0100T. Another concern is the costs reported for the claims when payment is not packaged for a new technology procedure may not be representative of all of the services included on a claim that is generated, which may also affect our ability to assign the new service to the most appropriate clinical APC.

To address this issue and help ensure that there is sufficient claims data for services assigned to New Technology APCs, in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58847), we proposed excluded payment for any procedure that is assigned to a New Technology APC (APCs 1491 through 1599 and APCs 1901 through 1908) from being packaged when included on a claim with a “J1” service assigned to a C-APC. For CY 2020, we proposed to continue to exclude payment for any procedure that is assigned to a New Technology APC from being packaged when included on a claim with a “J1” service assigned to a C-APC.

Some stakeholders have raised questions about whether the policy established in the CY 2019 OPPS/ASC final rule with comment period would also apply to comprehensive observation services assigned status indicator “J2.” We recognize that the policy described and adopted in the CY 2019 rulemaking may have been ambiguous with respect to this issue. While our intention in the CY 2019 rulemaking was only to exclude payment for services assigned to New Technology APCs from being bundled into the payment for a comprehensive “J1” service, we believe that there may also be some instances in which it would be clinically appropriate to provide a new technology service when providing comprehensive observation services. We would not generally expect Start Printed Page 61167that to be the case, because procedures assigned to New Technology APCs typically are new or low-volume surgical procedures, or are specialized tests to diagnosis a specific condition. In addition, it is highly unlikely a general observation procedure would be assigned to a New Technology APC because there are clinical APCs already established under the OPPS to classify general observation procedures. As we stated in the CY 2016 OPPS/ASC final rule with comment period, observation services may not be used for post-operative recovery and, as such, observation services furnished with services assigned to status indicator “T” will always be packaged (80 FR 70334). Therefore, we proposed that payment for services assigned to a New Technology APC when included on a claim for a service assigned status indicator “J2” assigned to a C-APC will be packaged into the payment for the comprehensive service. Nonetheless, we sought public comments on whether it would be clinically appropriate to exclude payment for any New Technology APC procedures from being packaged into the payment for a comprehensive “J2” service starting in CY 2020.

Comment: Several commenters, including device manufacturers, device manufacturer associations and physicians were opposed to our proposal to package payment for procedures assigned to a New Technology APC into the payment for comprehensive observation services assigned status indicator “J2”. The commenters stated that there were instances where beneficiaries receiving observation services may require the types of procedures that are assigned to new technology APCs. Several commenters specifically mentioned the HeartFlow Analysis, and stated that it could be performed appropriately for a patient receiving observation services. The commenters also stated that providing separate payment for this new technology procedure will allow CMS to collect sufficient claims data to enable assignment of the procedure to an appropriate clinical APC.

Response: We appreciate the stakeholders' comments regarding this proposal and agree that, although rare, there are situations in which it is clinically appropriate to provide a new technology service when providing comprehensive observation services. As discussed in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58847), the purpose of the new technology APC policy is to ensure that there are sufficient claims data for new services to assign these procedures to an appropriate clinical APC and therefore, we excluded procedures assigned to New Technology APCs from packaging under the C-APC policy. In the CY 2019 final rule, we specifically stated that the exclusion policy included circumstances when New Technology procedures were billed with comprehensive services assigned to status indicator “J1”, however we believe this rationale is also applicable to comprehensive observation services that are assigned status indicator “J2”. Therefore, we are modifying our policy for excluding procedures assigned to New Technology APCs from the C-APC policy. For CY 2020, we are finalizing our policy to continue to exclude payment for any procedure that is assigned to a New Technology APC from being packaged when included on a claim with a “J1” service assigned to a C-APC. For CY 2020, we are also finalizing a policy to exclude payment for any procedures that are assigned to a New Technology APC from being packaged into the payment for comprehensive observation services assigned to status indicator “J2” when they are included on a claim with “J2” procedures.

c. Calculation of Composite APC Criteria-Based Costs

As discussed in the CY 2008 OPPS/ASC final rule with comment period (72 FR 66613), we believe it is important that the OPPS enhance incentives for hospitals to provide necessary, high quality care as efficiently as possible. For CY 2008, we developed composite APCs to provide a single payment for groups of services that are typically performed together during a single clinical encounter and that result in the provision of a complete service. Combining payment for multiple, independent services into a single OPPS payment in this way enables hospitals to manage their resources with maximum flexibility by monitoring and adjusting the volume and efficiency of services themselves. An additional advantage to the composite APC model is that we can use data from correctly coded multiple procedure claims to calculate payment rates for the specified combinations of services, rather than relying upon single procedure claims which may be low in volume and/or incorrectly coded. Under the OPPS, we currently have composite policies for mental health services and multiple imaging services. (We note that, in the CY 2018 OPPS/ASC final rule with comment period, we finalized a policy to delete the composite APC 8001 (LDR Prostate Brachytherapy Composite) for CY 2018 and subsequent years.) We refer readers to the CY 2008 OPPS/ASC final rule with comment period (72 FR 66611 through 66614 and 66650 through 66652) for a full discussion of the development of the composite APC methodology, and the CY 2012 OPPS/ASC final rule with comment period (76 FR 74163) and the CY 2018 OPPS/ASC final rule with comment period (82 FR 59241 through 59242 and 59246 through 52950) for more recent background.

(1) Mental Health Services Composite APC

In the CY 2020 OPPS/ASC proposed rule (84 FR 39398), we proposed to continue our longstanding policy of limiting the aggregate payment for specified less resource-intensive mental health services furnished on the same date to the payment for a day of partial hospitalization services provided by a hospital, which we consider to be the most resource-intensive of all outpatient mental health services. We refer readers to the April 7, 2000 OPPS final rule with comment period (65 FR 18452 through 18455) for the initial discussion of this longstanding policy and the CY 2012 OPPS/ASC final rule with comment period (76 FR 74168) for more recent background.

In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79588 through 79589), we finalized a policy to combine the existing Level 1 and Level 2 hospital-based PHP APCs into a single hospital-based PHP APC, and thereby discontinue APCs 5861 (Level 1—Partial Hospitalization (3 services) for Hospital-Based PHPs) and 5862 (Level—2 Partial Hospitalization (4 or more services) for Hospital-Based PHPs) and replace them with APC 5863 (Partial Hospitalization (3 or more services per day)).

In the CY 2018 OPPS/ASC proposed rule and final rule with comment period (82 FR 33580 through 33581 and 59246 through 59247, respectively), we proposed and finalized the policy for CY 2018 and subsequent years that, when the aggregate payment for specified mental health services provided by one hospital to a single beneficiary on a single date of service, based on the payment rates associated with the APCs for the individual services, exceeds the maximum per diem payment rate for partial hospitalization services provided by a hospital, those specified mental health services will be paid through composite APC 8010 (Mental Health Services Composite). In addition, we set the payment rate for composite APC 8010 for CY 2018 at the same payment rate that will be paid for APC 5863, which is the maximum partial hospitalization per diem payment rate for a hospital, Start Printed Page 61168and finalized a policy that the hospital will continue to be paid the payment rate for composite APC 8010. Under this policy, the I/OCE will continue to determine whether to pay for these specified mental health services individually, or to make a single payment at the same payment rate established for APC 5863 for all of the specified mental health services furnished by the hospital on that single date of service. We continue to believe that the costs associated with administering a partial hospitalization program at a hospital represent the most resource intensive of all outpatient mental health services. Therefore, we do not believe that we should pay more for mental health services under the OPPS than the highest partial hospitalization per diem payment rate for hospitals.

In the CY 2020 OPPS/ASC proposed rule (84 FR 39398), for CY 2020, we proposed that when the aggregate payment for specified mental health services provided by one hospital to a single beneficiary on a single date of service, based on the payment rates associated with the APCs for the individual services, exceeds the maximum per diem payment rate for partial hospitalization services provided by a hospital, those specified mental health services would be paid through composite APC 8010 for CY 2020. In addition, we proposed to set the proposed payment rate for composite APC 8010 at the same payment rate that we proposed for APC 5863, which is the maximum partial hospitalization per diem payment rate for a hospital, and that the hospital continue to be paid the proposed payment rate for composite APC 8010.

We did not receive any public comment on these proposals. Therefore, we are finalizing our proposal, without modification, that when the aggregate payment for specified mental health services provided by one hospital to a single beneficiary on a single date of service, based on the payment rates associated with the APCs for the individual services, exceeds the maximum per diem payment rate for partial hospitalization services provided by a hospital, those specified mental health services would be paid through composite APC 8010 for CY 2020. In addition, we are finalizing our proposal to set the payment rate for composite APC 8010 for CY 2020 at the same payment rate that we set for APC 5863, which is the maximum partial hospitalization per diem payment rate for a hospital.

(2) Multiple Imaging Composite APCs (APCs 8004, 8005, 8006, 8007, and 8008)

Effective January 1, 2009, we provide a single payment each time a hospital submits a claim for more than one imaging procedure within an imaging family on the same date of service, in order to reflect and promote the efficiencies hospitals can achieve when performing multiple imaging procedures during a single session (73 FR 41448 through 41450). We utilize three imaging families based on imaging modality for purposes of this methodology: (1) Ultrasound; (2) computed tomography (CT) and computed tomographic angiography (CTA); and (3) magnetic resonance imaging (MRI) and magnetic resonance angiography (MRA). The HCPCS codes subject to the multiple imaging composite policy and their respective families are listed in Table 12 of the CY 2014 OPPS/ASC final rule with comment period (78 FR 74920 through 74924).

While there are three imaging families, there are five multiple imaging composite APCs due to the statutory requirement under section 1833(t)(2)(G) of the Act that we differentiate payment for OPPS imaging services provided with and without contrast. While the ultrasound procedures included under the policy do not involve contrast, both CT/CTA and MRI/MRA scans can be provided either with or without contrast. The five multiple imaging composite APCs established in CY 2009 are:

  • APC 8004 (Ultrasound Composite);
  • APC 8005 (CT and CTA without Contrast Composite);
  • APC 8006 (CT and CTA with Contrast Composite);
  • APC 8007 (MRI and MRA without Contrast Composite); and
  • APC 8008 (MRI and MRA with Contrast Composite).

We define the single imaging session for the “with contrast” composite APCs as having at least one or more imaging procedures from the same family performed with contrast on the same date of service. For example, if the hospital performs an MRI without contrast during the same session as at least one other MRI with contrast, the hospital will receive payment based on the payment rate for APC 8008, the “with contrast” composite APC.

We make a single payment for those imaging procedures that qualify for payment based on the composite APC payment rate, which includes any packaged services furnished on the same date of service. The standard (noncomposite) APC assignments continue to apply for single imaging procedures and multiple imaging procedures performed across families. For a full discussion of the development of the multiple imaging composite APC methodology, we refer readers to the CY 2009 OPPS/ASC final rule with comment period (73 FR 68559 through 68569).

In the CY 2020 OPPS/ASC proposed rule (84 FR 39398), we proposed to continue to pay for all multiple imaging procedures within an imaging family performed on the same date of service using the multiple imaging composite APC payment methodology. We stated that we continue to believe that this policy would reflect and promote the efficiencies hospitals can achieve when performing multiple imaging procedures during a single session.

The proposed CY 2020 payment rates for the five multiple imaging composite APCs (APCs 8004, 8005, 8006, 8007, and 8008) were based on proposed geometric mean costs calculated from CY 2018 claims available for the CY 2020 OPPS/ASC proposed rule that qualified for composite payment under the current policy (that is, those claims reporting more than one procedure within the same family on a single date of service). To calculate the proposed geometric mean costs, we used the same methodology that we have used to calculate the geometric mean costs for these composite APCs since CY 2014, as described in the CY 2014 OPPS/ASC final rule with comment period (78 FR 74918). The imaging HCPCS codes referred to as “overlap bypass codes” that we removed from the bypass list for purposes of calculating the proposed multiple imaging composite APC geometric mean costs, in accordance with our established methodology as stated in the CY 2014 OPPS/ASC final rule with comment period (78 FR 74918), were identified by asterisks in Addendum N to the CY 2020 OPPS/ASC proposed rule (which is available via the internet on the CMS website) and were discussed in more detail in section II.A.1.b. of the CY 2020 OPPS/ASC proposed rule.

For the CY 2020 OPPS/ASC proposed rule, we were able to identify approximately 700,000 “single session” claims out of an estimated 4.9 million potential claims for payment through composite APCs from our ratesetting claims data, which represents approximately 14 percent of all eligible claims, to calculate the proposed CY 2020 geometric mean costs for the multiple imaging composite APCs. Table 5 of the CY 2020 OPPS/ASC proposed rule listed the proposed Start Printed Page 61169HCPCS codes that would be subject to the multiple imaging composite APC policy and their respective families and approximate composite APC proposed geometric mean costs for CY 2020.

We did not receive any public comments on these proposals. Therefore, we are finalizing our proposal to continue the use of multiple imaging composite APCs to pay for services providing more than one imaging procedure from the same family on the same date, without modification. Table 6 below lists the HCPCS codes that will be subject to the multiple imaging composite APC policy and their respective families and approximate composite APC final geometric mean costs for CY 2020.

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3. Changes to Packaged Items and Services

a. Background and Rationale for Packaging in the OPPS

Like other prospective payment systems, the OPPS relies on the concept of averaging to establish a payment rate for services. The payment may be more or less than the estimated cost of providing a specific service or a bundle of specific services for a particular beneficiary. The OPPS packages payments for multiple interrelated items and services into a single payment to create incentives for hospitals to furnish services most efficiently and to manage their resources with maximum flexibility. Our packaging policies support our strategic goal of using larger payment bundles in the OPPS to maximize hospitals' incentives to provide care in the most efficient manner. For example, where there are a variety of devices, drugs, items, and supplies that could be used to furnish a service, some of which are more costly than others, packaging encourages hospitals to use the most cost-efficient item that meets the patient's needs, rather than to routinely use a more expensive item, which may occur if separate payment is provided for the item.

Packaging also encourages hospitals to effectively negotiate with manufacturers and suppliers to reduce the purchase price of items and services or to explore alternative group purchasing arrangements, thereby encouraging the most economical health care delivery. Similarly, packaging encourages hospitals to establish protocols that ensure that necessary services are furnished, while scrutinizing the services ordered by practitioners to maximize the efficient use of hospital resources. Packaging payments into larger payment bundles promotes the predictability and accuracy of payment for services over time. Finally, packaging may reduce the importance of refining service-specific payment because packaged payments include costs associated with higher cost cases requiring many ancillary items and services and lower cost cases requiring fewer ancillary items and services. Because packaging encourages efficiency and is an essential component of a prospective payment system, packaging payments for items and services that are typically integral, ancillary, supportive, dependent, or adjunctive to a primary service has been a fundamental part of the OPPS since its implementation in August 2000. For an extensive discussion of the history and background of the OPPS packaging policy, we refer readers to the CY 2000 OPPS final rule (65 FR 18434), the CY 2008 OPPS/ASC final rule with comment period (72 FR 66580), the CY 2014 OPPS/ASC final rule with comment period (78 FR 74925), the CY 2015 OPPS/ASC final rule with comment period (79 FR 66817), the CY 2016 OPPS/ASC final rule with comment period (80 FR 70343), the CY 2017 OPPS/ASC final rule with comment period (81 FR 79592), the CY 2018 OPPS/ASC final rule with comment period (82 FR 59250), and the CY 2019 OPPS/ASC final rule with comment period (83 FR 58854). As we continue to develop larger payment groups that more broadly reflect services provided in an encounter or episode of care, we have expanded the OPPS packaging policies. Most, but not necessarily all, categories of items and services currently packaged in the OPPS are listed in 42 CFR 419.2(b). Our overarching goal is to make payments for all services under the OPPS more consistent with those of a prospective payment system and less like those of a per-service fee schedule, which pays separately for each coded item. As a part of this effort, we have continued to examine the payment for items and services provided under the OPPS to determine which OPPS services can be packaged to further achieve the objective of advancing the OPPS toward a more prospective payment system.

For CY 2020, we examined the items and services currently provided under the OPPS, reviewing categories of integral, ancillary, supportive, dependent, or adjunctive items and services for which we believe payment would be appropriately packaged into payment for the primary service that they support. Specifically, we examined the HCPCS code definitions (including CPT code descriptors) and outpatient hospital billing patterns to determine whether there were categories of codes for which packaging would be appropriate according to existing OPPS packaging policies or a logical expansion of those existing OPPS packaging policies. In the CY 2020 OPPS/ASC proposed rule (84 FR 39423 through 39424), beginning in CY 2020, we proposed to conditionally package the costs of selected newly identified ancillary services into payment with a primary service where we believe that the packaged item or service is integral, ancillary, supportive, dependent, or adjunctive to the provision of care that was reported by the primary service HCPCS code. Below we discuss the proposed and finalized changes to the packaging policies beginning in CY 2020.

Comment: We received several comments from patient advocates, physicians, drug manufacturers, and professional medical societies regarding payment for blue light cystoscopy procedures involving Cysview® (hexaminolevulinate HCl) (described by HCPCS code C9275). Cysview® is a drug that functions as a supply in a diagnostic test or procedure and therefore payment for this product is packaged with payment for the primary procedure in the OPPS and ASC settings. Commenters stated that utilization of Cysview® is low in the HOPD and ASC settings, which they attributed to the packaging of Cysview as a drug that functions as a supply in a diagnostic test or procedure. Commenters indicated that packaged payment does not adequately pay for the blue light cystoscopy procedures, particularly in the ASC setting where payment is generally approximately 55 percent of the HOPD payment. Commenters believe that providers have been deterred from the use of this technology, especially in the ASC, and as a result a significant percentage of Start Printed Page 61174beneficiaries are not able to access the procedure.

Commenters also stated that there has been literature published showing that Blue Light Cystoscopy with Cysview® is more effective than white light cystoscopy alone at detecting and eliminating nonmuscle invasive bladder cancer tumors, leading to a reduction in bladder cancer recurrence.

Commenters made various recommendations for payment for blue light cystoscopy procedures involving Cysview®, including to pay separately for Cysview® when it is used with blue light cystoscopy in the HOPD and ASC settings, to pay separately for Cysview® when it is used with blue light cystoscopy in the ASC setting, similar to the policy finalized for Exparel® in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58860), or to utilize our equitable adjustment authority at section 1833(t)(2)(E) of the Act to provide an “add-on” or “drug intensive” payment to ASCs when using Cysview® in blue light cystoscopy procedures. Other commenters requested separate payment for all diagnostic imaging drugs (radiopharmaceuticals and contrast agents).

Response: We acknowledge the concerns of the numerous stakeholders who commented on this issue and understand the importance of blue light cystoscopy procedures involving Cysview®. Cysview has been packaged as a drug, biological, or radiopharmaceutical that functions as a supply in a diagnostic test or procedure since CY 2014 (78 FR 74930). As we stated in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59244), we recognize that blue light cystoscopy represents an additional elective but distinguishable service as compared to white light cystoscopy that, in some cases, may allow greater detection of bladder tumors in beneficiaries relative to white light cystoscopy alone. Given the additional equipment, supplies, operating room time, and other resources required to perform blue light cystoscopy in addition to white light cystoscopy, in CY 2018, we created a new HCPCS C-code to describe blue light cystoscopy and since CY 2018 have allowed for complexity adjustments to higher paying C-APCs for qualifying white light and blue light cystoscopy code combinations. At this time, we continue to believe that Cysview® is a drug that functions as a supply in a diagnostic test or procedure and payment for this drug is packaged with payment for the diagnostic procedure. Therefore, we do not believe it is necessary to pay separately for Cysview® when it is used with blue light cystoscopy in either the HOPD or ASC setting. We also do not believe that it would be appropriate to utilize our equitable adjustment authority at section 1833(t)(2)(E) of the Act to provide an “add-on” or “drug intensive” payment to ASCs when using Cysview® in blue light cystoscopy procedures nor do we have any evidence to show that separate payment for all diagnostic imaging drugs (radiopharmaceuticals, contrast agents) is required. However, we will continue to examine payment for blue light cystoscopy procedures involving Cysview to determine if any changes to this policy would be appropriate in future rulemaking.

Comment: Some commenters requested that we eliminate the packaging policy for drugs that function as a supply when used in a diagnostic test or procedure.

Response: In the CY 2014 OPPS/ASC final rule with comment period, we established a policy to package drugs, biologicals, and radiopharmaceuticals that function as supplies when used in a diagnostic test or procedure. In particular, we referred to drugs, biologicals, and radiopharmaceuticals that function as supplies as a part of a larger, more encompassing service or procedure, namely, the diagnostic test or procedure in which the drug, biological, or radiopharmaceutical is employed (78 FR 74927). At this time, we do not believe it is necessary to eliminate this policy. As previously noted, the OPPS packages payments for multiple interrelated items and services into a single payment to create incentives for hospitals to furnish services most efficiently and to manage their resources with maximum flexibility. Our packaging policies support our strategic goal of using larger payment bundles in the OPPS to maximize hospitals' incentives to provide care in the most efficient manner.

Comment: One commenter requested separate payment for add-on codes for Fractional Flow Reserve Studies (FFR/iFR) and Intravascular Ultrasound (IVUS). The commenter stated that they believe the packaging of these codes will disincentivize physicians to perform these adjunct procedures because of cost. The codes include:

  • 93571—Intravascular doppler velocity and/or pressure derived coronary flow reserve measurement (coronary vessel or graft) during coronary angiography including pharmacologically induced stress; initial vessel (list separately in addition to code for primary procedure);
  • 93572—Intravascular doppler velocity and/or pressure derived coronary flow reserve measurement (coronary vessel or graft) during coronary angiography including pharmacologically induced stress; each additional vessel (list separately in addition to code for primary procedure));
  • 92978—Endoluminal imaging of coronary vessel or graft using intravascular ultrasound (ivus) or optical coherence tomography (oct) during diagnostic evaluation and/or therapeutic intervention including imaging supervision, interpretation and report; initial vessel (list separately in addition to code for primary procedure); and
  • 92979—Endoluminal imaging of coronary vessel or graft using intravascular ultrasound (ivus) or optical coherence tomography (oct) during diagnostic evaluation and/or therapeutic intervention including imaging supervision, interpretation and report; each additional vessel (list separately in addition to code for primary procedure)).

Response: As stated in the CY 2008 OPPS/ASC final rule with comment period (72 FR 66630), we continue to believe that IVUS and FFR are dependent services that are always provided in association with a primary service. Add-on codes represent services that are integral, ancillary, supportive, dependent, or adjunctive items and services for which we believe payment would be appropriately packaged into payment for the primary service that they support. As we have noted in past rules, add-on codes do not represent standalone procedures and are inclusive to other procedures performed at the same time (79 FR 66818). We continue to believe it is unnecessary to provide separate payment for the previously mentioned add-on codes at this time.

b. Packaging Policy for Non-Opioid Pain Management Treatments

(1) Background on OPPS/ASC Non-Opioid Pain Management Packaging Policies

In the CY 2018 OPPS/ASC proposed rule (82 FR 33588), within the framework of existing packaging categories, such as drugs that function as supplies in a surgical procedure or diagnostic test or procedure, we requested stakeholder feedback on common clinical scenarios involving currently packaged items and services described by HCPCS codes that stakeholders believe should not be packaged under the OPPS. We also expressed interest in stakeholder Start Printed Page 61175feedback on common clinical scenarios involving separately payable HCPCS codes for which payment would be most appropriately packaged under the OPPS. Commenters who responded to the CY 2018 OPPS/ASC proposed rule expressed a variety of views on packaging under the OPPS. In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59255), we summarized these public comments. The public comments ranged from requests to unpackage most items and services that are either conditionally or unconditionally packaged under the OPPS, including drugs and devices, to specific requests for separate payment for a specific drug or device.

In terms of Exparel® in particular, we received several requests to pay separately for the drug Exparel® rather than packaging payment for it as a surgical supply. We had previously stated that we considered Exparel® to be a drug that functions as a surgical supply because it is indicated for the alleviation of postoperative pain (79 FR 66874 and 66875). We had also stated before that we considered all items related to the surgical outcome and provided during the hospital stay in which the surgery is performed, including postsurgical pain management drugs, to be part of the surgery for purposes of our drug and biological surgical supply packaging policy. (We note that Exparel® is a liposome injection of bupivacaine, an amide local anesthetic, indicated for single-dose infiltration into the surgical site to produce postsurgical analgesia. In 2011, Exparel® was approved by FDA for single-dose infiltration into the surgical site to provide postsurgical analgesia.[1 2] Exparel® had pass-through payment status from CYs 2012 through 2014 and was separately paid under both the OPPS and the ASC payment system during this 3-year period. Beginning in CY 2015, Exparel® was packaged as a surgical supply under both the OPPS and the ASC payment system.)

In the CY 2018 OPPS/ASC final rule with comment period (82 FR 52485, we reiterated our position with regard to payment for Exparel®, stating that we believed that payment for this drug is appropriately packaged with the primary surgical procedure. We also stated in the CY 2018 OPPS/ASC final rule with comment period that CMS would continue to explore and evaluate packaging policies under the OPPS and consider these policies in future rulemaking.

In addition to stakeholder feedback regarding OPPS packaging policies in response to the CY 2019 OPPS/ASC proposed rule, the President's Commission on Combating Drug Addiction and the Opioid Crisis (the Commission) had recommended that CMS examine payment policies for certain drugs that function as a supply, specifically non-opioid pain management treatments (83 FR 37068). The Commission was established in 2017 to study ways to combat and treat drug abuse, addiction, and the opioid crisis. The Commission's report [3] included a recommendation for CMS to “. . . review and modify ratesetting policies that discourage the use of non-opioid treatments for pain, such as certain bundled payments that make alternative treatment options cost prohibitive for hospitals and doctors, particularly those options for treating immediate postsurgical pain . . . .” [4] With respect to the packaging policy, the Commission's report states that “. . . the current CMS payment policy for `supplies' related to surgical procedures creates unintended incentives to prescribe opioid medications to patients for postsurgical pain instead of administering non-opioid pain medications. Under current policies, CMS provides one all-inclusive bundled payment to hospitals for all `surgical supplies,' which includes hospital administered drug products intended to manage patients' postsurgical pain. This policy results in the hospitals receiving the same fixed fee from Medicare whether the surgeon administers a non-opioid medication or not.” [5] HHS also presented an Opioid Strategy in April 2017 [6] that aims in part to support cutting-edge research and advance the practice of pain management. On October 26, 2017, the President declared the opioid crisis a national public health emergency under Federal law [7] and this declaration was most recently renewed on April 19, 2019.[8]

For the CY 2019 rulemaking, we reviewed available literature with respect to Exparel®, including a briefing document [9] submitted for FDA Advisory Committee Meeting held February 14-15, 2018, by the manufacturer of Exparel® that notes that “. . . Bupivacaine, the active pharmaceutical ingredient in Exparel®, is a local anesthetic that has been used for infiltration/field block and peripheral nerve block for decades” and that “since its approval, Exparel® has been used extensively, with an estimated 3.5 million patient exposures in the US.” [10] On April 6, 2018, FDA approved Exparel®'s new indication for use as an interscalene brachial plexus nerve block to produce postsurgical regional analgesia.[11] Therefore, we also stated in the CY 2019 OPPS/ASC proposed rule that, based on our review of currently available OPPS Medicare claims data and public information from the manufacturer of the drug, we did not believe that the OPPS packaging policy had discouraged the use of Exparel® for either of the drug's indications when furnished in the hospital outpatient department setting.

In the CY 2019 OPPS/ASC proposed rule, in response to stakeholder comments on the CY 2018 OPPS/ASC final rule with comment period (82 FR 52485) and in light of the recommendations regarding payment policies for certain drugs, we evaluated the impact of our packaging policy for drugs that function as a supply when used in a surgical procedure on the utilization of these drugs in both the hospital outpatient department and the ASC setting. Our packaging policy is that the costs associated with packaged drugs that function as a supply are included in the ratesetting methodology for the surgical procedures with which they are billed, and the payment rate for the associated procedure reflects the costs of the packaged drugs and other packaged items and services to the extent they are billed with the procedure. In our evaluation, we used currently available data to analyze the utilization patterns associated with Start Printed Page 61176specific drugs that function as a supply over a 5-year time period to determine whether this packaging policy reduced the use of these drugs. If the packaging policy discouraged the use of drugs that function as a supply or impeded access to these products, we would expect to see a significant decline in utilization of these drugs over time, although we note that a decline in utilization could also reflect other factors, such as the availability of alternative products, or a combination thereof.

The results of the evaluation of our packaging policies under the OPPS and the ASC payment system showed decreased utilization for certain drugs that function as a supply in the ASC setting, in comparison to the hospital outpatient department setting. In light of these results, as well as the Commission's recommendation to examine payment policies for non-opioid pain management drugs that function as a supply, we stated that we believe it was appropriate to pay separately for evidence-based non-opioid pain management drugs that function as a supply in a surgical procedure in the ASC setting to address the decreased utilization of these drugs and to encourage use of these types of drugs rather than prescription opioids. Therefore, in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58855 through 58860), we finalized the proposed policy to unpackage and pay separately at ASP + 6 percent for the cost of non-opioid pain management drugs that function as surgical supplies when they are furnished in the ASC setting for CY 2019. We also stated that we would continue to analyze the issue of access to non-opioid alternatives in the hospital outpatient department setting and in the ASC setting as we implemented section 6082 of the Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities (SUPPORT) Act (Pub. L. 115-271) enacted on October 24, 2018 (83 FR 58860 through 58861).

(2) Evaluation and CY 2020 Proposal for Payment for Non-Opioid Alternatives

Section 1833(t)(22)(A)(i) of the Act, as added by section 6082(a) of the SUPPORT Act, states that the Secretary must review payments under the OPPS for opioids and evidence-based non-opioid alternatives for pain management (including drugs and devices, nerve blocks, surgical injections, and neuromodulation) with a goal of ensuring that there are not financial incentives to use opioids instead of non-opioid alternatives. As part of this review, under section 1833(t)(22)(A)(iii) of the Act, the Secretary must consider the extent to which revisions to such payments (such as the creation of additional groups of covered OPD services to separately classify those procedures that utilize opioids and non-opioid alternatives for pain management) would reduce the payment incentives for using opioids instead of non-opioid alternatives for pain management. In conducting this review and considering any revisions, the Secretary must focus on covered OPD services (or groups of services) assigned to C-APCs, APCs that include surgical services, or services determined by the Secretary that generally involve treatment for pain management. If the Secretary identifies revisions to payments pursuant to section 1833(t)(22)(A)(iii) of the Act, section 1833(t)(22)(C) of the Act requires the Secretary to, as determined appropriate, begin making revisions for services furnished on or after January 1, 2020. Any revisions under this paragraph are required to be treated as adjustments for purposes of paragraph (9)(B), which requires any adjustments to be made in a budget neutral manner. Pursuant to these requirements, in our evaluation of whether there are payment incentives for using opioids instead of non-opioid alternatives, for the CY 2020 OPPS/ASC proposed rule, we used currently available data to analyze the payment and utilization patterns associated with specific non-opioid alternatives, including drugs that function as a supply, nerve blocks, and neuromodulation products, to determine whether our packaging policies have reduced the use of non-opioid alternatives. We focused on covered OPD services for this review, including services assigned to C-APCs, surgical APCs, and other pain management services. We believed that if the packaging policy discouraged the use of these non-opioid alternatives or impeded access to these products, we would expect to see a decline in the utilization over time, although we note that a decline in utilization could also reflect other factors, such as the availability of alternative products or a combination thereof.

We evaluated continuous peripheral nerve blocks and neuromodulation alternatives to determine if the current packaging policy represented a barrier to access. For each product, we examined the most recently available Medicare claims data. All of the alternatives examined showed consistent or increasing utilization in recent years, with no products showing decreases in utilization.

We also evaluated drugs that function as surgical supplies over a 6-year time period (CYs 2013 through 2018). During our evaluation, we did not observe significant declines in the total number of units used in the hospital outpatient department for a majority of the drugs included in our analysis. In fact, under the OPPS, we observed the opposite effect for several drugs that function as surgical supplies, including Exparel® (HCPCS code C9290). This trend indicates appropriate packaged payments that adequately reflect the cost of the drug and are not prohibiting beneficiary access.

From CYs 2013 through 2018, we found that there was an overall increase in the OPPS Medicare utilization of Exparel® of approximately 491 percent (from 2.3 million units to 13.6 million units) during this 6-year time period. The total number of claims reporting the use of Exparel® increased by 463 percent (from 10,609 claims to 59,724 claims) over this 6-year time period. This increase in utilization continued, even after the expiration of the 3-year period of pass-through payment status for this drug in 2014, resulting in a 109-percent overall increase in the total number of units used between CYs 2015 and 2018, from 6.5 million units to 13.6 million units. The number of claims reporting the use of Exparel® increased by 112 percent during this time period, from 28,166 claims to 59,724 claims.

The results of our review and evaluation of our claims data do not provide evidence to indicate that the OPPS packaging policy has had the unintended consequence of discouraging the use of non-opioid treatments for postsurgical pain management in the hospital outpatient department. Therefore, based on this data evaluation, we stated in the proposed rule that we do not believe that changes are necessary under the OPPS for the packaged drug policy for drugs that function as a surgical supply, nerve blocks, surgical injections, and neuromodulation products when used in a surgical procedure in the OPPS setting at this time.

For Exparel®, we reviewed claims data for development of the CY 2020 OPPS/ASC proposed rule and, based on these data and available literature, we concluded that there is no clear evidence that the OPPS packaging policy discourages the use of Exparel® for either of the drug's indications in the hospital outpatient department setting because the use of Exparel® continues to increase in this setting. Accordingly, we stated in the proposed rule that we continue to believe it is appropriate to package payment for the use of Start Printed Page 61177Exparel®, as we do for other postsurgical pain management drugs, when it is furnished in a hospital outpatient department. In addition, our updated review of claims data for the proposed rule showed a continued decline in the utilization of Exparel® in the ASC setting, which we believed supports our proposal to continue paying separately for Exparel® in the ASC setting.

Therefore, for CY 2020, we proposed to continue our policy to pay separately at ASP+6 percent for the cost of non-opioid pain management drugs that function as surgical supplies in the performance of surgical procedures when they are furnished in the ASC setting and to continue to package payment for non-opioid pain management drugs that function as surgical supplies in the performance of surgical procedures in the hospital outpatient department setting for CY 2020. However, we invited public comments on this proposal and asked the public to provide peer-reviewed evidence, if any, to describe existing evidence-based non-opioid pain management therapies used in the outpatient and ASC setting. We also invited the public to provide detailed claims-based evidence to document how specific unfavorable utilization trends are due to the financial incentives of the payment systems rather than other factors.

Multiple stakeholders, largely manufacturers of devices and drugs, requested separate payments for various non-opioid pain management treatments, such as continuous nerve blocks (including a disposable elastomeric pump that delivers non-opioid local anesthetic to a surgical site or nerve), cooled thermal radiofrequency ablation, and local anesthetics designed to reduce postoperative pain for cataract surgery and other procedures. These stakeholders suggested various mechanisms through which separate payment or a higher-paying APC assignment for the primary service could be made. The stakeholders offered surveys, reports, studies, and anecdotal evidence of varying degrees to support why the devices, drugs, or services offer an alternative to or a reduction of the need for opioid prescriptions. The majority of these stakeholder offerings lacked adequate sample size, contained possible conflicts of interest such as studies conducted by employees of device manufacturers, have not been fully published in peer-reviewed literature, or have only provided anecdotal evidence as to how the drug or device could serve as an alternative to, or reduce the need for, opioid prescriptions.

After reviewing the data from stakeholders and Medicare claims data, we did not find compelling evidence to suggest that revisions to our OPPS payment policies for non-opioid pain management alternatives are necessary for CY 2020. Additionally, MedPAC's March 2019 Report to Congress supports our conclusion; specifically, Chapter 16 of MedPAC's report, titled Mandated Report: Opioids and Alternatives in Hospital Settings—Payments, Incentives, and Medicare Data, concludes that there is no clear indication that Medicare's OPPS provides systematic payment incentives that promote the use of opioid analgesics over non-opioid analgesics.[12] However, we invited public comments on whether there were other non-opioid pain management alternatives for which our payment policy should be revised to allow separate payment. We requested public comments that provided evidence-based support, such as published peer-reviewed literature, that we could use to determine whether these products help to deter or avoid prescription opioid use and addiction as well as evidence that the current packaged payment for such non-opioid alternatives presents a barrier to access to care and therefore warrants revised, including possibly separate, payment under the OPPS. We noted that evidence that current payment policy provides a payment incentive for using opioids instead of non-opioid alternatives should align with available Medicare claims data.

We provide a summary of the comments received and our responses to those comments below.

Comment: Multiple commenters, including hospital associations, medical specialty societies, and drug manufacturers, requested that we pay separately for Exparel and other drugs that function as surgical supply in the hospital outpatient setting. Some of these commenters noted that Exparel is more frequently used in this setting and the use of non-opioid pain management treatments should also be encouraged in the hospital outpatient department. The manufacturer of Exparel, Pacira Pharmaceuticals, presented a 5-year OPPS claims data analysis of hospital trends in Exparel use and a 200 hospital survey on purchasing decisions for non-opioid alternatives, concluding that Medicare's packaging policy has led to hospitals reducing or stopping Exparel use.

Response: As we stated in the CY 2019 OPPS/ASC final rule (83 FR 58856), we do not believe that there is sufficient evidence that non-opioid pain management drugs should be paid separately in the hospital outpatient setting at this time. The commenters did not provide evidence that the OPPS packaging policy for Exparel (or other non-opioid drugs) creates a barrier to use of Exparel in the hospital setting. Further, while we received some public comments suggesting that, as a result of using Exparel in the OPPS setting, providers may prescribe fewer opioids for Medicare beneficiaries, we do not believe that the OPPS payment policy presents a barrier to use of Exparel or affects the likelihood that providers will prescribe fewer opioids in the HOPD setting. Several drugs are packaged under the OPPS and payment for such drugs is included in the payment for the associated primary procedure. We were not persuaded by the information supplied by commenters suggesting that some providers avoid use of non-opioid alternatives (including Exparel) solely because of the OPPS packaged payment policy. We observed increasing Exparel utilization in the HOPD setting with the total units increasing from 9.0 million in 2017 to 13.6 million in 2018, despite the bundled payment in the OPPS setting. This upward trend has been consistent since 2015, as the data shows approximately 6.5 million total units in 2015 and 8.1 million total units in 2016. Therefore, we do not believe that the current OPPS payment methodology for Exparel and other non-opioid pain management drugs presents a widespread barrier to their use.

In addition, higher use in the hospital outpatient setting not only supports the notion that the packaged payment for Exparel is not causing an access to care issue, but also that the payment rate for primary procedures in the HOPD using Exparel adequately reflects the cost of the drug. That is, because Exparel is commonly used and billed under the OPPS, the APC rates for the primary procedures reflect such utilization. Therefore, the higher utilization in the OPPS setting should mitigate the need for separate payment. We remind readers that the OPPS is a prospective payment system, not a cost-based system and, by design, is based on a system of averages under which payment for certain cases may exceed the costs incurred, while for others, it may not. As stated earlier in this section, the OPPS packages payments for multiple interrelated items and services into a single payment to create incentives for hospitals to furnish Start Printed Page 61178services most efficiently and to manage their resources with maximum flexibility. Our packaging policies support our strategic goal of using larger payment bundles in the OPPS to maximize hospitals' incentives to provide care in the most efficient manner. We continue to invite stakeholders to share evidence, such as published peer-reviewed literature, on these non-opioid alternatives. We also intend to continue to analyze the evidence and monitor utilization of non-opioid alternatives in the OPD and ASC settings for potential future rulemaking.

We also stated in the CY 2020 OPPS/ASC proposed rule that, although we found increases in utilization for Exparel when it is paid under the OPPS, we did notice a continued decline in Exparel utilization in the ASC setting. While several variables may contribute to this difference in utilization and claims reporting between the hospital outpatient department and the ASC setting, one potential explanation is that, in comparison to hospital outpatient departments, ASCs tend to provide specialized care and a more limited range of services. Also, ASCs are paid, in aggregate, approximately 55 percent of the OPPS rate. Therefore, fluctuations in payment rates for specific services may impact these providers more acutely than hospital outpatient departments, and as a result, ASCs may be less likely to choose to furnish non-opioid postsurgical pain management treatments, which are typically more expensive than opioids. Another possible contributing factor is that ASCs do not typically report packaged items and services and, accordingly, our analysis may be undercounting the number of Exparel units utilized in the ASC setting.

Therefore, we are finalizing our proposal to continue to unpackage and pay separately for the cost of non-opioid pain management drugs that function as surgical supplies when they are furnished in the ASC setting without modification. This policy and related comments are addressed in section XIII.D.3. of this final rule with comment period.

As we stated previously in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59250), our packaging policies are designed to support our strategic goal of using larger payment bundles in the OPPS to maximize hospitals' incentives to provide clinically appropriate care in the most efficient manner. The packaging policies established under the OPPS also typically apply when services are provided in the ASC setting, and the policies have the same strategic goals in both settings. While unpackaging and paying separately for drugs that function as surgical supplies is a departure from our overall packaging policy for drugs, we believe that the proposed change will continue to incentivize the use of non-opioid pain management drugs and is responsive to the Commission's recommendation to examine payment policies for non-opioid pain management drugs that function as a supply, with the overall goal of combating the current opioid addiction crisis. As previously noted, a discussion of the CY 2020 proposal for payment of non-opioid pain management drugs in the ASC setting was presented in further detail in section XIII.D.3 of the CY 2020 OPPS/ASC proposed rule, and we refer readers to section XIII.D.3 of this CY 2020 OPPS/ASC final rule with comment period for further discussion of the final policy for CY 2020. As stated above, we also requested public comments in the CY 2020 OPPS/ASC proposed rule that provide peer-reviewed evidence, such as published peer-reviewed literature, that we could use to determine whether these products help to deter or avoid prescription opioid use and addiction as well as evidence that the current packaged payment for such non-opioid alternatives presents a barrier to access to care and therefore warrants revised, including possibly separate, payment under the OPPS. We also stated that evidence that current payment policy provides a payment incentive for using opioids instead of non-opioid alternatives should align with available Medicare claims data.

Comment: Several commenters supported the assignment of status indicator “K” (Nonpass-Through Drugs and Nonimplantable Biologicals, Including Therapeutic Radiopharmaceuticals) and continuing to pay separately for the drug Prialt (HCPCS J2278, injection, ziconitide), a non-narcotic pain reliever administered via intrathecal injection. Commenters provided data indicating that Prialt potentially could lower opioid use, including opioids such as morphine. In addition to continued separate payment, several commenters recommended CMS reduce or eliminate the coinsurance for the drug in order to increase beneficiary access. Commenters stated that due to the drug's significant cost, the 20 percent coinsurance would put the drug out of reach for beneficiaries. Additionally, commenters stated that there is not enough financial incentive for providers to use Prialt in their patients compared to lower cost opioids. Commenters claim that Prialt is only paid at invoice cost, which they believe discourages provider use.

Response: We thank commenters for their feedback and for their support of the continued assignment of status indicator “K” to HCPCS J2278. Prialt is paid at its average sales price plus 6 percent according to the ASP methodology under the OPPS. We note that under section 1833(t)(8) of the Act, the payment is subject to applicable deductible and coinsurance, and we are unaware of statutory authority to alter beneficiary coinsurance for payments made under the OPPS. We note that because the dollar value of beneficiary coinsurance is directly proportionate to the payment rate (which is ASP + 6 percent for HCPCS code J2278), a lower sales price for the drug (which would lead to a lower Medicare payment rate under current policy) would be necessary for beneficiaries to have a lower coinsurance amount.

Comment: Many commenters requested that the drug Omidria (HCPCS code C9447, injection, phenylephrine ketorolac) be excluded from the packaging policy once its pass-through status expires on September 30, 2020. Omidria is indicated for maintaining pupil size by preventing intraoperative miosis and reducing postoperative ocular pain in cataract or intraocular surgeries. The commenters stated that the available data and multiple peer-reviewed articles on Omidria meet the section 6082 criteria for packaging exclusion. Commenters asserted that the use of Omidria decreases patients' need for fentanyl during surgeries and another commenter stated that Omidria reduces opioid use after cataract surgeries. In addition, commenters asserted that the OPPS and ASC payment system do not address the cost of packaged products used by small patient populations. Therefore, the OPPS and ASC payment structures for packaged supplies creates an access barrier and patients are forced to use inferior products that have increased complication risk and require the continued use of opioids to manage pain. One commenter referenced the results of a study that showed that Omidria reduces the need for opioids during cataract surgery by nearly 80 percent while decreasing pain scores by more than 50 percent.

Response: We thank commenters for their feedback on Omidria. Omidria received pass-through status for a 3-year period from 2015 to 2017. After expiration of its pass-through status, it was packaged per OPPS policy. Subsequently, Omidria's pass-through status was reinstated in October 2018 Start Printed Page 61179through September 30, 2020 as required by section 1833(t)(6)(G) of the Act, as added by section 1301(a)(1)(C) of the Consolidated Appropriations Act 2018 (Pub. L. 115-141). While our analysis supports the commenter's assertion that there was a decrease in the utilization of Omidria in 2018 following its pass-through expiration, we note that there could be many reasons that utilization declines after the pass-through period ends that are unrelated to the lack of separate payment, including the availability of other alternatives on the market (many of which had been used for several years before Omidria came on the market and are sold for a lower price), or physician preference among others.

Further, our clinical advisors' review of the clinical evidence submitted concluded that the study the commenter submitted was not sufficiently compelling or authoritative to overcome contrary evidence. Moreover, the results of a CMS study of cataract procedures performed on Medicare beneficiaries in the OPPS between January 2015 and July 2019 comparing procedures performed with Omidria to procedures performed without Omidria did not demonstrate a significant decrease in fentanyl utilization during the cataract surgeries in the OPPS when Omidria was used. Our results also did not suggest any decrease in opioid utilization post-surgery for procedures involving Omidria. At this time, we do not have compelling evidence to exclude Omidria from packaging after its current pass-through expires on September 30, 2020. We will continue to analyze the evidence and monitor utilization of this drug.

Comment: One commenter requested that MKO Melt, a non-FDA-approved, compounded drug comprised of midazolam/ketamine/ondansetron be excluded from the packaging policy under section 1833(t)(22)(A)(iii) of the Act. The commenter contended that MKO Melt are drugs functioning as a surgical supply in the ASC setting. The commenter provided a reference to a study titled, “Anesthesia for opioid addict: Challenges for perioperative physician” by Goyal et al., on the need for pain management in the opioid-dependent patient. The commenter also referenced a review article, “Perioperative Management of Acute Pain in the Opioid-dependent Patient,” by Mitra et al., on the special needs of opioid-dependent patients in surgeries and the potential opioid relapse in those patients who are recovering from opioid use disorder. Additionally, the commenter referenced a clinical trial registered in clinicaltrials.gov (NCT03653520) that supports sublingual MKO Melt for use during cataract surgeries to replace opioids. The study looked at 611 patients that were divided into three arms: (1) MKO melt arm, (2) diazepam/tramadol/ondansetron arm, (3) diazepam only arm. The study concluded that the MKO melt arm had the lowest incidence for supplemental injectable anesthesia to control pain.

Response: We thank the commenter for the comment. Based on the information provided, we are not able to validate that MKO Melt reduces the use of opioids. We note that ketamine, one of the components of MKO melt, exhibits some addictive properties. Moreover, we did not identify any compelling evidence that MKO Melt is effective for patients with a prior opioid addiction nor did we receive any data demonstrating that the current OPPS packaging policy incentivized providers to use opioids over MKO Melt. In accordance with our review under section 1833(t)(22)(A)(i) of the Act, as well as the lack of HCPCS code for the drug, and FDA approval, we were not able to establish any compelling evidence that MKO should be excluded from packaged payment.

Comment: Several commenters, including individual physicians, medical associations, and device manufacturers, supported separate payment for continuous peripheral nerve blocks as the commenters believed they significantly reduce opioid use. One commenter suggested that CMS provide separate payment for HCPCS code A4306 (Disposable drug delivery system, flow rate of less than 50 ml per hour) in the hospital outpatient department setting and the ASC setting because packaging represents a cost barrier for providers. The commenter contended that continuous nerve block procedures have been shown in high quality clinical studies to reduce the use of opioids, attaching studies for review. The commenter stated that separate payment for A4306 will remove the financial disincentive for HOPDs and ASCs to use these items, and would encourage continuous nerve blocks as a non-opioid alternative for post-surgical pain management.

Response: We appreciate the commenters' suggestion. We examined the data for A4306 and noted an overall trend of increasing utilization from CY 2014 through CY 2017. There was a slight decrease in utilization in CY 2018. However, we note that this slight decline may be an outlier, given the four year trend of consistently increasing utilization. Additionally, the geometric mean cost for HCPCS code A4306 was approximately $30 each year during that 4-year period. We acknowledge that use of these items may help in the reduction of opioid use. However, we note that packaged payment of such an item does not prevent the use of these items, as we found with the overall increased utilization of this product. We do not believe that the current utilization trends for HCPCS code A4306 suggest that the packaged payment is preventing use and remind readers that payment for packaged items is included in the payment for the primary service. We share the commenter's concern about the need to reduce opioid use and will take the commenter's suggestion regarding the need for separate payment for HCPCS code A4306 into consideration for future rulemaking.

Comment: Multiple commenters identified other non-opioid pain management alternatives that they believe decrease the dose, duration, and/or number of opioid prescriptions beneficiaries receive during and following an outpatient visit or procedure (especially for beneficiaries at high-risk for opioid addiction) and that may warrant separate payment for CY 2020. Commenters representing various stakeholders requested separate payments for various non-opioid pain management treatments, such as continuous nerve blocks, neuromodulation radiofrequency ablation, implants for lumbar stenosis, enhanced recovery after surgery, IV acetaminophen, IV ibuprofen, Polar ice devices for postoperative pain relief, THC oil, acupuncture, and dry needling procedures.

For neuromodulation, several commenters noted that spinal cord stimulators (SCS) may lead to a reduction in the use of opioids for chronic pain patients. One manufacturer commented that SCS provides the opportunity to potentially stabilize or decrease opioid usage and that neuromodulation retains its efficacy over multiple years. Regarding barriers to access, the commenter noted that Medicare beneficiaries often do not have access to SCS until after they have exhausted other treatments, which often includes opioids. The commenter presented evidence from observational studies that use of SCS earlier in a patient's treatment could help reduce opioid use while controlling pain, suggesting CMS look for ways to incorporate SCS earlier in the treatment continuum.

Another commenter asserted that the standard endpoints, such as a greater than 50 percent reduction in pain, that are used to determine if a neuromodulation-based non-opioid pain Start Printed Page 61180alternative therapy is effective are well-established and validated in all types of clinical trials and that CMS should establish a general, national coverage determination for neuromodulation-based non-opioid pain therapy based on these endpoints, rather than taking the time to create and process specific national coverage determinations or local coverage determinations. The commenter suggested that this would be a much faster and streamlined process for enhancing Medicare beneficiary access to neuromodulation-based pain management therapies.

One of the manufacturers of a high-frequency SCS device stated that additional payment was warranted for non-opioid pain management treatments because they provide an alternative treatment option to opioids for patients with chronic, leg, or back pain. The commenter provided supporting studies that claimed that patients treated with their high-frequency SCS device reported a statistically significant average decrease in opioid use compared to the control group. This commenter also submitted data that showed a decline in the mean daily dosage of opioid medication taken and that fewer patients were relying on opioids at all to manage their pain when they used the manufacturer's device.

Other commenters wrote regarding their personal experiences with radiofrequency ablation for sacral iliac joints and knees. One commenter referenced several studies, one of which found a decrease in analgesic medications associated with radiofrequency ablation; however, it did not provide evidence regarding a decrease in opioid usage.

One national hospital association commenter recommended that while “certainly not a solution to the opioid epidemic, unpackaging appropriate non-opioid therapies, like Exparel, is a low-cost tactic that could change long-standing practice patterns without major negative consequences.” This same commenter suggested that Medicare consider separate payment for IV acetaminophen, IV ibuprofen, and Polar ice devices for postoperative pain relief after knee procedures. The commenter also noted that therapeutic massage, topically applied THC oil, acupuncture, and dry needling procedures are very effective therapies for relief of both postoperative pain and long-term and chronic pain. Several other commenters expressed support for separate payment for IV acetaminophen.

Response: We appreciate the detailed responses from commenters on this topic. At this time, we have not found compelling evidence for other non-opioid pain management alternatives described above to warrant separate payment under the OPPS or ASC payment systems for CY 2020. We plan to take these comments and suggestions into consideration for future rulemaking. We agree that providing incentives to avoid and/or reduce opioid prescriptions may be one of several strategies for addressing the opioid epidemic. To the extent that the items and services mentioned by the commenters are effective alternatives to opioid prescriptions, we encourage providers to use them when medically necessary. We note that some of the items and services mentioned by commenters are not covered by Medicare, and we do not intend to establish payment for noncovered items and services at this time. We look forward to working with stakeholders as we further consider suggested refinements to the OPPS and the ASC payment system that will encourage use of medically necessary items and services that have demonstrated efficacy in decreasing opioid prescriptions and/or opioid abuse or misuse during or after an outpatient visit or procedure.

After reviewing the non-opioid pain management alternatives suggested by the commenters as well as the studies and other data provided to support the request for separate payment, we have not determined that separate payment is warranted at this time for any of the non-opioid pain management alternatives discussed above.

Comment: Several commenters addressed payment barriers that may inhibit access to non-opioid pain management treatments discussed throughout this section. Several commenters disagreed with CMS's assessment that current payment policies do not represent barriers to access for certain non-opioid pain management alternatives. Commenters encouraged CMS to provide timely insurance coverage for evidence-informed interventional procedures early in the course of treatment when clinically appropriate. Several other commenters encouraged CMS to more broadly evaluate all of its packaging policies to help ensure patient access to appropriate therapies and to evaluate how packaging affects the utilization of a medicine.

Response: We appreciate the various, insightful comments we received from stakeholders regarding barriers that may inhibit access to non-opioid alternatives for pain treatment and management in order to more effectively address the opioid epidemic. We will take these comments into consideration for future rulemaking. Many of these comments have been previously addressed throughout this section. CMS recognizes that medical exposure to opioids entails inherent risks, which may include delayed recovery, diversion, misuse, accidental overdose, development or re-emergence of addiction, and neonatal abstinence syndrome. However, there are challenges in developing a methodology to identify disincentives to use opioid alternatives. In the context of the opioid crisis, and given the central role the federal government plays in addressing it, these issues are of particular concern to CMS. Because of this, CMS intends to work with an interagency task force to review available data and to develop criteria for revisions to payment for opioid alternatives that are effective for pain relief or in reducing opioid use.

After consideration of the public comments we received, we are finalizing the proposed policy, without modification, to unpackage and pay separately at ASP+6 percent for the cost of non-opioid pain management drugs that function as surgical supplies when they are furnished in the ASC setting for CY 2020. Under this policy, the only FDA-approved drug that meets this criteria is Exparel.

We will continue to analyze the issue of access to non-opioid alternatives in the OPPS and the ASC settings for any subsequent reviews we conduct under section 1833(t)(22)(A)(ii). We are continuing to examine whether there are other non-opioid pain management alternatives for which our payment policy should be revised to allow separate payment. We will be reviewing evidence-based support, such as published peer-reviewed literature, that we could use to determine whether these products help to deter or avoid prescription opioid use and addiction as well as evidence that the current packaged payment for such non-opioid alternatives presents a barrier to access to care and therefore warrants revised, including possibly separate, payment under the OPPS. This policy is also discussed in section XII.D.3 of this final rule with comment period.

4. Calculation of OPPS Scaled Payment Weights

We established a policy in the CY 2013 OPPS/ASC final rule with comment period (77 FR 68283) of using geometric mean-based APC costs to calculate relative payment weights under the OPPS. In the CY 2019 OPPS/ASC final rule with comment period (83 FR 58860 through 58861), we applied this policy and calculated the relative payment weights for each APC for CY 2019 that were shown in Addenda A Start Printed Page 61181and B to that final rule with comment period (which were made available via the internet on the CMS website) using the APC costs discussed in sections II.A.1. and II.A.2. of that final rule with comment period. For CY 2020, as we did for CY 2019, we proposed to continue to apply the policy established in CY 2013 and calculate relative payment weights for each APC for CY 2020 using geometric mean-based APC costs.

For CY 2012 and CY 2013, outpatient clinic visits were assigned to one of five levels of clinic visit APCs, with APC 0606 representing a mid-level clinic visit. In the CY 2014 OPPS/ASC final rule with comment period (78 FR 75036 through 75043), we finalized a policy that created alphanumeric HCPCS code G0463 (Hospital outpatient clinic visit for assessment and management of a patient), representing any and all clinic visits under the OPPS. HCPCS code G0463 was assigned to APC 0634 (Hospital Clinic Visits). We also finalized a policy to use CY 2012 claims data to develop the CY 2014 OPPS payment rates for HCPCS code G0463 based on the total geometric mean cost of the levels one through five CPT E/M codes for clinic visits previously recognized under the OPPS (CPT codes 99201 through 99205 and 99211 through 99215). In addition, we finalized a policy to no longer recognize a distinction between new and established patient clinic visits.

For CY 2016, we deleted APC 0634 and reassigned the outpatient clinic visit HCPCS code G0463 to APC 5012 (Level 2 Examinations and Related Services) (80 FR 70372). For CY 2020, as we did for CY 2019, we proposed to continue to standardize all of the relative payment weights to APC 5012. We believe that standardizing relative payment weights to the geometric mean of the APC to which HCPCS code G0463 is assigned maintains consistency in calculating unscaled weights that represent the cost of some of the most frequently provided OPPS services. For CY 2020, as we did for CY 2019, we proposed to assign APC 5012 a relative payment weight of 1.00 and to divide the geometric mean cost of each APC by the geometric mean cost for APC 5012 to derive the unscaled relative payment weight for each APC. The choice of the APC on which to standardize the relative payment weights does not affect payments made under the OPPS because we scale the weights for budget neutrality.

We did not receive any public comments on our proposal to continue to use the geometric mean cost of APC 5012 to standardize relative payment weights for CY 2020. Therefore, we are finalizing our proposal and assigning APC 5012 the relative payment weight of 1.00, and using the relative payment weight for APC 5012 to derive the unscaled relative payment weight for each APC for CY 2020.

We note that in the CY 2019 OPPS/ASC final rule with comment period (83 FR 59004 through 59015), we discuss our policy, implemented on January 1, 2019, to control for unnecessary increases in the volume of covered outpatient department services by paying for clinic visits furnished at excepted off-campus provider-based department (PBD) at a reduced rate, and we are continuing the policy with the second year of the two-year transition in CY 2020. While the volume associated with these visits is included in the impact model, and thus used in calculating the weight scalar, the policy has a negligible effect on the scalar. Specifically, under this policy, there is no change to the relativity of the OPPS payment weights because the adjustment is made at the payment level rather than in the cost modeling. Further, under this policy, the savings that will result from the change in payments for these clinic visits will not be budget neutral. Therefore, the impact of this policy will generally not be reflected in the budget neutrality adjustments, whether the adjustment is to the OPPS relative weights or to the OPPS conversion factor. We refer readers to section X.C. of this CY 2020 OPPS/ASC final rule with comment period for further discussion of this final policy.

Section 1833(t)(9)(B) of the Act requires that APC reclassification and recalibration changes, wage index changes, and other adjustments be made in a budget neutral manner. Budget neutrality ensures that the estimated aggregate weight under the OPPS for CY 2020 is neither greater than nor less than the estimated aggregate weight that would have been calculated without the changes. To comply with this requirement concerning the APC changes, we proposed to compare the estimated aggregate weight using the CY 2019 scaled relative payment weights to the estimated aggregate weight using the proposed CY 2020 unscaled relative payment weights.

For CY 2019, we multiplied the CY 2019 scaled APC relative payment weight applicable to a service paid under the OPPS by the volume of that service from CY 2018 claims to calculate the total relative payment weight for each service. We then added together the total relative payment weight for each of these services in order to calculate an estimated aggregate weight for the year. For CY 2020, we proposed to apply the same process using the estimated CY 2020 unscaled relative payment weights rather than scaled relative payment weights. We proposed to calculate the weight scalar by dividing the CY 2019 estimated aggregate weight by the unscaled CY 2020 estimated aggregate weight.

For a detailed discussion of the weight scalar calculation, we refer readers to the OPPS claims accounting document available on the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​index.html. Click on the CY 2020 OPPS final rule link and open the claims accounting document link at the bottom of the page.

We proposed to compare the estimated unscaled relative payment weights in CY 2020 to the estimated total relative payment weights in CY 2019 using CY 2018 claims data, holding all other components of the payment system constant to isolate changes in total weight. Based on this comparison, we proposed to adjust the calculated CY 2020 unscaled relative payment weights for purposes of budget neutrality. We proposed to adjust the estimated CY 2020 unscaled relative payment weights by multiplying them by a proposed weight scalar of 1.4401 to ensure that the proposed CY 2020 relative payment weights are scaled to be budget neutral. The proposed CY 2020 relative payment weights listed in Addenda A and B to the proposed rule (which are available via the internet on the CMS website) were scaled and incorporated the recalibration adjustments discussed in sections II.A.1. and II.A.2. of the proposed rule.

Section 1833(t)(14) of the Act provides the payment rates for certain SCODs. Section 1833(t)(14)(H) of the Act provides that additional expenditures resulting from this paragraph shall not be taken into account in establishing the conversion factor, weighting, and other adjustment factors for 2004 and 2005 under paragraph (9), but shall be taken into account for subsequent years. Therefore, the cost of those SCODs (as discussed in section V.B.2. of this final rule with comment period) is included in the budget neutrality calculations for the CY 2020 OPPS.

We did not receive any public comments on the proposed weight scalar calculation. Therefore, we are finalizing our proposal to use the calculation process described in the proposed rule, without modification, for CY 2020. Using updated final rule claims data, we are updating the Start Printed Page 61182estimated CY 2020 unscaled relative payment weights by multiplying them by a weight scalar of 1.4349 to ensure that the final CY 2020 relative payment weights are scaled to be budget neutral. The final CY 2020 relative payments weights listed in Addenda A and B to this final rule with comment period (which are available via the internet on the CMS website) were scaled and incorporate the recalibration adjustments discussed in sections II.A.1. and II.A.2. of this final rule with comment period.

B. Conversion Factor Update

Section 1833(t)(3)(C)(ii) of the Act requires the Secretary to update the conversion factor used to determine the payment rates under the OPPS on an annual basis by applying the OPD fee schedule increase factor. For purposes of section 1833(t)(3)(C)(iv) of the Act, subject to sections 1833(t)(17) and 1833(t)(3)(F) of the Act, the OPD fee schedule increase factor is equal to the hospital inpatient market basket percentage increase applicable to hospital discharges under section 1886(b)(3)(B)(iii) of the Act. In the FY 2020 IPPS/LTCH PPS proposed rule (84 FR 19401), consistent with current law, based on IHS Global, Inc.'s fourth quarter 2018 forecast of the FY 2020 market basket increase, the proposed FY 2020 IPPS market basket update was 3.2 percent. However, sections 1833(t)(3)(F) and 1833(t)(3)(G)(v) of the Act, as added by section 3401(i) of the Patient Protection and Affordable Care Act of 2010 (Pub. L. 111-148) and as amended by section 10319(g) of that law and further amended by section 1105(e) of the Health Care and Education Reconciliation Act of 2010 (Pub. L. 111-152), provide adjustments to the OPD fee schedule increase factor for CY 2020.

Specifically, section 1833(t)(3)(F)(i) of the Act requires that, for 2012 and subsequent years, the OPD fee schedule increase factor under subparagraph (C)(iv) be reduced by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II) of the Act. Section 1886(b)(3)(B)(xi)(II) of the Act defines the productivity adjustment as equal to the 10-year moving average of changes in annual economy-wide, private nonfarm business multifactor productivity (MFP) (as projected by the Secretary for the 10-year period ending with the applicable fiscal year, year, cost reporting period, or other annual period) (the “MFP adjustment”). In the FY 2012 IPPS/LTCH PPS final rule (76 FR 51689 through 51692), we finalized our methodology for calculating and applying the MFP adjustment, and then revised this methodology, as discussed in the FY 2016 IPPS/LTCH PPS final rule (80 FR 49509). According to the FY 2020 IPPS/LTCH PPS proposed rule (84 FR 19402), the proposed MFP adjustment for FY 2020 was 0.5 percentage point.

For CY 2020, we proposed that the MFP adjustment for the CY 2020 OPPS is 0.5 percentage point (84 FR 39428). We proposed that if more recent data become subsequently available after the publication of the proposed rule (for example, a more recent estimate of the market basket increase and the MFP adjustment), we would use such updated data, if appropriate, to determine the CY 2020 market basket update and the MFP adjustment, which are components in calculating the OPD fee schedule increase factor under sections 1833(t)(3)(C)(iv) and 1833(t)(3)(F) of the Act, in this CY 2020 OPPS/ASC final rule with comment period.

We note that section 1833(t)(3)(F) of the Act provides that application of this subparagraph may result in the OPD fee schedule increase factor under section 1833(t)(3)(C)(iv) of the Act being less than 0.0 percent for a year, and may result in OPPS payment rates being less than rates for the preceding year. As described in further detail below, we proposed for CY 2020 an OPD fee schedule increase factor of 2.7 percent for the CY 2020 OPPS (which was 3.2 percent, the final estimate of the hospital inpatient market basket percentage increase, less the final 0.5 percentage point MFP adjustment).

We proposed that hospitals that fail to meet the Hospital OQR Program reporting requirements would be subject to an additional reduction of 2.0 percentage points from the OPD fee schedule increase factor adjustment to the conversion factor that would be used to calculate the OPPS payment rates for their services, as required by section 1833(t)(17) of the Act. For further discussion of the Hospital OQR Program, we refer readers to section XIV. of this final rule with comment period.

In the CY 2020 OPPS/ASC proposed rule, we proposed to amend 42 CFR 419.32(b)(1)(iv)(B) by adding a new paragraph (11) to reflect the requirement in section 1833(t)(3)(F)(i) of the Act that, for CY 2020, we reduce the OPD fee schedule increase factor by the MFP adjustment as determined by CMS.

To set the OPPS conversion factor for CY 2020, we proposed to increase the CY 2019 conversion factor of $79.490 by 2.7 percent. In accordance with section 1833(t)(9)(B) of the Act, we proposed further to adjust the conversion factor for CY 2020 to ensure that any revisions made to the wage index and rural adjustment were made on a budget neutral basis. We proposed to calculate an overall budget neutrality factor of 0.9993 for wage index changes. This adjustment was comprised of a 1.0005 proposed budget neutrality adjustment, using our standard calculation, of comparing proposed total estimated payments from our simulation model using the proposed FY 2020 IPPS wage indexes to those payments using the FY 2019 IPPS wage indexes, as adopted on a calendar year basis for the OPPS as well as a 0.9988 proposed budget neutrality adjustment for the proposed CY 2020 5 percent cap on wage index decreases to ensure that this transition wage index is implemented in a budget neutral manner, consistent with the proposed FY 2020 IPPS wage index policy (84 FR 19398). We stated in the proposed rule that we believed it was appropriate to ensure that this proposed wage index transition policy (that is, the proposed CY 2020 5 percent cap on wage index decreases) did not increase estimated aggregate payments under the OPPS beyond the payments that would be made without this transition policy. We proposed to calculate this budget neutrality adjustment by comparing total estimated OPPS payments using the FY 2020 IPPS wage index, adopted on a calendar year basis for the OPPS, where a 5 percent cap on wage index decreases is not applied to total estimated OPPS payments where the 5 percent cap on wage index decreases is applied. We stated in the proposed rule that these two proposed wage index budget neutrality adjustments would maintain budget neutrality for the proposed CY 2020 OPPS wage index (which, as we discussed in section II.C of the proposed rule, would use the FY 2020 IPPS post-reclassified wage index and any adjustments, including without limitation any adjustments finalized under the IPPS to address wage index disparities).

We did not receive any public comments on our proposed methodology for calculating the wage index budget neutrality adjustments discussed earlier in this section. Therefore, for the reasons discussed above and in the CY 2020 OPPS/ASC proposed rule (84 FR 39428 through 39429), we are finalizing our methodology for calculating the wage index budget neutrality adjustments as proposed, without modification. For CY 2020, we are finalizing an overall budget neutrality factor of 0.9981 for wage index changes. This adjustment is comprised of a 0.9990 budget neutrality adjustment, using our standard Start Printed Page 61183calculation of comparing total estimated payments from our simulation model using the final FY 2020 IPPS wage indexes to those payments using the FY 2019 IPPS wage indexes, as adopted on a calendar year basis for the OPPS as well as a 0.9991 budget neutrality adjustment for the CY 2020 5 percent cap on wage index decreases to ensure that this transition wage index is implemented in a budget neutral manner. We note that the final wage index budget neutrality adjustment figures set forth above differ from the figures set forth in the proposed rule due to updated data for the final rule.

For the CY 2020 OPPS, we are maintaining the current rural adjustment policy, as discussed in section II.E. of the proposed rule. Therefore, the proposed budget neutrality factor for the rural adjustment is 1.0000.

For the CY 2020 OPPS/ASC proposed rule, we proposed to continue previously established policies for implementing the cancer hospital payment adjustment described in section 1833(t)(18) of the Act, as discussed in section II.F. of the proposed rule and this final rule with comment period. We proposed to calculate a CY 2020 budget neutrality adjustment factor for the cancer hospital payment adjustment by comparing estimated total CY 2020 payments under section 1833(t) of the Act, including the proposed CY 2020 cancer hospital payment adjustment, to estimated CY 2020 total payments using the CY 2019 final cancer hospital payment adjustment, as required under section 1833(t)(18)(B) of the Act. The proposed CY 2020 estimated payments applying the proposed CY 2020 cancer hospital payment adjustment were the same as estimated payments applying the CY 2019 final cancer hospital payment adjustment. Therefore, we proposed to apply a budget neutrality adjustment factor of 0.9998 to the conversion factor for the cancer hospital payment adjustment. In accordance with section 16002(b) of the 21st Century Cures Act, we stated in the proposed rule that we are applying a budget neutrality factor calculated as if the proposed cancer hospital adjustment target payment-to-cost ratio was 0.90, not the 0.89 target payment-to-cost ratio we applied as stated in section II.F. of the proposed rule.

For the CY 2020 OPPS/ASC proposed rule, we estimated that proposed pass-through spending for drugs, biologicals, and devices for CY 2020 would equal approximately $268.8 million, which represented 0.34 percent of total projected CY 2020 OPPS spending. Therefore, the proposed conversion factor would be adjusted by the difference between the 0.14 percent estimate of pass-through spending for CY 2019 and the 0.34 percent estimate of proposed pass-through spending for CY 2020, resulting in a proposed decrease for CY 2020 of 0.20 percent. Proposed estimated payments for outliers would remain at 1.0 percent of total OPPS payments for CY 2020. We estimated for the proposed rule that outlier payments would be 1.03 percent of total OPPS payments in CY 2019; the 1.00 percent for proposed outlier payments in CY 2020 would constitute a 0.03 percent increase in payment in CY 2020 relative to CY 2019.

For the CY 2020 OPPS/ASC proposed rule, we also proposed that hospitals that fail to meet the reporting requirements of the Hospital OQR Program would continue to be subject to a further reduction of 2.0 percentage points to the OPD fee schedule increase factor. For hospitals that fail to meet the requirements of the Hospital OQR Program, we proposed to make all other adjustments discussed above, but use a reduced OPD fee schedule update factor of 0.7 percent (that is, the proposed OPD fee schedule increase factor of 2.7 percent further reduced by 2.0 percentage points). This would result in a proposed reduced conversion factor for CY 2020 of $79.770 for hospitals that fail to meet the Hospital OQR Program requirements (a difference of −1.628 in the conversion factor relative to hospitals that met the requirements).

In summary, for CY 2020, we proposed to amend § 419.32 by adding a new paragraph (b)(1)(iv)(B)(11) to reflect the reductions to the OPD fee schedule increase factor that are required for CY 2020 to satisfy the statutory requirements of sections 1833(t)(3)(F) and (t)(3)(G)(v) of the Act. We proposed to use a reduced conversion factor of $79.770 in the calculation of payments for hospitals that fail to meet the Hospital OQR Program requirements (a difference of −1.628 in the conversion factor relative to hospitals that met the requirements).

For CY 2020, we proposed to use a conversion factor of $81.398 in the calculation of the national unadjusted payment rates for those items and services for which payment rates are calculated using geometric mean costs; that is, the proposed OPD fee schedule increase factor of 2.7 percent for CY 2020, the required proposed wage index budget neutrality adjustment of approximately 0.9993, the proposed cancer hospital payment adjustment of 0.9998, and the proposed adjustment of −0.20 percentage point of projected OPPS spending for the difference in pass-through spending that resulted in a proposed conversion factor for CY 2020 of $81.398. We referred readers to section XXVI.B. of the proposed rule for a discussion of the estimated effect on the conversion factor of a policy to pay for 340B-acquired drugs at ASP + 3 percent, which is a policy on which we solicited comments for potential future rulemaking in the event of an adverse decision on appeal in the ongoing litigation involving our payment policy for 340B-acquired drugs.

Comment: One commenter, a state hospital association, asserts its member hospitals receive payments from CMS that are substantially lower than the costs their members incur to provide services. The commenter believes underpayments occur because the CMS hospital market basket estimate of inflation of 2.7 percent substantially underestimates overall health care inflation which the commenter claims to be between 5.5 percent and 7 percent. The commenter also states that hospital payments from CMS are reduced because of payment sequestration and the policy to reduce payment rates for clinic visits at off-campus hospital outpatient departments to 40 percent of the standard OPPS payment rate. The commenter suggests that CMS should help hospitals in all states regain this lost revenue by implementing a much larger annual increase in the market basket amount. The commenter advocates a 4.7 percent market basket adjustment in CY 2020, and even larger percentage increases in following years.

Response: The percentage change in the hospital market basket reflects the average change in the price of goods and services purchased by hospitals in order to provide medical care. A general measure of health care inflation (such as the Consumer Price Index for Medical Care Services) would not be appropriate as it is not specific to hospital medical services and is not reflective of the input price changes experienced by hospitals but rather the inflation experienced by the consumer for their medical expenses. In addition, the OPPS conversion factor is not designed to redress payment reductions made in a non-budget neutral manner. The policies cited by the commenter are intended to reduce Medicare expenditures. If the conversion factor was to be increased to offset these payment reductions, it would defeat the intent of these policy initiatives.

Comment: A commenter expressed their support for the proposed market basket increase of 2.7 percent.

Response: We appreciate the support of the commenter.Start Printed Page 61184

After reviewing the public comments we received, we are finalizing these proposals without modification. For CY 2020, we proposed to continue previously established policies for implementing the cancer hospital payment adjustment described in section 1833(t)(18) of the Act (discussed in section II.F. of this final rule with comment period). Based on the final rule updated data used in calculating the cancer hospital payment adjustment in section II.F. of this final rule with comment period, the target payment-to-cost ratio for the cancer hospital payment adjustment, which was 0.88 for CY 2019, is 0.89 for CY 2020. As a result, we are applying a budget neutrality adjustment factor of 0.9999 to the conversion factor for the cancer hospital payment adjustment.

As a result of these finalized policies, the OPD fee schedule increase factor for the CY 2020 OPPS is 2.6 percent (which reflects the 3.0 percent final estimate of the hospital inpatient market basket percentage increase, less the final 0.4 percentage point MFP adjustment). For CY 2020, we are using a conversion factor of $80.784 in the calculation of the national unadjusted payment rates for those items and services for which payment rates are calculated using geometric mean costs; that is, the OPD fee schedule increase factor of 2.6 percent for CY 2020, the required wage index budget neutrality adjustment of approximately 0.9981, and the adjustment of 0.88 percentage point of projected OPPS spending for the difference in pass-through spending that results in a conversion factor for CY 2020 of $80.784.

C. Wage Index Changes

Section 1833(t)(2)(D) of the Act requires the Secretary to determine a wage adjustment factor to adjust the portion of payment and coinsurance attributable to labor-related costs for relative differences in labor and labor-related costs across geographic regions in a budget neutral manner (codified at 42 CFR 419.43(a)). This portion of the OPPS payment rate is called the OPPS labor-related share. Budget neutrality is discussed in section II.B. of this final rule with comment period.

The OPPS labor-related share is 60 percent of the national OPPS payment. This labor-related share is based on a regression analysis that determined that, for all hospitals, approximately 60 percent of the costs of services paid under the OPPS were attributable to wage costs. We confirmed that this labor-related share for outpatient services is appropriate during our regression analysis for the payment adjustment for rural hospitals in the CY 2006 OPPS final rule with comment period (70 FR 68553). In the CY 2020 OPPS/ASC proposed rule (84 FR 39429), we proposed to continue this policy for the CY 2020 OPPS. We refer readers to section II.H. of this final rule with comment period for a description and an example of how the wage index for a particular hospital is used to determine payment for the hospital. We did not receive any public comments on this proposal. Therefore, for the reasons discussed above and in the CY 2020 OPPS/ASC proposed rule (84 FR 39429), we are finalizing our proposal, without modification, to continue this policy as discussed above for the CY 2020 OPPS.

As discussed in the claims accounting narrative included with the supporting documentation for this final rule with comment period (which is available via the internet on the CMS website), for estimating APC costs, we standardize 60 percent of estimated claims costs for geographic area wage variation using the same FY 2020 pre-reclassified wage index that that is used under the IPPS to standardize costs. This standardization process removes the effects of differences in area wage levels from the determination of a national unadjusted OPPS payment rate and copayment amount.

Under 42 CFR 419.41(c)(1) and 419.43(c) (published in the OPPS April 7, 2000 final rule with comment period (65 FR 18495 and 18545)), the OPPS adopted the final fiscal year IPPS post-reclassified wage index as the calendar year wage index for adjusting the OPPS standard payment amounts for labor market differences. Therefore, the wage index that applies to a particular acute care, short-stay hospital under the IPPS also applies to that hospital under the OPPS. As initially explained in the September 8, 1998 OPPS proposed rule (63 FR 47576), we believe that using the IPPS wage index as the source of an adjustment factor for the OPPS is reasonable and logical, given the inseparable, subordinate status of the HOPD within the hospital overall. In accordance with section 1886(d)(3)(E) of the Act, the IPPS wage index is updated annually.

The Affordable Care Act contained several provisions affecting the wage index. These provisions were discussed in the CY 2012 OPPS/ASC final rule with comment period (76 FR 74191). Section 10324 of the Affordable Care Act added section 1886(d)(3)(E)(iii)(II) to the Act, which defines a frontier State and amended section 1833(t) of the Act to add paragraph (19), which requires a frontier State wage index floor of 1.00 in certain cases, and states that the frontier State floor shall not be applied in a budget neutral manner. We codified these requirements at § 419.43(c)(2) and (3) of our regulations. For the CY 2020 OPPS, we proposed to implement this provision in the same manner as we have since CY 2011. Under this policy, the frontier State hospitals would receive a wage index of 1.00 if the otherwise applicable wage index (including reclassification, the rural floor, and rural floor budget neutrality) is less than 1.00. Because the HOPD receives a wage index based on the geographic location of the specific inpatient hospital with which it is associated, we stated that the frontier State wage index adjustment applicable for the inpatient hospital also would apply for any associated HOPD. In the CY 2020 OPPS/ASC proposed rule (84 FR 39430), we referred readers to the FY 2011 through FY 2019 IPPS/LTCH PPS final rules for discussions regarding this provision, including our methodology for identifying which areas meet the definition of “frontier States” as provided for in section 1886(d)(3)(E)(iii)(II) of the Act: For FY 2011, 75 FR 50160 through 50161; for FY 2012, 76 FR 51793, 51795, and 51825; for FY 2013, 77 FR 53369 through 53370; for FY 2014, 78 FR 50590 through 50591; for FY 2015, 79 FR 49971; for FY 2016, 80 FR 49498; for FY 2017, 81 FR 56922; for FY 2018, 82 FR 38142; and for FY 2019, 83 FR 41380. We did not receive any public comments on this proposal. Accordingly, for the reasons discussed above and in the CY 2020 OPPS/ASC proposed rule (84 FR 39430), we are finalizing our proposal, without modification, to continue to implement the frontier State floor under the OPPS in the same manner as we have since CY 2011.

In addition to the changes required by the Affordable Care Act, we noted in the CY 2020 OPPS/ASC proposed rule (84 FR 39430) that the FY 2020 IPPS wage indexes continue to reflect a number of adjustments implemented over the past few years, including, but not limited to, reclassification of hospitals to different geographic areas, the rural floor provisions, an adjustment for occupational mix, and an adjustment to the wage index based on commuting patterns of employees (the out-migration adjustment). Also, we noted that, as discussed in the FY 2020 IPPS/LTCH PPS proposed rule (84 FR 19393 through 19399), we proposed a number of policies under the IPPS to address wage index disparities between high and low wage index value hospitals. In particular, in the FY 2020 IPPS/LTCH Start Printed Page 61185PPS proposed rule, we proposed to (1) calculate the rural floor without including the wage data of urban hospitals that have reclassified as rural under section 1886(d)(8)(E) of the Act (as implemented in § 412.103) (84 FR 19396 through 19398); (2) remove the wage data of urban hospitals that have reclassified as rural under § 412.103 from the calculation of “the wage index for rural areas in the State” for purposes of applying section 1886(d)(8)(C)(iii) of the Act (84 FR 19398); (3) increase the wage index values for hospitals with a wage index below the 25th percentile wage index value across all hospitals by half the difference between the otherwise applicable final wage index value for a year for that hospital and the 25th percentile wage index value for that year, and to offset the estimated increase in payments to hospitals with wage index values below the 25th percentile by decreasing the wage index values for hospitals with wage index values above the 75th percentile wage index value across all hospitals (84 FR 19394 through 19396); and (4) apply a 5-percent cap for FY 2020 on any decrease in a hospital's final wage index from the hospital's final wage index in FY 2019, as a proposed transition wage index to help mitigate any significant negative impacts on hospitals (84 FR 19398). In addition, in the FY 2020 IPPS/LTCH PPS proposed rule (84 FR 19398), we proposed to apply a budget neutrality adjustment to the standardized amount so that our proposed transition wage index for hospitals that may be negatively impacted (described in item (4) above) would be implemented in a budget neutral manner. Furthermore, in the FY 2020 IPPS/LTCH PPS proposed rule (84 FR 19398 through 19399), we noted that our proposed adjustment relating to the rural floor calculation also would be budget neutral. We referred readers to the FY 2020 IPPS/LTCH PPS proposed rule (84 FR 19373 through 19399) for a detailed discussion of all proposed changes to the FY 2020 IPPS wage indexes.

Furthermore, as discussed in the FY 2015 IPPS/LTCH PPS final rule (79 FR 49951 through 49963) and in each subsequent IPPS/LTCH PPS final rule, including the FY 2019 IPPS/LTCH PPS final rule (83 FR 41362), the Office of Management and Budget (OMB) issued revisions to the labor market area delineations on February 28, 2013 (based on 2010 Decennial Census data), that included a number of significant changes, such as new Core Based Statistical Areas (CBSAs), urban counties that became rural, rural counties that became urban, and existing CBSAs that were split apart (OMB Bulletin 13-01). This bulletin can be found at: https://obamawhitehouse.archives.gov/​sites/​default/​files/​omb/​bulletins/​2013/​b13-01.pdf. In the FY 2015 IPPS/LTCH PPS final rule (79 FR 49950 through 49985), for purposes of the IPPS, we adopted the use of the OMB statistical area delineations contained in OMB Bulletin No. 13-01, effective October 1, 2014. For purposes of the OPPS, in the CY 2015 OPPS/ASC final rule with comment period (79 FR 66826 through 66828), we adopted the use of the OMB statistical area delineations contained in OMB Bulletin No. 13-01, effective January 1, 2015, beginning with the CY 2015 OPPS wage indexes. In the FY 2017 IPPS/LTCH PPS final rule (81 FR 56913), we adopted revisions to statistical areas contained in OMB Bulletin No. 15-01, issued on July 15, 2015, which provided updates to and superseded OMB Bulletin No. 13-01 that was issued on February 28, 2013. For purposes of the OPPS, in the CY 2017 OPPS/ASC final rule with comment period (81 FR 79598), we adopted the revisions to the OMB statistical area delineations contained in OMB Bulletin No. 15-01, effective January 1, 2017, beginning with the CY 2017 OPPS wage indexes.

On August 15, 2017, OMB issued OMB Bulletin No. 17-01, which provided updates to and superseded OMB Bulletin No. 15-01 that was issued on July 15, 2015. The attachments to OMB Bulletin No. 17-01 provide detailed information on the update to the statistical areas since July 15, 2015, and are based on the application of the 2010 Standards for Delineating Metropolitan and Micropolitan Statistical Areas to Census Bureau population estimates for July 1, 2014 and July 1, 2015. In the CY 2019 OPPS/ASC final rule with comment period (83 FR 58863 through 58865), we adopted the updates set forth in OMB Bulletin No. 17-01, effective January 1, 2019, beginning with the CY 2019 wage index. We continue to believe that it is important for the OPPS to use the latest labor market area delineations available as soon as is reasonably possible in order to maintain a more accurate and up-to-date payment system that reflects the reality of population shifts and labor market conditions. For a complete discussion of the adoption of the updates set forth in OMB Bulletin No. 17-01, we refer readers to the CY 2019 OPPS/ASC final rule with comment period (83 FR 58864 through 58865).

As we stated in the FY 2020 IPPS/LTCH PPS final rule (84 FR 42301), for the FY 2020 IPPS wage indexes, we are using the OMB delineations that were adopted, beginning with FY 2015 (based on the revised delineations issued in OMB Bulletin No. 13-01) to calculate the area wage indexes, with updates as reflected in OMB Bulletin Nos. 15-01 and 17-01. Similarly, in the CY 2020 OPPS/ASC proposed rule (84 FR 39431), for the proposed CY 2020 OPPS wage indexes, we proposed to continue to use the OMB delineations that were adopted under the OPPS, beginning with CY 2015 (based on the revised delineations issued in OMB Bulletin No. 13-01) to calculate the area wage indexes, with updates as reflected in OMB Bulletin Nos. 15-01 and 17-01. We did not receive any public comments on our proposal. Accordingly, for the reasons discussed above and in the CY 2020 OPPS/ASC proposed rule (84 FR 39430 through 39431), we are finalizing our proposal to continue to use the OMB delineations that were adopted beginning with CY 2015 to calculate area wage indexes under the OPPS, with updates as reflected in the OMB Bulletin Nos. 15-01, and 17-01.

CBSAs are made up of one or more constituent counties. Each CBSA and constituent county has its own unique identifying codes. The FY 2018 IPPS/LTCH PPS final rule (82 FR 38130) discussed the two different lists of codes to identify counties: Social Security Administration (SSA) codes and Federal Information Processing Standard (FIPS) codes. Historically, CMS listed and used SSA and FIPS county codes to identify and crosswalk counties to CBSA codes for purposes of the IPPS and OPPS wage indexes. However, the SSA county codes are no longer being maintained and updated, although the FIPS codes continue to be maintained by the U.S. Census Bureau. The Census Bureau's most current statistical area information is derived from ongoing census data received since 2010; the most recent data are from 2015. The Census Bureau maintains a complete list of changes to counties or county equivalent entities on the website at: https://www.census.gov/​geo/​reference/​county-changes.html (which, as of May 6, 2019, migrated to: https://www.census.gov/​programs-surveys/​geography.html). In the FY 2018 IPPS/LTCH PPS final rule (82 FR 38130), for purposes of crosswalking counties to CBSAs for the IPPS wage index, we finalized our proposal to discontinue the use of the SSA county codes and begin using only the FIPS county codes. Similarly, for the purposes of crosswalking counties to CBSAs for the OPPS wage index, in the CY 2018 OPPS/ASC final rule with Start Printed Page 61186comment period (82 FR 59260), we finalized our proposal to discontinue the use of SSA county codes and begin using only the FIPS county codes. For CY 2020, under the OPPS, we are continuing to use only the FIPS county codes for purposes of crosswalking counties to CBSAs.

In the CY 2020 OPPS/ASC proposed rule (84 FR 39431), we proposed to use the FY 2020 hospital IPPS post-reclassified wage index for urban and rural areas as the wage index for the OPPS to determine the wage adjustments for both the OPPS payment rate and the copayment standardized amount for CY 2020. Therefore, we stated in the proposed rule that any adjustments for the FY 2020 IPPS post-reclassified wage index, including, but not limited to, any policies finalized under the IPPS to address wage index disparities between low and high wage index value hospitals, would be reflected in the final CY 2020 OPPS wage index beginning on January 1, 2020. (We referred readers to the FY 2020 IPPS/LTCH PPS proposed rule (84 FR 19373 through 19399) and the proposed FY 2020 hospital wage index files posted on the CMS website.) With regard to budget neutrality for the CY 2020 OPPS wage index, we referred readers to section II.B. of the CY 2020 OPPS/ASC proposed rule. We stated that we continue to believe that using the IPPS wage index as the source of an adjustment factor for the OPPS is reasonable and logical, given the inseparable, subordinate status of the HOPD within the hospital overall. Summarized below are the comments we received regarding our proposal to use the final FY 2020 hospital IPPS post-reclassified wage index for urban and rural areas as the wage index for the OPPS, including any adjustments for the final FY 2020 IPPS post-reclassified wage index as discussed above, along with our responses.

Comment: Several commenters supported CMS adopting the finalized post-reclassified wage index from the FY 2020 IPPS/LTCH PPS final rule for use under the OPPS. Many of these commenters noted that the gap in payment between rural and urban hospitals has contributed to disparities in care and noted that increasing the wage index for hospitals with wage index values below the 25th percentile wage index value will help to lessen the gap. Some of these commenters noted that this change will help rural areas have access to quality, affordable health care. One commenter supported the proposal to increase the wage index for hospitals with wage index values below the 25th percentile, but wanted CMS to consider this solution temporary until the wage index is more equitable between hospitals.

Response: We appreciate the commenters' support. In response to the comment that CMS should consider the increase in the wage index for hospitals with wage index values below the 25th percentile wage index value (that it, low wage index hospitals) temporary until the wage index is more equitable between hospitals, as we stated in the FY 2020 IPPS/LTCH PPS final rule (84 FR 42326 through 42327), the increase in the IPPS wage index for low wage index hospitals is not intended to be permanent. As we stated in the FY 2020 IPPS/LTCH PPS final rule (84 FR 42326 through 42327), we expect that this policy will be in place for at least 4 years in order to allow employee compensation increases implemented by low wage index hospitals sufficient time to be reflected in the wage index calculation. We stated in the FY 2020 IPPS/LTCH PPS final rule (84 FR 42327) that, once there has been sufficient time for that increased employee compensation to be reflected in the wage data, there should not be a continuing need for this policy.

Comment: Several commenters supported the proposal to increase the wage index for low wage index hospitals but wanted it implemented in a non-budget neutral manner. They believe this would mitigate disparities for median wage index hospitals. Several commenters opposed the proposal to recalculate the wage index to help the lowest wage hospitals. These commenters believed that applying a budget neutrality adjustment for all hospitals to offset the increase in payments for low wage index hospitals would result in a significant loss of resources for patient care in other hospitals. While these commenters understood and appreciated the goal of the proposed changes to increase the wage index for low wage hospitals, they did not believe that these policies would help rural hospitals. They believed that certain communities would benefit from increasing the wage index for low wage hospitals but believed this policy does not adequately recognize differences in geographic labor markets. They further claimed that the offsetting reductions to the wage index in some areas will hinder hospitals' ability to attract and recruit quality health care practitioners.

Some commenters noted that OPPS payments to hospitals in their respective states would decrease by millions in CY 2020 due to the budget neutral implementation of the increase in the wage index for low wage hospitals. These commenters noted that any reduction in Medicare payments would force hospitals to reduce staff and/or salary and benefits. One commenter noted that, for many years, the disparities among geographic areas have continued to grow and have resulted in challenges recruiting staff. Some commenters recommended CMS convene a meeting to understand all of the challenges and issues in order to develop a comprehensive reform of the wage index. One commenter recommended that, if CMS is going to redistribute the area wage index, CMS offset the increased wage index for very low wage areas with a budget neutrality adjustment to the wage index applied evenly to all hospitals. However, this commenter preferred that CMS not use budget neutrality for the area wage index. They did not believe that the budget neutrality adjustment policy follows statutory requirements for adjusting the area wage index that require CMS to address real differences in labor costs. Several commenters believed CMS went beyond its authority in reallocating funding from hospitals in high wage areas, to provide funding to low wage area hospitals, without any relationship to actual wage-related data for the impacted areas. Another commenter strongly opposed decreasing payments to some or all hospitals to offset an increase in the area wage index for low wage index hospitals and did not believe the rationale in the FY 2020 IPPS final rule supported this change. One commenter opposed CMS making a budget neutrality adjustment across all hospitals as well as the transition wage index adjustment to ensure that no hospital's wage index decreases by more than 5 percent. This commenter believed that these adjustments negatively impact hospitals in the bottom quartile of wage index that would have seen a larger increase in payment without these additional adjustments.

Response: As we stated in the FY 2020 IPPS/LTCH PPS final rule (84 FR 42331), the intent of the wage index increase for hospitals with wage indexes below the 25th percentile wage index value across all hospitals (that is, low wage index hospitals) is to increase the accuracy of the wage index as a technical adjustment, and not to use the wage index as a policy tool to address non-wage issues related to rural hospitals, or the laudable goals of the overall financial health of hospitals in low wage areas or broader wage index reform. As we stated in the FY 2020 IPPS/LTCH PPS final rule, we believe the wage index increase we finalized for Start Printed Page 61187low wage index hospitals increases the accuracy of the wage index as a relative measure because it allows low wage index hospitals to increase their employee compensation in ways that we would expect if there were no lag in reflecting compensation adjustments in the wage index. Thus, we stated in the FY 2020 IPPS/LTCH PPS final rule that we believe the IPPS wage index adjustment for low wage index hospitals will appropriately reflect the relative hospital wage level in those areas compared to the national average wage level. We further stated in the FY 2020 IPPS/LTCH PPS final rule that because this policy is based on the actual wages that we expect low wage index hospitals to pay, it falls within the scope of the authority of section 1886(d)(3)(E) of the Act.

However, we note that, in the FY 2020 IPPS/LTCH PPS final rule (84 FR 42331 through 42332), we did not finalize our budget neutrality proposal to decrease the wage index for hospitals with wage index values above the 75th percentile wage index value to offset the estimated increase in payments to low wage index hospitals. Instead, in the FY 2020 IPPS/LTCH PPS final rule, consistent with our current methodology for implementing wage index budget neutrality under the IPPS, we finalized a budget neutrality adjustment to the IPPS national standardized amount for all hospitals so that the increase in the IPPS wage index for low wage index hospitals is implemented in a budget neutral manner. As explained in the FY 2020 IPPS/LTCH PPS final rule (84 FR42331), under section 1886(d)(3)(E) of the Act, the IPPS wage index adjustment is required to be implemented in a budget neutral manner. We further noted in the FY 2020 IPPS/LTCH PPS final rule that, even if the wage index were not required to be budget neutral, we would consider it inappropriate to use the wage index to increase or decrease overall spending. Similarly, under section 1886(t)(2)(D) and (9)(B) of the Act, the OPPS wage index adjustment is required to be implemented in a budget neutral manner. Accordingly, consistent with the policy finalized in the FY 2020 IPPS/LTCH PPS final rule, in this CY 2020 OPPS/ASC final rule with comment period, we are finalizing a budget neutrality adjustment to the conversion factor for all hospitals paid under the OPPS so that the increase in the OPPS wage index for low wage index hospitals is implemented in a budget neutral manner. We refer readers to section II.B. of this final rule with comment period for a discussion of budget neutrality. In addition, we refer readers to the FY 2020 IPPS/LTCH PPS final rule (84 FR 42328 through 42332) for further discussion of the final FY 2020 IPPS wage index policies (including the transition wage index adjustment) and detailed responses to similar comments.

In the CY 2020 OPPS/ASC proposed rule (84 FR 39431), we proposed to use the FY 2020 IPPS post-reclassified wage index for urban and rural areas as the wage index under the OPPS to determine the wage adjustments for both the OPPS payment rate and the copayment standardized amount. Because we continue to believe that using the IPPS post-reclassified wage index as the source of the wage index adjustment factor under the OPPS is reasonable and logical given the inseparable, subordinate status of the HOPD within the hospital overall, as proposed, we are finalizing the use of the FY 2020 hospital IPPS post-reclassified wage index for urban and rural areas as the wage index under the OPPS to determine the wage adjustments for both the OPPS payment rate and the copayment standardized amount for CY 2020. Accordingly, any adjustments for the final FY 2020 IPPS post-reclassified wage index, including, but not limited to, any policies finalized in the FY 2020 IPPS/LTCH PPS final rule to address wage index disparities between low and high wage index value hospitals, will be reflected in the final CY 2020 OPPS wage index beginning on January 1, 2020.

Comment: Several commenters noted support for the revised rural floor policy finalized in the FY 2020 IPPS/LTCH final rule. Many of these commenters supported the proposal to exclude the wage data of urban hospitals that reclassify as rural in calculating the rural floor. These commenters suggested that including the wage data of these hospitals in the rural floor calculation has inflated wage index values in certain states and that excluding the wage data of these hospitals will have positive effects on OPPS payment for rural hospitals.

Response: We thank commenters for their support.

Comment: A few commenters opposed the change to exclude the wage data of urban hospitals that have been reclassified as rural in calculating the IPPS rural floor. One of these commenters believed that CMS lacks the legal authority to remove from the rural floor calculation the wage data of hospitals that have been reclassified from urban to rural as implemented in the FY 2020 IPPS/LTCH final rule. This commenter believed CMS misread the applicable law in Section 1886(d)(8)(E) of the Act. One of the commenter's believed that removing the urban to rural reclassifications from the calculation of the rural floor penalizes hospitals that are allowed to reclassify under HHS authority.

One commenter believed that CMS should put more structure around the rural floor policy and should not apply the rural floor in primarily urban states with only one or two rural facilities. The commenter believed that this would reduce the potential for gaming the system in determining an equitable wage adjustment.

Response: We addressed similar comments in the FY 2020 IPPS/LTCH PPS final rule (84 FR 42334 through 42336). As provided in the FY 2020 IPPS/LTCH final rule (84 FR 42334), in the absence of broader wage index reform from Congress, we believe it is appropriate to revise the rural floor calculation as part of an effort to reduce wage index disparities. Regarding CMS's statutory authority to exclude the wage data of urban hospitals reclassified as rural from the IPPS rural floor calculation, as we stated in the FY 2020 IPPS/LTCH PPS final rule (84 FR 42334), we believe our calculation methodology is permissible under section 1886(d)(8)(E) of the Act (as implemented in § 412.103) and the rural floor statute (section 4410 of Pub. L. 105-33). Further, as we discussed in the FY 2020 IPPS/LTCH PPS final rule (84 FR 42336), we do not believe this policy penalizes or adversely impacts urban hospitals that have reclassified as rural. We refer readers to the FY 2020 IPPS/LTCH PPS final rule (84 FR 42332 through 42336) for further discussion of this policy and detailed responses to similar comments. We note that impact files and supporting data files available on the FY 2020 IPPS Final Rule Home Page provide the data necessary to understand the impact of the finalized policies under the IPPS. Furthermore, we appreciate the comment that CMS should not apply the rural floor in primarily urban states with only one or two rural facilities; however, because we consider this comment to be outside the scope of the CY 2020 OPPS wage index proposals, we are not addressing it in this final rule with comment period.

As we discussed above, we continue to believe that using the IPPS post-reclassified wage index as the source of the wage index adjustment factor under the OPPS is reasonable and logical given the inseparable, subordinate status of the HOPD within the hospital overall. Thus, as proposed, we are using the FY 2020 hospital IPPS post-reclassified Start Printed Page 61188wage index for urban and rural areas as the wage index under the OPPS to determine the wage adjustments for both the OPPS payment rate and the copayment standardized amount for CY 2020. Accordingly, as we proposed, any adjustments for the final FY 2020 IPPS post-reclassified wage index, including, but not limited to, the revised rural floor calculation methodology and other IPPS wage index policies finalized in the FY 2020 IPPS/LTCH PPS final rule to address wage index disparities, will be reflected in the final CY 2020 OPPS wage index beginning on January 1, 2020.

After considering the public comments received, for the reasons discussed earlier in this section and in the CY 2020 OPPS/ASC proposed rule, we are finalizing without modification our proposal to use the final FY 2020 IPPS post-reclassified wage index for urban and rural areas as the wage index under the OPPS to determine the wage adjustments for both the OPPS payment rate and the copayment standardized amount for CY 2020. Accordingly, as we proposed, any adjustments for the final FY 2020 IPPS post-reclassified wage index (as set forth in the FY 2020 IPPS/LTCH PPS final rule, 84 FR 42300 through 42339), including, but not limited to, any policies finalized in the FY 2020 IPPS/LTCH PPS final rule to address wage index disparities between low and high wage index value hospitals (as set forth at 84 FR 42300 through 42339), will be reflected in the final CY 2020 OPPS wage index beginning on January 1, 2020. As discussed above, we note that in the FY 2020 IPPS/LTCH PPS final rule (84 FR 42325 through 42332), we did not finalize our budget neutrality proposal to decrease the wage index for hospitals with wage index values above the 75th percentile wage index value to offset the estimated increase in payments to hospitals with wage index values below the 25th percentile wage index value, and thus this budget neutrality policy will not be applied under the OPPS. Instead, in the FY 2020 IPPS/LTCH PPS final rule, consistent with our current methodology for implementing IPPS wage index budget neutrality, we finalized a budget neutrality adjustment to the IPPS national standardized amount for all hospitals so that the increase in the IPPS wage index for low wage index hospitals is implemented in a budget neutral manner. Consistent with this IPPS policy, in this CY 2020 OPPS/ASC final rule with comment period, we are finalizing a budget neutrality adjustment to the conversion factor for all hospitals paid under the OPPS so that the increase in the OPPS wage index for low wage index hospitals is implemented in a budget neutral manner. We refer readers to section II.B. of this final rule with comment period for a discussion of budget neutrality.

Hospitals that are paid under the OPPS, but not under the IPPS, do not have an assigned hospital wage index under the IPPS. Therefore, for non-IPPS hospitals paid under the OPPS, it is our longstanding policy to assign the wage index that would be applicable if the hospital were paid under the IPPS, based on its geographic location and any applicable wage index adjustments. In the CY 2020 OPPS/ASC proposed rule (84 FR 39431), we proposed to continue this policy for CY 2020, and included a brief summary of the major proposed FY 2020 IPPS wage index policies and adjustments that we proposed to apply to these hospitals under the OPPS for CY 2020, which we have summarized below. We refer readers to the FY 2020 IPPS/LTCH PPS final rule (84 FR 42300 through 42339) for a detailed discussion of the final changes to the FY 2020 IPPS wage indexes.

It has been our longstanding policy to allow non-IPPS hospitals paid under the OPPS to qualify for the out-migration adjustment if they are located in a section 505 out-migration county (section 505 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA)). Applying this adjustment is consistent with our policy of adopting IPPS wage index policies for hospitals paid under the OPPS. We note that, because non-IPPS hospitals cannot reclassify, they are eligible for the out-migration wage index adjustment if they are located in a section 505 out-migration county. This is the same out-migration adjustment policy that applies if the hospital were paid under the IPPS. For CY 2020, we proposed to continue our policy of allowing non-IPPS hospitals paid under the OPPS to qualify for the out-migration adjustment if they are located in a section 505 out-migration county (section 505 of the MMA). In addition, for non-IPPS hospitals paid under the OPPS, we proposed to apply any policies that are finalized under the IPPS relating to wage index disparities. We also proposed that the wage index that would apply to non-IPPS hospitals for CY 2020 would include the rural floor adjustment. We did not receive any public comments on these proposals. Accordingly, for the reasons discussed above and in the CY 2020 OPPS/ASC proposed rule (84 FR 39431), we are finalizing these proposals without modifications.

For CMHCs, for CY 2020, we proposed to continue to calculate the wage index by using the post-reclassification IPPS wage index based on the CBSA where the CMHC is located. We also proposed to apply any policies that are finalized under the IPPS relating to wage index disparities. In addition, we proposed that the wage index that would apply to CMHCs for CY 2020 would include the rural floor adjustment. Also, we proposed that the wage index that would apply to CMHCs would not include the out-migration adjustment because that adjustment only applies to hospitals. We did not receive any public comments on these proposals. Therefore, for the reasons discussed above and in the CY 2020 OPPS/ASC proposed rule (84 FR 39431), we are finalizing these proposals without modifications.

Table 4 associated with the FY 2020 IPPS/LTCH PPS final rule (available via the internet on the CMS website at: http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html) identifies counties eligible for the out-migration adjustment. Table 2 associated with the FY 2020 IPPS/LTCH PPS final rule (available for download via the website above) identifies IPPS hospitals that will receive the out-migration adjustment for FY 2020. We are including the out-migration adjustment information from Table 2 associated with the FY 2020 IPPS/LTCH PPS final rule as Addendum L to this final rule with comment period with the addition of non-IPPS hospitals that will receive the section 505 out-migration adjustment under this CY 2020 OPPS/ASC final rule with comment period. Addendum L is available via the internet on the CMS website. We refer readers to the CMS website for the OPPS at: http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​index.html. At this link, readers will find a link to the final FY 2020 IPPS wage index tables and Addendum L.

D. Statewide Average Default Cost-to-Charge Ratios (CCRs)

In addition to using CCRs to estimate costs from charges on claims for ratesetting, CMS uses overall hospital-specific CCRs calculated from the hospital's most recent cost report to determine outlier payments, payments for pass-through devices, and monthly interim transitional corridor payments under the OPPS during the PPS year. For certain hospitals, under the regulations at 42 CFR 419.43(d)(5)(iii), CMS uses the statewide average default CCRs to determine the payments Start Printed Page 61189mentioned earlier if it is unable to determine an accurate CCR for a hospital in certain circumstances. This includes hospitals that are new, hospitals that have not accepted assignment of an existing hospital's provider agreement, and hospitals that have not yet submitted a cost report. CMS also uses the statewide average default CCRs to determine payments for hospitals whose CCR falls outside the predetermined ceiling threshold for a valid CCR or for hospitals in which the most recent cost report reflects an all-inclusive rate status (Medicare Claims Processing Manual (Pub. 100-04), Chapter 4, Section 10.11).

We discussed our policy for using default CCRs, including setting the ceiling threshold for a valid CCR, in the CY 2009 OPPS/ASC final rule with comment period (73 FR 68594 through 68599) in the context of our adoption of an outlier reconciliation policy for cost reports beginning on or after January 1, 2009. For details on our process for calculating the statewide average CCRs, we referred readers to the CY 2020 OPPS proposed rule Claims Accounting Narrative that is posted on the CMS website. In the CY 2020 OPPS/ASC proposed rule (84 FR 39432), we proposed to update the default ratios for CY 2020 using the most recent cost report data. We indicated that we would update these ratios in this final rule with comment period if more recent cost report data are available.

We did not receive any public comments on our proposal to use statewide average default CCRs if we cannot calculate a CCR for a hospital and to use these CCRs to adjust charges on claims to costs for setting the final CY 2020 OPPS payment weights. Therefore, we finalizing our proposal without modification.

As we stated in the CY 2020 OPPS/ASC proposed rule (84 FR 39432), we are no longer publishing a table in the Federal Register containing the statewide average CCRs in the annual OPPS proposed rule and final rule. These CCRs with the upper limit will be available for download with each OPPS CY proposed rule and final rule on the CMS website. We refer readers to the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​Hospital-Outpatient-Regulations-and-Notices.html; click on the link on the left of the page titled “Hospital Outpatient Regulations and Notices” and then select the relevant regulation to download the statewide CCRs and upper limit in the downloads section of the web page.

E. Adjustment for Rural Sole Community Hospitals (SCHs) and Essential Access Community Hospitals (EACHs) Under Section 1833(t)(13)(B) of the Act for CY 2020

In the CY 2006 OPPS final rule with comment period (70 FR 68556), we finalized a payment increase for rural sole community hospitals (SCHs) of 7.1 percent for all services and procedures paid under the OPPS, excluding drugs, biologicals, brachytherapy sources, and devices paid under the pass-through payment policy, in accordance with section 1833(t)(13)(B) of the Act, as added by section 411 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) (Pub. L. 108-173). Section 1833(t)(13) of the Act provided the Secretary the authority to make an adjustment to OPPS payments for rural hospitals, effective January 1, 2006, if justified by a study of the difference in costs by APC between hospitals in rural areas and hospitals in urban areas. Our analysis showed a difference in costs for rural SCHs. Therefore, for the CY 2006 OPPS, we finalized a payment adjustment for rural SCHs of 7.1 percent for all services and procedures paid under the OPPS, excluding separately payable drugs and biologicals, brachytherapy sources, items paid at charges reduced to costs, and devices paid under the pass-through payment policy, in accordance with section 1833(t)(13)(B) of the Act.

In the CY 2007 OPPS/ASC final rule with comment period (71 FR 68010 and 68227), for purposes of receiving this rural adjustment, we revised our regulations at § 419.43(g) to clarify that essential access community hospitals (EACHs) are also eligible to receive the rural SCH adjustment, assuming these entities otherwise meet the rural adjustment criteria. Currently, two hospitals are classified as EACHs, and as of CY 1998, under section 4201(c) of Public Law 105-33, a hospital can no longer become newly classified as an EACH.

This adjustment for rural SCHs is budget neutral and applied before calculating outlier payments and copayments. We stated in the CY 2006 OPPS final rule with comment period (70 FR 68560) that we would not reestablish the adjustment amount on an annual basis, but we may review the adjustment in the future and, if appropriate, would revise the adjustment. We provided the same 7.1 percent adjustment to rural SCHs, including EACHs, again in CYs 2008 through 2019. Further, in the CY 2009 OPPS/ASC final rule with comment period (73 FR 68590), we updated the regulations at § 419.43(g)(4) to specify, in general terms, that items paid at charges adjusted to costs by application of a hospital-specific CCR are excluded from the 7.1 percent payment adjustment.

In the CY 2020 OPPS/ASC proposed rule (84 FR 58870 through 58871), for the CY 2020 OPPS, we proposed to continue the current policy of a 7.1 percent payment adjustment that is done in a budget neutral manner for rural SCHs, including EACHs, for all services and procedures paid under the OPPS, excluding separately payable drugs and biologicals, brachytherapy sources, items paid at charges reduced to costs, and devices paid under the pass-through payment policy.

Comment: Several commenters supported the proposal to continue the 7.1 percent payment adjustment.

Response: We appreciate the commenters' support.

Comment: One commenter requested that CMS make the 7.1 percent rural adjustment permanent. The commenter appreciated the policy that CMS adopted in CY 2019 where we stated that the 7.1 percent rural adjustment would continue to be in place until our data support establishing a different rural adjustment percentage. However, the commenter believed that this policy still does not provide enough certainty for rural SCHs and EACHs to know whether they should take into account the rural SCH adjustment when attempting to calculate expected revenues for their hospital budgets.

Response: We thank the commenter for their input. We believe that our currrent policy, which states that the 7.1 percent payment adjustment for rural SCHs and EACHs will remain in effect until our data show that a different percentage for the rural payment adjustment is necessary, provides sufficient budget predictability for rural SCHs and EACHs. Providers would receive notice in a proposed rule before any changes to the rural adjustment percentage would be implemented.

Comment: Some commenters requested that CMS expand the payment adjustment for rural SCHs and EACHs to additional types of hospitals. One commenter requested that the payment adjustment apply to include urban SCHs because, according to the commenter, urban SCHs care for patient populations similar to rural SCHs and EACHs, face similar financial challenges to rural SCHs and EACHs, and act as safety net providers for rural areas despite their designation as urban providers. Another commenter requested that the payment adjustment also apply to Medicare-dependent hospitals (MDHs) because, Start Printed Page 61190according to the commenter, these hospitals face similar financial challenges to rural SCHs and EACHs, and MDHs play a similar safety net role to rural SCHs and EACHs, especially for Medicare. One commenter requested that payment rates for OPPS services for all rural hospitals be increased to reduce financial vulnerability for rural hospitals related to the high share of Medicare and Medicaid beneficiaries they serve.

Response: We thank the commenters for their comments. However, the analysis we did to compare costs of urban providers to those of rural providers did not support an add-on adjustment for providers other than rural SCHs and EACHs. In addition, our follow-up analyses performed in recent years have not shown differences in costs for all services for any of the additional types of providers mentioned by the commenters. Accordingly, we do not believe we currently have a basis to expand the payment adjustment to any providers other than rural SCHs and EACHs.

After consideration of the public comments we received, we are finalizing our proposal, without modification, to continue the current policy of a 7.1 percent payment adjustment that is done in a budget neutral manner for rural SCHs, including EACHs, for all services and procedures paid under the OPPS, excluding separately payable drugs and biologicals, devices paid under the pass-through payment policy, and items paid at charges reduced to costs.

F. Payment Adjustment for Certain Cancer Hospitals for CY 2020

1. Background

Since the inception of the OPPS, which was authorized by the Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33), Medicare has paid the 11 hospitals that meet the criteria for cancer hospitals identified in section 1886(d)(1)(B)(v) of the Act under the OPPS for covered outpatient hospital services. These cancer hospitals are exempted from payment under the IPPS. With the Medicare, Medicaid and SCHIP Balanced Budget Refinement Act of 1999 (Pub. L. 106-113), Congress established section 1833(t)(7) of the Act, “Transitional Adjustment to Limit Decline in Payment,” to determine OPPS payments to cancer and children's hospitals based on their pre-BBA payment amount (often referred to as “held harmless”).

As required under section 1833(t)(7)(D)(ii) of the Act, a cancer hospital receives the full amount of the difference between payments for covered outpatient services under the OPPS and a “pre-BBA amount.” That is, cancer hospitals are permanently held harmless to their “pre-BBA amount,” and they receive transitional outpatient payments (TOPs) or hold harmless payments to ensure that they do not receive a payment that is lower in amount under the OPPS than the payment amount they would have received before implementation of the OPPS, as set forth in section 1833(t)(7)(F) of the Act. The “pre-BBA amount” is the product of the hospital's reasonable costs for covered outpatient services occurring in the current year and the base payment-to-cost ratio (PCR) for the hospital defined in section 1833(t)(7)(F)(ii) of the Act. The “pre-BBA amount” and the determination of the base PCR are defined at 42 CFR 419.70(f). TOPs are calculated on Worksheet E, Part B, of the Hospital Cost Report or the Hospital Health Care Complex Cost Report (Form CMS-2552-96 or Form CMS-2552-10, respectively), as applicable each year. Section 1833(t)(7)(I) of the Act exempts TOPs from budget neutrality calculations.

Section 3138 of the Affordable Care Act amended section 1833(t) of the Act by adding a new paragraph (18), which instructs the Secretary to conduct a study to determine if, under the OPPS, outpatient costs incurred by cancer hospitals described in section 1886(d)(1)(B)(v) of the Act with respect to APC groups exceed outpatient costs incurred by other hospitals furnishing services under section 1833(t) of the Act, as determined appropriate by the Secretary. Section 1833(t)(18)(A) of the Act requires the Secretary to take into consideration the cost of drugs and biologicals incurred by cancer hospitals and other hospitals. Section 1833(t)(18)(B) of the Act provides that, if the Secretary determines that cancer hospitals' costs are higher than those of other hospitals, the Secretary shall provide an appropriate adjustment under section 1833(t)(2)(E) of the Act to reflect these higher costs. In 2011, after conducting the study required by section 1833(t)(18)(A) of the Act, we determined that outpatient costs incurred by the 11 specified cancer hospitals were greater than the costs incurred by other OPPS hospitals. For a complete discussion regarding the cancer hospital cost study, we refer readers to the CY 2012 OPPS/ASC final rule with comment period (76 FR 74200 through 74201).

Based on these findings, we finalized a policy to provide a payment adjustment to the 11 specified cancer hospitals that reflects their higher outpatient costs, as discussed in the CY 2012 OPPS/ASC final rule with comment period (76 FR 74202 through 74206). Specifically, we adopted a policy to provide additional payments to the cancer hospitals so that each cancer hospital's final PCR for services provided in a given calendar year is equal to the weighted average PCR (which we refer to as the “target PCR”) for other hospitals paid under the OPPS. The target PCR is set in advance of the calendar year and is calculated using the most recently submitted or settled cost report data that are available at the time of final rulemaking for the calendar year. The amount of the payment adjustment is made on an aggregate basis at cost report settlement. We note that the changes made by section 1833(t)(18) of the Act do not affect the existing statutory provisions that provide for TOPs for cancer hospitals. The TOPs are assessed, as usual, after all payments, including the cancer hospital payment adjustment, have been made for a cost reporting period. For CYs 2012 and 2013, the target PCR for purposes of the cancer hospital payment adjustment was 0.91. For CY 2014, the target PCR was 0.90. For CY 2015, the target PCR was 0.90. For CY 2016, the target PCR was 0.92, as discussed in the CY 2016 OPPS/ASC final rule with comment period (80 FR 70362 through 70363). For CY 2017, the target PCR was 0.91, as discussed in the CY 2017 OPPS/ASC final rule with comment period (81 FR 79603 through 79604). For CY 2018, the target PCR was 0.88, as discussed in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59265 through 59266). For CY 2019, the target PCR was 0.88, as discussed in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58871 through 58873).

2. Policy for CY 2020

Section 16002(b) of the 21st Century Cures Act (Pub. L. 114-255) amended section 1833(t)(18) of the Act by adding subparagraph (C), which requires that in applying § 419.43(i) (that is, the payment adjustment for certain cancer hospitals) for services furnished on or after January 1, 2018, the target PCR adjustment be reduced by 1.0 percentage point less than what would otherwise apply. Section 16002(b) also provides that, in addition to the percentage reduction, the Secretary may consider making an additional percentage point reduction to the target PCR that takes into account payment rates for applicable items and services described under section 1833(t)(21)(C) of the Act for hospitals that are not cancer hospitals described under Start Printed Page 61191section 1886(d)(1)(B)(v) of the Act. Further, in making any budget neutrality adjustment under section 1833(t) of the Act, the Secretary shall not take into account the reduced expenditures that result from application of section 1833(t)(18)(C) of the Act.

In the CY 2020 OPPS/ASC proposed rule (84 FR 39433), for CY 2020, we proposed to provide additional payments to the 11 specified cancer hospitals so that each cancer hospital's final PCR is equal to the weighted average PCR (or “target PCR”) for the other OPPS hospitals, using the most recent submitted or settled cost report data that were available at the time of the development of the proposed rule, reduced by 1.0 percentage point, to comply with section 16002(b) of the 21st Century Cures Act.

We did not propose an additional reduction beyond the 1.0 percentage point reduction required by section 16002(b) for CY 2020. To calculate the proposed CY 2020 target PCR, we are using the same extract of cost report data from HCRIS, as discussed in section II.A. of the CY 2020 OPPS/ASC proposed rule and this final rule with comment period, used to estimate costs for the CY 2020 OPPS. Using these cost report data, we included data from Worksheet E, Part B, for each hospital, using data from each hospital's most recent cost report, whether as submitted or settled.

We then limited the dataset to the hospitals with CY 2018 claims data that we used to model the impact of the proposed CY 2020 APC relative payment weights (3,770 hospitals) because it is appropriate to use the same set of hospitals that are being used to calibrate the modeled CY 2020 OPPS. The cost report data for the hospitals in this dataset were from cost report periods with fiscal year ends ranging from 2016 to 2018. We then removed the cost report data of the 49 hospitals located in Puerto Rico from our dataset because we did not believe their cost structure reflected the costs of most hospitals paid under the OPPS, and, therefore, their inclusion may bias the calculation of hospital-weighted statistics. We also removed the cost report data of 23 hospitals because these hospitals had cost report data that were not complete (missing aggregate OPPS payments, missing aggregate cost data, or missing both), so that all cost reports in the study would have both the payment and cost data necessary to calculate a PCR for each hospital, leading to a proposed analytic file of 3,539 hospitals with cost report data.

Using this smaller dataset of cost report data, we estimated that, on average, the OPPS payments to other hospitals furnishing services under the OPPS were approximately 90 percent of reasonable cost (weighted average PCR of 0.90). Therefore, after applying the 1.0 percentage point reduction, as required by section 16002(b) of the 21st Century Cures Act, we proposed that the payment amount associated with the cancer hospital payment adjustment to be determined at cost report settlement would be the additional payment needed to result in a proposed target PCR equal to 0.89 for each cancer hospital.

We did not receive any public comments on our proposals. Therefore, we are finalizing our proposed cancer hospital payment adjustment methodology without modification. For this final rule with comment period, we are using the most recent cost report data through June 30, 2019 to update the adjustment. This updated yields a target PCR of 0.90. We limited the dataset to hospitals with CY 2018 claims data that we used to model the impact of the CY 2020 APC relative payment weights (3,763) because it is appropriate to use the same set of hospitals that we are using to calibrate the modeled CY 2020 OPPS. The cost report data for the hospitals in the dataset were from cost report periods with fiscal years ends ranging from 2010 to 2018. We then removed the cost report data of the 46 hospitals located in Puerto Rico from our dataset because we do not believe their cost structure reflects the cost of most hospitals paid under the OPPS and, therefore, their inclusion may bias the calculation of hospital-weighted statistics. We also removed the cost report data of 21 hospitals because these hospitals had cost report data that were not complete (missing aggregate OPPS payments, missing aggregate cost data, or missing both), so that all cost report in the study would have both the payment and cost data necessary to calculate a PCR for each hospital, leading to an analytic file of 3,523 hospitals with cost report data.

Using this smaller dataset of cost report data, we estimated a target PCR of 0.90. Therefore, after applying the 1.0 percentage point reduction as required by section 1602(b) of the 21st Century Cures Act, we are finalizing that the payment amount associated with the cancer hospital adjustment to be determined at cost report settlement will be the additional payment needed to result in a PCR equal to 0.89 for each cancer hospital.

Table 7 shows the estimated percentage increase in OPPS payments to each cancer hospital for CY 2020, due to the cancer hospital payment adjustment policy. The actual amount of the CY 2020 cancer hospital payment adjustment for each cancer hospital will be determined at cost report settlement and will depend on each hospital's CY 2020 payments and costs. We note that the requirements contained in section 1833(t)(18) of the Act do not affect the existing statutory provisions that provide for TOPs for cancer hospitals. The TOPs will be assessed, as usual, after all payments, including the cancer hospital payment adjustment, have been made for a cost reporting period.

Start Printed Page 61192

G. Hospital Outpatient Outlier Payments

1. Background

The OPPS provides outlier payments to hospitals to help mitigate the financial risk associated with high-cost and complex procedures, where a very costly service could present a hospital with significant financial loss. As explained in the CY 2015 OPPS/ASC final rule with comment period (79 FR 66832 through 66834), we set our projected target for aggregate outlier payments at 1.0 percent of the estimated aggregate total payments under the OPPS for the prospective year. Outlier payments are provided on a service-by-service basis when the cost of a service exceeds the APC payment amount multiplier threshold (the APC payment amount multiplied by a certain amount) as well as the APC payment amount plus a fixed-dollar amount threshold (the APC payment plus a certain amount of dollars). In CY 2019, the outlier threshold was met when the hospital's cost of furnishing a service exceeded 1.75 times (the multiplier threshold) the APC payment amount and exceeded the APC payment amount plus $4,825 (the fixed-dollar amount threshold) (83 FR 58874 through 58875). If the cost of a service exceeds both the multiplier threshold and the fixed-dollar threshold, the outlier payment is calculated as 50 percent of the amount by which the cost of furnishing the service exceeds 1.75 times the APC payment amount. Beginning with CY 2009 payments, outlier payments are subject to a reconciliation process similar to the IPPS outlier reconciliation process for cost reports, as discussed in the CY 2009 OPPS/ASC final rule with comment period (73 FR 68594 through 68599).

It has been our policy to report the actual amount of outlier payments as a percent of total spending in the claims being used to model the OPPS. Our estimate of total outlier payments as a percent of total CY 2018 OPPS payments, using CY 2018 claims available for the CY 2020 OPPS/ASC proposed rule (84 FR 39434 through 39435) was approximately 1.0 percent of the total aggregated OPPS payments. Therefore, for CY 2018, we estimated that we paid the outlier target of 1.0 percent of total aggregated OPPS payments. Using an updated claims dataset for this CY 2020 OPPS final rule with comment period, we estimate that we paid approximately 1.00 percent of the total aggregated OPPS payments in outliers for CY 2018.

For the CY 2020 OPPS/ASC proposed rule, using CY 2018 claims data and CY 2019 payment rates, we estimated that the aggregate outlier payments for CY 2019 would be approximately 1.03 percent of the total CY 2019 OPPS payments. We provided estimated CY 2020 outlier payments for hospitals and CMHCs with claims included in the claims data that we used to model impacts in the Hospital-Specific Impacts—Provider-Specific Data file on the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​index.html.

2. Outlier Calculation for CY 2020

In the CY 2020 OPPS/ASC proposed rule (84 FR 39434 through 39435), for CY 2020, we proposed to continue our policy of estimating outlier payments to be 1.0 percent of the estimated aggregate total payments under the OPPS. We proposed that a portion of that 1.0 percent, an amount equal to less than Start Printed Page 611930.01 percent of outlier payments (or 0.0001 percent of total OPPS payments), would be allocated to CMHCs for PHP outlier payments. This is the amount of estimated outlier payments that would result from the proposed CMHC outlier threshold as a proportion of total estimated OPPS outlier payments. As discussed in section VIII.C. of the CY 2020 OPPS/ASC proposed rule (84 FR 39435), we proposed to continue our longstanding policy that if a CMHC's cost for partial hospitalization services, paid under APC 5853 (Partial Hospitalization for CMHCs), exceeds 3.40 times the payment rate for proposed APC 5853, the outlier payment would be calculated as 50 percent of the amount by which the cost exceeds 3.40 times the proposed APC 5853 payment rate.

For further discussion of CMHC outlier payments, we refer readers to section VIII.C. of the CY 2020 OPPS/ASC proposed rule and this final rule with comment period.

To ensure that the estimated CY 2020 aggregate outlier payments would equal 1.0 percent of estimated aggregate total payments under the OPPS, we proposed that the hospital outlier threshold be set so that outlier payments would be triggered when a hospital's cost of furnishing a service exceeds 1.75 times the APC payment amount and exceeds the APC payment amount plus $4,950.

We calculated the proposed fixed-dollar threshold of $4,950 using the standard methodology most recently used for CY 2019 (83 FR 58874 through 58875). For purposes of estimating outlier payments for the proposed rule, we used the hospital-specific overall ancillary CCRs available in the April 2019 update to the Outpatient Provider-Specific File (OPSF). The OPSF contains provider-specific data, such as the most current CCRs, which are maintained by the MACs and used by the OPPS Pricer to pay claims. The claims that we use to model each OPPS update lag by 2 years.

In order to estimate the CY 2020 hospital outlier payments for the proposed rule, we inflated the charges on the CY 2018 claims using the same inflation factor of 1.11189 that we used to estimate the IPPS fixed-dollar outlier threshold for the FY 2020 IPPS/LTCH PPS proposed rule (84 FR 19596). We used an inflation factor of 1.05446 to estimate CY 2019 charges from the CY 2018 charges reported on CY 2018 claims. The methodology for determining this charge inflation factor is discussed in the FY 2019 IPPS/LTCH PPS final rule (83 FR 41717 through 41718). As we stated in the CY 2005 OPPS final rule with comment period (69 FR 65845), we believe that the use of these charge inflation factors is appropriate for the OPPS because, with the exception of the inpatient routine service cost centers, hospitals use the same ancillary and outpatient cost centers to capture costs and charges for inpatient and outpatient services.

As noted in the CY 2007 OPPS/ASC final rule with comment period (71 FR 68011), we are concerned that we could systematically overestimate the OPPS hospital outlier threshold if we did not apply a CCR inflation adjustment factor. Therefore, we proposed to apply the same CCR inflation adjustment factor that we proposed to apply for the FY 2020 IPPS outlier calculation to the CCRs used to simulate the proposed CY 2020 OPPS outlier payments to determine the fixed-dollar threshold. Specifically, for CY 2020, we proposed to apply an adjustment factor of 0.97517 to the CCRs that were in the April 2019 OPSF to trend them forward from CY 2019 to CY 2020. The methodology for calculating the proposed adjustment is discussed in the FY 2020 IPPS/LTCH PPS proposed rule (84 FR 19597).

To model hospital outlier payments for the proposed rule, we applied the overall CCRs from the April 2019 OPSF after adjustment (using the proposed CCR inflation adjustment factor of 0.97517 to approximate CY 2020 CCRs) to charges on CY 2018 claims that were adjusted (using the proposed charge inflation factor of 1.11189 to approximate CY 2020 charges). We simulated aggregated CY 2020 hospital outlier payments using these costs for several different fixed-dollar thresholds, holding the 1.75 multiplier threshold constant and assuming that outlier payments would continue to be made at 50 percent of the amount by which the cost of furnishing the service would exceed 1.75 times the APC payment amount, until the total outlier payments equaled 1.0 percent of aggregated estimated total CY 2020 OPPS payments. We estimated that a proposed fixed-dollar threshold of $4,950, combined with the proposed multiplier threshold of 1.75 times the APC payment rate, would allocate 1.0 percent of aggregated total OPPS payments to outlier payments. For CMHCs, we proposed that, if a CMHC's cost for partial hospitalization services, paid under APC 5853, exceeds 3.40 times the payment rate for APC 5853, the outlier payment would be calculated as 50 percent of the amount by which the cost exceeds 3.40 times the APC 5853 payment rate.

Section 1833(t)(17)(A) of the Act, which applies to hospitals, as defined under section 1886(d)(1)(B) of the Act, requires that hospitals that fail to report data required for the quality measures selected by the Secretary, in the form and manner required by the Secretary under section 1833(t)(17)(B) of the Act, incur a 2.0 percentage point reduction to their OPD fee schedule increase factor; that is, the annual payment update factor. The application of a reduced OPD fee schedule increase factor results in reduced national unadjusted payment rates that will apply to certain outpatient items and services furnished by hospitals that are required to report outpatient quality data and that fail to meet the Hospital OQR Program requirements. For hospitals that fail to meet the Hospital OQR Program requirements, as we proposed, we are continuing the policy that we implemented in CY 2010 that the hospitals' costs will be compared to the reduced payments for purposes of outlier eligibility and payment calculation. For more information on the Hospital OQR Program, we referred readers to section XIV. of this final rule with comment period.

We received no public comments on our proposal. Therefore, we are finalizing our proposal, without modification, to continue our policy of estimating outlier payments to be 1.0 percent of the estimated aggregate total payments under the OPPS and to use our established methodology to set the OPPS outlier fixed-dollar loss threshold for CY 2020.

3. Final Outlier Calculation

Consistent with historical practice, we used updated data for this final rule with comment period for outlier calculations. For CY 2020, we are applying the overall CCRs from the October 2019 OPSF file after adjustment (using the CCR inflation adjustment factor of 0.97615 to approximate CY 2020 CCRs) to charges on CY 2018 claims that were adjusted using a charge inflation factor of 1.11100 to approximate CY 2020 charges. These are the same CCR adjustment and charge inflation factors that were used to set the IPPS fixed-dollar threshold for the FY 2020 IPPS/LTCH PPS final rule (84 FR 42629). We simulated aggregated CY 2020 hospital outlier payments using these costs for several different fixed-dollar thresholds, holding the 1.75 multiple-threshold constant and assuming that outlier payments will continue to be made at 50 percent of the amount by which the cost of furnishing the service would exceed 1.75 times the APC payment amount, until the total outlier payment equaled 1.0 percent of aggregated estimated total CY 2020 OPPS payments. We estimated that a Start Printed Page 61194fixed-dollar threshold of $5,075 combined with the multiple threshold of 1.75 times the APC payment rate, will allocate the 1.0 percent of aggregated total OPPS payments to outlier payments.

For CMHCs, if a CMHC's cost for partial hospitalization services, paid under APC 5853, exceeds 3.40 times the payment rate the outlier payment will be calculated as 50 percent of the amount by which the cost exceeds 3.40 times APC 5853.

H. Calculation of an Adjusted Medicare Payment From the National Unadjusted Medicare Payment

The basic methodology for determining prospective payment rates for HOPD services under the OPPS is set forth in existing regulations at 42 CFR part 419, subparts C and D. For this CY 2020 OPPS/ASC final rule with comment period, the payment rate for most services and procedures for which payment is made under the OPPS is the product of the conversion factor calculated in accordance with section II.B. of this final rule with comment period and the relative payment weight determined under section II.A. of this final rule with comment period. Therefore, the proposed national unadjusted payment rate for most APCs contained in Addendum A to this final rule with comment period (which is available via the internet on the CMS website) and for most HCPCS codes to which separate payment under the OPPS has been assigned in Addendum B to this final rule with comment period (which is available via the internet on the CMS website) was calculated by multiplying the proposed CY 2020 scaled weight for the APC by the CY 2020 conversion factor.

We note that section 1833(t)(17) of the Act, which applies to hospitals, as defined under section 1886(d)(1)(B) of the Act, requires that hospitals that fail to submit data required to be submitted on quality measures selected by the Secretary, in the form and manner and at a time specified by the Secretary, incur a reduction of 2.0 percentage points to their OPD fee schedule increase factor, that is, the annual payment update factor. The application of a reduced OPD fee schedule increase factor results in reduced national unadjusted payment rates that apply to certain outpatient items and services provided by hospitals that are required to report outpatient quality data and that fail to meet the Hospital OQR Program (formerly referred to as the Hospital Outpatient Quality Data Reporting Program (HOP QDRP)) requirements. For further discussion of the payment reduction for hospitals that fail to meet the requirements of the Hospital OQR Program, we refer readers to section XIV of this final rule with comment period.

In the CY 2020 OPPS/ASC proposed rule (84 FR 39435), we demonstrated the steps used to determine the APC payments that will be made in a CY under the OPPS to a hospital that fulfills the Hospital OQR Program requirements and to a hospital that fails to meet the Hospital OQR Program requirements for a service that has any of the following status indicator assignments: “J1”, “J2”, “P”, “Q1”, “Q2”, “Q3”, “Q4”, “R”, “S”, “T”, “U”, or “V” (as defined in Addendum D1 to the proposed rule, which is available via the internet on the CMS website), in a circumstance in which the multiple procedure discount does not apply, the procedure is not bilateral, and conditionally packaged services (status indicator of “Q1” and “Q2”) qualify for separate payment. We noted that, although blood and blood products with status indicator “R” and brachytherapy sources with status indicator “U” are not subject to wage adjustment, they are subject to reduced payments when a hospital fails to meet the Hospital OQR Program requirements.

We did not receive any public comments on these steps under the methodology that we included in the CY 2020 CY OPPS/ASC proposed rule to determine the APC payments for CY 2020. Therefore, we are using the steps in the methodology specified below, as we proposed, to demonstrate the calculation of the final CY 2020 OPPS payments using the same parameters.

Individual providers interested in calculating the payment amount that they will receive for a specific service from the national unadjusted payment rates presented in Addenda A and B to this final rule with comment period (which are available via the internet on the CMS website) should follow the formulas presented in the following steps. For purposes of the payment calculations below, we refer to the national unadjusted payment rate for hospitals that meet the requirements of the Hospital OQR Program as the “full” national unadjusted payment rate. We refer to the national unadjusted payment rate for hospitals that fail to meet the requirements of the Hospital OQR Program as the “reduced” national unadjusted payment rate. The reduced national unadjusted payment rate is calculated by multiplying the reporting ratio of 0.980 times the “full” national unadjusted payment rate. The national unadjusted payment rate used in the calculations below is either the full national unadjusted payment rate or the reduced national unadjusted payment rate, depending on whether the hospital met its Hospital OQR Program requirements to receive the full CY 2020 OPPS fee schedule increase factor.

Step 1. Calculate 60 percent (the labor-related portion) of the national unadjusted payment rate. Since the initial implementation of the OPPS, we have used 60 percent to represent our estimate of that portion of costs attributable, on average, to labor. We refer readers to the April 7, 2000 OPPS final rule with comment period (65 FR 18496 through 18497) for a detailed discussion of how we derived this percentage. During our regression analysis for the payment adjustment for rural hospitals in the CY 2006 OPPS final rule with comment period (70 FR 68553), we confirmed that this labor-related share for hospital outpatient services is appropriate.

The formula below is a mathematical representation of Step 1 and identifies the labor-related portion of a specific payment rate for a specific service.

X is the labor-related portion of the national unadjusted payment rate.

X = .60 * (national unadjusted payment rate).

Step 2. Determine the wage index area in which the hospital is located and identify the wage index level that applies to the specific hospital. We note that, under the CY 2020 OPPS policy for continuing to use the OMB labor market area delineations based on the 2010 Decennial Census data for the wage indexes used under the IPPS, a hold harmless policy for the wage index may apply, as discussed in section II.C. of this final rule with comment period. The wage index values assigned to each area reflect the geographic statistical areas (which are based upon OMB standards) to which hospitals are assigned for FY 2020 under the IPPS, reclassifications through the Medicare Geographic Classification Review Board (MGCRB), section 1886(d)(8)(B) “Lugar” hospitals, reclassifications under section 1886(d)(8)(E) of the Act, as defined in § 412.103 of the regulations, and hospitals designated as urban under section 601(g) of Public Law 98-21. For further discussion of the changes to the FY 2020 IPPS wage indexes, as applied to the CY 2020 OPPS, we refer readers to section II.C. of this final rule with comment period. We are continuing to apply a wage index floor of 1.00 to frontier States, in accordance with section 10324 of the Affordable Care Act of 2010.

Step 3. Adjust the wage index of hospitals located in certain qualifying Start Printed Page 61195counties that have a relatively high percentage of hospital employees who reside in the county, but who work in a different county with a higher wage index, in accordance with section 505 of Public Law 108-173. Addendum L to this final rule with comment period (which is available via the internet on the CMS website) contains the qualifying counties and the associated wage index increase developed for the proposed FY 2020 IPPS, which are listed in Table 2 associated with the FY 2020 IPPS/LTCH PPS proposed rule and available via the internet on the CMS website at: http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​AcuteInpatientPPS/​index.html. (Click on the link on the left side of the screen titled “FY 2020 IPPS Proposed Rule Home Page” and select “FY 2020 Proposed Rule Tables.”) This step is to be followed only if the hospital is not reclassified or redesignated under section 1886(d)(8) or section 1886(d)(10) of the Act.

Step 4. Multiply the applicable wage index determined under Steps 2 and 3 by the amount determined under Step 1 that represents the labor-related portion of the national unadjusted payment rate.

The formula below is a mathematical representation of Step 4 and adjusts the labor-related portion of the national unadjusted payment rate for the specific service by the wage index.

Xa is the labor-related portion of the national unadjusted payment rate (wage adjusted).

Xa = .60 * (national unadjusted payment rate) * applicable wage index.

Step 5. Calculate 40 percent (the nonlabor-related portion) of the national unadjusted payment rate and add that amount to the resulting product of Step 4. The result is the wage index adjusted payment rate for the relevant wage index area.

The formula below is a mathematical representation of Step 5 and calculates the remaining portion of the national payment rate, the amount not attributable to labor, and the adjusted payment for the specific service.

Y is the nonlabor-related portion of the national unadjusted payment rate.

Y = .40 * (national unadjusted payment rate).

Adjusted Medicare Payment = Y + Xa.

Step 6. If a provider is an SCH, as set forth in the regulations at § 412.92, or an EACH, which is considered to be an SCH under section 1886(d)(5)(D)(iii)(III) of the Act, and located in a rural area, as defined in § 412.64(b), or is treated as being located in a rural area under § 412.103, multiply the wage index adjusted payment rate by 1.071 to calculate the total payment.

The formula below is a mathematical representation of Step 6 and applies the rural adjustment for rural SCHs.

Adjusted Medicare Payment (SCH or EACH) = Adjusted Medicare Payment * 1.071.

We are providing examples below of the calculation of both the full and reduced national unadjusted payment rates that will apply to certain outpatient items and services performed by hospitals that meet and that fail to meet the Hospital OQR Program requirements, using the steps outlined above. For purposes of this example, we are using a provider that is located in Brooklyn, New York that is assigned to CBSA 35614. This provider bills one service that is assigned to APC 5071 (Level 1 Excision/Biopsy/Incision and Drainage). The CY 2020 full national unadjusted payment rate for APC 5071 is $609.94. The reduced national unadjusted payment rate for APC 5071 for a hospital that fails to meet the Hospital OQR Program requirements is $598.35. This reduced rate is calculated by multiplying the reporting ratio of 0.981 by the full unadjusted payment rate for APC 5071.

The FY 2020 wage index for a provider located in CBSA 35614 in New York, which includes the proposed adoption of IPPS 2020 wage index policies, is 1.2866. The labor-related portion of the full national unadjusted payment is approximately $470.84 (.60 * $609.94 * 1.2866). The labor-related portion of the reduced national unadjusted payment is approximately $461.90 (.60 * $598.35 * 1.2866). The nonlabor-related portion of the full national unadjusted payment is approximately $243.98 (.40 * $609.94). The nonlabor-related portion of the reduced national unadjusted payment is approximately $239.34 (.40 * $598.35). The sum of the labor-related and nonlabor-related portions of the full national adjusted payment is approximately $714.82 ($470.84 + $243.98). The sum of the portions of the reduced national adjusted payment is approximately $701.24 ($461.90 + $239.34).

I. Beneficiary Copayments

1. Background

Section 1833(t)(3)(B) of the Act requires the Secretary to set rules for determining the unadjusted copayment amounts to be paid by beneficiaries for covered OPD services. Section 1833(t)(8)(C)(ii) of the Act specifies that the Secretary must reduce the national unadjusted copayment amount for a covered OPD service (or group of such services) furnished in a year in a manner so that the effective copayment rate (determined on a national unadjusted basis) for that service in the year does not exceed a specified percentage. As specified in section 1833(t)(8)(C)(ii)(V) of the Act, the effective copayment rate for a covered OPD service paid under the OPPS in CY 2006, and in CYs thereafter, shall not exceed 40 percent of the APC payment rate.

Section 1833(t)(3)(B)(ii) of the Act provides that, for a covered OPD service (or group of such services) furnished in a year, the national unadjusted copayment amount cannot be less than 20 percent of the OPD fee schedule amount. However, section 1833(t)(8)(C)(i) of the Act limits the amount of beneficiary copayment that may be collected for a procedure (including items such as drugs and biologicals) performed in a year to the amount of the inpatient hospital deductible for that year.

Section 4104 of the Affordable Care Act eliminated the Medicare Part B coinsurance for preventive services furnished on and after January 1, 2011, that meet certain requirements, including flexible sigmoidoscopies and screening colonoscopies, and waived the Part B deductible for screening colonoscopies that become diagnostic during the procedure. Our discussion of the changes made by the Affordable Care Act with regard to copayments for preventive services furnished on and after January 1, 2011, may be found in section XII.B. of the CY 2011 OPPS/ASC final rule with comment period (75 FR 72013).

2. OPPS Copayment Policy

In the CY 2020 OPPS/ASC proposed rule (84 FR 39437), we proposed to determine copayment amounts for new and revised APCs using the same methodology that we implemented beginning in CY 2004. (We refer readers to the November 7, 2003 OPPS final rule with comment period (68 FR 63458).) In addition, we proposed to use the same standard rounding principles that we have historically used in instances where the application of our standard copayment methodology would result in a copayment amount that is less than 20 percent and cannot be rounded, under standard rounding principles, to 20 percent. (We refer readers to the CY 2008 OPPS/ASC final rule with comment period (72 FR 66687) in which we discuss our rationale for applying these rounding principles.) The proposed national unadjusted copayment amounts for services payable Start Printed Page 61196under the OPPS that would be effective January 1, 2020 are included in Addenda A and B to the proposed rule (which are available via the internet on the CMS website).

We did not receive any public comments on the proposed copayment amounts for new and revised APCs using the same methodology we implemented beginning in CY 2004 or the standard rounding principles we apply to our copayment amounts. Therefore, we are finalizing our proposed copayment policies, without modification.

As discussed in section XIV.E. of the CY 2020 OPPS/ASC proposed rule and this final rule with comment period, for CY 2020, the Medicare beneficiary's minimum unadjusted copayment and national unadjusted copayment for a service to which a reduced national unadjusted payment rate applies will equal the product of the reporting ratio and the national unadjusted copayment, or the product of the reporting ratio and the minimum unadjusted copayment, respectively, for the service.

We note that OPPS copayments may increase or decrease each year based on changes in the calculated APC payment rates, due to updated cost report and claims data, and any changes to the OPPS cost modeling process. However, as described in the CY 2004 OPPS final rule with comment period, the development of the copayment methodology generally moves beneficiary copayments closer to 20 percent of OPPS APC payments (68 FR 63458 through 63459).

In the CY 2004 OPPS final rule with comment period (68 FR 63459), we adopted a new methodology to calculate unadjusted copayment amounts in situations including reorganizing APCs, and we finalized the following rules to determine copayment amounts in CY 2004 and subsequent years.

  • When an APC group consists solely of HCPCS codes that were not paid under the OPPS the prior year because they were packaged or excluded or are new codes, the unadjusted copayment amount would be 20 percent of the APC payment rate.
  • If a new APC that did not exist during the prior year is created and consists of HCPCS codes previously assigned to other APCs, the copayment amount is calculated as the product of the APC payment rate and the lowest coinsurance percentage of the codes comprising the new APC.
  • If no codes are added to or removed from an APC and, after recalibration of its relative payment weight, the new payment rate is equal to or greater than the prior year's rate, the copayment amount remains constant (unless the resulting coinsurance percentage is less than 20 percent).
  • If no codes are added to or removed from an APC and, after recalibration of its relative payment weight, the new payment rate is less than the prior year's rate, the copayment amount is calculated as the product of the new payment rate and the prior year's coinsurance percentage.
  • If HCPCS codes are added to or deleted from an APC and, after recalibrating its relative payment weight, holding its unadjusted copayment amount constant results in a decrease in the coinsurance percentage for the reconfigured APC, the copayment amount would not change (unless retaining the copayment amount would result in a coinsurance rate less than 20 percent).
  • If HCPCS codes are added to an APC and, after recalibrating its relative payment weight, holding its unadjusted copayment amount constant results in an increase in the coinsurance percentage for the reconfigured APC, the copayment amount would be calculated as the product of the payment rate of the reconfigured APC and the lowest coinsurance percentage of the codes being added to the reconfigured APC.

We noted in the CY 2004 OPPS final rule with comment period that we would seek to lower the copayment percentage for a service in an APC from the prior year if the copayment percentage was greater than 20 percent. We noted that this principle was consistent with section 1833(t)(8)(C)(ii) of the Act, which accelerates the reduction in the national unadjusted coinsurance rate so that beneficiary liability will eventually equal 20 percent of the OPPS payment rate for all OPPS services to which a copayment applies, and with section 1833(t)(3)(B) of the Act, which achieves a 20-percent copayment percentage when fully phased in and gives the Secretary the authority to set rules for determining copayment amounts for new services. We further noted that the use of this methodology would, in general, reduce the beneficiary coinsurance rate and copayment amount for APCs for which the payment rate changes as the result of the reconfiguration of APCs and/or recalibration of relative payment weights (68 FR 63459).

3. Calculation of an Adjusted Copayment Amount for an APC Group

Individuals interested in calculating the national copayment liability for a Medicare beneficiary for a given service provided by a hospital that met or failed to meet its Hospital OQR Program requirements should follow the formulas presented in the following steps.

Step 1. Calculate the beneficiary payment percentage for the APC by dividing the APC's national unadjusted copayment by its payment rate. For example, using APC 5071, $121.99 is approximately 20 percent of the full national unadjusted payment rate of $609.94. For APCs with only a minimum unadjusted copayment in Addenda A and B to this final rule with comment period (which are available via the internet on the CMS website), the beneficiary payment percentage is 20 percent.

The formula below is a mathematical representation of Step 1 and calculates the national copayment as a percentage of national payment for a given service.

B is the beneficiary payment percentage.

B = National unadjusted copayment for APC/national unadjusted payment rate for APC.

Step 2. Calculate the appropriate wage-adjusted payment rate for the APC for the provider in question, as indicated in Steps 2 through 4 under section II.H. of this final rule with comment period. Calculate the rural adjustment for eligible providers, as indicated in Step 6 under section II.H. of this final rule with comment period.

Step 3. Multiply the percentage calculated in Step 1 by the payment rate calculated in Step 2. The result is the wage-adjusted copayment amount for the APC.

The formula below is a mathematical representation of Step 3 and applies the beneficiary payment percentage to the adjusted payment rate for a service calculated under section II.H. of this final rule with comment period, with and without the rural adjustment, to calculate the adjusted beneficiary copayment for a given service.

Wage-adjusted copayment amount for the APC = Adjusted Medicare Payment * B.

Wage-adjusted copayment amount for the APC (SCH or EACH) = (Adjusted Medicare Payment * 1.071) * B.

Step 4. For a hospital that failed to meet its Hospital OQR Program requirements, multiply the copayment calculated in Step 3 by the reporting ratio of 0.980.

The proposed unadjusted copayments for services payable under the OPPS that will be effective January 1, 2020, are shown in Addenda A and B to this final rule with comment period (which are available via the internet on the CMS website). We note that the national unadjusted payment rates and copayment rates shown in Addenda A Start Printed Page 61197and B to this final rule with comment period reflect the CY 2020 OPD fee schedule increase factor discussed in section II.B. of this final rule with comment period.

In addition, as noted earlier, section 1833(t)(8)(C)(i) of the Act limits the amount of beneficiary copayment that may be collected for a procedure performed in a year to the amount of the inpatient hospital deductible for that year.

III. OPPS Ambulatory Payment Classification (APC) Group Policies

A. OPPS Treatment of New and Revised HCPCS Codes

Payment for OPPS procedures, services, and items are generally based on medical billing codes, specifically, HCPCS codes, that are reported on HOPD claims. The HCPCS is divided into two principal subsystems, referred to as Level I and Level II of the HCPCS. Level I is comprised of CPT (Current Procedural Terminology), a numeric and alphanumeric coding system maintained by the American Medical Association (AMA), and consist of Category I, II, and III CPT codes. Level II, which is maintained by CMS, is a standardized coding system that is used primarily to identify products, supplies, and services not included in the CPT codes. HCPCS codes are used to report surgical procedures, medical services, items, and supplies under the hospital OPPS. Specifically, CMS recognizes the following codes on OPPS claims:

  • Category I CPT codes, which describe surgical procedures, diagnostic and therapeutic services, and vaccine codes;
  • Category III CPT codes, which describe new and emerging technologies, services, and procedures; and
  • Level II HCPCS codes (also known as alphanumeric codes), which are used primarily to identify drugs, devices, ambulance services, durable medical equipment, orthotics, prosthetics, supplies, temporary surgical procedures, and medical services not described by CPT codes.

CPT codes are established by the American Medical Association (AMA) while the Level II HCPCS codes are established by the CMS HCPCS Workgroup. These codes are updated and changed throughout the year. CPT and Level II HCPCS code changes that affect the OPPS are published through the annual rulemaking cycle and through the OPPS quarterly update Change Requests (CRs). Generally, these code changes are effective January 1, April 1, July 1, or October 1. CPT code changes are released by the AMA via their website while Level II HCPCS code changes are released to the public via the CMS HCPCS website. CMS recognizes the release of new CPT and Level II HCPCS codes and makes the codes effective (that is, the codes can be reported on Medicare claims) outside of the formal rulemaking process via OPPS quarterly update CRs. Based on our review, we assign the new codes to interim status indicators (SIs) and APCs. These interim assignments are finalized in the OPPS/ASC final rules. This quarterly process offers hospitals access to codes that more accurately describe items or services furnished and provides payment for these items or services in a timelier manner than if we waited for the annual rulemaking process. We solicit public comments on the new CPT and Level II HCPCS codes and finalize our proposals through our annual rulemaking process.

We note that, under the OPPS, the APC assignment determines the payment rate for an item, procedure, or service. Those items, procedures, or services not paid separately under the hospital OPPS are assigned to appropriate status indicators. Certain payment status indicators provide separate payment while other payment status indicators do not. In section XI. (CY 2020 OPPS Payment Status and Comment Indicators) of this final rule with comment period, we discuss the various status indicators used under the OPPS. We also provide a complete list of the status indicators and their definitions in Addendum D1 to this CY 2020 OPPS/ASC final rule with comment period.

1. HCPCS Codes That Were Effective April 1, 2019 for Which We Solicited Public Comments in the CY 2020 OPPS/ASC Proposed Rule

For the April 2019 update, there were no new CPT codes. However, eight new Level II HCPCS codes were established and made effective on April 1, 2019. These codes and their long descriptors were displayed in Table 7 of the proposed rule and are now listed in Table 8 of this final rule with comment period. Through the April 2019 OPPS quarterly update CR (Transmittal 4255, Change Request 11216, dated March 15, 2019), we recognized several new Level II HCPCS codes for separate payment under the OPPS. In the CY 2020 OPPS/ASC proposed rule (84 FR 39531-39532), we solicited public comments on the proposed APC and status indicator assignments for these Level II HCPCS codes, which were listed in Table 7 of the proposed rule.

We did not receive any public comments on the proposed OPPS APC and status indicator assignments for the new Level II HCPCS codes implemented in April 2019. Therefore, we are finalizing the proposed APC and status indicator assignments for these codes, as indicated in Table 8 below. We note that several of the HCPCS C-codes have been replaced with HCPCS J-codes, effective January 1, 2020. Their replacement codes are listed in Table 8. The final payment rates for these codes can be found in Addendum B to this final rule with comment period. In addition, the status indicator definitions can be found in Addendum D1 to this final rule with comment period. Both Addendum B and Addendum D1 are available via the internet on the CMS website.

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2. HCPCS Codes That Were Effective July 1, 2019 for Which We Solicited Public Comments in the CY 2020 OPPS/ASC Proposed Rule

For the July 2019 update, 58 new codes were established and made effective July 1, 2019. The codes and long descriptors were listed in Table 8 of the proposed rule. Through the July 2019 OPPS quarterly update CR (Transmittal 4313, Change Request 11318, dated May 24, 2019), we recognized several new codes for separate payment and assigned them to appropriate interim OPPS status indicators and APCs. In the CY 2020 OPPS/ASC proposed rule, we solicited public comments on the proposed APC and status indicator assignments for the codes implemented on July 1, 2019, all of which were listed in Table 8 of the proposed rule.

We received some public comments related to CPT codes 0546T, 0548T, 0549T, 0554T, 0555T, 0556T, 0557T, and 0558T, which we address in section III.D. (OPPS APC-Specific Policies) of this final rule with comment period. With the exception of the eight codes, we did not receive any public comments on the proposed OPPS APC and status indicator assignments for the other new CPT and Level II HCPCS codes implemented in July 2019. Therefore, we are finalizing the proposed APC and status indicator assignments for the July 2019 codes, including the eight codes on which we received public comments, as indicated in Table 9 below. We note that several of the HCPCS C-codes have been replaced with HCPCS J-codes, effective January 1, 2020. Their replacement codes are listed in Table 9. The final payment rates for the codes can be found in Addendum B to this final rule with comment period. In addition, the status indicator meanings can be found in Addendum D1 to this final rule with comment period. Both Addendum B and Addendum D1 are available via the internet on the CMS website.

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3. October 2019 HCPCS Codes for Which We Are Soliciting Public Comments in This CY 2020 OPPS/ASC Final Rule With Comment Period

As has been our practice in the past, we incorporate those new HCPCS codes that are effective October 1 in the final rule with comment period, thereby updating the OPPS for the following calendar year, as displayed in Table 9 of the proposed rule and reprinted as Table 10 of this final rule with comment period. These codes are released to the public through the October OPPS quarterly update CRs and via the CMS HCPCS website (for Level II HCPCS codes). For CY 2020, these codes are flagged with comment indicator “NI” in Addendum B to this OPPS/ASC final rule with comment period to indicate that we are assigning them an interim payment status which is subject to public comment. Specifically, the interim status indicator and APC assignments for codes flagged with comment indicator “NI” are open to public comment in this final rule with comment period, and we will respond to these public comments in the OPPS/ASC final rule with comment period for the next year's OPPS/ASC update.

In the CY 2020 OPPS/ASC proposed rule (84 FR 39449), we proposed to continue this process for CY 2020. Specifically, for CY 2020, we proposed to include in Addendum B to the CY 2020 OPPS/ASC final rule with comment period the new HCPCS codes effective October 1, 2019, that would be incorporated in the October 2019 OPPS quarterly update CR. Also, as stated above, the October 1, 2019 codes are flagged with comment indicator “NI” in Addendum B to this CY 2020 OPPS/Start Printed Page 61207ASC final rule with comment period to indicate that we have assigned the codes an interim OPPS payment status for CY 2020. We are inviting public comments on the interim status indicator and APC assignments for these codes, if applicable, that will be finalized in the CY 2021 OPPS/ASC final rule with comment period.

We note that we received a comment related to HCPCS code Q4184 (Cellesta or Cellesta Duo, per square centimeter), which was assigned to comment indicator “NI” in Addendum B of the CY 2019 OPPS/ASC final rule. The comment and our response can be found in section V.B.7 (Skin Substitutes) of this CY 2020 OPPS/ASC final rule with comment period.

4. January 2020 HCPCS Codes

a. New Level II HCPCS Codes for Which We Are Soliciting Public Comments in This CY 2020 OPPS/ASC Final Rule With Comment Period

As shown in Table 10 below, and as stated in the CY 2020 OPPS/ASC proposed rule (84 FR 39449), consistent with past practice, we solicit comments on the new Level II HCPCS codes that will be effective January 1 in the OPPS/ASC final rule with comment period, thereby allowing us to finalize the status indicators and APC assignments for the codes in the next OPPS/ASC final rule with comment period. Unlike the CPT codes that are effective January 1 and are included in the OPPS/ASC proposed rules, most Level II HCPCS codes are not released until sometime around November to be effective January 1. Because these codes are not available until November, we are unable to include them in the OPPS/ASC proposed rules. Consequently, for CY 2020, we proposed to include in Addendum B to the CY 2020 OPPS/ASC final rule with comment period the new Level II HCPCS codes effective January 1, 2020, that would be incorporated in the January 2020 OPPS quarterly update CR. These codes will be released to the public through the January OPPS quarterly update CRs and via the CMS HCPCS website (for Level II HCPCS codes). For CY 2020, the Level II HCPCS codes effective January 1, 2020 codes are flagged with comment indicator “NI” in Addendum B to this CY 2020 OPPS/ASC final rule with comment period to indicate that we have assigned the codes an interim OPPS payment status for CY 2020. We are inviting public comments on the interim status indicator and APC assignments for these codes, if applicable, that will be finalized in the CY 2021 OPPS/ASC final rule with comment period.

b. CPT Codes for Which We Solicited Public Comments in the CY 2020 OPPS/ASC Proposed Rule

For CY 2020, we received the CY 2020 CPT code updates that would be effective January 1, 2020, from AMA in time for inclusion in the CY 2020 OPPS/ASC proposed rule. We note that in the CY 2015 OPPS/ASC final rule with comment period (79 FR 66841 through 66844), we finalized a revised process of assigning APC and status indicators for new and revised Category I and III CPT codes that would be effective January 1. Specifically, for the new/revised CPT codes that we receive in a timely manner from the AMA's CPT Editorial Panel, we finalized our proposal to include the codes that would be effective January 1 in the OPPS/ASC proposed rules, along with proposed APC and status indicator assignments for them, and to finalize the APC and status indicator assignments in the OPPS/ASC final rules beginning with the CY 2016 OPPS update. For those new/revised CPT codes that were received too late for inclusion in the OPPS/ASC proposed rule, we finalized our proposal to establish and use HCPCS G-codes that mirror the predecessor CPT codes and retain the current APC and status indicator assignments for a year until we can propose APC and status indicator assignments in the following year's rulemaking cycle. We note that even if we find that we need to create HCPCS G-codes in place of certain CPT codes for the PFS proposed rule, we do not anticipate that these HCPCS G-codes will always be necessary for OPPS purposes. We will make every effort to include proposed APC and status indicator assignments for all new and revised CPT codes that the AMA makes publicly available in time for us to include them in the annual proposed rule, and to avoid the resort to HCPCS G-codes and the resulting delay in utilization of the most current CPT codes. Also, we finalized our proposal to make interim APC and status indicator assignments for CPT codes that are not available in time for the proposed rule and that describe wholly new services (such as new technologies or new surgical procedures), solicit public comments, and finalize the specific APC and status indicator assignments for those codes in the following year's final rule.

As stated above, for the CY 2020 OPPS update, we received the CY 2020 CPT codes from AMA in time for inclusion in the CY 2020 OPPS/ASC proposed rule. The new, revised, and deleted CY 2020 Category I and III CPT codes were included in Addendum B to the proposed rule (which is available via the internet on the CMS website). We noted in the proposed rule that the new and revised codes are assigned to new comment indicator “NP” to indicate that the code is new for the next calendar year or the code is an existing code with substantial revision to its code descriptor in the next calendar year as compared to current calendar year with a proposed APC assignment, and that comments will be accepted on the proposed APC and status indicator assignments.

Further, we reminded readers that the CPT code descriptors that appear in Addendum B are short descriptors and do not accurately describe the complete procedure, service, or item described by the CPT code. Therefore, we included the 5-digit placeholder codes and their long descriptors for the new and revised CY 2020 CPT codes in Addendum O to the proposed rule (which is available via the internet on the CMS website) so that the public could adequately comment on the proposed APCs and status indicator assignments. The 5-digit placeholder codes were included in Addendum O, specifically under the column labeled “CY 2020 OPPS/ASC Proposed Rule 5-Digit AMA Placeholder Code,” to the proposed rule. We noted that the final CPT code numbers will be included in this CY 2020 OPPS/ASC final rule with comment period. We also noted that not every code listed in Addendum O is subject to public comment. For the new and revised Category I and III CPT codes, we requested public comments on only those codes that are assigned to comment indicator “NP”.

In summary, in the CY 2020 OPPS/ASC proposed rule, we solicited public comments on the proposed CY 2020 status indicator and APC assignments for the new and revised Category I and III CPT codes that will be effective January 1, 2020. The CPT codes were listed in Addendum B to the proposed rule with short descriptors only. We listed them again in Addendum O to the proposed rule with long descriptors. We also proposed to finalize the status indicator and APC assignments for these codes (with their final CPT code numbers) in the CY 2020 OPPS/ASC final rule with comment period. The proposed status indicator and APC assignments for these codes were included in Addendum B to the proposed rule (which is available via the internet on the CMS website).

Commenters addressed several of the new CPT codes that were assigned to comment indicator “NP” in Addendum B to the CY 2020 OPPS/ASC proposed Start Printed Page 61208rule. We have responded to those public comments in sections III.D. (OPPS APC-Specific Policies), IV.B. (Device-Intensive Procedures) and XII. (Updates to the ASC Payment System) of this CY 2020OPPS/ASC final rule with comment period.

The final status indicators, APC assignments, and payment rates for the new CPT codes that are effective January 1, 2020 can be found in Addendum B to this final rule with comment period. In addition, the status indicator meanings can be found in Addendum D1 (OPPS Payment Status Indicators for CY 2020) to this final rule with comment period. Both Addendum B and D1 are available via the internet on the CMS website.

Finally, Table 10 below, which is a reprint of Table 9 from the CY 2020 OPPS/ASC proposed rule, shows the comment timeframe for new and revised HCPCS codes. The table provides information on our current process for updating codes through our OPPS quarterly update CRs, seeking public comments, and finalizing the treatment of these codes under the OPPS.

B. OPPS Changes—Variations Within APCs

1. Background

Section 1833(t)(2)(A) of the Act requires the Secretary to develop a classification system for covered hospital outpatient department services. Section 1833(t)(2)(B) of the Act provides that the Secretary may establish groups of covered OPD services within this classification system, so that services classified within each group are comparable clinically and with respect to the use of resources. In accordance with these provisions, we developed a grouping classification system, referred to as Ambulatory Payment Classifications (APCs), as set forth in regulations at 42 CFR 419.31. We use Level I (also known as CPT codes) and Level II HCPCS codes (also known as alphanumeric codes) to identify and group the services within each APC. The APCs are organized such that each group is homogeneous both clinically and in terms of resource use. Using this classification system, we have established distinct groups of similar services. We also have developed separate APC groups for certain medical devices, drugs, biologicals, therapeutic radiopharmaceuticals, and brachytherapy devices that are not packaged into the payment for the procedure.

We have packaged into the payment for each procedure or service within an APC group the costs associated with those items and services that are typically ancillary and supportive to a primary diagnostic or therapeutic modality and, in those cases, are an integral part of the primary service they support. Therefore, we do not make separate payment for these packaged items or services. In general, packaged items and services include, but are not limited to, the items and services listed in regulations at 42 CFR 419.2(b). A further discussion of packaged services is included in section II.A.3. of this final rule with comment period.Start Printed Page 61209

Under the OPPS, we generally pay for covered hospital outpatient services on a rate-per-service basis, where the service may be reported with one or more HCPCS codes. Payment varies according to the APC group to which the independent service or combination of services is assigned. In the CY 2020 OPPS/ASC proposed rule (84 FR 39451-39452), for CY 2020, we proposed that each APC relative payment weight represents the hospital cost of the services included in that APC, relative to the hospital cost of the services included in APC 5012 (Clinic Visits and Related Services). The APC relative payment weights are scaled to APC 5012 because it is the hospital clinic visit APC and clinic visits are among the most frequently furnished services in the hospital outpatient setting.

2. Application of the 2 Times Rule

Section 1833(t)(9)(A) of the Act requires the Secretary to review, not less often than annually, and revise the APC groups, the relative payment weights, and the wage and other adjustments described in paragraph (2) to take into account changes in medical practice, changes in technology, the addition of new services, new cost data, and other relevant information and factors. Section 1833(t)(9)(A) of the Act also requires the Secretary to consult with an expert outside advisory panel composed of an appropriate selection of representatives of providers to review (and advise the Secretary concerning) the clinical integrity of the APC groups and the relative payment weights. We note that the HOP Panel recommendations for specific services for the CY 2020 OPPS update are discussed in the relevant specific sections throughout this CY 2020 OPPS/ASC final rule with comment period.

In addition, section 1833(t)(2) of the Act provides that, subject to certain exceptions, the items and services within an APC group cannot be considered comparable with respect to the use of resources if the highest cost for an item or service in the group is more than 2 times greater than the lowest cost for an item or service within the same group (referred to as the “2 times rule”). The statute authorizes the Secretary to make exceptions to the 2 times rule in unusual cases, such as low-volume items and services (but the Secretary may not make such an exception in the case of a drug or biological that has been designated as an orphan drug under section 526 of the Federal Food, Drug, and Cosmetic Act). In determining the APCs with a 2 times rule violation, we consider only those HCPCS codes that are significant based on the number of claims. We note that, for purposes of identifying significant procedure codes for examination under the 2 times rule, we consider procedure codes that have more than 1,000 single major claims or procedure codes that both have more than 99 single major claims and contribute at least 2 percent of the single major claims used to establish the APC cost to be significant (75 FR 71832). This longstanding definition of when a procedure code is significant for purposes of the 2 times rule was selected because we believe that a subset of 1,000 or fewer claims is negligible within the set of approximately 100 million single procedure or single session claims we use for establishing costs. Similarly, a procedure code for which there are fewer than 99 single claims and that comprises less than 2 percent of the single major claims within an APC will have a negligible impact on the APC cost (75 FR 71832). In the CY 2020 OPPS/ASC proposed rule (84 FR 39451 through 39452), for CY 2020, we proposed to make exceptions to this limit on the variation of costs within each APC group in unusual cases, such as for certain low-volume items and services.

In the CY 2020 OPPS/ASC proposed rule, we identified the APCs with violations of the 2 times rule. Therefore, we proposed changes to the procedure codes assigned to these APCs in Addendum B to the proposed rule. We noted that Addendum B does not appear in the printed version of the Federal Register as part of the CY 2020 OPPS/ASC proposed rule. Rather, it is published and made available via the internet on the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​index.html. To eliminate a violation of the 2 times rule and improve clinical and resource homogeneity, we proposed to reassign these procedure codes to new APCs that contain services that are similar with regard to both their clinical and resource characteristics. In many cases, the proposed procedure code reassignments and associated APC reconfigurations for CY 2020 included in the proposed rule were related to changes in costs of services that were observed in the CY 2018 claims data newly available for CY 2020 ratesetting. Addendum B to the CY 2020 OPPS/ASC proposed rule identified with a comment indicator “CH” those procedure codes for which we proposed a change to the APC assignment or status indicator, or both, that were initially assigned in the July 1, 2019 OPPS Addendum B Update (available via the internet on the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​Addendum-A-and-Addendum-B-Updates.html), which was the latest payment rate file for 2019 prior to issuance of the proposed rule.

3. APC Exceptions to the 2 Times Rule

Taking into account the APC changes that we proposed to make for CY 2020 in the CY 2020 OPPS/ASC proposed rule, we reviewed all of the APCs to determine which APCs would not meet the requirements of the 2 times rule. We used the following criteria to evaluate whether to propose exceptions to the 2 times rule for affected APCs:

  • Resource homogeneity;
  • Clinical homogeneity;
  • Hospital outpatient setting utilization;
  • Frequency of service (volume); and
  • Opportunity for upcoding and code fragments.

Based on the CY 2018 claims data available for the CY 2020 proposed rule, we found 18 APCs with violations of the 2 times rule. We applied the criteria as described above to identify the APCs for which we proposed to make exceptions under the 2 times rule for CY 2020, and found that all of the 18 APCs we identified met the criteria for an exception to the 2 times rule based on the CY 2018 claims data available for the proposed rule. We did not include in that determination those APCs where a 2 times rule violation was not a relevant concept, such as APC 5401 (Dialysis), which only has two HCPCS codes assigned to it that have a similar geometric mean costs and do not create a 2 time rule violation. Therefore, we only identified those APCs, including those with criteria-based costs, such as device-dependent CPT/HCPCS codes, with violations of the 2 times rule.

We note that, for cases in which a recommendation by the HOP Panel appears to result in or allow a violation of the 2 times rule, we may accept the HOP Panel's recommendation because those recommendations are based on explicit consideration (that is, a review of the latest OPPS claims data and group discussion of the issue) of resource use, clinical homogeneity, site of service, and the quality of the claims data used to determine the APC payment rates.

Table 10 of the proposed rule listed the 18 APCs that we proposed to make an exception for under the 2 times rule for CY 2020 based on the criteria cited above and claims data submitted between January 1, 2018, and December 31, 2018, and processed on or before December 31, 2018. In the proposed Start Printed Page 61210rule, we stated that for the final rule with comment period, we intend to use claims data for dates of service between January 1, 2018, and December 31, 2018, that were processed on or before June 30, 2019, and updated CCRs, if available.

Based on the updated final rule CY 2018 claims data used for this CY 2020 final rule with comment period, we were able to remedy two APC violation out of the 18 APCs that appeared in Table 10 of the CY 2020 OPPS/ASC proposed rule. Specifically, APC 5672 (Level 2 Pathology) and APC 5733 (Level 3 Minor Procedures) no longer met the criteria for exception to the 2 times rule in this final rule with comment period. In addition, based on our analysis of the final rule claims data, we found a total of 17 APCs with violations of the 2 times rule. Of these 17 total APCs, 16 were identified in the proposed rule and one newly identified APC. Specifically, we found the following 16 APCs from the proposed rule continued to have violations of the 2 times rule for this final rule with comment period:

  • APC 5112 (Level 2 Musculoskeletal Procedures);
  • APC 5161 (Level 1 ENT Procedures)
  • APC 5181 (Level 1 Vascular Procedures)
  • APC 5311 (Level 1 Lower GI Procedures)
  • APC 5521 (Level 1 Imaging without Contrast);
  • APC 5522 (Level 2 Imaging without Contrast);
  • APC 5523 (Level 3 Imaging without Contrast);
  • APC 5524 (Level 4 Imaging without Contrast);
  • APC 5571 (Level 1 Imaging with Contrast)
  • APC 5612 (Level 2 Therapeutic Radiation Treatment Preparation);
  • APC 5691 (Level 1 Drug Administration);
  • APC 5721 (Level 1 Diagnostic Tests and Related Services);
  • APC 5731 (Level 1 Minor Procedures);
  • APC 5734 (Level 4 Minor Procedures);
  • APC 5822 (Level 2 Health and Behavior Services); and
  • APC 5823 (Level 3 Health and Behavior Services).

In addition, we found that APC 5593 (Level 3 Nuclear Medicine and Related Services) violated the 2 times rule using the final rule with comment period claims data.

Although we did not receive any comments on Table 10 of the proposed rule, we did receive comments on APC assignments for specific HCPCS codes. The comments, and our responses, can be found in section III.D. (OPPS APC-Specific Policies) of this final rule with comment period.

After considering the public comments we received on APC assignments and our analysis of the CY 2018 costs from hospital claims and cost report data available for this CY 2020 final rule with comment period, we are finalizing our proposals with some modifications. Specifically, we are finalizing our proposal to except 16 of the 18 proposed APCs from the 2 times rule for CY 2020 and also excepting one additional APC (APC 5593). As noted above, we were able to remedy two of the proposed rule 2 time violations in this final rule with comment period.

In summary, Table 11 below lists the 17 APCs that we are excepting from the 2 times rule for CY 2020 based on the criteria described earlier and a review of updated claims data for dates of service between January 1, 2018 and December 31, 2018, that were processed on or before June 30, 2019, and updated CCRs, if available. We note that, for cases in which a recommendation by the HOP Panel appears to result in or allow a violation of the 2 times rule, we generally accept the HOP Panel's recommendation because those recommendations are based on explicit consideration of resource use, clinical homogeneity, site of service, and the quality of the claims data used to determine the APC payment rates. The geometric mean costs for hospital outpatient services for these and all other APCs that were used in the development of this final rule with comment period can be found on the CMS website at: http://www.cms.gov.

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C. New Technology APCs

1. Background

In the CY 2002 OPPS final rule (66 FR 59903), we finalized changes to the time period in which a service can be eligible for payment under a New Technology APC. Beginning in CY 2002, we retain services within New Technology APC groups until we gather sufficient claims data to enable us to assign the service to an appropriate clinical APC. This policy allows us to move a service from a New Technology APC in less than 2 years if sufficient data are available. It also allows us to retain a service in a New Technology APC for more than 2 years if sufficient data upon which to base a decision for reassignment have not been collected.

In the CY 2004 OPPS final rule with comment period (68 FR 63416), we restructured the New Technology APCs to make the cost intervals more consistent across payment levels and refined the cost bands for these APCs to retain two parallel sets of New Technology APCs, one set with a status indicator of “S” (Significant Procedures, Not Discounted when Multiple. Paid under OPPS; separate APC payment) and the other set with a status indicator of “T” (Significant Procedure, Multiple Reduction Applies. Paid under OPPS; separate APC payment). These current New Technology APC configurations allow us to price new technology services more appropriately and consistently.

For CY 2019, there were 52 New Technology APC levels, ranging from the lowest cost band assigned to APC 1491 (New Technology-Level 1A ($0-$10)) through the highest cost band assigned to APC 1908 (New Technology-Level 52 ($145,001-$160,000)). We note that the cost bands for the New Technology APCs, specifically, APCs 1491 through 1599 and 1901 through 1908, vary with increments ranging from $10 to $14,999. These cost bands identify the APCs to which new technology procedures and services with estimated service costs that fall within those cost bands are assigned under the OPPS. Payment for each APC is made at the mid-point of the APC's assigned cost band. For example, payment for New Technology APC 1507 (New Technology-Level 7 ($501-$600)) is made at $550.50.

Under the OPPS, one of our goals is to make payments that are appropriate for the services that are necessary for the treatment of Medicare beneficiaries. The OPPS, like other Medicare payment systems, is budget neutral and increases are limited to the annual hospital inpatient market basket increase adjusted for multifactor productivity. We believe that our payment rates generally reflect the costs that are associated with providing care to Medicare beneficiaries. Furthermore, we believe that our payment rates are adequate to ensure access to services (80 FR 70374).

For many emerging technologies, there is a transitional period during which utilization may be low, often because providers are first learning about the technologies and their clinical utility. Quite often, parties request that Medicare make higher payment amounts under the New Technology APCs for new procedures in that transitional phase. These requests, and their accompanying estimates for expected total patient utilization, often reflect very low rates of patient use of expensive equipment, resulting in high per-use costs for which requesters believe Medicare should make full payment. Medicare does not, and we believe should not, assume responsibility for more than its share of the costs of procedures based on projected utilization for Medicare beneficiaries and does not set its payment rates based on initial projections of low utilization for services that require expensive capital equipment. For the OPPS, we rely on hospitals to make informed business decisions regarding the acquisition of high-cost capital equipment, taking into consideration their knowledge about their entire patient base (Medicare Start Printed Page 61212beneficiaries included) and an understanding of Medicare's and other payers' payment policies. (We refer readers to the CY 2013 OPPS/ASC final rule with comment period (77 FR 68314) for further discussion regarding this payment policy.)

We note that, in a budget neutral system, payments may not fully cover hospitals' costs in a particular circumstance, including those for the purchase and maintenance of capital equipment. We rely on hospitals to make their decisions regarding the acquisition of high-cost equipment with the understanding that the Medicare program must be careful to establish its initial payment rates, including those made through New Technology APCs, for new services that lack hospital claims data based on realistic utilization projections for all such services delivered in cost-efficient hospital outpatient settings. As the OPPS acquires claims data regarding hospital costs associated with new procedures, we regularly examine the claims data and any available new information regarding the clinical aspects of new procedures to confirm that our OPPS payments remain appropriate for procedures as they transition into mainstream medical practice (77 FR 68314). For CY 2020, we included the proposed payment rates for New Technology APCs 1491 to 1599 and 1901 through 1908 in Addendum A to the CY 2020 OPPS/ASC proposed rule (which is available via the internet on the CMS website). The final payment rates for these New Technology APCs are included in Addendum A to the CY 2020 OPPS/ASC final rule with comment period (which is available via the internet on the CMS website).

2. Establishing Payment Rates for Low-Volume New Technology Procedures

Procedures that are assigned to New Technology APCs are typically new procedures that do not have sufficient claims history to establish an accurate payment for the procedures. One of the objectives of establishing New Technology APCs is to generate sufficient claims data for a new procedure so that it can be assigned to an appropriate clinical APC. Some procedures that are assigned to New Technology APCs have very low annual volume, which we consider to be fewer than 100 claims. We consider procedures with fewer than 100 claims annually as low-volume procedures because there is a higher probability that the payment data for a procedure may not have a normal statistical distribution, which could affect the quality of our standard cost methodology that is used to assign services to an APC. In addition, services with fewer than 100 claims per year are not generally considered to be a significant contributor to the APC ratesetting calculations and, therefore, are not included in the assessment of the 2 times rule. As we explained in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58890), we were concerned that the methodology we use to estimate the cost of a procedure under the OPPS by calculating the geometric mean for all separately paid claims for a HCPCS procedure code from the most recent available year of claims data may not generate an accurate estimate of the actual cost of the procedure for these low-volume procedures.

In accordance with section 1833(t)(2)(B) of the Act, services classified within each APC must be comparable clinically and with respect to the use of resources. As described earlier, assigning a procedure to a new technology APC allows us to gather claims data to price the procedure and assign it to the APC with services that use similar resources and are clinically comparable. However, where utilization of services assigned to a New Technology APC is low, it can lead to wide variation in payment rates from year to year, resulting in even lower utilization and potential barriers to access to new technologies, which ultimately limits our ability to assign the service to the appropriate clinical APC. To mitigate these issues, we determined in the CY 2019 OPPS/ASC final rule with comment period that it was appropriate to utilize our equitable adjustment authority at section 1833(t)(2)(E) of the Act to adjust how we determined the costs for low-volume services assigned to New Technology APCs (83 FR 58892 through 58893). We have utilized our equitable adjustment authority at section 1833(t)(2)(E) of the Act, which states that the Secretary shall establish, in a budget neutral manner, other adjustments as determined to be necessary to ensure equitable payments, to estimate an appropriate payment amount for low-volume new technology procedures in the past (82 FR 59281). Although we have used this adjustment authority on a case-by-case basis in the past, we stated in the CY 2019 OPPS/ASC final rule with comment period that we believe it is appropriate to adopt an adjustment for low-volume services assigned to New Technology APCs in order to mitigate the wide payment fluctuations that have occurred for new technology services with fewer than 100 claims and to provide more predictable payment for these services.

For purposes of this adjustment, we stated that we believe that it is appropriate to use up to 4 years of claims data in calculating the applicable payment rate for the prospective year, rather than using solely the most recent available year of claims data, when a service assigned to a New Technology APC has a low annual volume of claims, which, for purposes of this adjustment, we define as fewer than 100 claims annually. We adopted a policy to consider procedures with fewer than 100 claims annually as low-volume procedures because there is a higher probability that the payment data for a procedure may not have a normal statistical distribution, which could affect the quality of our standard cost methodology that is used to assign services to an APC. We explained that we were concerned that the methodology we use to estimate the cost of a procedure under the OPPS by calculating the geometric mean for all separately paid claims for a HCPCS procedure code from the most recent available year of claims data may not generate an accurate estimate of the actual cost of the low-volume procedure. Using multiple years of claims data will potentially allow for more than 100 claims to be used to set the payment rate, which would, in turn, create a more statistically reliable payment rate.

In addition, to better approximate the cost of a low-volume service within a New Technology APC, we stated that we believe using the median or arithmetic mean rather than the geometric mean (which “trims” the costs of certain claims out) could be more appropriate in some circumstances, given the extremely low volume of claims. Low claim volumes increase the impact of “outlier” claims; that is, claims with either a very low or very high payment rate as compared to the average claim, which would have a substantial impact on any statistical methodology used to estimate the most appropriate payment rate for a service. We also explained that we believe having the flexibility to utilize an alternative statistical methodology to calculate the payment rate in the case of low-volume new technology services would help to create a more stable payment rate. Therefore, in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58893), we established that, in each of our annual rulemakings, we will seek public comments on which statistical methodology should be used for each low-volume service assigned to a New Technology APC. In the preamble of Start Printed Page 61213each annual rulemaking, we stated that we would present the result of each statistical methodology and solicit public comment on which methodology should be used to establish the payment rate for a low-volume new technology service. In addition, we will use our assessment of the resources used to perform a service and guidance from the developer or manufacturer of the service, as well as other stakeholders, to determine the most appropriate payment rate. Once we identify the most appropriate payment rate for a service, we will assign the service to the New Technology APC with the cost band that includes its payment rate.

Accordingly for CY 2020, we proposed to continue the policy we adopted in CY 2019 under which we will utilize our equitable adjustment authority under section 1833(t)(2)(E) of the Act to calculate the geometric mean, arithmetic mean, and median using multiple years of claims data to select the appropriate payment rate for purposes of assigning services with fewer than 100 claims per year to a New Technology APC. Additional details on our policy is available in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58892 through 58893).

Comment: One commenter expressed support for the continuation of our policy regarding payment rates for low-volume new technology procedures.

Response: We appreciate the commenter's support.

After considering the public comments we received, we are finalizing this proposal without modification.

3. Procedures Assigned to New Technology APC Groups for CY 2020

As we explained in the CY 2002 OPPS final rule with comment period (66 FR 59902), we generally retain a procedure in the New Technology APC to which it is initially assigned until we have obtained sufficient claims data to justify reassignment of the procedure to a clinically appropriate APC.

In addition, in cases where we find that our initial New Technology APC assignment was based on inaccurate or inadequate information (although it was the best information available at the time), where we obtain new information that was not available at the time of our initial New Technology APC assignment, or where the New Technology APCs are restructured, we may, based on more recent resource utilization information (including claims data) or the availability of refined New Technology APC cost bands, reassign the procedure or service to a different New Technology APC that more appropriately reflects its cost (66 FR 59903).

Consistent with our current policy, for CY 2020, in the CY 2020 OPPS/ASC proposed rule (84 FR 39454), we proposed to retain services within New Technology APC groups until we obtain sufficient claims data to justify reassignment of the service to a clinically appropriate APC. The flexibility associated with this policy allows us to reassign a service from a New Technology APC in less than 2 years if sufficient claims data are available. It also allows us to retain a service in a New Technology APC for more than 2 years if sufficient claims data upon which to base a decision for reassignment have not been obtained (66 FR 59902).

a. Magnetic Resonance-Guided Focused Ultrasound Surgery (MRgFUS) (APCs 1575, 5114, and 5414)

Currently, there are four CPT/HCPCS codes that describe magnetic resonance image-guided, high-intensity focused ultrasound (MRgFUS) procedures, three of which we proposed to continue to assign to standard APCs, and one that we proposed to continue to assign to a New Technology APC for CY 2020. These codes include CPT codes 0071T, 0072T, and 0398T, and HCPCS code C9734. CPT codes 0071T and 0072T describe procedures for the treatment of uterine fibroids, CPT code 0398T describes procedures for the treatment of essential tremor, and HCPCS code C9734 describes procedures for pain palliation for metastatic bone cancer.

As shown in Table 11 of the CY 2020 OPPS/ASC proposed rule, and as listed in Addendum B to the CY 2020 OPPS/ASC proposed rule, we proposed to continue to assign the procedures described by CPT codes 0071T and 0072T to APC 5414 (Level 4 Gynecologic Procedures) for CY 2020. We also proposed to continue to assign the APC to status indicator “J1” (Hospital Part B services paid through a comprehensive APC). In addition, we proposed to continue to assign the services described by HCPCS code C9734 (Focused ultrasound ablation/therapeutic intervention, other than uterine leiomyomata, with magnetic resonance (mr) guidance) to APC 5115 (Level 5 Musculoskeletal Procedures) for CY 2020. We also proposed to continue to assign HCPCS code C9734 to status indicator “J1”. We refer readers to Addendum B to the proposed rule for the proposed payment rates for CPT codes 0071T and 0072T and HCPCS code C9734 under the OPPS. Addendum B is available via the internet on the CMS website.

For the procedure described by CPT code 0398T, we have identified 37 paid claims from CY 2016 through CY 2018 (1 claim in CY 2016, 11 claims in CY 2017, and 25 claims in CY 2018). We note that the procedure described by CPT code 0398T was first assigned to a New Technology APC in CY 2016. Accordingly, there are 3 years of claims data available for the OPPS ratesetting purposes. The payment amounts for the claims vary widely, with a cost of approximately $29,254 for the sole CY 2016 claim, a geometric mean cost of approximately $4,647 for the 11 claims from CY 2017, and a geometric mean cost of approximately $11,716 for the 25 claims from CY 2018. We are concerned about the large fluctuation in the cost of the procedure described by CPT code 0398T from year to year and the relatively small number of claims available to establish a payment rate for the service. In accordance with section 1833(t)(2)(B) of the Act, we must establish that services classified within each APC are comparable clinically and with respect to the use of resources.

Therefore, as discussed in section III.C.2. of the proposed rule, we proposed to apply the policy we adopted in CY 2019, under which we will utilize our equitable adjustment authority under section 1833(t)(2)(E) of the Act to calculate the geometric mean, arithmetic mean, and median costs using multiple years of claims data to select the appropriate payment rate for purposes of assigning CPT code 0398T to a New Technology APC. We believe using this approach to assign CPT code 0398T to a New Technology APC is more likely to yield a payment rate that will be representative of the cost of the procedure described by CPT code 0398T, despite the fluctuating geometric mean costs for the procedure available in the claims data used for the proposed rule. We continue to believe that the situation for the procedure described by CPT code 0398T is unique, given the limited number of claims for the procedure and the high variability for the cost of the claims, which makes it challenging to determine a reliable payment rate.

Our analysis found that the estimated geometric mean cost of the 37 claims over the 3 year period for which there are claims was approximately $8,829, the estimated arithmetic mean cost of the claims was approximately $10,021, and the median cost of the claims was approximately $11,985. While the results of using different methodologies range from approximately $8,800 to nearly $12,000, two of the estimates fall within the cost bands of New Technology APC 1575 (New Start Printed Page 61214Technology—Level 38 ($10,001-$15,000)), with a proposed payment rate of $12,500.50. Consistent with our low volume policy for procedures assigned to a new technology APC, we presented the result of each statistical methodology in the proposed rule, and we sought public comments on which methodology should be used to establish payment for the procedures described by CPT code 0398T. We noted that we believe that the median cost estimate was the most appropriate representative cost of the procedure described by CPT code 0398T because it was consistent with the payment rates established for the procedure from CY 2017 to CY 2019 and did not involve any trimming of claims. Calculating the payment rate using either the geometric mean cost or the arithmetic mean cost would involve trimming the one paid claim from CY 2016, because the paid amount for the claim of $29,254 is substantially larger than the amount for any other paid claim reported for the procedure described by CPT code 0398T. The median cost estimate for CPT code 0398T also falls within the same New Technology APC cost band that was used to set the payment rate for CY 2019, which is $12,500.50 for this procedure. Therefore, for purposes of determining the proposed CY 2020 payment rate, we proposed to estimate the cost for the procedure described by CPT code 0398T by calculating the median cost of the 37 paid claims for the procedures in CY 2016 through CY 2018, and assigned the procedure described by CPT code 0398T to the New Technology APC that includes the estimated cost. Accordingly, we proposed to maintain the procedure described by CPT code 0398T in APC 1575 (New Technology—Level 38 ($10,001-$15,000)), with a proposed payment rate of $12,500.50 for CY 2020. We refer readers to Addendum B to the proposed rule for the proposed payment rates for all codes reportable under the OPPS. Addendum B is available via the internet on the CMS website.

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Comment: Multiple commenters, including the developer of MRgFUS, stated that the proposed payment rate for CPT code 0398T was too low because they believed the claims data for CPT code 0398T continue to underestimate the resources used to perform the procedure even when using the low-volume payment policy to establish the payment rate for the procedure. The developer also used the example of the service described by HCPCS code C9734 (Focused ultrasound ablation/therapeutic intervention, other than uterine leiomyomata, with magnetic resonance (mr) guidance), where the payment rate for the service had doubled from $5,222 in CY 2017 to $11,675 in the CY 2020 proposed rule, to argue that a similar increase could occur for CPT code 0398T. Commenters suggested several ideas for what they believed would be a more appropriate rate. Commenters believed the claims cost data reported for CPT code 0398T does not fully reflect the resource costs for the time the procedure takes, the cost of single-use supplies for the procedure, and hours of use of a provider's MRI machine. To reflect these costs, several commenters supported restoring the payment rate from CY 2018 of $17,500.50. Other commenters simply requested a higher rate than what was proposed such as a payment rate of either $22,000 or $25,000.

Response: We appreciate the commenters' concerns, but the claims data we currently have for CPT code 0398T do not support a higher payment rate even when using the low-volume payment policy. Also, while the payment rate for HCPCS code C9734 (Focused ultrasound ablation/therapeutic intervention, other than uterine leiomyomata, with magnetic resonance (mr) guidance) doubled from CY 2017 to CY 2020, the payment rate increase for HCPCS code C9734 is not predictive of the changes in cost that may occur with CPT code 0398T (Magnetic resonance image guided high intensity focused ultrasound (mrgfus), stereotactic ablation lesion, intracranial for movement disorder including stereotactic navigation and frame placement when performed). Rather, the payment rate for each service, including that described by HCPCS code C9734, is generally based on the costs associated with furnishing the service, which, in turn, drives the APC assignment. The geometric mean for C9734, which represents the cost of the individual procedure, increased from $8,655 in CY 2017 to $9,294 in CY 2020, and was reassigned to a higher level APC based clinical and resource similarity to other services.

Under the low-volume payment policy, we utilized our equitable adjustment authority under section 1833(t)(2)(E) of the Act to calculate the geometric mean, arithmetic mean, and median costs using multiple years of claims data to select the appropriate payment rate for purposes of assigning CPT code 0398T to a New Technology APC. We identified 43 claims reporting the procedure described by CPT code 0398T for the 3-year period of CY 2016 through CY 2018. We found the geometric mean cost for the procedure described by CPT code 0398T is approximately $8,485, the arithmetic mean cost is approximately $9,672, and the median cost is approximately $11,182. Based on our methodology, we will use the median cost of CPT code 0398T to set the payment rate for the procedure because the median cost is the highest rate of the three statistical methods and may reflect some of the higher resource costs, as described by commenters, for the procedure. The median cost for CPT code 0398T falls within the same New Technology APC 1575 (New Technology—Level 38 ($10,001-$15,000)) with a proposed payment rate of $12,500.50 that was proposed as the APC assignment for CPT code 0398T in the proposed rule.

Comment: Two commenters supported the assignment of CPT code 0398T to New Technology APC 1575 (New Technology—Level 38 ($10,001-$15,000)) with a proposed payment rate of $12,500.50. One of the commenters supported the proposed new technology APC assignment because it is reflective of the median cost of the service and would ensure that what the commenter believed would be a severe underpayment calculated from the geometric mean would not be used to establish the payment rate for CPT code 0398T, which the commenter believed could discourage providers from performing the service.

Response: We appreciate the support of the commenters.

Comment: One commenter, the developer, supported the assignment of HCPCS code C9734 to APC 5115 (Level 5 Musculoskeletal Procedures) for CY 2020.

Response: We appreciate the support of the commenter.

After consideration of the public comments we received, we are finalizing our proposal for the APC assignment of CPT code 0398T. Specifically, we are continuing to assign this code to New Technology APC 1575 (New Technology—Level 38 ($10,001-$15,000)), with a payment rate of $12,500.50, for CY 2020 through use of our low-volume payment policy for new technology procedures. In addition, we are finalizing our proposal, without modification, to assign HCPCS code C9734 to APC 5115. We also are finalizing our proposal to continue to assign CPT codes 0071T and 0072T to APC 5414, without modification. Table 11 above lists the final CY 2018 status Start Printed Page 61217indicator and APC assignments for MRgFUS procedures. We refer readers to Addendum B of this final rule with comment period for the final payment rates for all codes reportable under the OPPS. Addendum B is available via the internet on the CMS website.

b. Retinal Prosthesis Implant Procedure

CPT code 0100T (Placement of a subconjunctival retinal prosthesis receiver and pulse generator, and implantation of intra-ocular retinal electrode array, with vitrectomy) describes the implantation of a retinal prosthesis, specifically, a procedure involving the use of the Argus® II Retinal Prosthesis System. This first retinal prosthesis was approved by the Food and Drug Administration (FDA) in 2013 for adult patients diagnosed with severe to profound retinitis pigmentosa. Pass-through payment status was granted for the Argus® II device under HCPCS code C1841 (Retinal prosthesis, includes all internal and external components) beginning October 1, 2013, and this status expired on December 31, 2015. We note that after pass-through payment status expires for a medical device, the payment for the device is packaged into the payment for the associated surgical procedure. Consequently, for CY 2016, the device described by HCPCS code C1841 was assigned to OPPS status indicator “N” to indicate that payment for the device is packaged and included in the payment rate for the surgical procedure described by CPT code 0100T. For CY 2016, the procedure described by CPT code 0100T was assigned to New Technology APC 1599, with a payment rate of $95,000, which was the highest paying New Technology APC for that year. This payment included both the surgical procedure (CPT code 0100T) and the use of the Argus® II device (HCPCS code C1841). However, stakeholders (including the device manufacturer and hospitals) believed that the CY 2016 payment rate for the procedure involving the Argus® II System was insufficient to cover the hospital cost of performing the procedure, which includes the cost of the retinal prosthesis at the retail price of approximately $145,000.

For CY 2017, analysis of the CY 2015 OPPS claims data used for the CY 2017 OPPS/ASC final rule with comment period showed 9 single claims (out of 13 total claims) for the procedure described by CPT code 0100T, with a geometric mean cost of approximately $142,003 based on claims submitted between January 1, 2015, through December 31, 2015, and processed through June 30, 2016. Based on the CY 2015 OPPS claims data available for the final rule with comment period and our understanding of the Argus® II procedure, we reassigned the procedure described by CPT code 0100T from New Technology APC 1599 to New Technology APC 1906, with a final payment rate of $150,000.50 for CY 2017. We noted that this payment rate included the cost of both the surgical procedure (CPT code 0100T) and the retinal prosthesis device (HCPCS code C1841).

For CY 2018, the reported cost of the Argus® II procedure based on CY 2016 hospital outpatient claims data for 6 claims used for the CY 2018 OPPS/ASC final rule with comment period was approximately $94,455, which was more than $55,000 less than the payment rate for the procedure in CY 2017, but closer to the CY 2016 payment rate for the procedure. We noted that the costs of the Argus® II procedure are extraordinarily high compared to many other procedures paid under the OPPS. In addition, the number of claims submitted has been very low and has not exceeded 10 claims within a single year. We believed that it is important to mitigate significant payment differences, especially shifts of several tens of thousands of dollars, while also basing payment rates on available cost information and claims data. In CY 2016, the payment rate for the Argus® II procedure was $95,000.50. The payment rate increased to $150,000.50 in CY 2017. For CY 2018, if we had established the payment rate based on updated final rule claims data, the payment rate would have decreased to $95,000.50 for CY 2018, a decrease of $55,000 relative to CY 2017. We were concerned that these large fluctuations in payment could potentially create an access to care issue for the Argus® II procedure, and we wanted to establish a payment rate to mitigate the potential sharp decline in payment from CY 2017 to CY 2018.

In accordance with section 1833(t)(2)(B) of the Act, we must establish that services classified within each APC are comparable clinically and with respect to the use of resources. Therefore, for CY 2018, we used our equitable adjustment authority under section 1833(t)(2)(E) of the Act, which states that the Secretary shall establish, in a budget neutral manner, other adjustments as determined to be necessary to ensure equitable payments, to maintain the payment rate for this procedure, despite the lower geometric mean costs available in the claims data used for the final rule with comment period. For CY 2018, we reassigned the Argus® II procedure to APC 1904 (New Technology—Level 50 ($115,001-$130,000)), which established a payment rate for the Argus® II procedure of $122,500.50, which was the arithmetic mean of the payment rates for the procedure for CY 2016 and CY 2017.

For CY 2019, the reported cost of the Argus® II procedure based on the geometric mean cost of 12 claims from the CY 2017 hospital outpatient claims data was approximately $171,865, which was approximately $49,364 more than the payment rate for the procedure for CY 2018. In the CY 2019 OPPS/ASC final rule with comment period, we continued to note that the costs of the Argus® II procedure are extraordinarily high compared to many other procedures paid under the OPPS (83 FR 58897 through 58898). In addition, the number of claims submitted continued to be very low for the Argus® II procedure. We stated that we continued to believe that it is important to mitigate significant payment fluctuations for a procedure, especially shifts of several tens of thousands of dollars, while also basing payment rates on available cost information and claims data because we are concerned that large decreases in the payment rate could potentially create an access to care issue for the Argus® II procedure. In addition, we indicated that we wanted to establish a payment rate to mitigate the potential sharp increase in payment from CY 2018 to CY 2019, and potentially ensure a more stable payment rate in future years.

As discussed in section III.C.2. of the CY 2019 OPPS/ASC final rule with comment period (83 FR 58892 through 58893), we used our equitable adjustment authority under section 1833(t)(2)(E) of the Act, which states that the Secretary shall establish, in a budget neutral manner, other adjustments as determined to be necessary to ensure equitable payments, to establish a payment rate that is more representative of the likely cost of the service. We stated that we believed the likely cost of the Argus® II procedure is higher than the geometric mean cost calculated from the claims data used for the CY 2018 OPPS/ASC final rule with comment period but lower than the geometric mean cost calculated from the claims data used for the CY 2019 OPPS/ASC final rule with comment period.

For CY 2019, we analyzed claims data for the Argus® II procedure using 3 years of available data from CY 2015 through CY 2017. These data included claims from the last year that the Argus® II received transitional device pass-through payments (CY 2015) and the first 2 years since device pass-through payment status for the Argus® II Start Printed Page 61218expired. We found that the geometric mean cost for the procedure was approximately $145,808, the arithmetic mean cost was approximately $151,367, and the median cost was approximately $151,266. As we do each year, we reviewed claims data regarding hospital costs associated with new procedures. We regularly examine the claims data and any available new information regarding the clinical aspects of new procedures to confirm that OPPS payments remain appropriate for procedures like the Argus® II procedure as they transition into mainstream medical practice (77 FR 68314). We noted that the proposed payment rate included both the surgical procedure (CPT code 0100T) and the use of the Argus® II device (HCPCS code C1841). For CY 2019, the estimated costs using all three potential statistical methods for determining APC assignment under the New Technology low-volume payment policy fell within the cost band of New Technology APC 1908, which is between $145,001 and $160,000. Therefore, we reassigned the Argus® II procedure (CPT code 0100T) to APC 1908 (New Technology—Level 52 ($145,001-$160,000)), with a payment rate of $152,500.50 for CY 2019.

For CY 2020, the number of reported claims for the Argus® II procedure continues to be very low with a substantial fluctuation in cost from year to year. The high annual variability of the cost of the Argus® II procedure continues to make it difficult to establish a consistent and stable payment rate for the procedure. As previously mentioned, in accordance with section 1833(t)(2)(B) of the Act, we are required to establish that services classified within each APC are comparable clinically and with respect to the use of resources. Therefore, for CY 2020, we proposed to apply the policy we adopted in CY 2019, under which we utilize our equitable adjustment authority under section 1833(t)(2)(E) of the Act to calculate the geometric mean, arithmetic mean, and median costs using multiple years of claims data to select the appropriate payment rate for purposes of assigning the Argus® II procedure (CPT code 0100T) to a New Technology APC.

We identified 35 claims reporting the procedure described by CPT code 0100T for the 4-year period of CY 2015 through CY 2018. We found the geometric mean cost for the procedure described by CPT code 0100T to be approximately $146,059, the arithmetic mean cost to be approximately $152,123, and the median cost to be approximately $151,267. All of the resulting estimates from using the three statistical methodologies fall within the same New Technology APC cost band ($145,001-$160,000), where the Argus® II procedure is assigned for CY 2019. Consistent with our policy stated in section III.C.2. of the proposed rule, we presented the result of each statistical methodology in the proposed rule, and we sought public comments on which method should be used to assign procedures described by CPT code 0100T to a New Technology APC. All three potential statistical methodologies used to estimate the cost of the Argus® II procedure fell within the cost band for New Technology APC 1908, with the estimated cost being between $145,001 and $160,000. Accordingly, we proposed to maintain the assignment of the procedure described by CPT code 0100T in APC 1908 (New Technology—Level 52 ($145,001-$160,000)), with a proposed payment rate of $152,500.50 for CY 2020. We note that the proposed payment rate includes both the surgical procedure (CPT code 0100T) and the use of the Argus® II device (HCPCS code C1841). We refer readers to Addendum B to the proposed rule for the proposed payment rates for all codes reportable under the OPPS. Addendum B is available via the internet on the CMS website.

Comment: Two commenters, including the manufacturer, supported the assignment of 0100T to APC 1908 (New Technology—Level 52 ($145,001-$160,000)), with a proposed payment rate of $152,500.50 for CY 2020.

Response: We appreciate the support of the commenters. Consistent with our policy for low-volume services assigned to a New Technology APC, for this final rule, we calculated the geometric mean, arithmetic mean, and median costs using multiple years of claims data to select the appropriate payment rate for purposes of assigning the Argus® II procedure (CPT code 0100T) to a New Technology APC. We identified 41 claims reporting the procedure described by CPT code 0100T for the 4-year period of CY 2015 through CY 2018. We found the geometric mean cost for the procedure described by CPT code 0100T to be approximately $146,042, the arithmetic mean cost to be approximately $151,453, and the median cost to be approximately $151,426. All of the resulting estimates from using the three statistical methodologies fall within the same New Technology APC cost band ($145,001-$160,000), that was proposed as the APC assignment for CPT code 0100T in the proposed rule. Therefore, we are finalizing our proposal to maintain the assignment of the procedure described by CPT code 0100T in APC 1908 (New Technology—Level 52 ($145,001-$160,000)), with a payment rate of $152,500.50 for CY 2020. We refer readers to Addendum B to the proposed rule for the proposed payment rates for all codes reportable under the OPPS. Addendum B is available via the internet on the CMS website.

As we discussed in the CY 2019 OPPS/ASC final rule with comment period (83 FR 58898), the claims data from CY 2017 showed another payment issue with regard to the Argus® II procedure. We found that payment for the Argus® II procedure was sometimes bundled into the payment for another procedure. Therefore in CY 2019, we implemented a policy to exclude payment for all procedures assigned to New Technology APCs from being bundled into the payment for procedures assigned to a C-APC. For CY 2020, we proposed to continue this policy as described in section II.A.2.b.(3) of the proposed rule. Our proposal would continue to exclude payment for any procedure that is assigned to a New Technology APC from being packaged when included on a claim with a service assigned to status indicator “J1”. While we did not propose to exclude payment for a procedure assigned to a New Technology APC from being packaged when included on a claim with a service assigned to status indicator “J2”, we sought public comments on this issue.

Comment: Several commenters, including device manufacturers, device manufacturer associations and physicians were opposed to our proposal to package payment for procedures assigned to a New Technology APC into the payment for comprehensive observation services assigned status indicator “J2”. The commenters stated that there were instances where beneficiaries receiving observation services may require the types of procedures that are assigned to New Technology APCs. Several commenters specifically mentioned HeartFlow, and stated that it could be performed appropriately for a patient receiving observation services. The commenters also stated that providing separate payment for this new technology procedure will allow CMS to collect sufficient claims data to enable assignment of the procedure to an appropriate clinical APC.

Response: We appreciate the stakeholders' comments regarding this proposal and agree that, although rare, there are situations in which it is clinically appropriate to provide a new technology service when providing comprehensive observation services. As discussed in the CY 2019 OPPS/ASC Start Printed Page 61219final rule with comment period (83 FR 58847), the purpose of the new technology APC policy is to ensure that there are sufficient claims data for new services in order to assign these procedures to a clinical APC and therefore, we excluded procedures assigned to New Technology APCs from packaging under the C-APC policy. In the CY 2019 final rule, we specifically stated that the exclusion policy included circumstances when New Technology procedures were billed with comprehensive services assigned to status indicator “J1”, however we believe this rationale is also applicable to comprehensive observations services that are assigned status indicator “J2”.

Accordingly, for CY 2020 and subsequent years, we are modifying our policy for excluding procedures assigned to New Technology APCs from the C-APC policy. That is, we are finalizing our proposal to exclude payment for any procedure that is assigned to a New Technology APC from being packaged when included on a claim with a “J1” service assigned to a C-APC. For CY 2020 and subsequent years, we are also finalizing a policy to exclude payment for any procedures that are assigned to a New Technology APC from being packaged into the payment for comprehensive observation services assigned to status indicator “J2” when they are included on a claim with “J2” procedures. This policy is also described in section II.A.2.b.(3) of this final rule.

c. Bronchoscopy With Transbronchial Ablation of Lesion(s) by Microwave Energy

Effective January 1, 2019, CMS established HCPCS code C9751 (Bronchoscopy, rigid or flexible, transbronchial ablation of lesion(s) by microwave energy, including fluoroscopic guidance, when performed, with computed tomography acquisition(s) and 3-D rendering, computer-assisted, image-guided navigation, and endobronchial ultrasound (EBUS) guided transtracheal and/or transbronchial sampling (eg, aspiration[s]/biopsy[ies]) and all mediastinal and/or hilar lymph node stations or structures and therapeutic intervention(s)). This microwave ablation procedure utilizes a flexible catheter to access the lung tumor via a working channel and may be used as an alternative procedure to a percutaneous microwave approach. Based on our review of the New Technology APC application for this service and the service's clinical similarity to existing services paid under the OPPS, we estimated the likely cost of the procedure would be between $8,001 and $8,500. We have not received any claims data for this service. Therefore, we proposed to continue to assign the procedure described by HCPCS code C9751 to New Technology APC 1571 (New Technology—Level 34 ($8,001-$8,500)), with a proposed payment rate of $8,250.50 for CY 2020. Details regarding HCPCS code C9751 were shown in Table 12 of the CY 2020 OPPS/ASC proposed Rule, which is reprinted below in Table 13.

Comment: The developer of the procedure noted that there will be clinical trials for HCPCS code C9751 in CY 2020 and it is anticipated the procedure also will have a limited market release in CY 2020. Therefore, the developer is expecting claims to be reported billed with HCPCS code C9751 for CY 2020.

Response: We appreciate the update on the expected utilization for HCPCS code C9751 for CY 2020.

Comment: One commenter supported our proposal to assign HCPCS code C9751 to New Technology APC 1571 (New Technology—Level 34 ($8,001-$8,500)), with a proposed payment rate of $8,250.50 for CY 2020.

Response: We appreciate the support of the commenter.

After considering the public comments, we are finalizing our proposal to assign HCPCS code C9751 to New Technology APC 1571 (New Technology—Level 34 ($8,001-$8,500)), with a payment rate of $8,250.50 for CY 2020.

d. Pathogen Test for Platelets

As stated in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59281), HCPCS code P9100 is used to report any test used to identify bacterial or other pathogen contamination in blood platelets. Currently, there are two rapid bacterial detection tests cleared by FDA that are described by HCPCS code P9100. According to their instructions for use, rapid bacterial detection tests should be performed on platelets from 72 hours after collection. Currently, certain rapid and culture-based tests can be used to extend the dating for platelets from 5 days to 7 days. Blood banks and transfusion services may test and use 6-day old to 7-day old platelets if the test results are negative for bacterial contamination.Start Printed Page 61220

HCPCS code P9100 was assigned in CY 2019 to New Technology APC 1493 (New Technology—Level 1C ($21-$30)), with a payment rate of $25.50. For CY 2020, based on CY 2018 claims data, there are approximately 1,100 claims reported for this service with a geometric mean cost of approximately $32. This geometric mean cost would result in the assignment of the service described by HCPCS code P9100 to a New Technology APC, based on the associated cost band, with a higher payment rate than where the service is currently assigned. Therefore, for CY 2020, we proposed to reassign the service described by HCPCS code P9100 to New Technology APC 1494 (New Technology—Level 1D ($31-$40)), with a proposed payment rate of $35.50.

Comment: One commenter expressed support for the proposal.

Response: We appreciate the support of the commenter.

After considering the public comments, we are finalizing our proposal to assign HCPCS code P9100 to New Technology APC 1494 (New Technology—Level 1D ($31-$40)), with a payment rate of $35.50.

e. Fractional Flow Reserve Derived From Computed Tomography (FFRCT)

Fractional Flow Reserve Derived from Computed Tomography (FFRCT), also known by the trade name HeartFlow, is a noninvasive diagnostic service that allows physicians to measure coronary artery disease in a patient through the use of coronary CT scans. The HeartFlow procedure is intended for clinically stable symptomatic patients with coronary artery disease, and, in many cases, may avoid the need for an invasive coronary angiogram procedure. HeartFlow uses a proprietary data analysis process performed at a central facility to develop a three-dimensional image of a patient's coronary arteries, which allows physicians to identify the fractional flow reserve to assess whether or not patients should undergo further invasive testing (that is, a coronary angiogram).

For many procedures in the OPPS, payment for analytics that are performed after the main diagnostic/image procedure are packaged into the payment for the primary procedure. However, in CY 2018, we determined that HeartFlow should receive a separate payment because the procedure is performed by a separate entity (that is, a HeartFlow technician who conducts computer analysis offsite) rather than the provider performing the CT scan. We assigned CPT code 0503T, which describes the analytics performed, to New Technology APC 1516 (New Technology—Level 16 ($1,401-$1,500)), with a payment rate of $1,450.50 based on pricing information provided by the developer of the procedure that indicated the price of the procedure was approximately $1,500.

For CY 2020, based on our analysis of the CY 2018 claims data available for the proposed rule, we found that over 840 claims had been submitted for payment for HeartFlow during CY 2018. We stated that the estimated geometric mean cost of HeartFlow was $788.19, or roughly $660 lower that the payment rate for CY 2019 of $1,450.50. Therefore, for CY 2020, we proposed to reassign the service described by CPT code 0503T in order to adjust the payment rate to better reflect the cost for the service. We proposed to reassign the service described by CPT code 0503T to New Technology APC 1509 (New Technology—Level 9 ($701-$800)), with a proposed payment rate of $750.50 for CY 2020. We sought public comments on this proposal.

Comment: Multiple commenters requested that we retain the CY 2019 OPPS APC assignment of APC 1516 (New Technology—Level 16 ($1401-$1500)) for HeartFlow with a payment rate of $1,450.50. The commenters were concerned that reducing the payment rate to $750.50 would discourage hospitals from using the service because they stated that the list price of the HeartFlow service is substantially higher than the proposed payment rate. Commenters were concerned that reduced utilization of HeartFlow would cause some beneficiaries to have unnecessary invasive coronary angiograms that are more costly than the HeartFlow procedure.

Multiple commenters, including the developer of HeartFlow, provided additional reasons to maintain the current payment rate for the service of $1,450.50 despite claims data suggesting a lower payment rate for HeartFlow. The commenters believed that 78 single frequency claims used for the proposed rule solely represented a single year and that such a low number of claims would be an insufficient number of claims on which to base a payment rate reduction for the service. Two commenters suggested that CMS should collect another one or two years of claims data before making changes to the current payment rate. One of the commenters believed the reason the estimated cost of HeartFlow derived from claims data is substantially less than the current payment rate may be due to providers submitting claims without marked up gross charges for the services they provide.

Another commenter, the developer, encouraged CMS to use our equitable adjustment authority under section 1833(t)(2)(E) of the Act, which states that the Secretary shall establish, in a budget neutral manner, other adjustments as determined to be necessary to ensure equitable payments to maintain the current payment rate for HeartFlow. The developer suggested that CMS should use its own assessment of the resources required to perform the HeartFlow service to set the payment rate for the service. The developer cited instances in the last four years where CMS used its equitable adjustment authority to mitigate either large fluctuations or declines in annual payment rates. These cases include: (1) A CY 2018 decision to use multiple years of claims data to pay a higher rate for CPT code 0100T (Placement of a subconjunctival retinal prosthesis receiver and pulse generator, and implantation of intraocular retinal electrode array, with vitrectomy) of $122,500.50 rather than the payment rate generated by the most recent year of claims data of $95,000.50; (2) a CY 2016 decision regarding the payment rate of CPT code 0308T (Insertion of ocular telescope prosthesis including removal of crystalline lens or intraocular lens prosthesis) where the median cost of $18,365 was used to set the payment rate instead of the geometric mean cost of $13,865 because only 39 single frequency claims were reported for the service, and where we stated that “the median cost would be a more appropriate measure of the central tendency for purposes of calculating the cost and the payment rate for the procedure;” (3) a CY 2016 decision to adjust the geometric mean per diem cost for the partial hospital program to ensure a per diem payment for fewer services was less than a per diem payment for a larger number of services; and (4) a CY 2018 decision to establish a payment rate of $17,500.50 for CPT code 0398T (Magnetic resonance image guided high intensity focused ultrasound (mrgfus), stereotactic ablation lesion, intracranial for movement disorder including stereotactic navigation and frame placement when performed) instead of proposed payment rate of $9,750.50.

The developer believes that the proposed New Technology APC assignment for HeartFlow, which would result in a nearly 50 percent reduction in the payment rate between CY 2019 and CY 2020, is similar to these cases described in their comment. Therefore, the developer asked us to use our equitable adjustment authority to Start Printed Page 61221maintain the CY 2019 payment rate of $1,450.50 for the service rather than adopt the proposed payment rate.

Response: The proposed payment rate for CPT code 0503T was based on claims data from CY 2018, which is the first year the service was payable in the OPPS. For ratesetting for CY 2018 and CY 2019, there were no claims data available showing the cost of the service. Also, there were no services identified as comparable to CPT code 0503T, which meant we could not estimate the cost of CPT code 0503T by using the cost of a similar service. Accordingly, we previously based pricing for the service on pricing information provided by the developer of the procedure.

We recognize that there was a low volume of claims for HeartFlow based on the data available for the proposed rule and, thus, we should have applied the low-volume policy for new technology services in the proposed rule.

However, for the final rule, using the most recently available data, there are now 957 total claims billed with CPT code 0503T and 101 single frequency claims. We appreciate the concerns of the commenters who stated that there were not enough claims billed with HeartFlow to use claims data to revise the rate for HeartFlow. While 101 single claims is above the threshold we established for low-volume services assigned to a new technology APC, we agree with the commenters that a payment reduction of nearly 50 percent is significant for a new technology that still has relatively low volume.

Accordingly, given the low number of single frequency claims for CPT code 0503T, that number of claims for the Heartflow procedure was below the low-volume payment policy threshold for the proposed rule, and that it is only two claims above the threshold using data available for this final rule with comment period, we have decided to use our equitable adjustment authority under section 1833(t)(2)(E) of the Act to calculate the geometric mean, arithmetic mean, and median using the CY 2018 claims data to determine an appropriate payment rate for HeartFlow using our new technology APC low-volume payment policy. While the number of single frequency claims is just above our threshold to use the low-volume payment policy, we still have concerns about the normal cost distribution of the claims used to calculate the payment rate for Heartflow, and we decided the low-volume payment policy would be the best approach to address those concerns.

Our analysis found that the geometric mean cost for CPT code 0503T was $768.26, the arithmetic mean cost for CPT code 0503T was $960.12 and that the median cost for CPT code 0503T was $900.28. Of the three cost methods, the highest amount was for the arithmetic mean. The arithmetic mean falls within the cost band for New Technology APC 1511 (New Technology—Level 11 ($901-$1000)) with a payment rate of $950.50. The arithmetic mean helps to account for some of the higher costs of CPT code 0503T identified by the commenters that may not have been reflected by either the median or the geometric mean. We acknowledge the commenters' concern and recognize that it may be theoretically possible that the reported cost of CPT code 0503T is higher than what we calculated from the claims data due to some providers reporting costs lower than actual costs for the service. However, we rely on hospitals to bill all CPT codes accurately in accordance with their code descriptors and CPT and CMS instructions, as applicable, and to report charges on claims and charges and costs on their Medicare hospital cost reports appropriately. In addition, we do not specify the methodologies that hospitals must use to set charges for this or any other service.

After consideration of the public comments we received, we are utilizing our new technology low-volume payment policy to set the payment rate for the HeartFlow service CPT code 0503T based on the arithmetic mean for the procedure. Specifically, we are assigning CPT code 0503T to New Technology APC 1511 (New Technology—Level 11 ($901-$1000)) with a payment rate of $950.50.

f. Cardiac Positron Emission Tomography (PET)/Computed Tomography (CT) Studies

Effective January 1, 2020, we have assigned three CPT codes (78431, 78432, and 78433) that describe the services associated with cardiac PET/CT studies to New Technology APCs. Table 13 reports code descriptors, status indicators, and APC assignments for these CPT codes. These codes were listed in Addendum B to the CY 2020 OPPS/ASC proposed rule as 78X32, 78X33, and 78X44. More information about CPT codes 78431, 78432, and 78433 can be found in section III. D. b. of this final rule.

Comment: Several commenters reported that certain societies submitted a new technology application to CMS for CPT codes 78431, 78432, and 78433 that details the costs associated with providing these services. For CPT code 78431, these same commenters disagreed with the proposed APC placement and recommended its reassignment from APC 5594 (Level 4 Nuclear Medicine and Related Services) with a proposed payment rate of $1,466.16 to APC 1522 (New Technology—Level 23 ($2501-$3000)) with a proposed payment rate of $2,750.50. They reported that, based on the resource cost of the service described by CPT code 78431, APC 1522 provides adequate reimbursement for the service. Similarly, for CPT codes 78432 and 78433, the commenters indicated that APC 5594 would not adequately cover the resource costs associated with these procedures, and recommended their reassignment to APC 1523 (New Technology—Level 23 ($2501-$3000)) with a proposed payment rate of $ 2,750.50

Response: Based on the information provided in the new technology application, and the comments received, we are revising the APC assignments for these codes. Specifically, we are revising the APC assignment for CPT code 78431 from APC 5594 to APC 1522, and reassigning CPT codes 78432 and 78433 from APC 5594 to APC 1523.

In summary, after consideration of the public comments for the new cardiac PET/CT codes, and based on our evaluation of the new technology application which provided the estimated costs for the services and described the components and characteristics of the new codes, we are assigning CPT codes 78431, 78432, and 78433 to the final APCs listed in Table 14 below. Please refer to section III. D. b. of this final rule for more information on the finalized proposal to establish a payment rate for other new CPT codes associated with PET/CT studies. The final CY 2020 payment rate for the codes can be found in Addendum B to this final rule with comment period (which is available via the internet on the CMS website).

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Start Printed Page 61223

g. V-Wave Interatrial Shunt Procedure

A randomized, double-blinded control IDE study is currently in progress for the V-Wave interatrial shunt procedure. All participants who passed initial screening for the study receive a right heart catherization procedure described by CPT code 93451 (Right heart catheterization including measurement(s) of oxygen saturation and cardiac output, when performed). Participants assigned to the experimental group also receive the V-Wave interatrial shunt procedure while participants assigned to the control group only receive right heart catheterization. The developer of V-Wave is concerned that the current coding of these services by Medicare would reveal to the study participants whether they have received the interatrial shunt because an additional procedure code, CPT code 93799 (Unlisted cardiovascular service or procedure) would be included on the claims for participants receiving the interatrial shunt. Therefore, we created a temporary HCPCS code to describe the V-wave interatrial shunt procedure for both the experimental group and the control group in the study. Specifically, we established HCPCS code C9758 (Blinded procedure for NYHA class III/IV heart failure; transcatheter implantation of interatrial shunt or placebo control, including right heart catheterization, trans-esophageal echocardiography (TEE)/intracardiac echocardiography (ICE), and all imaging with or without guidance (for example, ultrasound, fluoroscopy), performed in an approved investigational device exemption (IDE) study) to describe the service, and we assigned the service to New Technology APC 1589 (New Technology—Level 38 ($10,001-$15,000)). Details about the temporary HCPCS code are shown in Table 15 below. The final CY 2020 payment rate for V-Wave interatrial shunt procedure can be found in Addendum B to this final rule with comment period (which is available via the internet on the CMS website).

Start Printed Page 61224

D. OPPS APC-Specific Policies

1. Barostim NeoTM System (APC 5464)

In CY 2019, CPT codes 0266T and 0268T were assigned to APC 5463 (Level 3 Neurostimulator and Related Procedures) with a payment rate of $18,707.16. For CY 2020, as listed in Addendum B to the CY 2020 OPPS/ASC proposed rule, we proposed to reassign both codes to APC 5464 (Level 4 Neurostimulator and Related Procedures) with a proposed payment rate of $29,025.99. Table 16 below lists the long descriptors, proposed status indicator (SI), and APC assignments for these codes. We note that both codes are associated with the Barostim NeoTM System.

Comment: A medical device company agreed with the reassignment for CPT codes 0266T and 0268T to APC 5464. The commenter stated that APC 5464 is the more appropriate assignment for these codes based on clinical and resource homogeneity, and encouraged CMS to finalize the APC assignment.

Response: As we have stated every year since the implementation of the OPPS on August 1, 2000, we review, on an annual basis, the APC assignments for all services and items paid under the OPPS based on our analysis of the latest claims data.

Based on our analysis of the proposed rule claims data as well as clinical review of the services described, we proposed to revise the APC assignment for both CPT codes 0266T and 0268T to APC 5464. In our analysis of CPT code 0268T (which describes implantation/replacement of the pulse generator), we noticed that the APC assignment for CPT code 0266T (which describes the implantation or replacement of the complete system) was lower. We do not believe that the payment for the complete system (CPT code 0266T) should be less than the payment for the implantation/replacement of the pulse generator (CPT code 0268T) procedure. Consequently, we proposed to revise the APC assignment for CPT code 0266T to APC 5464. Although we had no claims data for CPT code 0266T, we believed it was necessary to revise the APC assignment to appropriately reflect the device cost associated with the procedure.

Similar to our findings for the proposed rule, based on updated claims data for this final rule with comment period, the geometric mean cost for CPT code 0268T supports its reassignment from APC 5463 to APC 5464. Specifically, our claims data show a geometric mean cost of approximately $25,558 for CPT code 0268T based on 6 single claims (out of 6 total claims), which is consistent with the geometric mean cost of approximately $28,491 for APC 5464, rather than the geometric mean cost of approximately $18,864 for APC 5463. Furthermore, as mentioned above, we are also assigning CPT code 0266T to APC 5464 even though we do not yet have claims data because we do not believe that the service for implantation of the entire system (CPT code 0266T) would be less resource intensive than the implantation of the pulse generator alone (CPT code 0268T).Start Printed Page 61225

In summary, after consideration of the public comment and analysis of the latest claims data, we are finalizing our proposal, without modification, to assign CPT codes 0266T and 0268T to APC 5464 for CY 2020. Table 16 below list the long descriptors for the codes and the final SI and APC assignments. The final CY 2020 payment rate for the codes can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) assignments for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website.

2. Biomechanical Computed Tomography (BCT) Analysis (APCs 5521, 5523, and 5731)

The CPT Editorial Panel established five new codes, specifically, CPT codes 0554T, 0555T, 0556T, 0557T, and 0558T, to describe the services associated with biomechanical computed tomography (BCT) analysis effective July 1, 2019. Through the July 2019 OPPS quarterly update CR (Transmittal 4313, Change Request 11318, dated May 24, 2019), we assigned these new codes to appropriate interim status indicators (SI) and APCs. Table 17 below lists the long descriptors and proposed SI and APCs of the codes.

Comment: A commenter agreed with the SI and APC assignments and stated that the APC assignments for these codes are the best available placements. The commenter also noted that CMS did not assign the comprehensive code (CPT code 0554T) and the physician interpretation code (CPT code 0557T) to an APC because the codes represent physician services.

Response: We thank the commenter for its feedback. We are finalizing the SIs and APC assignments for the codes. Table 17 below list the long descriptors and final SIs and APCs. The final CY 2020 payment rate for the codes can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the complete list of the OPPS payment status indicators and their definitions for CY 2020. Both Addendum B and Addendum D1 are available via the internet on the CMS website.

As we do for all codes, we will reevaluate the APC assignments for CPT codes 0555T, 0556T, and 0558T once we have claims data. We remind hospitals that we review, on an annual basis, the APC assignments for all services and items paid under the OPPS based on the latest claims data.

Start Printed Page 61226

3. Cardiac Magnetic Resonance (CMR) Imaging (APC 5572)

For CY 2020, we proposed to maintain the APC assignment for CPT code 75561 (Cardiac magnetic resonance imaging for morphology and function without contrast material(s), followed by contrast material(s) and further sequences) to APC 5572 (Level 2 Imaging with Contrast) with a proposed payment rate of $373.45.

Comment: Some commenters expressed concern with the placement of CPT code 75561 in APC 5572, and stated that it is grouped with services that are not similar clinically or with respect to resource use. As an example, they observed that CPT code 75561 is unlike CT of the abdomen or pelvis or MRI of the neck and spine, and instead, is more similar to those services in APC 5573 (Level 3 Imaging with Contrast), with a proposed payment rate of $682.96.Another commenter expressed concern with the payment stability for CPT code 75561. The commenter noted that although the code is assigned to the same APC for CY 2020, the payment for the service is slated for another reduction. The commenter observed that the payment rate for the service has decreased in the last several years and noted the following yearly rates:

  • CY 2017 OPPS payment rate: $426.52
  • CY 2018 OPPS payment rate: $456.34Start Printed Page 61227
  • CY 2019 OPPS payment rate: $385.88
  • CY 2020 OPPS proposed payment rate: $373.45

This same commenter reported that the code was previously included in a nuclear medicine APC, which it maintained was appropriate based on its clinical and resource homogeneity to cardiovascular magnetic resonance and cardiac nuclear imaging services in the APC, and that, since its APC reassignment, the payment for the service has dropped. The commenter believed that the different cost reporting methods used by hospitals may contribute to the artificially low relative payment weights and payment amounts for CT and MR.

Response: For CY 2020, based on claims submitted between January 1, 2018 through December 30, 2018, that were processed on or before June 30, 2019, our analysis of the latest claims data for this final rule continues to support our proposal of assigning CPT code 75561 to APC 5572. Specifically, our claims data show a geometric mean cost of approximately $413 for CPT code 75561 based on 14,350 single claims (out of 18,118 total claims), which is comparable to the geometric mean cost of about $359 for APC 5572, rather than the geometric mean cost of approximately $660 for APC 5573. The geometric cost of approximately $413 for CPT code 75561 is also consistent with the costs for significant services in APC 5572, which range between about $269 (for CPT code 74174) to $515 (for CPT code 73525). Based on our analysis of the latest claims data, we believe that CPT code 75561 is appropriately assigned to APC 5572.

With regards to the issue of payment stability, we note that Section 1833(t)(9)(A) of the Act requires the Secretary to review, not less often than annually, and to revise the groups, relative payment weights, and the wage and other adjustments to take into account changes in medical practices, changes in technology, the addition of new services, new cost data, and other relevant information and factors. Therefore, every year we review and revise the APC assignments based on our evaluation of these factors using the latest OPPS claims data. While we recognize the concerns about payment stability, we note that changes made to payment rates are based on our calculations of geometric mean costs from the most recently available Medicare claims and cost report data analysis, which may or may not result in payment increases and/or reductions based on the most recent geometric mean costs available. We note that the geometric mean costs reflect the national average resources to furnish a service in the hospital outpatient setting. To the extent that costs decrease, so too, would the payment rate.

In addition, with regard to the issue of different hospital cost reporting methods, we are unable to determine whether hospitals are misreporting the procedure. It is generally not our policy to judge the accuracy of hospital charging and coding for purposes of ratesetting. We rely on hospitals to accurately report the use of HCPCS codes in accordance with their code descriptors and CPT and CMS instructions, and to appropriately report services on claims and charges and costs for the services on their Medicare hospital cost report. Also, we do not specify the methodologies that hospitals use to set charges for this or any other service. Furthermore, we state in Chapter 4 of the Medicare Claims Processing Manual that “it is extremely important that hospitals report all HCPCS codes consistent with their descriptors; CPT and/or CMS instructions and correct coding principles, and all charges for all services they furnish, whether payment for the services is made separately paid or is packaged” to enable CMS to establish future ratesetting for OPPS services.

Comment: One commenter who expressed concern with the APC assignment for CPT code 75561 also requested that we address in the final rule how we determine which services are clinically similar. The commenter noted that CMS has constructed many APCs with a mix of imaging services that are dissimilar and yet preserves the clinical homogeneity of some APCs, such as nuclear medicine services.

Response: Under the OPPS, each service is assigned to an APC based on the clinical and resource similarity to other services within the APC or family of APCS. The OPPS is a prospective payment system under which payment groupings (that is, APCs) are based on clinical and resource similarity rather than code-specific payment rates, which would result in a cost-based fee schedule. For example APCs 5111-5116, which are described as Levels 1 through 6 Musculoskeletal Procedures, all include services that involve musculoskeletal services/procedures and the various levels of that APC family differentiate such procedures based on resource homogeneity. That is, the descriptors for APCs 5111 through 5116 are general and broadly describe a variety of musculoskeletal procedures, and are differentiated by the various levels based on the geometric mean costs for each APC. Clinically, all the procedures in APCs 5111 through 5116 are similar in that they involve some form of musculoskeletal procedure. In addition, as stated in section III.B.2. (Application of the 2 Times Rule) of this final rule with comment, section 1833(t)(2) of the Act provides that, subject to certain exceptions, the items and services within an APC group cannot be considered comparable with respect to the use of resources if the highest cost for an item or service in the group is more than 2 times greater than the lowest cost for an item or service within the same group (referred to as the “2 times rule”). While it may seem appropriate to place one code in a specific grouping, based on our 2 times rule criteria, we must assign the code to the appropriate APC based on its geometric mean cost.

In summary, after consideration of the public comments, we are finalizing our proposal, without modification, to assign CPT code 75561 to APC 5572. The final CY 2020 payment rate for CPT code 75561 can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) meanings for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website.

4. CardioFluxTM Magnetocardiography (MCG) Myocardial Imaging (APC 5723)

For CY 2020, we proposed to maintain the APC assignment for CPT code 0541T to APC 5722 (Level 2 Diagnostic Tests and Related Services) with a proposed payment rate of $256.60. We also proposed to continue to assign CPT code 0541T, which is an add-on code, to status indicator “N” to indicate that the code is packaged and payment for it is included in the primary procedure or service. In this case, the payment for 0542T is included in CPT code 0541T. We note that CPT codes 0541T and 0542T are associated with the CardioFlux magnetocardiography imaging technology. Table 18 below lists the long descriptors for the codes as well as the proposed SI and APC assignments.

Comment: A commenter disagreed with the assignment to APC 5722 and reported that the service associated with CPT code 0541T is not clinically and resource comparable to the services in the APC. The commenter stated that the service is clinically comparable to the services that are assigned to APCs 5593 and 5724, specifically:Start Printed Page 61228

  • APC 5593 (Level 3 Nuclear Medicine), with a proposed payment rate of $ 1,293.33, which includes—

+ CPT code 78451 (Myocardial perfusion imaging); and

+ CPT code 78452 (Myocardial perfusion imaging).

  • APC 5724 (Level 4 Diagnostic Tests and Related Services), with a proposed payment rate of approximately $ 920.66, which includes—

+ CPT code 95965 (Magnetoencephalography (MEG)); and

+ CPT code 95966 (Magnetoencephalography (MEG)).

The commenter indicated that this new technology requires the use of very expensive capital equipment, and added that the CardioFlux System costs about $1.5 million with a useful life of seven years. The technology itself involves hospital site implementation and ongoing operation. The commenter stated that the proposed payment does not provide adequate payment for this novel technology. The commenter expressed concern that the proposed low payment rate will severely limit uptake of this new technology, and, consequently, urged CMS to reassign CPT code 0541T to either APC 5593 or APC 5724 to ensure patient access to this emerging technology and its potential for savings to the Medicare program.

Response: Under the OPPS, one of our goals is to make payments that are appropriate for the services that are necessary for the treatment of Medicare beneficiaries. The OPPS, like other Medicare payment systems, is a prospective payment system. The payment rates that are established reflect the geometric mean costs associated with items and services assigned to an APC and we believe that our payment rates generally reflect the costs that are associated with providing care to Medicare beneficiaries in cost efficient settings. Moreover, we strive to establish rates that are adequate to ensure access to medically necessary services for Medicare beneficiaries.

For many emerging technologies there is a transitional period during which utilization may be low, often because providers are first learning about the techniques and their clinical utility. Quite often, the requests for higher payment amounts are for new procedures in that transitional phase. These requests, and their accompanying estimates for expected Medicare beneficiary or total patient utilization, often reflect very low rates of patient use, resulting in high per use costs for which requesters believe Medicare should make full payment. Medicare does not, and we believe should not, assume responsibility for more than its share of the costs of procedures based on Medicare beneficiary projected utilization and does not set its payment rates based on initial projections of low utilization for services that require expensive capital equipment.

We note that in a budget neutral environment, payments may not fully cover hospitals' costs, including those for the purchase and maintenance of capital equipment. We rely on hospitals to make their decisions regarding the acquisition of high cost equipment with the understanding that the Medicare program must be careful to establish its initial payment rates for new services that lack hospital claims data based on realistic utilization projections for all such services delivered in cost-efficient hospital outpatient settings. As the OPPS acquires claims data regarding hospital costs associated with new procedures, we annually review the claims data and any available new information regarding the clinical aspects of new procedures to confirm that our OPPS payments remain appropriate for procedures as they transition into mainstream medical practice.

In addition, we note this new technology is currently under clinical trial (ClinicalTrials.gov Identifiers: NCT03968809 and NCT04044391) and does not appear to be a service that is typically performed in an HOPD facility. Further, based on our clinical evaluation, we do not agree that CardioFlux MCG is similar to the MEG procedures described by CPT codes 95965 and 95966 since MEG procedures involve the brain while the CardioFlux technology involves imaging of the heart. Also, we do not agree that CardioFlux MCG is similar to the myocardial perfusion scans described by CPT codes 78451 and 78452 because these scans involve the use of radioactive tracers, specialized staff, and more time as the test generally takes two to four hours to complete. Furthermore, based on our findings, the CardioFlux MCG scan is unlike other cardiac imaging tests because it does not require or expose the patient to radiation, and takes about 90 seconds to perform with physician review and return of interpretation of the results in an estimated 5 minutes per patient.

However, based on our review of the issue and feedback from our medical advisors, as well as the anticipated operating costs per case derived from the public comment and publicly available information about the service, we believe that CPT code 0541T should be assigned to APC 5723 (Level 3 Diagnostic Tests and Related Services) rather than to APC 5722 (Level 2 Diagnostic Tests and Related Services). Because we have neither claims data nor specific HOPD costs, including the cost to perform each exam (other than the cost of the capital equipment that was supplied to us), we believe that APC 5723 is the most appropriate assignment at this time.

Therefore, after consideration of the public comment, we are finalizing our proposal, with modification, to assign CPT code 0541T to APC 5723. Table 18 list the long descriptors and final SI and APC assignments for both codes. The final CY 2020 payment rate for CPT code 0541T can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) meanings for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website.

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5. Cataract Removal With Endoscopic Cyclophotocoagulation (ECP) (APC 5492)

For CY 2020, the CPT Editorial Panel established two new codes to describe cataract removal with endoscopic cyclophotocoagulation (ECP), specifically, CPT codes 66987 and 66988. As listed in Table 19 below with the long descriptors, and also in Addendum B to the CY 2020 OPPS/ASC proposed rule, we proposed to assign CPT code 66987 and 66988 to APC 5491 (Level 1 Intraocular Procedures) with a proposed payment rate of $2,053.39. The codes were listed as 66X01 and 66X02 (the 5-digit CMS placeholder codes), respectively, in Addendum B with the short descriptors and again in Addendum O with the long descriptors. We also assigned the codes to comment indicator “NP” in Addendum B to indicate that they are new for CY 2020 and that public comments would be accepted on their proposed status indicator assignments. We note these codes will be effective January 1, 2020.

Comment: A commenter disagreed with the APC assignment and, based on their analysis of the combined geometric mean costs for the existing cataract and ECP procedures (CPT codes 66982, 66984, and 66711), believed the new codes should be reassigned to APC 5492 (Level 2 Intraocular Procedures) with a proposed payment rate of $3,867.16. Four professional ophthalmology organizations suggested that CMS should establish the payment rate for CPT code 66987 based on the combined costs of CPT codes 66711 and 66982, and, similarly, determine the payment rate for CPT code 66988 based on the combined costs of CPT codes 66711 and 66984. They expressed concern that the proposed payment rates for the codes do not adequately capture the resources hospitals will expend for each combined procedure.

Response: APC assignment for a code is not typically based on combined costs of existing HCPCS codes, rather, it is based on similarity to other codes within an APC based clinical homogeneity and resource costs. As specified in 42 CFR 419.31(a)(1), CMS classifies outpatient services and procedures that are comparable clinically and in terms of resource use into APC groups. Also, as we stated in the CY 2012 OPPS/ASC final rule (76 FR 74224), the OPPS is a prospective payment system that provides payment for groups of services that share clinical and resource use characteristics. It should be noted that, with all new codes, our policy has been to assign the service or procedure to an APC based on feedback from a variety of sources, including but not limited to review of the clinical similarity of the service to existing procedures; advice from CMS medical advisors; information from interested specialty societies; and review of all other information available to us, including information provided to us by the public, whether through meetings with stakeholders or additional information that is mailed or otherwise communicated to us.

Based on our analysis of the public comment and input from our medical advisors, we believe that we should Start Printed Page 61230revise the APC assignment for these new cataract codes. We reviewed the components of the procedure associated with CPT codes 66987 and 66988, and after our analysis, we agree with commenters that the resources associated with the new codes are higher than the routine cataract and ECP procedures when performed by themselves. Therefore, we are reassigning the new codes from APC 5491 to APC 5492.

In summary, after consideration of the public comments, we are finalizing our proposal with modification, and revising the APC assignment for CPT codes 66987 and 66988 to APC 5492 for CY 2020. Table 19 lists the final SI and APC assignments for the two codes. The final CY 2020 payment rate for the codes can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) meanings for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website.

We note that we will reevaluate the APC assignments for CPT codes 66987 and 66988 once we have claims data. We review, on an annual basis, the APC assignments for all services and items paid under the OPPS based on the latest claims data that we have available.

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6. Chimeric Antigen Receptor T-Cell (CAR T) Therapy (APCs 5694, 9035, and 9194)

Chimeric Antigen Receptor (CAR) T-cell therapy is a cell-based gene therapy in which T-cells are collected and genetically engineered to express a chimeric antigen receptor that will bind to a certain protein on a patient's cancerous cells. The CAR T-cells are then administered to the patient to attack certain cancerous cells and the individual is observed for potential serious side effects that would require medical intervention.

Two CAR T-cell therapies received FDA approval in 2017. KYMRIAH® (manufactured by Novartis Pharmaceuticals Corporation) was Start Printed Page 61232approved for use in the treatment of patients up to 25 years of age with B-cell precursor acute lymphoblastic leukemia (ALL) that is refractory or in second or later relapse. In May 2018, KYMRIAH® received FDA approval for a second indication, treatment of adult patients with relapsed or refractory large B-cell lymphoma after two or more lines of systemic therapy, including diffuse large B-cell lymphoma (DLBCL), high grade B-cell lymphoma, and DLBCL arising from follicular lymphoma. YESCARTA® (manufactured by Kite Pharma, Inc.) was approved for use in the treatment of adult patients with relapsed or refractory large B-cell lymphoma and who have not responded to or who have relapsed after at least two other kinds of treatment.

The HCPCS code to describe the use of KYMRIAH® (HCPCS code Q2042) has been active since January 1, 2019 for OPPS, which replaced HCPCS code Q2040, active January 1, 2018 through December 31, 2018, as discussed in the CY2019 OPPS/ASC final rule with comment period. The HCPCS code to describe the use of YESCARTA® (HCPCS code Q2041) has been active since April, 1, 2018 for OPPS. The HCPCS Q-code for the currently approved CAR T-cell therapies include leukapheresis and dose preparation procedures because these services are included in the manufacturing of these biologicals. Both of these CAR T-cell therapies were approved for transitional pass-through payment status, effective April 1, 2018. The HCPCS codes that describe the use of these CAR T-cell therapies were assigned status indicator “G” in Addenda A and B to the CY2020 OPPS/ASC proposed rule.

As discussed in section V.A.4. (Drugs, Biologicals, and Radiopharmaceuticals with New or Continuing Pass-Through Payment Status in CY 2019) of this final rule with comment period, we are finalizing our proposal to continue pass-through payment status for HCPCS code Q2042 and HCPCS code Q2041 for CY 2020. In section V.A.4. of this final rule with comment period, we also are finalizing our proposal to determine the pass-through payment rate following the standard ASP methodology, updating pass-through payment rates on a quarterly basis if applicable information indicates that adjustments to the payment rates are necessary.

The AMA created four Category III CPT codes that are related to CAR T-cell therapy, effective January 1, 2019. As discussed in the CY 2019 OPPS/ASC final rule with comment period, we finalized our proposal to assign procedures described by CPT codes, 0537T, 0538T, and 0539T to status indicator “B” (Codes that are not recognized by OPPS when submitted on an outpatient hospital Part B bill type (12x and 13x)) to indicate that the services are not paid under the OPPS. The procedures described by CPT codes 0537T, 0538T, and 0539T describe the various steps required to collect and prepare the genetically modified T-cells, and Medicare does not generally pay separately for each step used to manufacture a drug or biological. Additionally, we finalized that the procedures described by CPT code 0540T would be assigned status indicator “S” (Procedure or Service, Not Discounted when Multiple) and APC 5694 (Level IV Drug Administration) for CY 2019. Additionally, the National Uniform Billing Committee (NUBC) established CAR T-cell related revenue codes and value code to be reportable on Hospital Outpatient Department (HOPD) claims effective for claims received on or after April 1, 2019.

As listed in Addendum B of the CY 2020 OPPS/ASC proposed rule, we proposed to assign procedures described by these CPT codes, 0537T, 0538T, and 0539T, to status indicator “B” (Codes that are not recognized by OPPS when submitted on an outpatient hospital Part B bill type (12x and 13x)) to indicate that the services are not paid under the OPPS. We proposed to assign CPT code 0540T to status indicator “S” (Procedure or Service, Not Discounted when Multiple) and APC 5694 (Level IV Drug Administration).

At the August 19, 2019 meeting, the HOP Panel recommended that CMS reassign the status indicator for the procedures described by the specific CPT codes 0537T, 0538T, and 0539T from “B” to “Q1” for CY2020.

Comment: Several commenters opposed our proposal to continue to assign status indicator “B” to CPT codes 0537T, 0538T, and 0539T for CY2020. Commenters proposed a variety of alternative status indicators including status indicators “N”, “S”, and “Q1.” Commenters believed that CPT codes 0537T, 0538T, and 0539T did not represent the steps required to manufacture the CAR T product as CMS has stated. Generally, those advocating for status indicator “N” (Items and Services Packaged into APC Rates) stated that this assignment would ease the billing burden and confusion experienced by providers under the current status indicator assignment of “B”. Generally, those advocating for status indicator “S” (Procedure or Service, Not Discounted When Multiple) believed that separate payment is warranted for these services as they are distinct procedures and are ordered and performed by clinicians. Finally, generally those advocating for status indicator “Q1”, indicating conditional separate payment, supported the HOP Panel's recommendation to assign this status indicator based on codes, such as CPT code 0565T (placeholder code 05X3T) (Autologous cellular implant derived from adipose tissue for the treatment of osteoarthritis of the knees; tissue harvesting and cellular implant creation). CPT code 0565T has a status indicator of “Q1” and commenters believe it is similar to the procedures described by CPT codes 0537T, 0538T, and 0539T, since CPT code 0565T involves the collection and harvest of cells, in the form of tissue, for the treatment of osteoarthritis of the knee. Additionally, commenters stated that the HCPCS drug Q-codes (Q2041 and Q2042) should be revised to eliminate the language referencing leukapheresis and dose preparation procedures.

Response: We thank the commenters for their feedback. CMS does not believe that separate or packaged payment under the OPPS is necessary for the procedures described by CPT codes 0537T, 0538T, and 0539T for CY2020. The existing CAR T-cell therapies on the market were approved as biologics and, therefore, provisions of the Medicare statute providing for payment for biological products apply. The procedures described by CPT codes 0537T, 0538T, and 0539T describe the various steps required to collect and prepare the genetically modified T-cells and Medicare does not generally pay separately for each step used to manufacture a drug or biological product. Additionally, we note that CAR T-cell therapy is a unique therapy approved as a biologic, with unique preparation procedures, and it cannot be directly compared to other therapies or existing CPT codes. We note that the current HCPCS coding for the currently approved CAR T-cell therapy drugs, HCPCS codes Q2041 and Q2042, include leukapheresis and dose preparation procedures as these services are including in the manufacturing of these biologicals. Therefore, payment for these services is incorporated into the drug Q-codes. We note that although there is no payment associated with 0537T, 0538T, and 0539T for reasons stated previously, these codes can still be reported to CMS for tracking purposes. Additionally, HOPDs can bill Medicare for reasonable and necessary services that are otherwise payable under the OPPS, and we believe that the comments in reference to payment for services in settings not payable under Start Printed Page 61233the OPPS are outside the scope of this proposed rule.

Accordingly, we are not revising the existing Q-codes for CAR T-cell therapies to remove leukapheresis and dose preparation procedures, and we are not accepting the recommendations to revise the status indicators for procedures described by CPT codes 0537T, 0538T, and 0539T. We will continue to evaluate and monitor our payment for CAR T-cell therapies.

Comment: We note that commenters were supportive of the decision to continue the assignment of status indicator “S” (Procedure or Service, Not Discounted When Multiple) to CPT code 0540T.

Response: We thank commenters for their support and are finalizing our proposal to maintain status indicator “S” for CPT code 0540T.

Comment: Some commenters recommended CMS evaluate modifications to CAR T-cell payments for future rule making years, including strategies such as creating a new statutory benefit category for cell and gene therapies and value-based payment. Specifically, commenters suggested value-based payments could include milestone-based payments over time, indication-based pricing or combination-based pricing.

Response: We thank commenters for their feedback. Currently, the existing CAR T-cell therapies on the market were approved as biologics and, therefore, provisions of the Medicare statute providing for payment for biologicals apply. In regards to the creation of a new statutory benefit category, that is out of the scope of existing CMS statutory authority.

In summary, after consideration of the public comments we received, we are finalizing our proposal to assign status indicator “B” to CPT codes 0537T, 0538T, and 0539T for CY2020. Additionally, we are continuing our policy from CY2019 to assign status indicator “S” to CPT code 0540T for CY2020. Tables 20 and 21 below show the final SI and APC assignments for HCPCS codes Q2041, Q2042, 0537T, 0538T, 0539T, and 0540T for CY 2020. We refer readers to Addendum B to this final rule with comment period for the payment rates for all codes reportable under the OPPS. Addendum B is available via the internet on the CMS website. In addition, we refer readers to Addendum D1 to this final rule with comment period for the complete list of the OPPS payment status indicators and their definitions for CY2020.

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7. Colonoscopy and Sigmoidoscopy With Endoscopic Mucosal Resection (EMR) (APC 5313)

For CY 2020, we proposed to continue to assign CPT codes 45349 and 45390 to APC 5312 (Level 2 Lower GI Procedures), with a proposed payment rate of $1,024.08. The long descriptors and proposed SI and APC assignments for both codes can be found in Table 22 below.

Comment: A commenter believed that the two procedures are different from the other procedures currently assigned to APC 5312, and stated they are more similar to these procedures that are assigned to APC 5313:

  • 46610 (Anoscopy; with removal of single tumor, polyp, or other lesion by hot biopsy forceps or bipolar cautery);
  • 46612 (Anoscopy; with removal of multiple tumors, polyps, or other lesions by hot biopsy forceps, bipolar cautery or snare technique); and
  • 46615 (Anoscopy; with ablation of tumor(s), polyp(s), or other lesion(s) not amenable to removal by hot biopsy forceps, bipolar cautery or snare technique) where lesions are being removed by methods other than just the snare wire technique.

Based on clinical and resource homogeneity, the commenter requested a reassignment from APC 5312 to APC 5313 (Level 3 Lower GI Procedures), which had a proposed payment rate of $2,512.28, for CPT code 45349 and 45390

Response: Upon review of data available for this final rule with comment period, we agree with the commenter that the most appropriate assignment for both codes is APC 5313. Based on the latest hospital outpatient claims data used for this final rule with comment period, our analysis supports the reassignment for the codes to APC 5313. Specifically, our analysis of the claims data show a geometric mean cost of approximately $1,941 for CPT code 45349 based on 386 single claims (out of 387 total claims), and a geometric mean cost of about $2,039 for CPT code 45390 based on 10,212 single claims (out of 10,246). In both instances, the geometric mean cost for the codes are most compatible with APC 5313, whose geometric mean cost is approximately $2,294, compared to APC 5312, whose geometric mean cost is about $983. We believe that maintaining both codes in APC 5312 would underpay for the procedures. Therefore, we are reassigning the codes from APC 5312 to APC 5313 for CY 2020.

In summary, after consideration of the public comment, we are finalizing our proposal with modification, and revising the APC assignment for 45349 and 45390 from APC 5312 to APC 5313 for CY 2020. Table 22 lists the final SI and APC assignments for the two codes. The final CY 2020 payment rate for the codes can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) meanings for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website.

As we do every year, we will reevaluate the APC assignment for CPT codes 45349 and 45390 in the next rulemaking cycle. We remind hospitals that we review, on an annual basis, the APC assignments for all services and items paid under the OPPS based on the latest claims data available to us.

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8. Coronary Computed Tomographic Angiography (CCTA) (APC 5571)

For CY 2020, we proposed to continue to assign CPT codes 75572, 75573, and 75574 to APC 5571 (Level 1 Imaging with Contrast) with a proposed payment rate of $179.91. The long descriptors and proposed status indicator (SI) and APC assignments for the codes can be found in Table 23 below.

Comment: Many commenters expressed concern with the decreased reimbursement for the codes and stated that the proposed payment rate underestimates the resources necessary to provide the service. They noted this is the third consecutive year of decreased reimbursement for cardiac CT. Some commenters added that the exams described by CPT codes 75572, 75573, and 75574 require more resources than the contrast-enhanced studies in APC 5571 because they require more time, are performed by highly trained technologists, involve higher risk patients, require administration of vasoactive medications, and require close supervision of patients during and after the procedure. A commenter urged CMS to reassign the codes to a higher paying APC that is more resource intensive and includes procedures that share similar clinical characteristics, such as APC 5572 (Level 2 Imaging with Contrast), which had a proposed payment rate of $373.45, or APC 5573 (Level 3 Imaging with Contrast), which had a proposed payment rate of $682.96. Other commenters specifically requested a reassignment to APC 5573 based on clinical and resource homogeneity to these services that are assigned to the APC: Stress cardiac magnetic resonance imaging (CPT code 75563), stress echocardiography (HCPCS codes C8928, C8930), and nuclear SPECT MPI (CPT codes 78451, 78452). One commenter recommended the reassignment of CPT code 75574 to APC 5191 (Level 1 Endovascular Procedures) with a proposed payment rate of $2,899.34 and believed the service is very similar to a cardiac catheterization procedure that is described by CPT code 93455 (Catheter placement in coronary artery(s) for coronary angiography, including intraprocedural injection(s) for coronary angiography, imaging supervision and interpretation; with catheter placement(s) in bypass graft(s) (internal mammary, free arterial, venous grafts) including intraprocedural injection(s) for bypass graft angiography). This same commenter suggested that the less-intensive CPT codes 75572 and 75573 be reassigned to APC 5572.

Response: CPT codes 75572, 75573, and 75574 were effective January 1, 2010, and prior to that they were described by Category III CPT codes from January 1, 2006 through December 31, 2009; therefore, we have many years of claims data associated with these services. For this final rule with comment period, based on claims submitted between January 1, 2018 through December 30, 2018, that were processed on or before June 30, 2019, our analysis of the latest claims data for this final rule supports maintaining CPT codes 75572, 75573, and 75574 in APC 5571. Specifically, our claims data show a geometric mean cost of approximately $159 for CPT code 75572 based on 12,299 single claims (out of 23,902 total claims), $185 for CPT code 75573 based on 323 single claims (out of 466 total claims), and $196 for CPT code 75574 based on 25,434 single claims (out of 40,219 total claims). Because the geometric mean costs for the CCTA codes range are between $159 and $196, we believe it would be inappropriate to reassign the codes to these suggested APCs because their geometric mean costs are significantly higher:

  • APC 5572 (with geometric mean cost of about $359)
  • APC 5573 (with a geometric mean cost of approximately $660)
  • APC 5191 (with a geometric mean cost of about $2,788)

In our analysis to determine the cause of the decreased payment rates for the last several years, we also reviewed our claims data to determine whether changes in payment for certain computed tomography (CT) services impacted the OPPS payment rates. Specifically, section 218(a)(1) of the Protecting Access to Medicare Act of 2014 (PAMA) (Pub. L. 113-93) amended section 1834 of the Act by establishing a new subsection 1834(p). Effective for services furnished on or after January 1, 2016, section 1834(p) of the Act reduces payment for the technical component (TC) of applicable CT services paid under the MPFS and applicable CT services paid under the OPPS, with a 5-percent reduction required in 2016 and a 15-percent reduction required in 2017 and subsequent years. The applicable CT services are identified by HCPCS codes 70450 through 70498; 71250 through 71275; 72125 through 72133; 72191 through 72194; 73200 through 73206; 73700 through 73706; 74150 through 74178; 74261 through 74263; and 75571 through 75574 (and any succeeding codes) for services furnished using equipment that does not meet each of the attributes of the National Electrical Manufacturers Association (NEMA) Standard XR-29-2013, entitled “Standard Attributes on CT Equipment Related to Dose Optimization and Management.”

In the CY 2016 OPPS/ASC final rule with comment period (80 FR 70470), we established a new “CT” modifier to be used on claims that include CT services furnished using equipment that does not meet each of the attributes of NEMA Standard XR-29-2013. Hospitals are required to report the “CT” modifier on claims for CT scans described by any of the HCPCS codes we identified (and any Start Printed Page 61236successor codes) that are furnished on non-NEMA Standard XR-29-2013-compliant CT scanners. The use of this modifier results in the applicable payment reduction for the CT service, as specified under section 1834(p) of the Act.

Based on our analysis, we observed declining use of the CT modifier in both billing volume and the number of providers using the modifier over the past several years. Further, we note that the payment reduction required by section 1834(p), as amended by section 218(a)(1) of PAMA, does not directly affect the geometric mean costs under the OPPS, because we do not use payment rates to establish CCRs, rather we use the charges submitted by hospitals on claims and costs estimated through applying the cost report CCRs for modeling purposes. The application of the payment reductions associated with the CT modifier only occurs after the prospective OPPS payments are already calculated.

Comment: Some commenters recommended the establishment of a new cost center specific to CCTA. They noted that hospitals currently do not submit any cost center data for cardiac CT services.

Response: We thank the commenters for their suggestion. CMS is currently reviewing non-standard cost centers used frequently in the Medicare cost report in order to establish additional standardized reporting. We will consider the establishment of a new cost center specific to cardiac CT services in our review.

In summary, after consideration of the public comments and after our analysis of the latest claims data, we are finalizing our proposal, without modification, to assign CPT codes 75572, 75573, and 75574 to APC 5571 for CY 2020. Table 23 lists the final SI and APC assignments for the three codes. The final CY 2020 payment rate for the codes can be found in Addendum B to this final rule with comment period (which is available via the internet on the CMS website).

As we do every year, we will reevaluate the APC assignment for CPT codes 75572, 75573, and 75574 for the next rulemaking cycle. We remind hospitals that we review, on an annual basis, the APC assignments for all services and items paid under the OPPS based on the latest claims data.

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9. Deep Brain Stimulation (DBS) Programming (APC 5742)

In CY 2018, the DBS programming codes were described by CPT code 95978 (first 60 minutes), which was assigned to APC 5742, with a payment of $115.18, and CPT code 95979 (each additional 30 minutes), which was assigned to SI “N” to indicate that the code is packaged since it is an add-on code. For CY 2019, the CPT Editorial Panel deleted CPT code 95978 and replaced it with CPT code 95983 (first 15 minutes) effective January 1, 2019. Similarly, CPT code 95979 was deleted and replaced with CPT code 95984 (each additional 15 minutes) effective January 1, 2019. As a result of this coding change, we assigned the 15-minute CPT code 95983 to APC 5741 (Level 1 Electronic Analysis of Devices) with a payment rate of $37.16, and assigned CPT code 95984 to “N” to indicate that the code is packaged because it describes an add-on service, which is similar to the SI for its predecessor code (CPT code 95979). Table 24 below list the long descriptors and proposed SI and APC assignments for CPT codes 95983 and 95984.

At the August 21, 2019 HOP Panel Meeting, a presenter requested that the 15-minute CPT code 95983 be reassigned to APC 5742. The presenter added that the cost of providing the service from 2018 to 2019 has not changed but the reimbursement has reduced the hospital payment by about $100. The presenter requested an APC modification for CPT code 95983 from APC 5741 to APC 5742 so that hospitals receive adequate payment for providing the service. Based on the information presented at the meeting, the HOP Panel recommended a reassignment to APC 5742 for CPT code 95983. Specifically, the Panel recommended that “CMS move HCPCS code 95983, Electronic analysis of implanted neurostimulator pulse generator/transmitter (e.g., contact group[s], interleaving, amplitude, pulse width, frequency [hz], on/off cycling, burst, magnet mode, dose lockout, patient selectable parameters, responsive neurostimulation, detection algorithms, closed loop parameters, and passive parameters) by physician or other qualified health care professional; with brain neurostimulator pulse generator/transmitter programming, first 15 minutes face-to-face time with physician or other qualified health care professional, to APC code 5472, Level II Electronic Analysis of Devices, if the final data that are available in time for consideration of the Final Rule are consistent with preliminary data.”

For CY 2020, we proposed to continue to assign CPT code 95983 to APC 5741 (Level 1 Electronic Analysis of Devices) with a proposed payment rate of $36.81. In addition, we proposed to continue to assign CPT code 95984 to status indicator (SI) “N” to indicate that the code is an add-on that is packaged and payment for it is included in the primary service. In this case, the payment for the add-on code is included in CPT code 95983.

Comment: Several commenters requested the reassignment of CPT code 95983 to APC 5742. One commenter stated that the assignment of the primary CPT code 95983 to the lower level APC 5741 is not appropriate because the overall time and resources expended by a hospital when furnishing this service in the HOPD setting remains the same, even if the units are billed differently. This same commenter indicated that, based on the coding descriptor for the replacement codes with the primary service described as the first 15-minutes and the secondary service as each additional 15-minutes, hospitals will continue to receive a single line-item payment for the service, with the payment for the add-on CPT code packaged into it, regardless of the number of units billed. Another commenter stated that reassigning the code from APC 5741 to APC 5742 will have no effect on the geometric mean cost of either APC. Another commenter requested the reassignment based on the geometric mean cost of approximately $109 for the predecessor code (CPT code 95978) and the Panel's recommendation at the August 19, 2019 HOP Panel Meeting.

Response: As noted above, the predecessor CPT code 95978 described a 60-minute service, while the replacement code—CPT code 95983—describes a 15-minute service. Based on the new time specified in the descriptor for CPT code 95983, we believed that assigning the replacement code to APC 5741 was appropriate. However, at the August 21, 2019 HOP Panel meeting, the presenter indicated that the service of providing DBS programming during 2018 and 2019 are the same, but because of the coding change that packages any service after each additional 15 minutes, the maximum payment that a hospital would receive for the service is a single unit of the code. The presenter recommended a change in the APC assignment to APC 5742 so that hospitals receive adequate payment for the service based on the coding structure of the replacement codes.

As recommended by the HOP Panel, we reviewed the claims data associated with the predecessor code (CPT code 95978). Based on the latest hospital outpatient claims data used for this final rule with comment period, our analysis reveals a geometric mean cost of approximately $109 for the code, which is consistent with the geometric mean cost of about $111 for APC 5742 compared to APC 5741 whose geometric mean cost is about $35. Based on the information presented at the HOP Panel Meeting, the Panel's recommendation, as well as the final rule claims data, we agree with the commenters that APC 5741 may not adequately reflect the resources to provide the service described by CPT code 95983 and are, therefore, modifying the assignment for CPT code 95983 to APC 5742.

In summary, after consideration of the public comments and the presentation at the August 21 HOP Panel Meeting, we are finalizing our proposal, with modification, and revising the APC assignment for CPT code 95983 to APC 5742 for CY 2020. Table 24 list the final SI and APC assignments for CPT code 95983 and 95984. The final CY 2020 payment rate for CPT code 95983 can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) meanings for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website.

As we do every year, we will reevaluate the APC assignment for CPT code 95983 for the next rulemaking cycle. We remind hospitals that we review, on an annual basis, the APC assignments for all services and items paid under the OPPS.

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10. Extracorporeal Shock Wave Lithotripsy (ESWL) (APC 5374)

For the CY 2019 OPPS/ASC final rule, we reviewed all of the procedures assigned to the Urology Procedures APCs, specifically, APCs 5371 through 5377, and made some modifications to more appropriately reflect the resource costs and clinical characteristics of the services within each APC grouping. Specifically, we revised the APC assignment of the procedures assigned to the family of Urology APCs to more appropriately reflect a prospective payment system that is based on payment groupings and not code-specific payment rates, while maintaining clinical and resource homogeneity. As we stated in the CY 2019 OPPS/ASC final rule (83 FR 58900), this modification was based on public comments we received in response to the CY 2019 OPPS/ASC proposed rule on the proposed APC assignments for certain urology procedures.

We received many comments on the APC reassignment for the extracorporeal shock wave lithotripsy (ESWL) procedure, which is described by CPT code 50590 (Lithotripsy, extracorporeal shock wave), in the CY 2019 OPPS/ASC final rule with comment period. The commenters indicated there was no discussion in the preamble on the reassignment of the code from APC 5375 (Level 5 Urology and Related Services) to APC 5374 (Level 4 Urology and Related Services), and they disagreed with the revision and believed that APC 5375 was the more appropriate assignment for the code. We remind the commenters that, as we have stated in every OPPS/ASC proposed and final rules, we review, on an annual basis, the APC assignments for all services and items paid under the OPPS based on our analysis of the latest claims data. Based on updated claims data for the final rule for CY 2019, we found that the geometric mean cost of approximately $3,265 for CPT code 50590 did not support its continued assignment to APC 5375, which had a geometric mean cost of about $4,055. We believed that we would have significantly overpaid for the procedure had we maintained the assignment to APC 5375. Consequently, we revised the APC assignment for CPT code 50590 to APC 5374, which had a geometric mean cost of approximately $2,952 for CY 2019.

We note that the SI and APC assignment for CPT code 50590 were subject to comment in the CY 2019 OPPS/ASC proposed rule but not in the CY 2019 OPPS/ASC final rule with comment period. Nevertheless, we received comments on this specific issue in response to the CY 2019 OPPS/ASC final rule with comment period. Because CPT code 50590 was not assigned to comment indicator “NI” in the final rule because it was not a new code for CY 2019, and therefore, the comments received related to this code Start Printed Page 61240were out-of-scope. Nonetheless, we discuss above to provide some clarity to this issue.

For CY 2020, as listed in Addendum B to the proposed rule, we proposed to maintain the APC assignment for CPT code 50590 to APC 5374 with a proposed payment rate of $3,059.21.

Comment: Some commenters requested that we restore the code to APC 5375 where it had been placed for several years prior to CY 2019. The commenters indicated that CPT code 50590 is similar to two ureteroscopy with lithotripsy (URSL) procedures that are assigned to APC 5375, specifically:

  • CPT code 52353 (Cystourethroscopy, with ureteroscopy and/or pyeloscopy; with lithotripsy (ureteral catheterization is included)); and
  • CPT code 52356 (Cystourethroscopy, with ureteroscopy and/or pyeloscopy; with lithotripsy including insertion of indwelling ureteral stent (e.g., gibbons or double-j type)).

In addition, some commenters suggested that placing the three procedures in two separate APCs may create an unintended consequence of unplanned admissions to the hospital. Specifically, the commenters indicated that if the proposed assignment for CPT code 50590 is finalized in APC 5374, while CPT codes 52353 and 52356 are finalized in APC 5375, hospitals might discontinue ESWL services (described by CPT code 50590) which would make it less accessible to Medicare beneficiaries and, ultimately, encourage hospitals to perform more URSL procedures, which, according to the commenter, have higher complication rates compared to ESWL. These commenters asserted that 90 percent of Medicare patients require an indwelling ureteral stent after a URSL procedure (described by CPT codes 52353 and 52356), and that the stents lead to infection, visits to the ER, and unplanned admissions. Hence, the commenters requested an APC reassignment to APC 5375 for CPT code 50590 to eliminate any unintended consequences.

Further, the commenters noted that because of the capital equipment expense associated with purchasing ($500,000) and maintaining ($65,000 per year) a lithotripter, hospitals rarely own their own lithotripter and generally contract under arrangement with suppliers to provide the service. Alternatively, the commenter asserted that all URSL equipment is owned by the hospitals furnishing the service and that the hospitals are therefore able to train clinicians on the equipment.

Response: As discussed above, we revised the APC assignment for CPT code 50590 based on our analysis of the latest claims data for the CY 2019 final rule. For this final rule with comment period, which is based on claims submitted between January 1, 2018 through December 30, 2018, that were processed on or before June 30, 2019, our findings do not support a reassignment to APC 5375. Instead, our analysis supports retaining CPT code 50590 in APC 5374. Specifically, our data reveal a geometric mean cost of approximately $3,247 for CPT code 50590 based on 40,009 single claims (out of 40,351 total claims). The geometric mean cost for APC 5374 is about $2,953 while APC 5375 shows a geometric mean cost of approximately $4,140. Based on the geometric mean cost, we believe that maintaining CPT code in APC 5374 is more appropriate than reassigning it to APC 5375, based on the geometric mean cost of CPT code 50590 relative to that of APCs 5374 and 5375.

In addition, we note that the resource costs associated with the URSL procedures (CPT codes 52353 and 52356) are higher than that of ESWL (CPT code 50590). Specifically, the geometric mean cost for CPT code 50590 for CY 2020 is $3,247 while the geometric mean cost for CPT codes 52353 and 52356 are $3,740 and $4,361, respectively. The geometric mean cost of $3,247 for CPT code 50590 falls within APC 5374, whose geometric mean costs for the significant procedures range between $2,495 (for CPT code 52351) and $3,472 (for CPT code 52318), while the geometric mean costs of $3,740 and $4,361 for CPT codes 52353 and 52356, respectively, fall within APC 5375, whose geometric mean costs for the significant procedures range between $3,575 (for CPT code 52630) and $5,655 (for CPT code 55875). Although all three procedures are used for the treatment of kidney stones, we disagree that CPT codes 50590, 52353, and 52356 are similar based on resource and clinical homogeneity. With regards to unintended consequences as a result of the assignment to APC 5374 for CPT code 50590, we rely on physicians to provide appropriate care based on the needs of their patients. While the payment rate for services assigned to APC 5375 is higher than that of APC 5374, it is based on the relative resources associated with furnishing the services assigned to that APC. While each of the lithotripsy procedures have some clinical similarity, as the commenters pointed out, they have clinical differences. While the commenters expected that these clinical differences may result in similar or higher resources for CPT code 50590 compared to CPT codes 52353 and 52356, that has not been borne out in the Medicare data we have available. As we do every year, we will review the claims data associated with CPT code 50590 to determine its appropriate APC placement for the next rulemaking update.

Comment: Some commenters suggested, based on their analysis of the OPPS Limited Data Sets (LDS) for the CY 2018 OPPS/ASC final rule, the CY 2019 OPPS/ASC final rule, and the CY 2020 OPPS/ASC proposed rule, that the methodology formula that was supplied with the LDS materials was flawed and, therefore, they were unable to validate CMS's calculation or the accuracy of the cost data upon which CMS relied to determine the payment rates. In addition, these same commenters suggested that because hospitals do not generally own lithotripters, they would not be surprised if the cost reports for CPT code 50590 were inaccurate.

Response: It is generally not our policy to judge the accuracy of hospital coding and charging for purposes of ratesetting. We rely on hospitals to accurately report the use of HCPCS codes in accordance with their code descriptors and CPT and CMS instructions, and to report services on claims and charges and costs for the services on their Medicare hospital cost report appropriately. We do not specify the methodologies that hospitals use to set charges for this or any other service. In addition, we state in Chapter 4 of the Medicare Claims Processing Manual that “it is extremely important that hospitals report all HCPCS codes consistent with their descriptors; CPT and/or CMS instructions and correct coding principles, and all charges for all services they furnish, whether payment for the services is made separately paid or is packaged” to enable CMS to establish future ratesetting for OPPS services.

Comment: To pay appropriately for CPT code 50590, some commenters suggested adding the cost of a ureteral stent in calculating the geometric mean cost since some procedures (less than 20 percent) require the device. They noted that the URSL procedure described by CPT code 52356 requires the insertion of a ureteral stent that costs $609.16.

Response: Geometric mean costs are determined based on the costs reported on the claim. If the CPT code descriptor describes the insertion of a device, we would expect the device cost to be packaged into the cost of the procedure Start Printed Page 61241since the charges associated with the device and its insertion should be reflected in claims submitted to Medicare. We note that the CPT code descriptor for the URSL procedures (CPT codes 52353 and 52356) describes the use of stents, consequently, the geometric mean cost for the procedures include the packaged cost of the devices. However, the CPT code descriptor for the ESWL procedure does not describe the use of a ureteral stent, so we disagree that device costs for a ureteral stent should be included in CPT code 50590. If a ureteral stent were involved in an ESWL procedure, HOPDs should report the CPT code that appropriately describes the procedure performed. Moreover, as we have stated previously, we rely on HOPDs to accurately report all HCPCS codes consistent with their descriptors; CPT and/or CMS instructions and correct coding principles, and all charges for all services they furnish, whether payment for the services is made separately paid or is packaged.

In summary, after consideration of the public comments and after our analysis of the updated claims data for this final rule with comment period, we are finalizing our proposal, without modification, to continue to assign CPT code 50590 to APC 5374 for CY 2020. The final CY 2020 payment rate for the code can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) meanings for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website.

As always, we will reevaluate the APC assignment for CPT code 50590 for the next rulemaking cycle. As stated above, we review, on an annual basis, the APC assignments for all services and items paid under the OPPS.

11. Extravascular Implantable Cardioverter Defibrillator (EV ICD)

As displayed in Table 25 and in Addendum B to the CY 2020 OPPS/ASC proposed rule, we proposed to assign CPT codes 0571T through 0580T to status indicator (SI) “E1” to indicate that the codes are not payable by Medicare when submitted on outpatient claims (any outpatient bill type) because the services associated with these codes are either not covered by any Medicare outpatient benefit category, are statutorily excluded from Medicare payment, or are not reasonable and necessary. The codes were listed as 06X0T through and 07X4T (the 5-digit CMS placeholder codes) in Addendum B with the short descriptors, and again in Addendum O with the long descriptors. We also assigned the codes to comment indicator “NP” in Addendum B to indicate that they are new for CY 2020 and that public comments would be accepted on their proposed status indicator assignments. We note that these codes will be effective January 1, 2020.

Comment: A commenter reported that the device associated with these codes is in a clinical trial and also received FDA approval with an IDE Category B designation. The commenter added that they are currently in the process of applying for Medicare national coverage for the clinical trial as a Category B IDE study. The commenter requested that we crosswalk the new codes to the SIs and APC assignments of comparable procedures involving ICD placement so that appropriate hospital outpatient payment may be made in the event the Category B IDE study is approved for Medicare coverage. The commenter listed the comparable codes with the SI and APCs assignments.

Response: Based on our review, the clinical trial has not met Medicare's standards for coverage, nor does it appear on the CMS Approved IDE List, which can be found at this CMS website: https://www.cms.gov/​Medicare/​Coverage/​IDE/​Approved-IDE-Studies.html. Because the clinical trial associated with these codes has not been approved for Medicare coverage, we believe we should continue to assign CPT codes 0571T through 0580T to status indicator “E1” for CY 2020. If Medicare approves the clinical trial as a Category B IDE study, we will reassess the SI and APC assignments for the codes.

Therefore, after consideration of the public comment received, we are finalizing our proposal without modification for CPT codes 0571T through 0580T. The final status indicator assignments for both codes are listed in Table 25 below. We refer readers to Addendum D1 of this final rule with comment period for the complete list of the OPPS payment status indicators and their definitions for CY 2020. Addendum D1 is available via the internet on the CMS website.

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12. Genicular and Sacroiliac Joint Nerve Injections/Procedures (APCs 5442 and 5431)

For CY 2020, the CPT Editorial Panel established four new codes to describe genicular and sacroiliac joint nerve injections and procedures. As listed in Table 26 below with the long descriptors, and also in Addendum B to the CY 2020 OPPS/ASC proposed rule, we proposed to assign CPT codes 64451 and 64454 to APC 5442 (Level 2 Nerve Injections) with a proposed payment rate of $627.39. We note both CPT codes 64451 and 64454 describe therapeutic and/or diagnostic injection procedures. We also proposed to assign CPT code 64624 to APC 5443 (Level 3 Nerve Injections) with a proposed payment rate of $808.58. In addition, we proposed to assign CPT code 64625 to APC 5431 (Level 1 Nerve Procedures) with a proposed payment rate of $1,747.26. CPT codes 64451, 64454, 64624, and 64625 were listed as 6XX00, 64XX0, 64XX1, and 6XX01 (the 5-digit CMS placeholder codes), respectively, in Addendum B with the short descriptors, and again in Addendum O with the long descriptors. We also assigned these codes to comment indicator “NP” in Addendum B to indicate that the codes are new for CY 2020 and that public comments would be accepted on their proposed status indicator assignments. We note that these codes will be effective January 1, 2020.

Comment: Several commenters disagreed with the APC assignment for CPT code 64624 (shown in the proposed rule with placeholder code 64XX1) and suggested that it would be more appropriate, based on clinical homogeneity, to assign it to APC 5431, where similar radiofrequency ablation procedures are assigned, specifically, CPT codes 64633 (Destruction by neurolytic agent, paravertebral facet joint nerve(s), with imaging guidance (fluoroscopy or ct); cervical or thoracic, single facet joint), 64635 (Destruction by neurolytic agent, paravertebral facet joint nerve(s), with imaging guidance Start Printed Page 61244(fluoroscopy or ct); lumbar or sacral, single facet joint), and new CPT code 64625. Several commenters reported that, unlike CPT code 64640 (Destruction by neurolytic agent; other peripheral nerve or branch) which only involves one nerve, the procedure described by CPT code 64624 requires more expensive medical equipment and supplies and involves the destruction of three nerves. Most commenters agreed that the procedure is not a nerve injection. One commenter explained that the procedure describes the destruction of three nerve branches at three locations in the knee, and the destruction is typically done via radiofrequency ablation similar to those procedures described by CPT codes 64633 and 64635 that are assigned to APC 5431. Another commenter suggested that reassigning CPT code 64624 to APC 5431, similar to new CPT code 64625, would provide adequate reimbursement for the procedure and enable providers to offer patients with chronic knee pain an effective alternative to systemic opioids.

Response: After consideration of the public comments, and based on the characteristics of the procedure, as well as input from our medical advisors, we believe that it would be appropriate to revise the APC assignment for CPT code 64624 from APC 5443 to APC 5431. We agree with the commenters that this new procedure shares similar characteristics with CPT codes 64633 and 64635 that are assigned to APC 5431.

Comment: A commenter agreed with the proposed APC assignments for CPT codes 64451, 64454, and 64425.

Response: We thank the commenter for their feedback and are finalizing the APC assignments for these codes.

In summary, after consideration of the public comments, we are finalizing our proposal with modification. Specifically, we are finalizing the APC assignments for CPT codes 64451, 64454, and 64425 to the APCs listed in Table 26. In addition, we are revising the APC assignment for CPT code 64624 from APC 5443 to APC 5431. Table 26 lists the long descriptors for the codes, as well as the final APC and SI assignments for all four codes. The final CY 2020 payment rate for the codes can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) meanings for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website.

As always, we will reevaluate the APC assignment for these codes once we have claims data. We review, on an annual basis, the APC assignments for all services and items paid under the OPPS based on the latest claims data that we have available.

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13. FemBloc® and FemChec®

For CY 2020, the CPT Editorial Panel established two new codes to describe FemBloc (0567T) and FemChec (0568T). As listed in Table 27 with the long descriptors, and in Addendum B to the CY 2020 OPPS/ASC proposed rule, we proposed to assign CPT code 0567T to APC 5414 (Level 4 Gynecologic Procedures) and status indicator (SI) “J1” (Hospital Part B services paid through a comprehensive APC) with a payment rate of $2,564.60. In addition, we proposed to assign new CPT code 0568T to APC 5732 (Level 2 Minor Procedures) and status indicator “Q1” (conditionally packaged) with a payment rate of $34.33. The codes were listed as 05X1T and 05X2T (the 5-digit CMS placeholder codes), respectively, in Addendum B with the short descriptors, and again in Addendum O with the long descriptors. We also assigned these codes to comment indicator “NP” in Addendum B to indicate that the codes are new for CY 2020 and that public comments would be accepted on their proposed status indicator assignments. We note these codes will be effective January 1, 2020.

Comment: A medical technology company disagreed with the proposed APC assignment for CPT code 0567T and suggested that we reassign the procedure code from APC 5414 to APC 5415 (Level 5 Gynecologic Procedures) with a proposed payment rate of $4,426.45. The commenter noted that the single-use, disposable device associated with the code contains two deployable and retractable balloon catheters and a biopolymer that retails for $1,800. The commenter believes the procedure more appropriately fits in APC 5415 based on its similarity to CPT code 58565 (Hysteroscopy, surgical; with bilateral fallopian tube cannulation to induce occlusion by placement of permanent implants). Specifically, the commenter explained that in both procedures, specifically CPT codes Start Printed Page 6124658565 and 0567T, the entrances to the fallopian tubes are accessed and a device is placed that causes permanent occlusion of the tubes.

Response: Based on our findings associated with FemBloc, the procedure is currently in clinical trial with an estimated study completion date of September 2022 (ClinicalTrials.gov Identifier: NCT03067272). Because the FemBloc device has not received FDA approval, we believe that we should reassign CPT code 0567T to status indicator “E1” to indicate that the code is not payable by Medicare when submitted on outpatient claims (any outpatient bill type). If FDA approves the device, we will reassess the code and determine the appropriate SI and APC assignments.

Comment: The same commenter for FemBloc also requested an APC modification for the code associated with FemChec. Specifically, the commenter requested the reassignment for CPT code 0568T from APC 5732 (Level 2 Minor Procedures) to APC 5523 (Level 3 Imaging without Contrast) with a proposed payment rate of $231.28. The commenter reported that the code is more clinically related to one of the procedures assigned to APC 5523, specifically, CPT code 76831 (Saline infusion sonohysterography (sis), including color flow doppler, when performed). Both CPT codes 0568T and 76831 require ultrasound and saline to study the uterus.

Response: Our findings reveal that the clinical study associated with FemBloc also applies to FemChec. Based on the clinical study (ClinicalTrials.gov Identifier: NCT03067272), FemChec will be used with FemBloc. Because the FemBloc device has not received FDA approval, we believe that we should reassign CPT code 0568T to status indicator “E1” to indicate that the code is not payable by Medicare when submitted on outpatient claims (any outpatient bill type). If FDA approves FemBloc, we will reassess the code associated with FemChec and determine the appropriate OPPS SI and APC assignments for CPT code 0568T.

Therefore, after consideration of the public comments, we are revising the SI and APC assignments for CPT codes 0567T and 0568T. The final status indicator assignments for both codes are listed in Table 27 below. We refer readers to Addendum D1 of this final rule with comment period for the complete list of the OPPS payment status indicators and their definitions for CY 2020. Addendum D1 is available via the internet on the CMS website.

14. Hemodialysis Arteriovenous Fistula (AVF) Procedures (APC 5194)

For CY 2019, based on two new technology applications received by CMS for hemodialysis arteriovenous fistula creation, CMS established two new HCPCS codes to describe the procedures. Specifically, CMS established HCPCS code C9754 for the Ellipsys® System and C9755 for the WavelinQTM System effective January 1, 2019. Both HCPCS codes were assigned to APC 5193 (Level 3 Endovascular Procedures) with a payment rate of 9,669.04 for CY 2019.

At the August 21, 2019 HOP Panel Meeting, a presenter requested that we reassign the WavelinQ procedure to APC 5194. The presenter indicated that the APC payment associated with HCPCS code C9755 is inadequate to cover the cost of the procedure. According to the presenter, the conservative cost estimate for the procedure is over $12,500. The presenter also reported that their HOPD facility performed 35 procedures between October 2018 to July 31, 2019, and the average payment for each procedure ranged between $3,410 and $11,247. Based on the information presented at the meeting, the HOP Panel made no recommendation to CMS on the APC assignment for the WavelinQ procedure.

For CY 2020, as listed in Table 28 below with the long descriptors and proposed SI and APC assignments, we Start Printed Page 61247proposed to continue to assign HCPCS codes C9754 and C9755 to APC 5193 with a proposed payment rate of $10,013.25. We received several comments related to this proposal. Below are the comments and our responses.

Comment: Several physicians stated that the current payment rate does not cover the cost of the procedure and requested the reassignment of both HCPCS code C9754 and C9755 to APC 5194 (Level 4 Endovascular Procedures) with a proposed payment rate of $16,049.73. A physician association explained that the new technologies describe innovative new procedures that increase options for dialysis patients to have a successful arteriovenous fistula for dialysis access, and that the procedures are important in making fistula access possible for patients that either refuse open surgery or where skilled surgeons are not readily available. However, they expressed concern that the procedures may not be available to patients if the costs are higher than the payment, and requested that CMS carefully examine the most recent claims to determine if they should be reclassified to APC 5194.

Response: After consideration of the public comments received and based on input from our medical advisors, as well as our review of the latest claims data available to us, we believe that we should revise the APC assignment for HCPCS code C9754 and C9755 to APC 5194 for CY 2020.

Comment: A medical device company requested an APC reassignment based on data presented at the August 21, 2019 HOP Panel Meeting. They indicated that their analysis of the 1Q2019 Medicare Limited Data Set (LDS) Standard Analytic File (SAF) for HCPCS code C9755 showed a geometric mean cost of $12,960, and suggested reassigning the code to APC 5194. They also reminded CMS that the reassignment to APC 5194 is in line with various HHS initiatives, such as the HHS Initiative on “Advancing American Kidney Health” since the payment rate for the procedure would improve access to the service.

Response: As stated above, we believe that it is appropriate to revise the APC assignment for HCPCS code C9754 and C9755. Consequently, we are reassigning both codes from APC 5193 to APC 5194 for CY 2020.

Comment: A commenter representing 13 different health systems suggested that CMS adopt the recommendation they made at the August 21, 2019 HOP Panel Meeting. Specifically, they recommended the reassignment of HCPCS code C9755 from APC 5193 to APC 5194.

Response: Although there was a presentation at the August 21, 2019 meeting on HCPCS code C9755 with a request to reassign the code to APC 5194, the HOP Panel made no recommendation to CMS. We note that the August 21, 2019, HOP Panel recommendations are posted online and can be found on this CMS website: https://www.cms.gov/​Regulations-and-Guidance/​Guidance/​FACA/​AdvisoryPanelonAmbulatoryPaymentClassificationGroups.html. Although the HOP Panel made no recommendation to CMS, based on the proposed rule comments, and our review of the issue, we are revising the APC assignment for HCPCS code C9755 to APC 5194 for CY 2020.

Comment: A commenter stated that it was brought to their attention that other comments related to the WavelinQ procedure may urge CMS to revisit the APC assignment for HCPCS code C9755. The commenter indicated that if CMS were to revisit the issue and reassign the APC assignment for the WavelinQ procedure, it should also apply the same consideration to the Ellipsys procedure (C9754).

Response: We agree that the services described by HCPCS codes C9754 and C9755 are clinically similar and, therefore, we are revising the APC assignment for both HCPCS code C9754 and C9755 to APC 5194 for CY 2020. However, we note that claims data upon which we could determine the geometric mean costs associated with each procedure are not yet available for ratesetting but once such data become available, we will be able to determine whether the two services are similar in terms of resources. In addition, as has been our practice since the implementation of the OPPS in 2000, we review, on an annual basis, the APC assignments for the procedures and services paid under the OPPS. Consequently, we will review the cost data associated with HCPCS codes C9754 and C9755 for the next annual rulemaking.

In summary, after consideration of the public comments, we are finalizing our proposal with modification. Specifically, we are reassigning HCPCS codes C9754 and C9755 from APC 5193 to APC 5194 for CY 2020. The final CY 2020 payment rate for the codes can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) meanings for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website. Table 28 lists the final SI and APC assignments for HCPCS codes C9754 and C9755.

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15. Hemodialysis Duplex Studies (APCs 5522 and 5523)

For CY 2020, the CPT Editorial Panel established two new codes to describe hemodialysis duplex studies, specifically, CPT codes 93985 and 93986. The new codes replace HCPCS code G0365 (Vessel mapping of vessels for hemodialysis access (services for preoperative vessel mapping prior to creation of hemodialysis access using an autogenous hemodialysis conduit, including arterial inflow and venous outflow)). HCPCS code G0365 was assigned to status indicator “D” in the proposed rule to indicate that the code would be deleted on December 31, 2019.

As listed in Table 29 below with the long descriptors, and also in Addendum B to the CY 2020 OPPS/ASC proposed rule, we proposed to assign CPT code 93985 and 93986 to APC 5522 (Level 2 Imaging without Contrast) with a proposed payment rate of $111.04. The codes were listed as 93X00 and 93X01 (the 5-digit CMS placeholder codes), respectively, in Addendum B with the short descriptors, and again in Addendum O with the long descriptors. We also assigned these codes to comment indicator “NP” in Addendum B to indicate that the codes are new for CY 2020 and that public comments would be accepted on their proposed status indicator assignments. We note that these codes will be effective January 1, 2020.

Comment: Several commenters recommended a reassignment of CPT code 93985 from APC 5522 to APC 5523 (Level 3 Imaging without Contrast) with a proposed payment rate of $231.28. They indicated that the code represents a bilateral study, and as such, should be assigned to APC 5523 with similar bilateral/complete duplex studies.

Response: Based on the public comments that we received, our review of the procedure associated with CPT code 93985 and advice from our medical advisors, we agree that the code fits more appropriately in APC 5523 based on its clinical homogeneity and resource use to the other procedures in the APC. Therefore, we are reassigning the code to APC 5523. We received no comments on CPT code 93986. Consequently, we are finalizing its APC assignment to APC 5522.

In summary, after consideration of the public comments, we are finalizing our proposal with modification. Specifically, we are finalizing our proposal for CPT code 93986 to APC 5522, and reassigning CPT code 93985 to APC 5523. Table 29 below lists the long descriptors for the three codes and the final SI and APC assignments for CY 2020. The final CY 2020 OPPS payment rates can be found in Addendum B of this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator meanings for all codes reported under the OPPS for CY 2020. Both Addendum B and Addendum D1 are available via the internet on the CMS website.

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16. Intraocular Procedures (APCs 5491 Through 5494)

In prior years, CPT code 0308T (Insertion of ocular telescope prosthesis including removal of crystalline lens or intraocular lens prosthesis) was assigned to the APC 5495 (Level 5 Intraocular Procedures) based on its estimated costs. In addition, its relative payment weight has been based on its median cost under our payment policy for low-volume device-intensive procedures because the APC contained a low volume of claims. The low-volume device-intensive procedures payment policy is discussed in more detail in section III.C.2. of the proposed rule.

In the CY 2019 OPPS/ASC proposed rule, we proposed to reassign CPT code 0308T from APC 5495 to APC 5493 (Level 3 Intraocular Procedures), based on the data for two claims available for ratesetting for the proposed rule, and to delete APC 5495 (83 FR 37096 through 37097). However in the CY 2019 OPPS/ASC final rule with comment period, based on updated data on a single claim available for ratesetting for the final rule, we modified our proposal and reassigned procedure code CPT code 0308T to the APC 5494 (Level 4 Start Printed Page 61250Intraocular Procedures) (83 FR 58917 through 58918). We made this change based on the similarity of the estimated cost for the single claim of $12,939.75 to that of the APC ($11,427.14). However, this created a discrepancy in payments between the OPPS setting and the ASC setting in which the ASC payments would be higher than the OPPS payments for the same service because of the intersection of the estimated cost for the encounter determined under a comprehensive methodology within the OPPS and the estimated cost determined under the payment methodology for device-intensive services within the ASC payment system.

In reviewing the claims data available for the proposed rule for CY 2020 OPPS ratesetting, we found several claims reporting the procedure described by CPT code 0308T. Based on the claims data, the procedure would have a geometric mean cost of $28,122.51 and a median cost of $19,864.38. These cost statistics are significantly higher than the geometric mean cost of the other procedure assigned to APC 5494, that is, the procedure described by CPT code 67027 (Implant eye drug system), which has a geometric mean cost of $12,296.27. In addition, if we continued to assign the procedure described by CPT code 0308T to APC 5494 (the Level 4 Intraocular Procedures APC), the discrepancy between payments within the OPPS and the ASC payment system would also continue to exist. As a result, we proposed to reestablish APC 5495 (Level 5 Intraocular Procedures) because we believe that the procedure described by CPT code 0308T would be most appropriately placed in this APC based on its estimated cost. Assignment of the procedure to the Level 5 Intraocular Procedures APC is consistent with its historical placement and would also address the large discrepancy in payment for the procedure between the OPPS and the ASC payment system. We note that, based on data available for the proposed rule, the proposed payment rate for this procedure when performed in an ASC, as discussed in more detail in section XIII.D.1.c. of the proposed rule, would be no higher than the OPPS payment rate for this procedure when performed in the hospital outpatient setting. We will continue to monitor the volume of claims data available for the procedure for ratesetting purposes.

Therefore, for CY 2020, we proposed to reestablish APC 5495 (Level 5 Intraocular Procedures) and reassign the procedure described by CPT code 0308T from APC 5494 to APC 5495. Under this proposal, the proposed CY 2020 OPPS payment rate for the service would be established based on its median cost, as discussed in section V.A.5. of the proposed rule, because it is a device-intensive procedure assigned to an APC with fewer than 100 total annual claims within the APC.

Comment: Several commenters expressed support for our proposal to assign the HCPCS code 0308T to APC 5495 (Level 5 Intracoular Procedures).

Response: We thank commenters for their support.

After consideration of the public comments we received, we are finalizing our proposal, without modification, to assign HCPCS code CPT 0308T to APC 5495 for the CY 2020 OPPS.

17. Long-Term Electroencephalogram (EEG) Monitoring Services (APCs 5722, 5723, and 5724)

For CY 2020, the CPT Editorial Panel deleted four existing long-term EEG monitoring services, specifically, CPT codes 95950, 95951, 95953, and 95956, and replaced them with 23 new CPT codes that consisted of 10 professional component (PC) codes and 13 technical component (TC) codes. As listed in Table 30 below with the long descriptors, and also in Addendum B to the CY 2020 OPPS/ASC proposed rule, we proposed to assign the 13 technical component codes, specifically, CPT codes 95700 through 95716, to either APC 5722 (Level 2 Diagnostic Tests and Related Services) with a proposed payment rate of $256.60 or APC 5723 (Level 3 Diagnostic Tests and Related Services) with a proposed payment rate of $486.65. The codes were listed as 95X01 through and 95X13 (the 5-digit CMS placeholder codes) in Addendum B with the short descriptors, and again in Addendum O with the long descriptors. In addition, we proposed to assign the 10 professional component codes, specifically, CPT codes 95717 through 95726, to status indicator “M” to indicate that the services are not paid under the OPPS since they describe physician services. These codes were listed were listed as 95X14 through 95X23 (the 5-digit CMS placeholder codes) in Addendum B with the short descriptors, and again in Addendum O with the long descriptors. We assigned these 23 codes to comment indicator “NP” in Addendum B to indicate that the codes are new for CY 2020 and that public comments would be accepted on their proposed status indicator assignments. We note these codes will be effective January 1, 2020.

Comment: Many commenters expressed concern with the proposed APC assignments for CPT codes 95712, 95713, 95715, and 95716 and stated that the proposed payment rates for the codes do not provide adequate reimbursement. A commenter indicated that the proposed APC assignments for the EEG monitoring services for 2 to 12 hours does not appropriately reflect the resources and time required to monitor complex epilepsy patients. Several other commenters recommended the reassignment of CPT codes 95712 and 95713 to APC 5723 and stated they should be paid approximately half the rate of the 24-hour video EEG services. These same commenters stated that the reassignment of CPT codes 95715 and 95716 to APC 5724, which had a proposed payment rate of $920.66, would be appropriate since patients being tested may be classified as observation stays and will not be admitted to the hospital. The commenters added that these codes were previously described by predecessor CPT code 95951 (24 hour VEEG), which was assigned to APC 5724 (Level 4 Diagnostic Tests and Related Services).

Response: With respect to CPT codes 95712 (2-12 hours VEEG with intermittent monitoring) and 95713 (2-12 hours VEEG with continuous monitoring), we believe that the resources and time associated with intermittent monitoring (CPT code 95712) are less than that of continuous monitoring (CPT code 95713), and therefore, believe they should be assigned to different APCs. Based on input from our medical advisors that intermittent monitoring involves checking the patient every two hours rather than the full 12 hours, we believe it would be appropriate to modify the APC assignment for the continuous monitoring code (CPT code 95713) to APC 5723. Applying this same concept to the 12-24 VEEG technical component codes, we believe that the resources associated with the intermittent monitoring code (CPT code 95715) are not the same as the continuous monitoring code (CPT code 95716). Therefore, we are reassigning the APC assignment for CPT code 95716 to APC 5724. Although the commenters indicated that the predecessor code for 95715 and 95716 was CPT code 95951, we are uncertain whether the predecessor code describes continuous or intermittent monitoring since the code descriptor lacks this specificity.

Comment: Some commenters urged CMS not to finalize the policies proposed in the PFS or OPPS proposed rules. They indicated that the policies would dramatically reduce reimbursement for EEG and VEEG services and instead, suggested that we Start Printed Page 61251appropriately value these services so that people with epilepsy have access and can be diagnosed and treated in a timely manner.

Response: We believe these commenters did not fully understand our APC proposal. Because the existing EEG and VEEG CPT codes will be deleted on December 31, 2019, if we do not finalize our proposal for the 13 technical codes that will be effective January 1, 2020, there would be no codes to report the services associated with EEG and VEEG.

In summary, after consideration of the public comments, we are finalizing our proposal, with modification. Specifically, we are finalizing our proposal to assign CPT codes 95700 through 95712, 95714, and 95715 to the APCs listed in Table 30 below. In addition, we are modifying our proposal for CPT codes 95713 and 95716, and revising their APC assignments to APC 5723 and APC 5724, respectively. Further, we are finalizing our proposal to assign CPT codes 95717 through 95726 to status indicator “M”. These codes, along with the deleted codes, are listed in Table 30. The final CY 2020 payment rate for these codes can be found in Addendum B to this final rule with comment period (which is available via the internet on the CMS website).

As always, we will reevaluate the APC assignment for these codes once we have claims data. We review, on an annual basis, the APC assignments for all services and items paid under the OPPS based on the latest claims data that we have available.

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18. Musculoskeletal Procedures (APCs 5111 Through 5116)

Prior to the CY 2016 OPPS, payment for musculoskeletal procedures was primarily divided according to anatomy and the type of musculoskeletal procedure. As part of the CY 2016 reorganization to better structure the OPPS payments towards prospective payment packages, we consolidated those individual APCs so that they became a general Musculoskeletal APC series (80 FR 70397 through 70398).

In the CY 2018 OPPS/ASC final rule with comment period (82 FR 59300), we continued to apply a six-level structure for the Musculoskeletal APCs because doing so provided an appropriate distinction for resource costs at each level and provided clinical homogeneity. However, we indicated that we would continue to review the structure of these APCs to determine whether additional granularity would be necessary.

In the CY 2019 OPPS proposed rule (83 FR 37096), we recognized that commenters had previously expressed concerns regarding the granularity of the current APC levels and, therefore, requested comment on the establishment of additional levels. Specifically, we solicited comments on the creation of a new APC level between the current Level 5 and Level 6 within the Musculoskeletal APC series. While some commenters provided suggested APC reconfigurations and requests for change to APC assignments, many commenters requested that we maintain the current six-level structure and continue to monitor the claims data as they become available. Therefore, in the CY 2019 OPPS/ASC final rule with comment period, we maintained the six-level APC structure for the Start Printed Page 61253Musculoskeletal Procedures APCs (83 FR 58920 through 58921).

Based on the claims data available for the CY 2020 OPPS/ASC proposed rule, we continue to believe that the six-level APC structure for the Musculoskeletal Procedures APC series is appropriate. Therefore, we proposed to maintain the APC structure for the CY 2020 OPPS update.

We note that this is the first year for which claims data are available for the total knee arthroplasty procedure described by CPT code 27447, which was removed from the inpatient only list in the CY 2018 OPPS/ASC final rule with comment period (82 FR 59382 through 59385). Based on approximately 60,000 hospital outpatient claims reporting the procedure that were available for ratesetting in the proposed rule, the geometric mean cost was approximately $12,472.05, which is similar to the geometric mean cost for APC 5115 (Level 5 Musculoskeletal Procedures) of $11,879.66, and within a range of the lowest geometric mean cost of the significant procedure costs of $9,969.37 and the highest geometric mean cost of the significant procedure costs of $12,894.18. Therefore, we believed that the assignment of the procedure described by CPT code 27447 in the Level 5 Musculoskeletal Procedures APC series remains appropriate and, therefore, we proposed to continue to assign CPT code 27447 to APC 5115 (Level 5 Musculoskeletal Procedures) for CY 2020.

We also proposed to remove the procedure described by CPT code 27130 (Total hip arthroplasty) from the CY 2020 OPPS inpatient only list. Based on the estimated costs derived from in the available claims data, as well as the 50th percentile IPPS payment for TKA/THA procedures without major complications or comorbidities (MS-DRG 470) of approximately $11,900 for FY 2020 when the procedure is performed on an inpatient basis, we believed that it was appropriate to assign the procedure described by CPT code 27130 to the Level 5 Musculoskeletal Procedures APC series, which had a geometric mean cost of $11,879.66. Therefore, for CY 2020, we also proposed to assign the procedure described by CPT code 27130 to APC 5115. We noted that we will monitor the claims data reflecting these procedures as they become available. For a more detailed discussion of the procedures that were proposed to be removed from the inpatient only (IPO) list for CY 2020 under the OPPS, we refer readers to section IX. of the proposed rule.

Table 31 displays the CY 2020 Musculoskeletal Procedures APC series' structure and APC geometric mean costs.

Comment: Several commenters requested that CMS reconsider the proposal to assign CPT code 22869 (Insertion of interlaminar/interspinous process stabilization/distraction device, without open decompression or fusion, including image guidance when performed, lumbar; single level) to APC 5115, and instead allow the code to remain in APC 5116, where it has been historically placed. They believed that the proposal to move the APC was based on inaccurate data, due to one hospital incorrectly reporting its costs and charges. They noted that the influence of that inaccurate data would be short term and that the claims would eventually support the higher placement, as the reporting issues were corrected. We also note that the HOP Panel made a recommendation that CMS examine the claims data for CPT code 22869 and determine an appropriate APC placement.

Response: While we recognize the concerns that the commenters have described, it is generally not our policy to judge the accuracy of hospital coding and charging for purposes of ratesetting. We rely on hospitals to accurately report the use of HCPCS codes in accordance with their code descriptors and CPT and CMS instructions, and to report services on claims and charges and costs for the services on their Medicare hospital cost report appropriately. However, we do not specify the methodologies that hospitals use to set charges for this or any other service. In addition, we state in Chapter 4 of the Medicare Claims Processing Manual that “it is extremely important that hospitals report all HCPCS codes consistent with their descriptors; CPT and/or CMS instructions and correct coding principles, and all charges for all services they furnish, whether payment for the services is made separately paid Start Printed Page 61254or is packaged” to enable CMS to establish future ratesetting for OPPS services.

After consideration of the public comments we received, we are finalizing the proposed six level Musculoskeletal Procedures APC structure. We also are finalizing the proposed assignment of the procedure described by CPT codes 22869 to APC 5115. As discussed in section IX. of this final rule, we are also finalizing the proposal to remove the procedure described by CPT code 27130 from the inpatient only list and to assign it to APC 5115 for the CY 2020 OPPS.

19. Nuclear Medicine Services

a. Cardiac Positron Emission Tomography (PET) Studies (APCs 5593 and 5594)

For CY 2020, we proposed to continue to assign CPT code 78459 (Myocardial imaging, positron emission tomography (pet), metabolic evaluation) to APC 5593 (Level 3 Nuclear Medicine and Related Services) with a proposed payment rate of $1,293.33. Similarly, we proposed to maintain the APC assignments for CPT codes 78491 (Myocardial imaging, positron emission tomography (pet), perfusion; single study at rest or stress) and 78492 (Myocardial imaging, positron emission tomography (pet), perfusion; multiple studies at rest and/or stress) to APC 5594 (Level 4 Nuclear Medicine and Related Services) with a proposed payment rate of $1,466.16.

Comment: Commenters agreed with the APC assignments for CPT codes 78459, 78491, and 78492 and stated they are placed appropriately in APCs 5593 and 5594. Some commenters added that the cost associated with CPT code 78492, which describes a wall motion and ejection fraction, supports its maintenance in APC 5594.

Response: We thank the commenters for their feedback and will finalize the APC assignments for CPT code 78459 to APC 5593, and for CPT codes 78491 and 78492 to APC 5594.

b. Cardiac Positron Emission Tomography (PET)/Computed Tomography (CT) Studies (APCs 1522, 1523, and 5594)

For CY 2020, the CPT Editorial established six new codes to describe the services associated with cardiac PET/CT studies, specifically, CPT codes 78429, 78430, 78431, 78432, 78433, and 78434. These codes were listed in Addendum B to the CY 2020 OPPS/ASC proposed rule as 78X29, 78X31, 78X32, 78X33, 78X34, and 78X35 (the 5-digit CMS placeholder codes), respectively, in Addendum B with the short descriptors, and again in Addendum O with the long descriptors. We also assigned these codes to comment indicator “NP” in Addendum B to indicate that the codes are new for CY 2020 and that public comments would be accepted on their proposed status indicator assignments. We note that these codes will be effective January 1, 2020. Table 32 below list the placeholder codes, long descriptors, and proposed SI and APC assignments.

Comment: Several commenters opposed the APC assignment for CPT code 78429 (placeholder code 78X29) and recommended its reassignment from APC 5593 to APC 5594. They stated that APC 5593 does not recognize the additional cost associated with the CT scan that is included in the service, and requested revising the code to APC 5594.

Response: Based on the commenters' feedback and our review of the components of this new service, we agree with the commenters that APC 5594 is the more appropriate assignment for CPT code 78429. Therefore, we will reassign CPT code 78429 from APC 5593 to APC 5594.

Comment: Several commenters agreed with the APC placement for CPT code 78430 (placeholder code 78X31) in APC 5594. They stated that APC 5594 allows adequate payment for the CT scanner that that is a component of this service.

Response: We thank the commenters for their feedback and are finalizing the APC assignment for CPT code 78430 to APC 5594.

Comment: Several commenters reported that certain societies submitted a new technology application to CMS for CPT codes 78431 (placeholder code 78X32), 78432 (placeholder code 78X33), and 78433 (placeholder code 78X34) that details the costs associated with providing the services. For CPT code 78431, these same commenters disagreed with the proposed APC placement and recommended its revision from APC 5594 (Level 4 Nuclear Medicine and Related Services) with a proposed payment rate of $1,466.16 to APC 1522 (New Technology—Level 23 ($2501-$3000)) with a proposed payment rate of $2,750.50. They reported that, based on the resource cost of the service described by CPT code 78431, APC 1522 provides adequate reimbursement for the service. Similarly, for CPT codes 78432 and 78433, the commenters indicated that APC 5594 would not adequately reimburse the resource costs associated with providing these services, and recommended their reassignment to APC 1523 (New Technology—Level 23 ($2501-$3000)) with a proposed payment rate of $ 2,750.50

Response: Based on our assessment of the information provided in the new technology application and the public comments received, we are revising the APC assignments for these codes. Specifically, we are revising the APC assignment for CPT code 78431 from APC 5594 to APC 1522, and reassigning CPT codes 78432 and 78433 from APC 5594 to APC 1523.

In summary, after consideration of the public comments for the new cardiac PET/CT codes, and based on our evaluation of the new technology application that provided the estimated costs for the services and described the components and characteristics of the new codes, we are finalizing our proposal, with modification, to assign CPT codes 78429, 78431, 78432, and 78433 to the final APCs listed in Table 32 below. In addition, we are finalizing our proposal, without modification, for CPT codes 78430 and 78434. In Table 32 below we list the long descriptors and final SI and APC assignments for the codes. The final CY 2020 payment rate for the codes can be found in Addendum B to this final rule with comment period (which is available via the internet on the CMS website).

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c. Single-Photon Emission Computed Tomography (SPECT) Studies (APCs 5591, 5593, and 5594).

For CY 2020, we proposed to continue to assign CPT codes 78800 and 78801 to APC 5591 with a proposed payment rate of $372.69, CPT codes 78802 and 78804 to APC 5593 with a proposed payment rate of $1,293.33), and CPT code 78803 to APC 5592 with a proposed payment rate of $482.38.

We also proposed to assign new CPT codes 78830 and 78831 to APC 5593, and 78832 to APC 5594 with a proposed payment rate of $1,466.16. In addition, we proposed to assign new CPT code 78835 to status indicator “N” because it is an add-on code that is packaged and payment for it is included in the primary service. Table 33 below list the long descriptors and their proposed SI and APC assignments for these codes.

Comment: Some commenters agreed with the proposed APC assignments for CPT codes 78800, 78801, and 78802.

Response: We thank the commenters for their feedback and are finalizing the APC assignments for these codes.

Comment: Several commenters disagreed with the assignment for CPT codes 78803 and requested a modification from APC 5592 to APC 5593 because this one code will replace seven SPECT codes that will be deleted on December 31, 2019. Specifically, they reported that the seven CPT codes listed in Figure 34 will be deleted. Several commenters indicated that APC 5592 would not account for the deleted SPECT codes and recommended using a weighted average to determine an appropriate geometric mean cost for 78803. Based on their calculation, the geometric mean cost for the code should be $784.18, which is higher than the approximately $462 geometric mean cost for APC 5592, and is more consistent with the geometric mean cost for APC 5593.

Response: Based on our analysis of the latest claims data for this final rule with comment period, and as listed in the Figure 33 below, the range of geometric mean cost for CPT code 78803 and the seven deleted codes is between $433 and $1,417. We note that several of the deleted codes were assigned to APC 5593, and based on our review of these codes, we believe it would be appropriate to reassign CPT code 78803 from APC 5592 to APC 5593.

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Comment: Some commenters disagreed with the assignment of CPT code 78804 to APC 5593, and stated that the APC assignment does not adequately capture the cost of multiple SPECTs provided. The commenters indicated that it would not make sense to continue to assign single and full sets of studies to the same APC and urged CMS to reassign the code to APC 5594.

Response: For CY 2020, based on claims submitted between January 1, 2018 and December 30, 2018 that were processed on or before June 30, 2019, our analysis of the latest claims data for this final rule supports maintaining CPT code 78804 in APC 5593. Specifically, our claims data show a geometric mean cost of approximately $1,298 for CPT code 78804 based on 1,656 single claims (out of 2,961 total claims), which is more appropriate in APC 5593 whose geometric mean cost is about $1,245 compared to the geometric mean cost of approximately $1,412 for APC 5594.

Comment: Some commenters agreed with the APC assignment for new CPT codes 78830 and 78832 to APC 5593 and APC 5594, respectively.

Response: We appreciate the commenters' feedback and are finalizing the APC assignment for CPT code 78830 to APC 5593 and for CPT code 78832 to APC 5594.

Comment: Several commenters opposed the APC assignment for CPT code 78831 to APC 5593. They indicated that the proposed APC assignment for CPT code 78831 does not adequately capture the resources required to perform the procedure and should be reassigned to APC 5594.

Response: We believe that new CPT code 78831 shares similar characteristics and resources to existing CPT code 78804. Consequently, we assigned the new code to APC 5593, which is the same APC assignment for CPT 78804. We note that once we have claims data for CPT code 78831, we will assess and determine whether a reassignment is necessary. As always, we review the APC assignments for all services under the OPPS based on the latest claims data.

In summary, after consideration of the public comments and after evaluation of our claims data for this final rule with comment period, we are finalizing our proposal, without modification, for CPT codes 78800, 78801, 78802, 78804, 78830, 78831, 78832, and 78835. However, we are finalizing our proposal, with modification, for CPT code 78803 and reassigning the code from APC 5592 to APC 5593 for CY 2020. Table 34 below list the long descriptors for these codes and their final SI and APC assignments. The final CY 2020 payment rate for the codes can be found in Addendum B to this final rule with comment period (which is available via the internet on the CMS website).

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20. Radiofrequency Spectroscopy

As displayed in Table 8 and Addendum B to the CY 2020 OPPS/ASC proposed rule, we proposed to assign CPT code 0546T (Radiofrequency spectroscopy, real time, intraoperative margin assessment, at the time of partial Start Printed Page 61262mastectomy, with report) to status indicator (SI) “N” to indicate that the code is packaged and payment for it is included in the primary surgical procedure. Specifically, payment for the codes assigned to status indicator “N” is made through the payment for the separately payable, independent services with which they are billed. No separate payment is made for services that we have assigned to status indicator “N.” We note that CPT code 0546T is associated with the MarginProbe procedure.

Comment: Several commenters requested separate payment for CPT code 0546T. One commenter stated that the code should be adequately valued and removed from packaging. Another commenter stated that packaging the code will limit the number of Medicare beneficiaries who will benefit from the procedure. Still another commenter suggested a modification in the status indicator from “N” to “J1” (comprehensive APC) but did not suggest any specific APC to which they believed the code should be assigned. Another commenter stated that assigning separate payment for CPT code 0546T is in line with CMS' objectives of reducing the number of repeat surgical excisions.

Response: As noted in the code descriptor, CPT code 0546T describes an intraoperative procedure that is performed at the time of partial mastectomy. As specified in 42 CFR 419.2(b)(14), intraoperative items and services are packaged under the OPPS. By definition, a service that is performed intraoperatively is provided during and, therefore on the same date of service, as another procedure that is separately payable under the OPPS. Because intraoperative services support the performance of an independent procedure and they are provided in the same operative session as the independent procedure, we have packaged the payment for the radiofrequency spectroscopy into the OPPS payment for the primary surgical procedure with which it is reported. In this case, the payment for CPT code 0546T is included in the breast mastectomy codes that are reported with the procedure.

We note that since 2008, intraoperative services have been packaged under the OPPS, however, packaging has always been a primary component of the OPPS since its implementation in 2000. As we state in section II.A.3. (Changes to Packaged Items and Services) of this final rule, because packaging encourages efficiency and is an essential component of a prospective payment system, packaging payment for items and services that are typically integral, ancillary, supportive, dependent, or adjunctive to a primary service has been a fundamental part of the OPPS since its implementation in August 2000.

Comment: A medical device company stated that although CPT code 0546T is a procedure provided during an operative session, it is a distinct procedure with a beginning, middle, and end. The commenter reported that the cost of the procedure is not included in the primary surgical procedure. The same commenter pointed out that based on the language below from the CY 2008 OPPS/ASC final rule (72 FR 66621), it believed CMS has the discretion not to package an intraoperative service:

“To the extent that a service for which New Technology APC status is being requested is ancillary and supportive of another service, for example, a new intraoperative service or a new guidance service, we might not consider it to be a complete service because its value is as part of an independent service. However, if the entire, complete service, including the guidance component of the service, for example, is `truly new,' as we explained that term at length . . . we would consider the new complete procedure for New Technology APC assignment.”

The commenter also indicated that, at its September 2018 meeting, the CPT Editorial Panel determined that radiofrequency spectroscopy is a stand-alone service and, therefore, issued a unique code, specifically, CPT code 0546T to be effective July 1, 2019. The commenter noted that until July 1, 2019 there was no code available to adequately describe the service, therefore, the procedure could not be represented in the claims data upon which CMS has established the CY 2020 OPPS payment determinations. Consequently, the commenter requested that CMS assign CPT code 0546T to New Technology APC 1518 (New Technology—Level 18 ($1601-$1700)) with a proposed payment rate of $1,650.50, and indicated that the payment would reflect the cost of the sterile, disposable, radiofrequency spectroscopy probe and supplies. The commenter asserted that assigning separate payment for the procedure would alleviate the barrier to access to care for the service.

Response: We note that the establishment of a new CPT code does not indicate that a code is always a stand-alone procedure or service. The current CPT code set lists hundreds of add-on codes that do not describe stand-alone services. For the list of add-on codes, refer to Appendix D (Summary of CPT Add-on Codes) of the latest CPT code book. We note that the CPT Editorial Panel does not establish new CPT codes because the service or procedure is considered stand-alone, rather they establish new codes for procedures and services that are not described by any existing code and have met their application criteria.

As stated above, CPT code 0546T is associated with the MarginProbe procedure. CPT code 0546T describes an intraoperative procedure that is performed at the time of partial mastectomy. As specified in 42 CFR 419.2(b)(14), intraoperative items and services are packaged under the OPPS.

We also disagree with the commenter's statement that CMS has the discretion not to package an intraoperative procedure. As noted above, 42 CFR 419.2(b)(14) states that intraoperative items and services are packaged under the OPPS. We do not agree that MarginProbe, for which CPT code 0546T was established, is a new, standalone procedure for which separate payment should be made. We note that the preamble language the commenter quoted only applies for services that are truly new and a complete service and, as mentioned in the quoted language, with respect to an ancillary service, which may include a new intraoperative service or a new guidance service, we might not consider it to be a complete service because its value is as part of an independent service. MarginProbe, received Premarket Approval (PMA) from the FDA on December 27, 2012, and has been on the market since February 2013, however, FDA approval alone does not compel a determination under Medicare that the technology represents a separate standalone service that would qualify for New Technology APC assignment.

Finally, because CPT code 0546T describes an intraoperative service that is performed during a mastectomy procedure, we are finalizing our proposal to assign the code to status indicator “N”. Therefore, after consideration of the public comments received, we are finalizing our proposal without modification for CPT code 0546T. The final status indicator assignment for the code is listed in Addendum B to this final with comment period. We refer readers to Addendum D1 of this final rule with comment period for the complete list of the OPPS payment status indicators and their definitions for CY 2020. Both Addendum B and Addendum D1 are available via the internet on the CMS website.Start Printed Page 61263

21. Reflectance Confocal Microscopy (RCM)

For CY 2020, we proposed to continue to assign CPT code 96932 to status indicator “Q1” (conditionally packaged) and APC 5731 (Level 1 Minor Procedures) with a proposed payment rate of $23.57. We note that the CPT Editorial Panel established six (6) CPT codes to describe the services associated with RCM. These codes are shown in Table 35 with the long descriptors and proposed status indicator assignments.

Comment: A commenter stated that the low payment rate for this service under the OPPS is based on misreporting of charges by a hospital. The commenter explained that based on their review and analysis of the OPPS claims, only two hospitals in the country are performing this imaging test, and that the proposed payment rate is based primarily on one hospital's charges. The same commenter stated that the cost of performing the imaging service is about $128, which is more than the proposed payment rate of $23.57. To correct the low payment for the test, the commenter suggested that CMS use its equitable adjustment authority to set an appropriate payment for 96932 and also recommended that we do one of the following:

  • Reassign the code to APC 5522 (Level 1 Imaging without Contrast) with a proposed payment rate of $111.04;
  • Reassign the code to New Technology APC 1503 (New Technology—Level 3 ($101-$200) with a proposed payment rate of $150.50; or
  • Assign an unconditionally packaged (“N”) or non-payable status indicator to the code, similar to the other RCM codes.

The commenter also expressed concern that the low payment rate under the OPPS significantly impacts the payment for the service under the PFS. The commenter added that RCM is primarily performed in the physician office setting, however, because of the low payment rate established under the OPPS, the payment for the service is inadequate. To correct the low payment rate, the commenter suggested that CMS revise the status indicator of CPT code 96932 to identify the service as packaged or non-payable, and, therefore, not have a published OPPS payment rate for the code. The commenter believed that packaging the code or assigning it as non-payable will correct the payment rate and provide adequate payment for the service.

Response: Section 5102(b) of the Deficit Reduction Act of 2005 (DRA) amended the PFS statute to place a payment cap on the technical component (TC) of certain diagnostic imaging procedures and the TC portions of the global diagnostic imaging services at the amount paid under the OPPS. To implement this provision, the physician fee schedule (PFS) amount is compared to the OPPS payment amount and the lower amount is used for payment. CPT code 96932 is designated as a DRA imaging code whose payment under the PFS is capped at the OPPS rate even when performed in a physician office setting. Based on our review of the issue, we believe that we should revise the OPPS status indicator assignment for CPT code 96932 from “Q1” to “N”, similar to the status indicator assignment for several other RCM codes. Since CPT code was low volume under the OPPS, it may be inappropriate to establish an OPPS payment rate by which the PFS rate would be capped. Accordingly, this change will allow there not to be an OPPS cap for the service.

In summary, after consideration of the public comment, we are finalizing our proposal with modification and revising the status indicator assignment for CPT code 96930 to “N” for CY 2020. Table 35 below lists the long descriptors and final status indicator assignments for the six (6) codes that describe the services associated with RCM. We refer readers to Addendum D1 of this final rule with comment period for the complete list of the OPPS payment status indicators and their definitions for CY 2020. Addendum D1 is available via the internet on the CMS website.

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22. remedē® System—Transvenous Phrenic Nerve Stimulation Therapy (APCs 5461-5464, 5724, and 5742)

For the CY 2020 update, we proposed to modify the APC assignment for certain CPT codes associated with the Transvenous Phrenic Nerve Stimulation Therapy or remedē® System. Of the 13 codes, we received a comment on the APC assignment for three codes, specifically, CPT codes 0426T, 0427T, and 0431T. As shown in Table 36 below with the long descriptors, and also in Addendum B to the CY 2020 OPPS/ASC proposed rule, we proposed to reassign CPT codes 0426T and 0431T from APC 5463 (Level 3 Neurostimulator and Related Procedures) to APC 5464 (Level 4 Neurostimulator and Related Procedures) with a proposed payment rate of $29,025.99. In addition, we proposed to continue to assign CPT code 0427T to APC 5463 ((Level 3 Neurostimulator and Related Procedures) with a proposed payment rate of $19,370.82.

Comment: A device company suggested that we maintain the current assignment and not revise the APC assignment to APC 5464 for CPT code 0426T. The commenter stated that the resources required for the procedure are more closely aligned with the procedures in APC 5463.

Response: Based on our evaluation of the procedure associated with CPT code 0426T, we agree that the procedure described by the code appropriately fits in APC 5463 based on its clinical similarity to other procedures in the APC. CPT code 0426T describes the insertion or replacement of the stimulation lead associated with a neurostimulator system for the treatment of central sleep apnea, and APC 5463 includes other procedures that involve the insertion or replacement of a stimulation lead for a neurostimulator system. Therefore, we will maintain the APC assignment for CPT code 0426T to APC 5463 for CY 2020.

Comment: The same device company that commented on CPT code 0426T also commented on the APC assignment for CPT code 0427T. According to the commenter, the procedure describes the initial insertion of the implantable pulse generator when the full system cannot be implanted for a patient, and added that the procedure does not occur frequently.

The commenter also noted that the hospital resources associated with CPT code 0427T are very similar to CPT code 0431T, which is assigned to APC 5464, and recommended the assignment of both procedures to APC 5464.

Response: Based on our review of the two procedures, we agree that the resources associated with inserting or replacing a pulse generator for a neurostimulator system that is described by CPT code 0427T are very similar to removing and replacing a pulse generator for a neurostimulator system that is described by CPT code 0431T. Consequently, we are modifying our Start Printed Page 61265proposal and reassigning CPT code 0427T to APC 5464.

Comment: The same device company that commented on CPT codes 0426T and 0427T also commented on CPT code 0431T. Specifically, the commenter concurred with the APC reassignment for the code to APC 5464.

Response: As indicated above, based on our review of the two procedures, we agree that the resources associated with inserting or replacing a pulse generator for a neurostimulator system that is described by CPT code 0427T are very similar to removing and replacing a pulse generator for a neurostimulator system that is described by CPT code 0431T. Therefore, we are finalizing our proposal for CPT code 0431T and assigning the code to APC 5464.

In summary, after consideration of the public comment, we are finalizing our proposal with modification. Specifically, we are finalizing our APC proposal for CPT code 0431T to APC 5464, however, we are maintaining the APC assignment for CPT code 0426T to APC 5463, and reassigning CPT code 0427T to APC 5464. We note that the final CY 2020 OPPS payment rates for all the codes associated with the Transvenous Phrenic Nerve Stimulation Therapy or remedē® System can be found in Addendum B of this final rule with comment period. Table 36 below lists the long descriptors for all 13 codes and the final APC and SI assignments for CY 2020. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator meanings for all codes reported under the OPPS for CY 2020. Both Addendum B and Addendum D1 are available via the internet on the CMS website.

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Start Printed Page 61267

23. Surgical Pathology Tissue Exam (APC 5673)

In CY 2019, CPT code 88307 (Level V—surgical pathology, gross and microscopic examination) was assigned to APC 5673 (Level 3 Pathology) with a payment rate of $274.22. For CY 2020, we proposed to reassign the code to APC 5672 (Level 2 Pathology) with a proposed payment rate of $148.62.

Comment: A commenter disagreed with the proposed reassignment and urged CMS to continue to assign CPT code 88307 to APC 5673. This same commenter reported that the service includes complex Level V surgical pathology specimens and the proposed change represents a 46 percent decrease in the payment amount. The commenter added that the proposed reassignment creates a resource cost rank order anomaly with other physician services and the technical costs will not be fully recovered from each unit of service. In addition, the commenter believed that the data do not identify actual costs for specific procedures, and stated that the cost associated with CPT code 88307 is greater than six times the cost of the services assigned to APC 5672 (Level 2 Pathology) based on physician fee schedule technical component cost differences. The commenter also believed that the data leading to the APC reassignment must be flawed and added that charge-based cost data were neither designed nor intended to be an accurate estimate of service/procedure level costs at the CPT code level. The commenter stated that the hospital charge-based cost data used for OPPS rate-setting allows CMS to estimate costs for purposes of grouping a number of services or procedures (multiple distinct codes) into appropriate clinically and economically homogeneous APCs.

Response: As stated in section III.B. (Final OPPS Changes—Variations Within APCs) of this final rule with comment period, payments for OPPS services and procedures are based on our analysis of the latest claims data. For the proposed rule, the OPPS proposed payment rates were based on claims data that were submitted between January 1, 2018 through December 31, 2018, that were processed on or before December 31, 2018. However, for the final rule, the OPPS final payment rates are based on claims that were submitted between January 1, 2018 through December 31, 2018, that were processed on or before June 30, 2019. Based on the latest hospital outpatient claims data used for this final rule with comment period, we agree with the commenter that the code should continue to be assigned to APC 5673 for CY 2020. Specifically, CPT code 88307 shows a geometric mean cost of approximately $219, which is more appropriate in APC 5673 whose geometric cost is approximately $277 compared to the geometric mean cost of about $140 for APC 5672. Consequently, we are revising our proposal and maintaining the APC assignment for CPT code 88307 to APC 5673 for CY 2020.

In summary, after consideration of the public comment, and after our analysis of the updated claims data for this final rule with comment period, we are finalizing our proposal with modification. Specifically, we are revising the APC assignment for CPT code 88307 to APC 5673 for CY 2020. The final CY 2020 payment rate for the code can be found in Addendum B to this final rule with comment period (which is available via the internet on the CMS website).

As we do every year, we will reevaluate the APC assignment for CPT code 88307 for the next rulemaking cycle. We note that we review, on an annual basis, the APC assignments for all services and items paid under the OPPS.Start Printed Page 61268

24. Urology Procedures

a. HIFU Procedure—High-Intensity Focused Ultrasound of the Prostate (APC 5375)

In 2017, CMS received a new technology application for the prostate HIFU procedure and established a new code, specifically, HCPCS code C9747 (Ablation of prostate, transrectal, high intensity focused ultrasound (hifu), including imaging guidance). Based on the estimated cost provided in the new technology application, we assigned the new code to APC 5376 (Level 6 Urology and Related Services) with a payment rate of $7,452.66 effective July 1, 2017. We announced the SI and APC assignment in the July 2017 OPPS quarterly update CR (Transmittal 3783, Change Request 10122, dated May 26, 2017).

For the CY 2018 update, we made no change to the APC assignment and continued to assign HCPCS code C9747 to APC 5376 with a payment rate of $7,596.26. We note that the payment rates for the CY 2018 OPPS update were based on claims submitted between January 1, 2016 through December 30, 2016, that were processed on or before June 30, 2017. Since HCPCS code C9747 was established on July 1, 2017, we had no claims data for the procedure for use in ratesetting for CY 2018.

However, for the CY 2019 update, based on the latest claims data for the final rule, we revised the APC assignment for HCPCS code C9747 from APC 5376 to APC 5375 with a payment rate of $4,020.54. We note that the payment rates for CY 2019 were based on claims submitted between January 1, 2017 through December 30, 2017, that were processed on or before June 30, 2018. Our claims data showed a geometric mean cost of approximately $5,000 for HCPCS code C9747 based on 64 single claims (out of 64 total claims), which was significantly lower than the geometric mean cost of about $7,717 for APC 5376. We believed that the geometric mean cost for HCPCS code C9747 was more comparable to the geometric mean cost of approximately $4,055 for APC 5375. Consequently, we reassigned the code from APC 5376 to APC 5375 (Level 5 Urology and Related Services) for CY 2019.

For CY 2020, we proposed to continue to assign HCPCS code C9747 to APC 5375 with a proposed payment rate $4,286.06.

Comment: Several commenters disagreed with the APC assignment for HCPCS code C9747 and recommended a reclassification to APC 5376 because they believed the service is clinically similar and comparable in terms of resources to cryoablation of the prostate, which is described by CPT code 55873 (Cryosurgical ablation of the prostate (includes ultrasonic guidance and monitoring), and placed in APC 5376 (Level 6 Urology and Related Services), with a proposed payment rate of $8,193.30. The commenters believed that the geometric mean cost, and ultimately, the APC determination for the prostate HIFU procedure was based on inaccurate hospital costs. They believed that the average cost of the procedure should be approximately $6,250, and requested a reassignment to APC 5376 to enable Medicare beneficiaries to continue to receive the treatment. They stated based on their projections that maintaining the APC assignment to APC 5375 for the procedure will decrease the number of Medicare beneficiaries receiving the treatment by 75 percent if the CY 2020 payment rate is finalized.

Response: As we have stated every year since the implementation of the OPPS on August 1, 2000, we review, on an annual basis, the APC assignments for all services and items paid under the OPPS based on our analysis of the latest claims data. For CY 2020, based on claims submitted between January 1, 2018 through December 30, 2018, that were processed on or before June 30, 2019, our analysis of the latest claims data for this final rule supports maintaining HCPCS code C9747 in APC 5375. Specifically, our claims data shows a geometric mean cost of approximately $5,850 for HCPCS code C9747 based on 264 single claims (out of 268 total claims), which is comparable to the geometric mean cost of about $4,140 for APC 5375, rather than the geometric mean cost of approximately $7,894 for APC 5376.

Also, we do not agree that the resource costs associated with the prostate HIFU procedure are similar to those of cryoablation of the prostate. Our claims data for the CY 2020 update shows a geometric mean cost of about $8,152 based on 1,417 single claims (out of 1,429 total claims) for cryoablation of the prostate. The geometric mean cost for CPT code 55873 is reasonably consistent with APC 5376, whose geometric mean cost is approximately $7,894.

With respect to the issue of inaccurate hospital cost reporting for HCPCS code C9747, based on our analysis of the CY 2020 hospital outpatient claims data used for this final rule with comment period, we are unable to determine whether hospitals are misreporting the procedure. It is generally not our policy to judge the accuracy of hospital coding and charging for purposes of ratesetting. We rely on hospitals to accurately report the use of HCPCS codes in accordance with their code descriptors and CPT and CMS instructions, and to report services on claims and charges and costs for the services on their Medicare hospital cost report appropriately. Also, we do not specify the methodologies that hospitals use to set charges for this or any other service. Furthermore, we state in Chapter 4 of the Medicare Claims Processing Manual that “it is extremely important that hospitals report all HCPCS codes consistent with their descriptors; CPT and/or CMS instructions and correct coding principles, and all charges for all services they furnish, whether payment for the services is made separately paid or is packaged” to enable CMS to establish future ratesetting for OPPS services.

Comment: A commenter reported that the prostate HIFU procedure (C9747) and cryoablation of the prostate (55873) are two clinically similar procedures for the ablation of prostate for cancer, and are the only two acknowledged treatments for radiorecurrent, non-metastatic prostate cancer. This same commenter requested that we either create a new APC group specific to prostate ablation procedures or modify the organization of HCPCS codes within the urology family of APCs. The commenter specifically noted that a reorganization for APCs 5374 through 5376 would be appropriate but added that there are other inconsistencies across procedures within the urology APCs. The commenter also mentioned that CPT codes 50555 (Renal endoscopy through established nephrostomy or pyelostomy, with or without irrigation, instillation, or ureteropyelography, exclusive of radiologic service; with biopsy) and 50557 (Renal endoscopy through established nephrostomy or pyelostomy, with or without irrigation, instillation, or ureteropyelography, exclusive of radiologic service; with fulguration and/or incision, with or without biopsy) are assigned to two different APCs, however, their APC assignments appear reversed. The commenter further suggested updating the procedures within APCs 5374, 5375, and 5376 so that the geometric mean costs for the procedure fall into the following ranges:

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Response: We appreciate the commenter's suggestions and may consider a reorganization of the procedures in the urology APCs in future rulemaking. We note that each year, under the OPPS, we revise and make changes to the APC groupings based on the latest hospital outpatient claims data to appropriately place procedures and services in APCs based on clinical characteristics and resource similarity. For CY 2020, based on our analysis of the latest claims data for this final rule, we do not believe that establishing a new APC specific to prostate ablation procedures is necessary, nor do we believe that modifying the HCPCS codes within the urology family APCs is appropriate at this time.

With respect to CPT codes 50555 and 50557, based on our review of the claims data for this final rule with comment period, we revised the APC assignment for CPT code 50555 from APC 5375 to APC 5376, and maintained the APC assignment for CPT code 50557 in APC 5376. Specifically, our claims data show a geometric about $7,327 for CPT code 50555 and approximately $6,224 for CPT code 50557, which are more comparable with the geometric cost for APC 5376 of about $7,894 unlike that of APC 5375 whose geometric mean cost is approximately $4,140.

In summary, after consideration of the public comments, and after our analysis of the updated claims data for this final rule with comment period, we are finalizing our proposal, without modification, to continue to assign HCPCS code C9747 to APC 5375 for CY 2020. The final CY 2020 payment rate for the code can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) meanings for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website.

b. ProACT Procedure—Transperineal Periurethral Adjustable Balloon Continence Device Procedure (APCs 5371, 5374, 5375, and 5376)

In 2017, CMS received a new technology application for the transperineal periurethral adjustable balloon continence device procedure, which is associated with ProACT Therapy, and established a new code, specifically, HCPCS code C9746. Based on the estimated cost for the bilateral placement of the balloon continence devices, we assigned the code to APC 5377 (Level 7 Urology and Related Services) with a payment rate of $14,363.61 effective July 1, 2017. We announced the new code, and interim SI and APC assignments, and payment rate in the July 2017 quarterly update to the OPPS (Transmittal 3783, Change Request 10122, dated May 26, 2017).

For the CY 2018 update, we made no change to the APC assignment and continued to assign HCPCS code C9746 to APC 5377 with a payment rate of $15,697.82. We note that OPPS payment rates for the CY 2018 update were based on claims submitted between January 1, 2016 through December 30, 2016, that were processed on or before June 30, 2017. Since HCPCS code C9746 was established on July 1, 2017, we had no claims data for the procedure for use in ratesetting in CY 2018.

For the CY 2019 update, we again had no claims data for the code so we made no change to the APC assignment and continued to assign HCPCS code C9746 to APC 5377 with a payment rate of $16,319.55. We note that the payment rates for CY 2019 were based on claims submitted between January 1, 2017 through December 30, 2017, that were processed on or before June 30, 2018.

In July 2019, the CPT Editorial Panel established four new codes to describe the transperineal periurethral adjustable balloon continence device procedure, specifically, CPT codes 0548T, 0549T, 0550T, and 0551T. In the July 2019 quarterly update to the OPPS (Transmittal 4313, Change Request 11318, dated May 24, 2019), we listed the temporary APC assignments for the new codes in the July 2019 OPPS Update CR and announced the deletion of HCPCS code C9746 on June 30, 2019, since it was replaced with CPT code 0548T effective July 1, 2019. These codes are listed in Table 37 along with their long descriptors and proposed SI and APC assignments.

For CY 2020, we proposed to revise the APC assignment for new CPT code 0548T, which was previously described by HCPCS code C9746. In addition, we proposed to assign CPT codes 0549T, 0550T, and 0551T to APCs 5375, 5374, and 5371, respectively.

Comment: A medical device company suggested that CPT code 0548T remain in APC 5377, consistent with the APC assignment for the predecessor code (HCPCS code C9746). This commenter indicated that the calculated geometric mean cost does not accurately reflect the actual cost of the procedure. The commenter noted there were only two billings identified in the CMS data—one billing at the correct cost of $16,250 and one billing incorrectly recorded at $0. The commenter stated that the resulting calculation of the geometric mean cost of $8,125 does not accurately represent the actual cost of the bilateral procedure for CPT code 0548T. In addition, the same commenter requested a reassignment from APC 5375 to APC 5376 for CPT code 0549T.

Response: As we have stated every year since the implementation of the OPPS on August 1, 2000, we review, on an annual basis, the APC assignments for all services and items paid under the OPPS based on our analysis of the latest claims data. For CY 2020, based on claims submitted between January 1, 2018 through December 30, 2018, that were processed on or before June 30, 2019, our analysis of the latest claims data for this final rule supports revising the APC assignment for CPT code 0548T (which was previously described by predecessor HCPCS code C9746) from APC 5377 to APC 5376 (Level 6 Urology and Related Services). Specifically, our claims data shows a geometric mean cost of approximately $9,504 for HCPCS code C9746 based on 7 single claims (out of 7 total claims), which is most comparable to the geometric mean cost of about $7,894 for APC 5376, rather than the geometric mean cost of approximately $17,195 for APC 5377. We believe that assigning CPT code 0548T to APC 5377 would significantly overpay for the procedure.

In addition, based on the geometric mean cost for the placement of the bilateral balloon continence devices (CPT code 0548T), we do not agree that we should revise the APC assignment for CPT code 0549T, which represents Start Printed Page 61270the unilateral placement of the balloon continence device, from APC 5375 to APC 5376. We believe that the cost associated with CPT code 0549T should be less than that of CPT code 0548T since CPT code 0549T describes the use of only one device.

Moreover, we rely on hospitals to accurately report the use of HCPCS codes in accordance with their code descriptors and CPT and CMS instructions, and to appropriately report services on claims and charges and costs for the services on their Medicare hospital cost report. However, we do not specify the methodologies that hospitals use to set charges for this or any other service. We also state in Chapter 4 of the Medicare Claims Processing Manual that “it is extremely important that hospitals report all HCPCS codes consistent with their descriptors; CPT and/or CMS instructions and correct coding principles, and all charges for all services they furnish, whether payment for the services is made separately paid or is packaged” to enable CMS to establish future ratesetting for OPPS services.

In summary, after consideration of the public comment and after our analysis of the updated claims data for this final rule with comment period, we are finalizing our proposal, without modification, to assign CPT codes 0548T, 0549T, 0550T, and 0551T to the APCs listed in Table 37 below. The final CY 2020 payment rate for the codes can be found in Addendum B to this final rule with comment period. In addition, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) meanings for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website.

c. Rezum Procedure—Transurethral High Energy Water Vapor Thermal Therapy of the Prostate (APC 5373)

In late 2017, CMS received a new technology application for the transurethral radiofrequency generated water vapor thermal therapy of the prostate, also known as the Rezum procedure, and established a new code, specifically, HCPCS code C9748 (Transurethral destruction of prostate tissue; by radiofrequency water vapor (steam) thermal therapy) effective January 1, 2018. Based on the estimated cost of the procedure, we assigned the new code to APC 5373 (Level 3 Urology and Related Services) with a payment rate of $1,695.68 effective January 1, 2018. The new code appeared in both the OPPS Addendum B of the CY 2018 OPPS/ASC final rule and the January 2018 OPPS Update CR (Transmittal 3941, Change Request 10417, dated December 22, 2017).

For the CY 2019 update, the CPT Editorial Panel established a new code to describe the Rezum procedure, specifically, CPT code 53854 (Transurethral destruction of prostate tissue; by radiofrequency generated water vapor thermotherapy) effective January 1, 2019. We deleted HCPCS code C9748 on December 31, 2018 because it was replaced with CPT code 53854 and assigned the new code to APC 5373, which was the same APC assignment for the predecessor code, with a payment rate of $1,739.75. We note that payment rates for the CY 2019 update were based on claims submitted between January 1, 2017 and December 30, 2017 that were processed on or before June 30, 2018.

For the CY 2020 update, we proposed to maintain the APC assignment for CPT code 53854 to APC 5373 with a proposed payment rate of $1,797.97.

Comment: Several commenters requested a reclassification for CPT code 53854 from APC 5373 to APC 5374 (Level 4 Urology and Related Services) with a proposed payment rate of $3,059.21. The commenters reported that the Rezum procedure is most clinically similar to the transurethral microwave therapy (TUMT), which is described by CPT code 53850 (Transurethral destruction of prostate tissue; by microwave thermotherapy), and transurethral needle (radiofrequency) ablation (TUNA), which is described by CPT code 53852 Start Printed Page 61271(Transurethral destruction of prostate tissue; by radiofrequency thermotherapy). Some commenters reported that the primary difference between each of these codes is the energy source used to destroy or shrink the prostate tissue, specifically, CPT code 53850 uses microwave energy, 53852 uses radiofrequency energy, and 53854 uses radiofrequency generated water vapor thermotherapy. Apart from the energy source, the commenters indicated that the procedures and resources used in these procedures are similar. Consequently, they recommended that all three procedures be placed in APC 5374.

Response: As we have stated every year since the implementation of the OPPS on August 1, 2000, we review, on an annual basis, the APC assignments for all services and items paid under the OPPS based on our analysis of the latest claims data. For CY 2020, based on claims submitted between January 1, 2018 through December 30, 2018, that were processed on or before June 30, 2019, our analysis of the latest claims data for this final rule supports maintaining the APC assignment for CPT code 53854 (which was previously described by predecessor HCPCS code C9748) to APC 5373. Our claims data show a geometric mean cost of approximately $1,899 for the predecessor HCPCS code C9748 based on 191 single claims (out of 192 total claims). The geometric mean cost for the Rezum procedure is more in line with the geometric mean cost of about $1,733 for APC 5373 rather than with APC 5374 whose geometric mean cost is approximately $2,953.

In addition, based on our analysis of the claims data, the resource costs associated with the TUMT and TUNA procedures are not similar to the Rezum procedure. While all three procedures treat the same indication and utilize the same type of technology, time, set up, and planning, their resource costs vary. Our claims data show a geometric mean cost of approximately $2,851 for the TUMT procedure (CPT code 53850) based on 41 single claims (out of 41 total claims), and about $3,027 for the TUNA procedure (CPT code 53852) based on 513 single claims (out of 514 total claims). In both cases, the resource costs for the TUMT and TUNA procedures are much higher than those for the Rezum procedure.

Therefore, after consideration of the public comments, and after our analysis of the updated claims data for this final rule with comment period, we are finalizing our proposal, without modification, and assigning CPT code 53854 to APC 5373. Table 38 below list the final APC assignments for CPT code 58350 (TUMT), 53852 (TUNA) and 53854 (Rezum). In addition, the final CY 2020 payment rates for these procedures can be found in Addendum B to this final rule with comment period. Further, we refer readers to Addendum D1 of this final rule with comment period for the status indicator (SI) meanings for all codes reported under the OPPS. Both Addendum B and D1 are available via the internet on the CMS website.

As always, we will reevaluate the APC assignment for CPT code 53854 in the next rulemaking cycle. As stated above, we review, on an annual basis, the APC assignments for all services and items paid under the OPPS.

d. VaporBlate Procedure—Transurethral Radiofrequency Generated Water Vapor Thermal Therapy of the Prostate

As displayed in Addendum B to the CY 2020 OPPS/ASC proposed rule, we proposed to assign the procedure described by CPT code 0582T (Transurethral ablation of malignant prostate tissue by high-energy water vapor thermotherapy, including intraoperative imaging and needle guidance) to status indicator “E1” to indicate that the code is not payable by Medicare when submitted on outpatient claims (any outpatient bill type) because the services associated with these codes are either not covered by any Medicare outpatient benefit category, are statutorily excluded by Medicare, or are not reasonable and necessary. The code was listed as 0X76T (the 5-digit CMS placeholder code) in Addendum B with the short descriptor, and again in Addendum O with the long descriptor. We also assigned the code to comment indicator “NP” in Addendum B to indicate that the code is new for CY 2020 and that public comments would be accepted on the proposed status indicator assignment. We note that the code will be effective January 1, 2020.

Comment: A medical device company reported that the technology associated with this new code received FDA approval as an IDE. Specifically, the VaporBlate technology was designated by the FDA as a Category B IDE on August 29, 2019. The commenter also Start Printed Page 61272stated that they are in the process of applying for Medicare coverage of the Category B IDE clinical trial. In the event the clinical trial is approved by Medicare, the commenter suggested assigning the code to one of the following APCs:

  • APC 1590 (New Technology—Level 39 ($15,001-$20,000)) with a proposed payment rate of $ 17,500.50; or
  • APC 5377 (Level 7 Urology and Related Services) with a proposed payment rate of $17,465.94.

The commenter explained that the VaporBlate procedure involves the transurethral ablation of malignant prostate tissue by high-energy water vapor thermotherapy, which is unlike that of the Rezum procedure that involves transurethral radiofrequency generated water vapor thermal therapy for benign prostatic hyperplasia (BPH). The commenter added that the resource costs associated with the VaporBlate procedure are significantly higher than those for the Rezum procedure. The Rezum generator (capital equipment) used in CPT code 53854 costs $32,500 and the Rezum supply kit (disposables) costs between $1,000 and $1,500, while the VaporBlate generator (capital equipment) used to perform the procedure described by the VaporBlate procedure costs $80,000 and the supply kits (disposables) cost $12,500 each. Based on the clinical and cost differences, the commenter stated that CPT code 0582T should not be assigned to the same APC as CPT code 53854 (Rezum procedure).

Response: Based on our understanding of the procedure, we found that the service associated with CPT code 0582T is currently in clinical trial (Study Title: “Ablation of Prostate Tissue in Patients With Intermediate Risk Localized Prostate Cancer”; ClinicalTrials.gov Identifier: NCT04087980). Further review of the clinical trial revealed that the clinical study has not yet met CMS' standards for coverage, nor does it appear on the CMS Approved IDE List, which can be found at this CMS website: https://www.cms.gov/​Medicare/​Coverage/​IDE/​Approved-IDE-Studies.html. Because the VaporBlate technology has not been approved for Medicare coverage as a Category B IDE, we believe that we should continue to assign CPT code 0582T to status indicator “E1”. If this technology later meets CMS' standards for coverage, we will reassess the APC assignment for the code in a future quarterly update and/or rulemaking cycle.

Therefore, after consideration of the public comment, we are finalizing our proposal, without modification, to assign CPT code 0582T to status indicator “E1”. We refer readers to Addendum D1 of this final rule with comment period for the complete list of the OPPS payment status indicators and their definitions for CY 2020. Addendum D1 is available via the internet on the CMS website.

IV. OPPS Payment for Devices

A. Pass-Through Payment for Devices

1. Beginning Eligibility Date for Device Pass-Through Status and Quarterly Expiration of Device Pass-Through Payments

a. Background

The intent of transitional device pass-through payment, as implemented at 42 CFR 419.66, is to facilitate access for beneficiaries to the advantages of new and truly innovative devices by allowing for adequate payment for these new devices while the necessary cost data is collected to incorporate the costs for these devices into the procedure APC rate (66 FR 55861). Under section 1833(t)(6)(B)(iii) of the Act, the period for which a device category eligible for transitional pass-through payments under the OPPS can be in effect is at least 2 years but not more than 3 years. Prior to CY 2017, our regulation at 42 CFR 419.66(g) provided that this pass-through payment eligibility period began on the date CMS established a particular transitional pass-through category of devices, and we based the pass-through status expiration date for a device category on the date on which pass-through payment was effective for the category. In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79654), in accordance with section 1833(t)(6)(B)(iii)(II) of the Act, we amended § 419.66(g) to provide that the pass-through eligibility period for a device category begins on the first date on which pass-through payment is made under the OPPS for any medical device described by such category.

In addition, prior to CY 2017, our policy was to propose and finalize the dates for expiration of pass-through status for device categories as part of the OPPS annual update. This means that device pass-through status would expire at the end of a calendar year when at least 2 years of pass-through payments had been made, regardless of the quarter in which the device was approved. In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79655), we changed our policy to allow for quarterly expiration of pass-through payment status for devices, beginning with pass-through devices approved in CY 2017 and subsequent calendar years, to afford a pass-through payment period that is as close to a full 3 years as possible for all pass-through payment devices.

We refer readers to the CY 2017 OPPS/ASC final rule with comment period (81 FR 79648 through 79661) for a full discussion of the current device pass-through payment policy.

We also have an established policy to package the costs of the devices that are no longer eligible for pass-through payments into the costs of the procedures with which the devices are reported in the claims data used to set the payment rates (67 FR 66763).

b. Expiration of Transitional Pass-Through Payments for Certain Devices

As stated earlier, section 1833(t)(6)(B)(iii) of the Act requires that, under the OPPS, a category of devices be eligible for transitional pass-through payments for at least 2 years, but not more than 3 years. There currently is one device category eligible for pass-through payment: C1823 Generator, neurostimulator (implantable), nonrechargeable, with transvenous sensing and stimulation leads), which was established effective January 1, 2019. The pass-through payment status of the device category for HCPCS code C1823 will end on December 31, 2021. HCPCS code C1823 will continue to receive pass-through status in CY 2020.

2. New Device Pass-Through Applications

a. Background

Section 1833(t)(6) of the Act provides for pass-through payments for devices, and section 1833(t)(6)(B) of the Act requires CMS to use categories in determining the eligibility of devices for pass-through payments. As part of implementing the statute through regulations, we have continued to believe that it is important for hospitals to receive pass-through payments for devices that offer substantial clinical improvement in the treatment of Medicare beneficiaries to facilitate access by beneficiaries to the advantages of the new technology. Conversely, we have noted that the need for additional payments for devices that offer little or no clinical improvement over previously existing devices is less apparent. In such cases, these devices can still be used by hospitals, and hospitals will be paid for them through appropriate APC payment. Moreover, a goal is to target pass-through payments for those devices where cost considerations might be most likely to interfere with patient access (66 FR 55852; 67 FR 66782; and 70 FR 68629). Start Printed Page 61273We note that, in section IV.A.4. of the CY 2020 OPPS/ASC proposed rule, we proposed an alternative pathway that would grant fast-track device pass-through payment under the OPPS for devices approved under the FDA Breakthrough Device Program for OPPS device pass-through payment applications received on or after January 1, 2020. We refer readers to section IV.A.4. of the CY 2020 OPPS/ASC proposed rule for a complete discussion on this proposal.

As specified in regulations at 42 CFR 419.66(b)(1) through (3), to be eligible for transitional pass-through payment under the OPPS, a device must meet the following criteria:

  • If required by FDA, the device must have received FDA approval or clearance (except for a device that has received an FDA investigational device exemption (IDE) and has been classified as a Category B device by the FDA), or meet another appropriate FDA exemption; and the pass-through payment application must be submitted within 3 years from the date of the initial FDA approval or clearance, if required, unless there is a documented, verifiable delay in U.S. market availability after FDA approval or clearance is granted, in which case CMS will consider the pass-through payment application if it is submitted within 3 years from the date of market availability;
  • The device is determined to be reasonable and necessary for the diagnosis or treatment of an illness or injury or to improve the functioning of a malformed body part, as required by section 1862(a)(1)(A) of the Act; and
  • The device is an integral part of the service furnished, is used for one patient only, comes in contact with human tissue, and is surgically implanted or inserted (either permanently or temporarily), or applied in or on a wound or other skin lesion.

In addition, according to § 419.66(b)(4), a device is not eligible to be considered for device pass-through payment if it is any of the following: (1) Equipment, an instrument, apparatus, implement, or item of this type for which depreciation and financing expenses are recovered as depreciation assets as defined in Chapter 1 of the Medicare Provider Reimbursement Manual (CMS Pub. 15-1); or (2) a material or supply furnished incident to a service (for example, a suture, customized surgical kit, or clip, other than a radiological site marker).

Separately, we use the following criteria, as set forth under § 419.66(c), to determine whether a new category of pass-through payment devices should be established. The device to be included in the new category must—

  • Not be appropriately described by an existing category or by any category previously in effect established for transitional pass-through payments, and was not being paid for as an outpatient service as of December 31, 1996;
  • Have an average cost that is not “insignificant” relative to the payment amount for the procedure or service with which the device is associated as determined under § 419.66(d) by demonstrating: (1) The estimated average reasonable costs of devices in the category exceeds 25 percent of the applicable APC payment amount for the service related to the category of devices; (2) the estimated average reasonable cost of the devices in the category exceeds the cost of the device-related portion of the APC payment amount for the related service by at least 25 percent; and (3) the difference between the estimated average reasonable cost of the devices in the category and the portion of the APC payment amount for the device exceeds 10 percent of the APC payment amount for the related service (with the exception of brachytherapy and temperature-monitored cryoablation, which are exempt from the cost requirements as specified at § 419.66(c)(3) and (e)); and
  • Demonstrate a substantial clinical improvement, that is, substantially improve the diagnosis or treatment of an illness or injury or improve the functioning of a malformed body part compared to the benefits of a device or devices in a previously established category or other available treatment.

Beginning in CY 2016, we changed our device pass-through evaluation and determination process. Device pass-through applications are still submitted to CMS through the quarterly subregulatory process, but the applications will be subject to notice-and-comment rulemaking in the next applicable OPPS annual rulemaking cycle. Under this process, all applications that are preliminarily approved upon quarterly review will automatically be included in the next applicable OPPS annual rulemaking cycle, while submitters of applications that are not approved upon quarterly review will have the option of being included in the next applicable OPPS annual rulemaking cycle or withdrawing their application from consideration. Under this notice-and-comment process, applicants may submit new evidence, such as clinical trial results published in a peer-reviewed journal or other materials for consideration during the public comment process for the proposed rule. This process allows those applications that we are able to determine meet all of the criteria for device pass-through payment under the quarterly review process to receive timely pass-through payment status, while still allowing for a transparent, public review process for all applications (80 FR 70417 through 70418).

More details on the requirements for device pass-through payment applications are included on the CMS website in the application form itself at: http://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​passthrough_​payment.html, in the “Downloads” section. In addition, CMS is amenable to meeting with applicants or potential applicants to discuss research trial design in advance of any device pass-through application or to discuss application criteria, including the substantial clinical improvement criterion.

b. Applications Received for Device Pass-Through Payment for CY 2020

We received seven complete applications by the March 1, 2019 quarterly deadline, which was the last quarterly deadline for applications to be received in time to be included in the CY 2020 OPPS/ASC proposed rule. We received one of the applications in the second quarter of 2018, three of the applications in the fourth quarter of 2018, and three of the applications in the first quarter of 2019. None of the applications were approved for device pass-through payment during the quarterly review process.

Applications received for the later deadlines for the remaining 2019 quarters (June 1, September 1, and December 1), if any, will be presented in the CY 2021 OPPS/ASC proposed rule. We note that the quarterly application process and requirements have not changed in light of the addition of rulemaking review. Detailed instructions on submission of a quarterly device pass-through payment application are included on the CMS website at: https://www.cms.gov/​Medicare/​Medicare-Fee-for-Service-Payment/​HospitalOutpatientPPS/​Downloads/​catapp.pdf. A discussion of the applications received by the March 1, 2019 deadline is presented below.

(1) Surefire® SparkTM Infusion System

TriSalus Life Sciences submitted an application for a new device category for transitional pass-through payment status for the Surefire® SparkTM Infusion System. The Surefire® SparkTM Infusion System is described as a Start Printed Page 61274flexible, ultra-thin microcatheter with a self-expanding, nonocclusive one-way microvalve at the distal end. The applicant stated that it has designed the Pressure Enabled Drug DeliveryTM technology of the Surefire® SparkTM Infusion System to overcome intratumoral pressure in solid tumors and improve distribution and penetration of therapy during Transcatheter Arterial Chemoembolization (TACE) procedures. TACE is a minimally invasive, image-guided procedure used to infuse a high dose of chemotherapy into liver tumors. According to the applicant, the pliable, one-way valve at the distal tip of the Surefire® SparkTM Infusion System creates a temporary local increase in pressure during infusion, opening up collapsed vessels in tumors, which enables perfusion and therapy delivery in areas inaccessible to the systemic circulation, a positive hydrostatic pressure gradient, and restores convective flow to enable therapy to penetrate deeper into the tumor. During the TACE procedure, the physician first gains catheter access into the arterial system of the hepatic arteries through a small incision in the groin or the wrist. The applicant stated that the physician then uses real-time fluoroscopic guidance to navigate the Surefire® SparkTM Infusion System into the blood vessels feeding the tumors, infusing the chemotherapy and embolic materials through the Surefire® SparkTM Infusion System until the tumor bed is completely saturated.

With respect to the newness criterion at § 419.66(b)(1), FDA granted 510(k) premarket clearance as of April 3, 2018. The application for a new device category for transitional pass-through payment status for the Surefire® SparkTM Infusion System was received on November 29, 2018, which is within 3 years of the date of the initial FDA approval or clearance. We invited public comments on whether the Surefire® SparkTM Infusion System meets the newness criterion.

Comment: The manufacturer of Surefire® SparkTM Infusion System believed this device meets the eligibility criteria for device pass-through payment under the regulation at § 419.66, which includes the newness criterion.

Response: We appreciate the commenter's input. After consideration of the public comments we received and based on the fact that the Surefire® SparkTM Infusion System application was received within 3 years of FDA approval, we believe that the Surefire® SparkTM Infusion System meets the newness criterion.

With respect to the eligibility criterion at § 419.66(b)(3), according to the applicant, the use of the Surefire® SparkTM Infusion System is integral to the service of providing delivery of chemotherapy into liver tumors, is used for one patient only, comes in contact with human skin, and is applied in or on a wound or other skin lesion. The applicant also claimed the Surefire® SparkTM Infusion System meets the device eligibility requirements of § 419.66(b)(4) because it is not an instrument, apparatus, implement, or items for which depreciation and financing expenses are recovered, and it is not a supply or material furnished incident to a service. We invited public comments on whether the Surefire® SparkTM Infusion System meets the eligibility criteria at § 419.66(b).

Comment: The manufacturer of Surefire® SparkTM Infusion System believed that that the Surefire® SparkTM Infusion System met the eligibility criteria at § 419.66(b).

Response: We appreciate the commenter's input. Based on the information we have received and our review of the application, we have determined that Surefire® SparkTM Infusion System meets the eligibility criterion at § 419.66(b)(3) and (b)(4).

The criteria for establishing new device categories are specified at § 419.66(c). The first criterion, at § 419.66(c)(1), provides that CMS determines that a device to be included in the category is not appropriately described by any of the existing categories or by any category previously in effect, and was not being paid for as an outpatient service as of December 31, 1996. We identified several existing pass-through payment categories that may be applicable to the Surefire® SparkTM Infusion System. The Surefire® SparkTM Infusion System may be described by HCPCS code C1887 (Catheter, guiding (may include infusion/perfusion capability)). The applicant describes the Surefire® SparkTM Infusion System as a device used in vascular interventional procedures to deliver diagnostic and therapeutic agents in the peripheral vasculatures. The CMS List of Device Category Codes for Present or Previous Pass-Through Payment and Related Definitions describes HCPCS code C1887 as intended for the introduction of interventional/diagnostic devices into the coronary or peripheral vascular systems. In the CY 2020 OPPS/ASC proposed rule, we also stated that the Surefire® SparkTM Infusion System may also be described by HCPCS code C1751 (Catheter, infusion, inserted peripherally, centrally or midline (other than hemodialysis)). The applicant describes the Surefire® SparkTM Infusion System as being inserted through a small incision in the groin or the wrist. We invited public comments on this issue.

Comment: The manufacturer of the device does not believe there is an existing pass-through payment category that describes the Surefire® SparkTM Infusion System, commenting that the existing device categories that CMS identified do not adequately describe critical aspects of the device. The manufacturer noted that existing categories, such as C1887 Catheter, guiding (may include infusion/perfusion capability) and C1751 Catheter, infusion, inserted peripherally, centrally or midline (other than hemodialysis)—do not appropriately describe catheters with a pressure-enabled drug delivery (PEDD) valve, a key mechanism of action of the Surefire® SparkTM Infusion System. The manufacturer stated that the PEDD valve is closely associated with differential and improved outcomes as compared to catheters without PEDD valves and is not appropriately described by existing categories.

Response: We appreciate the commenter's input. After consideration of the public comments we received, we believe there is no existing pass-through payment category that appropriately describes the Surefire® SparkTM Infusion System, due to the pressure-enabled drug delivery (PEDD) valve which offers a unique mechanism for therapy delivery. Based on this information, we believe that the Surefire® SparkTM Infusion System meets the eligibility criterion.

The second criterion for establishing a device category, at § 419.66(c)(2), provides that CMS determines that a device to be included in the category has demonstrated that it will substantially improve the diagnosis or treatment of an illness or injury or improve the functioning of a malformed body part compared to the benefits of a device or devices in a previously established category or other available treatment. With respect to this criterion, the applicant submitted four studies to support the claim that their technology represents a substantial clinical improvement over existing technologies. The applicant asserts that the Surefire® SparkTM Infusion System represents a substantial clinical improvement over existing technologies because it offers a treatment option that no other catheters currently available can provide. The manufacturer notes that the self-expanding, nonocclusive, one-way valve can infuse therapy at pressure higher Start Printed Page 61275than the baseline mean arterial pressure, and this pressurized delivery opens up collapsed vessels in tumors and enables perfusion and therapy delivery into hypoxic areas of the liver tumors. The applicant also believes that the Surefire® SparkTM Infusion System represents a substantial clinical improvement because the technology has shown improved tumor response rates in hepatocellular carcinoma, as well as a decrease in the rate of disease recurrence and the need for subsequent treatment.

The first pilot study of nine patients being treated for hepatocellular carcinoma, who received infusions via both a conventional end-hole catheter and an antireflux microcatheter, demonstrated statistically significant reductions in downstream distribution of embolic particles with the antireflux catheter and increases in tumor deposition (p < 0.05).[13] The second singlecenter retrospective study was conducted with 22 patients treated for hepatocellular carcinoma with the Surefire® SparkTM Infusion System and TACE. As assessed by MRI, there appeared to be overall disease response in 91 percent of patients and 85 percent of lesions and complete response in 32 percent of patients and 54 percent of lesions.[14] In the first study for a case-control series, 19 patients undergoing treatment using SIS-TACE had a statistically significant improvement in disease response rate compared to 19 patients treated with end-hole microcatheters, 78.9 percent compared to 36.8 percent for initial overall response rate (p = 0.008).[15] In the second study, a multi-center registry of 72 patients demonstrated high response rate when compared to historical control at 6 months follow-up.[16]

Based on the information submitted by the applicant, one concern was that large-scale studies with long-term follow-up were limited. Also, the majority of studies presented had a sample size of less than 25 and the highest sample size presented was less than 100 patients. Additionally, patient follow-up occurred mostly within a 3 to 6 month timeframe with few studies occurring beyond this range. Another concern was that none of the studies presented improvements in mortality with the use of the Surefire® SparkTM Infusion System. Outcomes focused primarily on tumor response rates and lesion size, based upon imaging. We noted additional data on mortality endpoints would be helpful to fully assess substantial clinical improvement. We invited public comments on whether the Surefire® SparkTM Infusion System meets the substantial clinical improvement criterion.

Comment: The manufacturer responded to several statements regarding Surefire® SparkTM Infusion System and substantial clinical improvement in the CY 2020 OPPS/ASC proposed rule, and asserted that SparkTM Infusion System meets the substantial clinical improvement criterion. The manufacturer stated that the population size in the studies submitted to CMS are normal for a new and innovative technology, noting that the studies are methodologically rigorous and show statistically significant differentiation from comparators. The manufacturer also noted that overall survival is not an appropriate endpoint for hepatocellular carcinoma. They cited National Comprehensive Cancer Network (NCCN) guidelines, noting that tumor necrosis and pathologic response are primary predictors of success in these cases and locoregional therapy should be viewed as a way to transition patients to transplant or resection. The manufacturer also suggested that CMS should consider that clinical improvements vary based on the therapeutic agent being delivered by the SparkTM Infusion System and that these agents are approved on a variety of endpoints.

Response: We appreciate the response to the questions we had regarding SparkTM Infusion System. After reviewing the information provided in the public comment, we agree that while the opportunity for large-scale studies with long-term follow-up is limited for a new technology, the existing studies show statistically significant improvements. Additionally, with regard to our questions about impacts on mortality, we accept the applicant's statement that there are other key clinical endpoints, such as tumor necrosis and progression-free survival, that can be used to assess improvements from the SparkTM Infusion System.

Comment: Multiple commenters supported granting SparkTM Infusion System transitional pass-through payment status. Many of the commenters mentioned that SparkTM Infusion System provides substantial clinical benefit over conventional therapy and urged CMS to approve the transitional pass-through payment to reduce cost burden and increase patient access.

Response: We appreciate the additional information that the commenters provided on the performance and the benefits of SparkTM Infusion System.

After consideration of the public comments we received, we have determined that SparkTM Infusion System does meet the substantial clinical improvement criterion.

The third criterion for establishing a device category, at § 419.66(c)(3), requires us to determine that the cost of the device is not insignificant, as described in § 419.66(d). Section 419.66(d) includes three cost significance criteria that must each be met. The applicant provided the following information in support of the cost significance requirements. The applicant stated that the Surefire® SparkTM Infusion System would be reported with CPT code 37243, which is assigned to APC 5193 (Level 3 Endovascular Procedures). To meet the cost criterion for device pass-through payment status, a device must pass all three tests of the cost criterion for at least one APC. For our calculations, we used APC 5193, which has a CY 2019 payment rate of $9,669.04. Beginning in CY 2017, we calculated the device offset amount at the HCPCS/CPT code level instead of the APC level (81 FR 79657). CPT code 37243 had a device offset amount of $3,894.69 at the time the application was received. According to the applicant, the cost of the Surefire® SparkTM Infusion System is $7,750.

Section 419.66(d)(1), the first cost significance requirement, provides that the estimated average reasonable cost of devices in the category must exceed 25 percent of the applicable APC payment amount for the service related to the category of devices. The estimated average reasonable cost of $7,750 for the Surefire® SparkTM Infusion System is Start Printed Page 6127680.2 percent of the applicable APC payment amount for the service related to the category of devices of $9,669.04 ($7,750/$9,669.04 × 100 = 80.2 percent). Therefore, we believe the Surefire® SparkTM Infusion System meets the first cost significance requirement.

The second cost significance requirement, at § 419.66(d)(2), provides that the estimated average reasonable cost of the devices in the category must exceed the cost of the device-related portion of the APC payment amount for the related service by at least 25 percent, which means that the device cost needs to be at least 125 percent of the offset amount (the device-related portion of the APC found on the offset list). The estimated average reasonable cost of $7,750 for the Surefire® SparkTM Infusion System exceeds the cost of the device-related portion of the APC payment amount for the related service of $3,894.69 by 199 percent ($7,750−$3,894.69) × 100 = 198.99 percent). Therefore, we believe that the Surefire® SparkTM Infusion System meets the second cost significance requirement.

The third cost significance requirement, at § 419.66(d)(3), provides that the difference between the estimated average reasonable cost of the devices in the category and the portion of the APC payment amount for the device must exceed 10 percent of the APC payment amount for the related service. The difference between the estimated average reasonable cost of $7,750 for the SparkTM Infusion System and the portion of the APC payment amount for the device of $3,894.69 exceeds the APC payment amount for the related service of $9,669.04 by 40 percent (($7,750−$3,894.69)/$9,669.04) × 100 = 39.87 percent). Therefore, we believe that the Surefire® SparkTM Infusion System meets the third cost significance requirement.

We invited public comments on whether the Surefire® SparkTM Infusion System meets the device pass-through payment criteria discussed in this section, including the cost criterion.

Comment: The manufacturer of the Surefire® SparkTM Infusion System believed that the device meets the cost criterion for device pass-through payment status.

Response: We appreciate the manufacturer's input. After consideration of the public comments we received, we believe that Surefire® SparkTM Infusion System meets the cost criterion for device pass-through payment status.

After consideration of the public comments we received, we are approving the Surefire® SparkTM Infusion System for device pass-through payment status beginning in CY 2020.

(2) TracPatch

According to the applicant, TracPatch is a wearable device that utilizes an accelerometer, temperature sensor and step counter to allow the surgeon and patient to monitor recovery and help ensure critical milestones are being met. The applicant states that TracPatch utilizes wearable monitoring technology and methods in an effort to enhance the rehabilitation experience for both patients and physicians. Accelerometers are utilized to recognize and record the results when patients perform standard physical therapy exercises, in addition to providing standard step count and high-acceleration events that may indicate a fall. A temperature sensor monitors the skin temperature near the joint.

TracPatch is described by the applicant as a 24/7 remote monitoring wearable device that captures a patient's key daily activities: such as range of motion progress, exercise compliance, and ambulation. TracPatch is used for pre- and post-operative patient monitoring, patient engagement, data analytics and post-op cost reduction.

According to the applicant, the wearable devices stick on the skin above and below the knee. The wearables are applied before total knee surgery to determine a patient's baseline activity levels, and then again after surgery to allow the patient and surgeon to monitor activity, pain, range of motion and physical therapy. The use of the Bluetooth connectivity allows the device to be paired with any smartphone and the TracPatch cloud allows for unlimited data collection and storage. The applicant states that TracPatch includes a web dashboard and computer application, which permit a health care provider to monitor a patient's recovery in real-time, allowing for immediate care adjustments and the ability for providers and patients to respond to issues that may occur during recovery from surgery.

With respect to the newness criterion at § 419.66(b)(1), the applicant stated that TracPatch does not need FDA clearance because it is a Class I device that would be assigned to a generic category of devices described in 21 CFR parts 862 through 892 that is exempt from FDA premarket notification. However, the applicant did not identify which category of exempted devices that TracPatch would be assigned. The applicant also stated that TracPatch will be introduced into the market in 2019, which would be within 3 years of the device pass-through payment application for TracPatch that was received in March 2019. We invited public comments on whether the TracPatch is exempt from FDA clearance and if the TracPatch meets the newness criterion.

Comment: One commenter, the manufacturer, stated that they had registered TracPatch as a Class I Exempt goniometer with FDA which was listed on the Global Unique Device Identification Database (GUDID) as of August 28, 2019.

Response: We thank the manufacturer for clarifying that TracPatch is now registered with FDA as a Class I Exempt goniometer as of August 28, 2019.

After consideration of the public comments, we have determined that TracPatch meets the newness criterion.

With respect to the eligibility criterion at § 419.66(b)(3), the applicant claimed that the TracPatch is an integral part of monitoring the range of motion for a knee prior to and after total knee arthroplasty, is used for one patient only, and is placed on the skin above and below the knee and secured by Velcro strips. The applicant stated that the device is not surgically implanted or inserted into the patient and is not applied in or on a wound or other skin lesion. We stated concerns in the proposed rule with TracPatch's eligibility with respect to the criterion at § 419.66(b)(3) because to be eligible for pass-through payment a device must be surgically implanted or inserted into the patient or applied in a wound or on other skin lesions. In addition, the applicant stated that the TracPatch meets the device eligibility requirements of § 419.66(b)(4) because it is not an instrument, apparatus, implement, or item for which depreciation and financing expenses are recovered. We determined that TracPatch was not a material or supply furnished incident to a service. We invited public comments on whether the TracPatch meets the eligibility criterion.

Comment: One commenter, the manufacturer, provided more information on whether TracPatch meets the eligibility criterion. The manufacturer states that the device is adhered to a patient's skin using a medical adhesive patch and not Velcro strips and that the device is placed near a wound (which we assume is the incision for the associated knee surgery) in a sterile setting. The placement of the device near the wound allows real time monitoring of changes to the wound and complications and abnormalities that may arise. Also the device placement is important to perform measurements related to the knee's range of motion.Start Printed Page 61277

Response: The commenter did not state or provide evidence either in its device pass-through application or in its comment on the CY 2020 OPPS/ASC proposed rule, that the TracPatch device is surgically implanted or inserted into a patient or is applied in a wound or on other skin lesions. In fact, the description of the Class I Exempt goniometer on the FDA product classification web page states that the goniometer is not an implantable device. To be considered for device pass-through payment, a device must meet this part of the eligibility criterion.

After consideration of all of the information we have received, we have determined that TracPatch is not surgically implanted or inserted into a patient or applied in a wound or on other skin lesions, and the product thus does not meet the eligibility criterion for device pass-through payment status. Because we have determined that TracPatch does not meet the basic eligibility criterion for transitional pass-through payment status, we have not evaluated this product to determine whether it meets the other criteria required for transitional pass-through payment for devices; that is the substantial clinical improvement criterion, and the cost criterion.

Comment: Multiple commenters, including physicians and patients, described the benefits of TracPatch and how it helped either them or their patients with their recoveries from knee surgery.

Response: We appreciate the comments we received about the benefits of TracPatch. However, we did not evaluate substantial clinical improvement for TracPatch because it did not meet the eligibility criterion.

After consideration of the public comments we received, we are not approving device pass-through payment status for TracPatch for CY 2020.

(3) Vagus Nerve Stimulation (VNS) Therapy® System for Treatment Resistant Depression (TRD)

LivaNova USA Inc. submitted an application for the Vagus Nerve Stimulation (VNS) Therapy® System for Treatment Resistant Depression (TRD). According to the applicant, the VNS Therapy® System consists of two implantable components: A programmable electronic pulse generator and a bipolar electrical lead that is connected to the programmable electronic pulse generator. The applicant stated that the surgical procedure to implant the VNS Therapy® System involves subcutaneous implanting of the pulse generator in the intraclavicular region as well as insertion of the bipolar electrical lead which entails wrapping two spiral electrodes around the cervical portion of the left vagus nerve within the carotid sheath.

According to the applicant, following implant and recovery, the physician programs the pulse generator to intermittently stimulate the vagus nerve at a level that balances efficacy and patient tolerability. The pulse generator delivers electrical stimulation via the bipolar electrical lead to the cervical portion of the left vagus nerve within the carotid sheath thereby relaying information to the brain stem modulating structures relevant to depression. Stimulation typically consists of a 30-second period of “on time,” during which the device stimulates at a fixed level of output current, followed by a 5-minute “off time” period of no stimulation.

The applicant states that a hand-held programmer is utilized to program the pulse generator stimulation parameters, including the current charge, pulse width, pulse frequency, and the on/off stimulus time, which is also known as the on/off duty cycle. Initial settings can be adjusted to enhance the tolerability of the device as well as its clinical effects on the patient. The generator runs continuously, but patients can temporarily turn off the device by holding a magnet over it. The generator can also be turned on and off by the programmer.

The applicant states that the VNS Therapy® System provides indirect modulation of brain activity through the stimulation of the vagus nerve. The vagus nerve, the tenth cranial nerve, has parasympathetic outflow that regulates the autonomic (that is, involuntary) functions of heart rate and gastric acid secretion, and also includes the primary functions of sensation from the pharynx, muscles of the vocal cords and swallowing. It is a nerve that carries both sensory and motor information to and from the brain. Importantly, the vagus nerve has influence over widespread brain areas and it is believed that electrical stimulation of the vagus nerve alters various networks of the brain in order to treat psychiatric disease.

With respect to the newness criterion at § 419.66(b)(1), the applicant received FDA clearance for the VNS Therapy® System for TRD through the premarket approval (PMA) process on July 15, 2005, and the VNS Therapy® for TRD device was introduced to the market in September 2005. However, on May 4, 2007, a national coverage determination (NCD 160.18) was released prohibiting Medicare from covering the use of the VNS Therapy® System for TRD. This NCD remained in effect until February 15, 2019, when CMS determined that the VNS Therapy® for TRD could receive payment if the service was performed in CMS-approved coverage with evidence development (CED) studies. Although the VNS Therapy® System for TRD was introduced to the market in September 2005, Medicare has only covered it for slightly more than 11/2 years. However, § 419.66(b)(1) states that a pass-through payment application for a device must be received within 3 years of when the device either received FDA approval or was introduced to the market. The applicant stated that the VNS Therapy® System for TRD was introduced to the market in September 2005, which means the device pass-through payment application would have needed to have been submitted to CMS by September 2008. However, the pass-through application for the device was not received by CMS until March 2019.

In addition, it appeared that the neurostimulator device for the VNS Therapy® System for TRD is the same device that has been used since 1997 to treat epilepsy.[17] The applicant stated the following three differences between the two devices: (1) How the device is programmed to treat epilepsy versus TRD; (2) how the external magnets of the device are used for epilepsy treatment as compared to TRD treatment; and (3) that the battery life of the device to treat epilepsy is different than the battery life of the device when treating TRD. However, it was not clear that these differences demonstrate that the actual device used to treat TRD is any different than the device used to treat epilepsy.

Based on the information presented, we invited public comments on whether the VNS Therapy® System for TRD meets the newness criterion.

Comment: One commenter, the manufacturer, made additional arguments for why the VNS Therapy® System for TRD meets the newness criterion. The manufacturer stated that there were 22 months between the FDA approval of the associated procedure to treat TRD in July 2005 and CMS' issuance of the national determination of non-coverage on May 4, 2007. The manufacturer asserts that during those 22 months the VNS Therapy® System for TRD was “realistically not available” because of concerns about covering the TRD treatment procedure during the period between FDA approval and the national determination of non-coverage. Start Printed Page 61278In another part of the manufacturer's comment, they state that the uncertainty of coverage for the TRD treatment procedure meant that the treatment was not available to patients during the July 2005 to May 2007 time period.

The manufacturer believes the most equitable reading of the rule that is consistent with the intent of the criterion when it was established in the CY 2016 OPPS final rule (80 FR 70418 through 70420) is that the 3-year period for newness from when the VNS Therapy® System for TRD was introduced into the market in July 2015 should have been held in suspension from May 4, 2007 when the original national determination of non-coverage by CMS until the subsequent national determination allowing coverage of the VNS Therapy® System for TRD with coverage with evidence development (CED) was released on February 15, 2019.

The manufacturer cites CMS statements from the CY 2016 OPPS final rule supporting this reading, including that device pass-through payment is for devices that are truly new and do not have sufficient claims data for CMS to analyze, and that market availability for a device could be considered to be after its FDA approval or clearance date where there is a national coverage determination of non-coverage of the device within the Medicare population. The manufacturer asserts that the reason that the newness criterion does not address the market availability situation faced by the VNS Therapy® System for TRD is that CMS simply did not envision that such a situation would occur. The manufacturer asserts that the VNS Therapy® System for TRD neurostimulator device has not been available in the market for 3 full years, and therefore still meets the newness criterion.

Response: We disagree with the commenter's conclusion. The manufacturer did not provide evidence to establish that the neurostimulator device for the VNS Therapy® System for TRD was not similar to the neurostimulator device that has been used since 1997 to treat epilepsy. With no evidence to the contrary, it appears the neurostimulator device for the VNS Therapy® System for TRD has been on the market continuously since 1997 and therefore fails the newness criterion.

However, even if we were to assume the neurostimulator device for the VNS Therapy® System for TRD was a new device upon FDA approval for the TRD treatment procedure in July 2005, the device would still not meet the newness criterion. The manufacturer's comment about suggesting an equitable reading of the newness criterion consistent with what it believed was our intent in the CY 2016 OPPS final rule (80 FR 70418 through 70420) implied that, for a device to meet the newness standard, it had to be available in the market for less than three years and that the availability period would be suspended if the device was unavailable in the market due to national non-coverage. This comment does not align with the language of § 419.66(b)(1), which states that the application for device pass-through payment must be received within 3 years from the date of market availability and makes no exception for periods of national non-coverage. As we stated in the proposed rule, based on information provided in the original device pass-through application, the device pass-through application had to be submitted by September 2008 to meet the newness requirement.

Comment: One commenter stated that it did not believe that the VNS Therapy® System for TRD meets the newness criterion for device pass-through payment. The commenter states that while there have been technical improvements with the VNS Therapy® System for TRD, the commenter believes these are typical upgrades of an existing technology and not evidence of a new device.

Response: We appreciate the feedback from the commenter, including their concern that the differences cited by the manufacturer between the neurostimulator VNS device to treat epilepsy and the neurostimulator VNS device to treat TRD are not substantial enough to establish the VNS Therapy® System for TRD neurostimulator device as a new device that meets the newness criterion. A device also will fail the newness criterion if, as noted above, it is on the market more than three years, based either on its FDA clearance or approval date or the date of U.S. market availability.

After consideration of all of the information we have received, we have determined that the VNS Therapy® System for TRD does not meet the newness criterion.

With respect to the eligibility criterion at § 419.66(b)(3), the applicant claimed that the VNS Therapy® System for TRD is an integral part of a procedure to provide adjunctive treatment of chronic or recurrent depression in adult patients that have failed four or more antidepressant treatments. The VNS Therapy® System for TRD is used for one patient only, comes in contact with human tissue, and is surgically implanted or inserted into the patient. In addition, the applicant stated that the VNS Therapy® System for TRD meets the device eligibility requirements of § 419.66(b)(4) because it is not an instrument, apparatus, implement, or item for which depreciation and financing expenses are recovered. We determined that the VNS Therapy® for TRD was not a material or supply furnished incident to a service. We invited public comments on whether the VNS Therapy® for TRD meets the eligibility criterion.

Comment: One commenter, the manufacturer, claimed that the VNS Therapy® for TRD device meets the basic eligibility criteria for pass-through status. The device is an integral part of the service provided which is the adjunctive treatment of TRD. The device is used by one patient, comes in contact with human tissue and is surgically implanted. The manufacturer also asserts that the device is not an instrument, apparatus, implement, or item for which depreciation and financing expenses are recovered. The manufacturer states that the device is not a material or supply furnished incident to a service.

Response: We appreciate the additional comments from the manufacturer. After consideration of all of the information we have received, we have determined that the VNS Therapy® System for TRD does meet the device eligibility criterion as described by § 419.66(b)(4).

The criteria for establishing new device categories are specified at § 419.66(c). The first criterion, at § 419.66(c)(1), provides that CMS determines that a device to be included in the category is not appropriately described by any existing categories or by any category previously in effect, and was not being paid for as an outpatient service as of December 31, 1996. With respect to the existence of a previous pass-through device category that describes the device used for the VNS Therapy® System for TRD, the applicant suggested a category descriptor of “Generator, neurostimulator (implantable), treatment resistant depression, non-rechargeable.” However, the device category represented by HCPCS code C1767 is described as “Generator, neurostimulator (implantable), non-rechargeable,” which appears to encompass the device category descriptor for the VNS Therapy® System for TRD suggested by the applicant. The applicant asserts that the device category descriptor for HCPCS code C1767 is overly broad and noted the establishment of HCPCS code C1823 (Generator, neurostimulator (implantable), nonrechargeable, with transvenous sensing and stimulation Start Printed Page 61279leads), effective January 1, 2019, as an example of where a new device category for a nonrechargeable neurostimulation system to treat central sleep apnea was carved out from the broad category described by HCPCS code C1767.

The applicant believes its proposed category for the device for the VNS Therapy® System for TRD should similarly qualify as a new category. However, HCPCS code C1823 was established due to specific device features which distinguish that device category from HCPCS code C1767. The applicant for the VNS Therapy® System for TRD requested a new device category based on a beneficiary's diagnosis, but OPPS does not differentiate payment by diagnosis.

Comment: The applicant asserts that the VNS Therapy® for TRD device is not described by any of the existing device categories in the OPPS and that the associated service was not paid as an outpatient service as of December 31, 1996.

Response: We do not agree with the applicant's assertion. We believe the VNS Therapy® for TRD device is described by existing HCPCS code C1767 (Generator, neurostimulator (implantable), non-rechargeable) and does not meet the criterion that is described by § 419.66(c)(1) because the device is described by an existing device category. As stated in the proposed rule, OPPS does not differentiate payment by diagnosis and therefore cannot establish new device categories based solely on a previously described device being used to treat a new indication. In the original pass-through application, the applicant cited the example of the establishment of a new category code, HCPCS code C1823 (Generator, neurostimulator (implantable), nonrechargeable, with transvenous sensing and stimulation leads), for the remede system even though that device is a non-rechargeable neurostimulator and initially appeared to be covered by HCPCS code C1767, like the VNS Therapy® for TRD device. However, as we stated in the proposed rule, HCPCS code C1823 was established due to specific device features that distinguish that device category from HCPCS code C1767. The applicant has not identified any device features of the VNS Therapy® for TRD device that distinguish it from the category described by HCPCS code C1767.

After consideration of all of the information we have received, we have determined that the VNS Therapy® System for TRD is described by either an existing category or by a category previously in effect and does not meets the requirements of § 419.66(c)(1) and the device category eligibility criterion.

Because we have determined that the VNS Therapy® System for TRD does not meet either the newness criterion or the device category eligibility criterion for transitional pass-through payment status, we have not evaluated this device to determine whether it meets the other criteria required for transitional pass-through payment for devices; namely, the substantial clinical improvement criterion and the cost criterion.

Comment: A commenter supported giving pass-through status for the VNS Therapy® System for TRD because the commenter believes the clinical benefits of the VNS Therapy® System for TRD have been demonstrated by the studies submitted for the recent national coverage determination that established coverage with evidence development for the procedure.

Response: We appreciate the comment in support of the clinical benefits of the VNS Therapy® System for TRD. However, we did not evaluate substantial clinical improvement for the VNS Therapy® System for TRD because this device does not meet the newness criterion or the device category eligibility criterion.

After consideration of the public comments we received, we are not approving VNS Therapy® System for TRD device pass-through payment status for CY 2020.

(4) Optimizer® System

Impulse Dynamics submitted an application for a new device category for transitional pass-through payment status for the Optimizer® System. According to the applicant, the Optimizer® System is an implantable device that delivers Cardiac Contractility Modulation (CCM) therapy for the treatment of patients with moderate to severe chronic heart failure. CCM therapy is intended to treat patients with persistent symptomatic heart failure despite receiving guideline directed medical therapy (GDMT). The applicant stated that the Optimizer System consists of the Optimizer Implantable Pulse Generator (IPG), Optimizer Mini Charger, and Omni II Programmer with Omni Smart Software. Lastly, the applicant stated that the Optimizer® System delivers CCM signals to the myocardium. CCM signals are nonexcitatory electrical signals applied during the cardiac absolute refractory period that, over time, enhance the strength of cardiac muscle contraction.

With respect to the newness criterion at § 419.66(b)(1), the applicant received a Category B-3 Investigational Device Exemption (IDE) from FDA on April 6, 2017. Subsequently, the applicant received its premarket approval (PMA) application from FDA on March 21, 2019. We received the application for a new device category for transitional pass-through payment status for the Optimizer® System on February 26, 2019, which is within 3 years of the date of the initial FDA approval or clearance. We invited public comments on whether the Optimizer® System meets the newness criterion.

Comment: The manufacturer believes that the Optimizer® System meets the newness criterion.

Response: We appreciate the commenter's input. After consideration of the public comment we received, we believe that the Optimizer® System meets the newness criterion.

With respect to the eligibility criterion at § 419.66(b)(3), according to the applicant, the Optimizer® System is integral to the CCM therapy service provided, is used for one patient only, comes in contact with human skin, and is applied in or on a wound or other skin lesion. The applicant also stated that the Optimizer® System meets the device eligibility requirements of § 419.66(b)(4) because it is not an instrument, apparatus, implement, or items for which depreciation and financing expenses are recovered, and it is not a supply or material furnished incident to a service.

We did not receive any public comments regarding whether Optimizer® System meets the eligibility criterion. Based on the information we have received, we have determined that Optimizer® System meets the eligibility criterion.

The criteria for establishing new device categories are specified at § 419.66(c). The first criterion, at § 419.66(c)(1), provides that CMS determines that a device to be included in the category is not appropriately described by any of the existing categories or by any category previously in effect, and was not being paid for as an outpatient service as of December 31, 1996. For the proposed rule, we had not identified an existing pass-through payment category that describes the Optimizer® System.

Comment: The manufacturer of the Optimizer® System indicated that there is not an existing pass-through payment category that describes the device.

Response: We appreciate the commenter's input. After consideration of the public comment we received, we believe that the Optimizer® System meets the device category eligibility criterion.Start Printed Page 61280

The second criterion for establishing a device category, at § 419.66(c)(2), provides that CMS determines that a device to be included in the category has demonstrated that it will substantially improve the diagnosis or treatment of an illness or injury or improve the functioning of a malformed body part compared to the benefits of a device or devices in a previously established category or other available treatment. The applicant stated that the use of CCM significantly improves clinical outcomes for a patient population compared to currently available treatments. With respect to this criterion, the applicant submitted studies that examined the impact of CCM on quality of life, exercise tolerance, hospitalizations, and mortality.

The applicant noted that the use of the Optimizer® System significantly improves clinical outcomes for patients with moderate-to-severe chronic heart failure, and specifically improves exercise tolerance, quality of life, and functional status of patients that are otherwise underserved. The applicant claims that the Optimizer® System fulfills an unmet need because there is currently no therapeutic medical device therapies available for the 70 percent of heart failure patients who have New York Heart Association (NYHA) Class III heart failure, normal QRS duration and reduced ejection fraction (EF). FDA approved the Optimizer® System for NYHA Class III heart failure patients who remain symptomatic despite guideline directed medical therapy, who are in normal sinus rhythm, are not indicated for Cardiac Resynchronization Therapy, and have a left ventricular ejection fraction ranging from 25 percent to 45 percent.[18]

The applicant presented several studies to support these claims. According to the applicant, the results of a randomized clinical study in which patients with NYHA functional Class III, ambulatory Class IV heart failure despite OMT, an EF from 25-45 percent, or a normal sinus rhythm with QRS duration <130ms (n  =  160) were randomized to continued medical therapy (n = 86) or CCM with the Optimizer® System (n = 74) for 24 weeks showed a statistically significant improvement in the primary endpoint of peak oxygen consumption (pVO2  =  0.84, 95 percent Bayesian credible interval 0.123 to 1.52) compared with the patients who were randomized to continued medical therapy.[19] The secondary endpoint of quality of life, measured by Minnesota Living with Heart Failure Questionnaire (MLWHFQ) (p<0.001), 6-minute hall walk test (p = 0.02), and an NYHA function class assessment (p<0.001) were better in the treatment group versus control group. The secondary endpoint of heart failure-related hospitalizations was lowered from 10.8 percent to 2.9 percent (p = 0.048). The applicant also reported a registry study of 140 patients with a left ventricular ejection fraction from 25-45 percent receiving CCM therapy with a primary endpoint of comparing observed survival to Seattle Heart Failure Model (SHFM) predicted survival over 3 years of follow-up. All patients implanted with the Optimizer® System at participating centers were offered participation and 72 percent of patients agreed to enroll in the registry. There were improvements in quality of life markers (MLWHFQ) and a 75-percent reduction in heart failure hospitalizations (p<0.0001). Survival at 3 years was similar between the two study arms with CCM at 82.8 percent [73.4 percent-89.1 percent] and SHFM at 76.7 percent (p = 0.16). However, for patients with a left ventricular ejection fraction from 35-45 percent receiving CCM therapy, the 3-year mortality for CCM therapy was significantly better than predicted with 88 percent for CCM compared to 74.7 percent for SHFM (p = 0.0463).[20] The applicant presented a randomized, double blind, crossover study of CCM signals with 164 patients with EF ≤35 percent and NYHA Class II (24 percent) or III (76 percent) symptoms who received a CCM pulse generator. After the 6-month treatment period, results indicated statistically significantly improved peak VO2 and MLWHFQ (p = 0.03 for each parameter), concluding that CCM signals appear to be safe for patients and that exercise tolerance and quality of life were significantly better while patients were receiving active CCM treatment.[21]

A study was conducted with 68 consecut