Hospitals Harmed by Proposed OPPS Rule

Last week CMS issued its proposed Outpatient Prospective Payment System rule for FY19 that contains significant regulatory changes that will result in a substantial reduction to hospital payments under the Medicare program.  

The proposed rule will reduce payments to clinical services in hospital off-campus provider-based clinics, further reduce payments for 340B acquired drugs in the off-campus clinics, and make changes to the rules at grandfathered clinics, which will reduce payments for new services provided in them.  MHA and the national hospital community say the overall changes fail to recognize the critical role that hospitals play in their communities and will impede access to services as patients will be forced to travel to receive the care that is now provided by the community-based hospital outpatient facilities.

“At a time when the Massachusetts hospital community is facing a nurse staffing ratio ballot question that is estimated to cost $1.3 billion initially, and $900 million annually, the proposed Medicare outpatient changes will further exacerbate the fragile financial conditions of hospitals in Massachusetts.  Congress never intended to apply the cuts in a manner that CMS is proposing,” said Steve Walsh, MHA’s president and CEO.

“In 2015, Congress clearly intended to provide current off-campus hospital clinics with the existing outpatient payment rate in recognition of the critical role they play in their communities. But CMS's proposal runs counter to this and will instead impede access to care for the most vulnerable patients” said the American Hospital Association.