LEGISLATURE


ASCA Advocates for Fair Implementation of Section 603 Congress passes site-neutral payment legislation BY KRISTIN MURPHY


O


n November 2, 2015, congres- sional leaders and the Obama administration announced a bipartisan budget agreement that would fund the federal government for two years, raise the nation’s debt ceiling and stave off Medicare premium increases for ben- eficiaries. The final legislation, called the Bipartisan Budget Act of 2015, responded to a number approaching fiscal deadlines and leadership changes in the House that could have impacted the ability to strike such a deal. The package included a provision (Section 603) aimed at stopping the practice of hospitals purchasing off- campus facilities, such as ASCs and physician offices, and then charging the Medicare program and beneficia- ries the higher hospital rates. The pro- vision applies to any outpatient facil- ity or physician practice located more than 250 yards from the main campus of the hospital that is acquired or estab- lished and wholly owned by a hospital after the enactment of the legislation. This policy change, referred to as site- neutral, means that Medicare will no longer pay a different price for similar services delivered in different settings. As drafted, on January 1, 2017, Medicare will begin paying hospital- owned facilities bought or built after November 2, 2015, according to the ‘applicable payment system’ or the physician fee schedule rate for office visits and the ASC rate for outpa- tient surgical procedures. Outpatient departments, ASCs, physician offices and other off-campus facilities that are currently operating will be exempted from the payment changes. For ASCs, this means that a pur-


chase by a hospital and conversion to a hospital outpatient department (HOPD) would not result in the hos-


34 ASC FOCUS JUNE/JULY 2016


For ASCs, this means that a purchase by a hospital and conversion to a hospital outpatient department (HOPD) would not result in the hospital being reimbursed by Medicare beyond the current ASC rate.


—Kristin Murphy, ASCA


pital being reimbursed by Medicare beyond the current ASC rate. The pro- vision came in response to concerns of many policymakers that hospitals were purchasing physician practices and ASCs and increasing the costs of care to the Medicare program and its beneficiaries. The Congressional Bud- get Office, which is responsible for measuring the potential cost or savings that changes in federal law may have on federal spending, estimated that the provision will save $7.3 billion over the next 10 years. Many advocacy groups, includ-


ing the American Hospital Associa- tion, have expressed concern that the change will adversely impact projects


currently under construction, ren- dering them financially unsound or impossible to complete. These groups have asked for an extension of the deadline at which the payments will be cut and/or a grandfathering pro- vision that would exempt facilities that were currently under construc- tion from the law. Some congressio- nal officials have expressed concern that exempting facilities from the law would undermine the savings that the bill initially provided. Over the past several months, ASCA has actively monitored this issue and its potential impact on ASCs and advocated for fair implementation. In mid-February, the House Energy and Commerce Committee requested infor- mation on the impact of Section 603 to ensure it will be implemented as Con- gress intended. ASCA provided com- ments highlighting the need to make certain that any site-neutral policy dis- cussions ensure that the sites be clini- cally similar and eliminate the differ- ence in procedures that are allowed in HOPDs versus ASCs. ASCA also emphasized that any site-neutral poli- cies should ensure that providers caring for more clinically complex patients be compensated for the increased cost of providing that care. To read the letter go to www.ascaconnect.org/Section603. ASCA will continue to monitor the implementation of Section 603 and provide feedback to members of Congress and the federal agencies that implement the law to ensure that the interests of the ASC community are considered in any future legislation or regulations.


Kristin Murphy is ASCA’s assistant director of legislative affairs. Write her at kmurphy@ascassociation.org.


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50