REGULATORY REVIEW


Device-Intensive Status Since the payment systems were aligned, devices have been packaged in the surgical reimbursement rate. If the device cost represented 50 percent of the entire procedure cost when per- formed in a hospital outpatient depart- ment (HOPD), the procedure was des- ignated as device-intensive and the device cost was fully contemplated in the reimbursement rate. In 2008, the first year of the revised payment sys- tem, there were 45 device-intensive codes in the ASC payment system.


Impact of the New Payment System on Device-Intensive Codes By 2012, ASCs, on average, were receiving 56 percent of the HOPD reimbursement for the same code. So, if there is a code that is $1,000 when performed in an HOPD but the device costs are $499, since the code does not meet the device offset threshold, the ASC would only receive approxi- mately $560. The device itself was cov- ered, but not much else. ASCA ramped up its efforts on this issue, arguing that the agency should lower the threshold to encourage migration of these proce- dures with high device costs.


2015 Payment Rule


In the 2015 proposed payment rule, CMS proposed to lower the device off- set percentage from 50 to 40 percent. ASCA asked CMS to lower the pro- posed 40 percent threshold to 30 per- cent since the ASC conversion fac- tor at the time was approximately 60 percent of the HOPD conversion fac- tor (30/50 = 60 percent). CMS ignored ASCA’s proposal at the time and final- ized the 40 percent device-offset. Still, the number of device-intensive codes increased from 75 in 2014 to 137 in 2015 under this policy change.


2019 Payment Rule ASCA continued to advocate for the 30 percent threshold, and in 2019,


18 ASC FOCUS AUGUST 2021 | ascfocus.org


TRACK THE LATEST REGULATORY AND LEGISLATIVE NEWS FOR ASCs


Visit ASCA’s website every week to stay up to date on the latest government affairs news affecting the ASC industry. Every week, ASCA’s Government Affairs Update newsletter is posted online for ASCA members to read. The weekly newsletter tracks and analyzes the latest legislative and regulatory developments concerning ASCs.


ascassociation.org/ GovtAffairsUpdate


affected by the changed device inten- sive threshold, so ASCA anticipates a further reduction in the device inten- sive threshold will lead to migration of services from HOPDs to ASCs.


Conversion Factor


CMS obliged. This increased the num- ber of device intensive codes from 154 in 2018 to 264 in 2019. ASCA com- mended CMS for making this change and provided data from the 50 to 40 percent threshold change to indicate the type of impact CMS might see with this new policy. In the first year following the effective date of that pol- icy—2015—there was a clear migra- tion of services from the HOPD to the ASC setting among the procedures


One of the biggest achievements for ASCA and the ASC community came in the 2019 OPPS/ASC Payment Rule. For the first time since the OPPS and ASC payment systems were aligned in 2009, CMS indicated it would use the same update factor for the ASC setting as it uses for hospitals, updat- ing the ASC conversion factor using the hospital market basket instead of the Consumer Price Index for All- Urban Consumers (CPI-U). ASCA had been advocating for this change for years, and it has been a key part of the ASC Quality & Access Act that ASCA supports.


CMS is using the hospital mar- ket basket to update ASC payments for CY 2019 through CY 2023. Dur- ing this time, the agency will monitor volume to see if this policy leads to migration to the lower cost ASC set- ting. While the long-term goal is to have this change be made permanent, a five-year trial period was far beyond what we had seen in the decade pre- ceding this policy change. ASCA will continue to work with its member facilities


and industry


stakeholders to advocate for the expan- sion of the ASC-CPL, a lower device threshold and permanent alignment of the ASC conversion factor with that used for the OPPS. While change often happens slowly when dealing with the federal government, ASCA is making progress and providing more access than ever to Medicare beneficiaries who will benefit from the high-quality surgical experience ASCs provide.


Kara Newbury is ASCA’s director of Govern- ment Affairs and regulatory counsel. Write her at knewbury@ascassociation.org.


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