Comments – Implementation Section 603 BBA 2015 – 1656-P Federal Register
August 19, 2016
Centers for Medicare & Medicaid Services
Department of Health and Human Services
Attention: CMS– 1656–P
P.O. Box 8013
Baltimore, MD 21244–1850
Dear Sirs:
The following comments are made relative to the July 14, 2016 Federal Register entry, specifically to:
X. Proposed Nonrecurring Policy Changes, A. Implementation of Section 603 of the Bipartisan Budget Act of 2015 Relating to Payment for Certain Items and Services Furnished by Certain Off-Campus Departments of a Provider
This section goes from page 45681 through page 45691.
General Comments
The approach being taken is much too restrictive and bureaucratic in nature and results in the development of a whole new set of rules and associated regulations. A more minimalist and simplistic approach should be taken with as few rule changes as possible and with a minimal amount of compliance risk for hospitals and other main providers. If the intent of Congress is not known, then a minimalist approach should be taken implementing the plain language of the legislation. In other words, if a hospital or other main providers establish a new off-campus provider-based operation, then payment for this newly created clinic or operation will be at the lower, most likely MPFS, rate starting January 1, 2017.
Even with a minimalist approach there are still many other issues that must be addressed, but most of these can be addressed at a subregulatory level.
Mid-Build Issue – Definition of a New Operations
Section 603 of BBA (Bipartisan Budget Act) 2015 came as a rather sudden surprise for hospitals. The process of developing, acquiring and converting and/or otherwise establishing provider-based operations, whether in the hospital, on the hospital campus or off-campus, requires significant effort and can be a significant process. As a result it can take at least several months, if not up to a year, to develop a new operation particularly if off-campus.
As a result, the criteria used to establish whether a given off-campus provider-based operation was established prior to November 2, 2015 for grandfathering purposes is of extreme importance. The use of the single criterion of billing is much too restrictive. A hospital, or other main provider, may have been in the middle of the process for establishing an off-campus provider-based operation.
For instance, a hospital may have built a building, furnished the building, hired personnel, contracted with physicians, filed an attestation, filed the appropriate CMS-855 enrollment forms, and other administrative activities but may not have been ready to bill until after the November 2nd deadline.
If a hospital can substantiate a bone fide effort to establish an off-campus provider-based operation prior to the November 2nd deadline, then the grandfathering of the provider-based operation should be allowed. A review process whereby the Regional Offices can be lobbied by hospitals with such ‘in the middle of building’ situations can be judged for grandfathering purposes. This type of review process would be self-terminating and certainly does not need to go through the NPRM (National Public Rulemaking) process. Although, the criteria for judgement should be clearly delineated by CMS at the national level.
Dedicated Emergency Departments (DEDs) Exemption
For off-campus provider-based operations that are DEDs, the payment restrictions imposed by Section 603 of BBA 2015 are certainly inappropriate. The suggested exception for DED services is appropriate.
There are a number of other related issues that should be considered in this area.
- A hospital may have established a provider-based urgent care clinic off-campus after the November 2nd deadline. For payment purposes this clinic will be paid as freestanding. (Comments relative to billing and claims filing issues are made later in this document.) However, according to EMTALA if this clinic meets the one-third rule, then this clinic will be deemed a DED. Does this mean that this clinic can then:
- Refile claims (i.e., split billing) back to the time that the one-third rule was achieved,
- Can this urgent care clinic then bill as if grandfathered for Section 603 BBA 2015?
- An alternative scenario is if the hospital established a freestanding urgent care clinic and then the one-third rule caused the clinic to be deemed as a DED. Does this mean that the clinic will then be considered provider-based and be able to split-bill and be excepted from Section 603 BBA 2015?
On-Campus Provider-Based Operations Exemption
No comments in this area. Section 603 BBA 2015 is very precise in that only off-campus clinics and/or operations are considered.
Within Distance from Remote Locations
Subregulatory guidance is needed as to how to measure the 250 yards and/or encouragement should be made to have unusual situations reviewed and approved by the Regional Offices.
Subregulatory guidance is also needed to determine if the 250 yard measure is also applicable to EMTALA situations. For example, a hospital’s property may abut onto a different property but the distance from the closest wall of the hospital to the property line is only 100 yards. Does the concept of ‘campus’ for EMTALA purpose include the 150 yards into the adjacent property? This becomes a critical issue when considering ‘presents to the DED’ within EMTALA.
Relocation of Off-Campus PBDs
The plain language of the legislation in Section 603 of BBA 2015 should be followed. Only if a new off-campus provider-based clinic or operation is established should the payment limitation be applied. If there is a new building built, a move is necessitated because a new lease is required, there is a suite change in a medical office building and/or other relocation necessitated then the grandfathering should continue. In these cases the clinic not ‘new’, there has only been a change in address or location.
This should also apply to services provided at an already existing provider-based clinic or operation. If the clinic wishes to add providers or increase service lines, then such changes should automatically come under grandfathering.
A simple approach is to have already existent (and/or those granted grandfathering through mid-build approval) provider-based operations to continue with normal provider-based billing and reimbursement. To do otherwise means that a whole new bureaucracy must be established to address complicated coding, billing and reimbursement issues.
For newly established off-campus provider-based operations, enrollment as a freestanding operation should be required (even though the operation is technically provider-based) and payment should be made through MPFS or any other applicable payment process (ASC, IDTF, Clinical Laboratory, etc.).
By taking such a simplistic or minimalist approach the whole issue of proper coding, billing and reimbursement with split operations (i.e., part provider-based, part equivalently freestanding) can be avoided. See comments concerning service line identification.
Expansion of Clinical Family of Services
If an off-campus provider-based clinic or operation meets the grandfathering provisions, then the expansion of service personnel and/or expansion of services should be allowed. For instance, an already established multi-specialty provider-based clinic may want to add a new type of specialist, say a nephrologist, to the roster of specialty physicians. This would be both an expansion in the number of providers and, at least for this example, potentially an increase in the service lines being offered.
There is no need to increase the bureaucratic machinations by delimiting the increase in the number of service personnel and/or service lines through some sort of clinical-families classifications. Section 603 of BBA 2015 states that only ‘new’ clinic or operations are to be affected. Expansion of a current clinic or operation should continue as grandfathered.
Changes of Ownership and Excepted Status
The requirement that the provider agreement be maintained is reasonable. While there can be a number of different situations, the Reginal Offices should review changes in ownership and determine whether there is a significant change in the provider agreement that would justify terminating the off-campus provider-based clinic or operation as being grandfathered under Section 603 of BBA 2015.
Enrollment Data Collection
As long as the bureaucratic machinations (i.e., families of services, etc.) are not implemented, the only real change in enrollment will be for newly establish (i.e., after November 2, 2015 or not qualifying for any mid-build exceptions) provider-based operations that will need to enroll but will be paid as freestanding analogs. As recommended elsewhere in these comments, billing can be accomplished on the UB-04 with payment under the MPFS and/or other appropriate payment process.
Payment Challenges for Services to Off-Campus PBDs that Are Not Grandfathered
If the decision is made to require special billing for additional service lines and/or providers, then the billing and claims processes along with proper adjudication will become complex and challenging. If the decision is made only to require special billing for off-campus provider-based clinics or operations that are not grandfathered, then there is a relatively simple approach that can be taken for billing, claims filing and associated adjudication processes. (See comments below concerning CAH Method II billing.)
Proposed Payment for Off-Campus PBDs that Are Not Grandfathered
The easiest way around hospitals with off-campus provider-based operations that are not grandfathered is to allow the hospital to file the institutional claim (i.e., the UIB-04) for those services (normally professional) that are to be paid through the MPFS and/or other payment mechanisms. This is already being done for CAHs (Critical Access Hospitals) using Method II billing. Thus, the processes for accomplishing such claims filing, associated adjudication and ultimate payment are all in place already.
If the decision is made to also include expanded lines of service into the reduced payment process, then this same approach can be used. There would be some differences because with CAH Method II reimbursement, the site-of-service (SOS) differential is applied whereas with the non-excepted off-campus clinics (and/or non-excepted items or lines of service) the SOS differential is not applied.
This type of process should not cause undue expense to the Medicare program and to the MACs.
Physician contracts and payment arrangements will need consideration for off-campus provider-based clinics established after the November 2nd deadline regardless of how the claims filing and payment processes are arranged. Because there will be only one billing (whether on the 1500 or UB-04), the way in which the physicians and qualified practitioners will be reimbursed will have to occur through some sort of contractual arrangement. In some cases the physician and practitioners will be employed by the hospital or main provider so that the contractual issue is not that difficult. If there are situations in which the physician is not employed (and/or not under contract), then some sort of arrangement for payment will need negotiation.
Such arrangements will need consideration relative to delimitations in the provider-based rule (see 42 CFR §413.65) and/or relative to delimitation in the Stark regulations.
Direct Billing and Payment for CY2018
As discussed above, the direct billing and payment for off-campus provider-based clinic or operations should use the CAH Method II process whereby professional claims (i.e., claim that will be paid solely through the MPFS) are filed on the UB-04. This will require some adjustment relative to the payment process because the SOS differential will not occur.
Conclusion and General Recommendation
The implementation of Section 603 of BBA 2015 should be done at a minimalist level. That is, there should as few changes as possible and any sort of bureaucratic machinations should be avoided. Only clinics or operations that are truly new (i.e., never existed in any form previously) should be subject to the payment reductions. Already existing or those situations that in the middle of being established should be grandfathered and not affected by the changes from Section 603 of BBA 2015.
For new off-campus clinics or operations that are established after the November 2, 2015 deadline, a modified form of claims filing on the UB-04 should be established that is similar to the CAH Method II billing and claims filing. This will allow hospitals, as the main providers, to file an institutional claim (i.e., UB-04) for services that will be adjudicated and paid through MPFS.
Thank-you for consideration of these comments.
Sincerely,
Duane C. Abbey, Ph.D.
President, Abbey & Abbey, Consultants, Inc.
Abbey & Abbey, Consultants, Inc.08-19-2016
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