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FY 2011 Medicare Inpatient PPS Proposed Rule April 29, 2010

FY 2011 Medicare Inpatient PPS Proposed Rule April 29, 2010. Danielle Lloyd, MPH Senior Director, Reimbursement Policy. FY 2011 Proposed Inpatient PPS Rule. Released April 19, will be published in May 4 Federal Register.

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FY 2011 Medicare Inpatient PPS Proposed Rule April 29, 2010

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  1. FY 2011 Medicare Inpatient PPS Proposed RuleApril 29, 2010 Danielle Lloyd, MPH Senior Director, Reimbursement Policy

  2. FY 2011 Proposed Inpatient PPS Rule • Released April 19, will be published in May 4 Federal Register. • Market basket update of 2.4% for hospitals reporting quality measures (otherwise 0.4% update). • On average, negative 0.1% drop in operating payments– will be negative 0.35% once PPACA integrated. • Behavioral offset 2.9% for changes in documentation and coding as a result of the implementation of MS-DRGs in FYs 08 and 09. Leaves 2.9% behavioral offset to be recouped in FY 12, and a required prospective adjustment of 3.9%. • Retires 1 and adds 10 (including 8 HACs) quality measures (total of 55), while offering a choice of participation in 1 of 4 registries (Cardiac, Stroke, ICD complications, and nursing sensitive care). • Comments due June 18 with final rule expected by August 1.

  3. FY 2011 Proposed Inpatient PPS • Released April 19, will be published in May 4 Federal Register. • Comments due June 18 with final rule expected by August 1. • Expect corrections for Patient Protection and Affordable Care Act of 2010. Operating Rates • Market basket update of 2.4% for hospitals reporting quality measures (otherwise 0.4% update). • On average, negative 0.1% drop in payments in FY 11 – will be negative 0.35% once PPACA integrated. Capital Rates • Capital input price index update of 1.5 percent. • On average, negative 0.2% drop in payments in FY 2011.

  4. Behavioral offset • Proposed behavioral offset of 2.9% in FY 2011 for changes in documentation and coding as a result of MS-DRG implementation, with 2.9% pushed off until FY 2012, for payments in FYs 08 and 09. • CMS does not yet propose to reduce payments by the 3.9% to correct for “overpayment” going forward. • Proposes a 2.9% documentation and coding adjustment to the capital federal rate on a prospective basis. • Proposes 2.9% offset to hospital-specific rates of Sole Community and Medicare Dependent Hospitals • Leaves 2.5% recoupment (for total of 5.4%) as SCHs/MDHs were not previously reduced by 1.5% as were the other hospitals.

  5. FY 2011 RHQDAPU Measure Requirements • Proposing to retire the claims-based AHRQ Mortality for Selected Surgical Procedures Composite • AHRQ issued guidance in June 2009 “the measure is not recommended for comparative reporting” • RHQDAPU remaining measures: • 27 Chart Abstracted measures (AMI, HF, PN and SCIP) • 14 Claims-based measures • 30-Day Mortality (AMI, HF, PN) • 30-Day Risk Standardized Readmission (AMI, HF, PN) • AHRQ PSI, IQIs and Composite • Nursing Sensitive/PSI Harmonized measure with PSI-4 • 3 Structural Measures – Participation in a Registry • Cardiac Surgery, Stroke and Nursing Sensitive Care

  6. Proposed for FY 2012 • Retain the existing 45 FY 2011 measures • Add 10 claims-based measures • 2 AHRQ PSIs • PSI-11 Post-Operative Respiratory Failure • PSI-12 Post-Operative Pulmonary Embolism or VT • 8 Hospital Acquired Condition (HACs) • Foreign Object Retained After Surgery • Air Embolism • Blood Incompatibility • Pressure Ulcer Stages III & IV • Falls and Trauma: • Vascular Catheter-Associated Infection • Catheter-Associated Urinary Tract Infection (UTI) • Manifestations of Poor Glycemic Control

  7. Proposed for FY 2012 • Proposing hospitals submit all-patient data to allow CMS to calculate the patient volume for the 55 MS-DRGs relating to the APU measures. • Inviting comment on retirement of measures for high performance and other reasons. “Other Considerations” HF-1 Discharge Instructions PN-3b Blood Culture prior to 1st ABX SCIP-Inf-2 Prophylactic ABX selection SCIP-Inf-4 Cardiac Surgery Controlled Post-op Glucose “TOPPED OUT” AMI-1 Aspirin at arrival AMI-3 ACEI/ARB for LVSD AMI-4 Adult smoking cessation a AMI-5 BB prescribed at discharge HF-4 Adult smoking cessation PN-4 Adult smoking cessation SCIP-Inf-6 Appropriate hair removal

  8. Proposed for FY 2013 • Retain the existing FY 2012 measures • Add one new chart abstracted measure • AMI-10 Statin at Discharge • Data collection begins with January 1, 2011 discharges • Add two new Healthcare-Associated Infection (HAI) • Currently collected by CDC via the NHSN • Central Line Associated Blood Stream Infection (NQF #0139) • Surgical Site Infection (NQF # 0299)

  9. Proposed for FY 2013 • Add Registry-Based Measures • Proposes hospitals choose 1 of the 4 proposed topics: • Implantable Cardioverter Defibrillator (ICD) Complications • Cardiac Surgery • Stroke • Nursing-Sensitive Care • Collect and report data to a qualified registry for the specific topic • Registry would contract with hospital to submit data to CMS • Data Collection begins with January 1, 2011 discharges • Proposing a definition for qualified registries • CMS will provide list of registries

  10. Proposed for FY 2014 • Retain the existing FY 2013 measures • Add 4 new chart abstracted measures • Data collection begins with January 1, 2012 discharges • ED Throughput – Admit Decision Time to ED Departure for admitted patients • ED Throughput – Median time from ED Arrival to ED Departure for admitted patients • Global Flu Immunization • Global Pneumonia Immunization • Specific PN immunization measures would be retired

  11. Additional RHQDAPU Changes • Synchronize APU Data Submission and Validation • CMS proposes to align the quarterly discharge periods within the calendar year • Effective with FY 2013 payment decision • Data must be submitted in all 4 calendar quarters of 2011 • Data Validation will use 4 quarters of data • 4th qtr of CY that occurs 2 years before payment determination and the first 3 calendar quarters of the following year • Example 2013 validation • 4th calendar quarter 2010 through 3rd calendar quarter 2011

  12. EHRs and RHQDAPU • EHR quality measures reporting for Meaningful Use • Per the HITECH Act, CMS proposed a EHR incentive program that uses quality measure reporting to demonstrate meaningful use of a certified EHR • HITECH Act requires that preference be given to quality measures used in RHQDAPU • EHR Incentive Program and RHQDAPU are two separate programs that will overlap with reporting of quality measures • In NPRM for EHR incentive, if a measure is submitted for EHR and used in RHQDAPU hospitals will submit once for both programs

  13. Hospital-acquired conditions The Deficit Reduction Act required CMS to: • Identify by October 1, 2007 at least two preventable complications of care that could cause patients to be assigned to a higher-paying DRG when present as a secondary diagnosis: • The conditions must be high cost, high volume or both • The  conditions must be reasonably preventable by the hospital through the application of evidence-based guidelines. • To determine which complications occurred during the stay, hospitals must submit the secondary diagnoses that are present on admission (POA) when reporting payment information beginning in FY 08. • For FY 09, such preventable complications will NOT lead to the patient being assigned to a higher-paying DRG. • If the patient has another CC/MCC (that is not a HAC) then the case will STILL get the higher DRG.

  14. Hospital-acquired conditions Hospitals will not qualify for higher payment for the following HACs: • Object left in during surgery (acute reaction to foreign substance) • Air embolism • Blood incompatibility replaces code with 5 new codes in 2011 • Catheter-associated urinary tract infections • Pressure ulcers (Stages III/IV) • Surgical site infections (e.g., Mediastinitis after CABG, certain orthopedic and Bariatric surgeries ) expanded in 2009 • Vascular catheter-associated infections (e.g. blood stream infection) • Hospital-acquired falls leading to injuries (including fractures, dislocations, intracranial injury, crushing injury and burns) - two new codes in 2010 • DVT/PE after hip and knee replacement* - new in 2009 • Poor glycemic control (Ketoacidosis & Coma- hypoglycemic & hyporosmolar) new in 2009 • *There is no payment ramification for PE

  15. Cost Reports and Transfer Policy CMS Cost Report • Proposes to adopt new standard cost centers for CT scanning, MRIs, and cardiac catherization. • to improve the accuracy of cost estimations. Transfer Policy • Proposes to expand post-acute transfer policy related to transfers from an IPPS hospital to: • hospitals that do not have an agreement to participate with Medicare under the IPPS, and • Critical Access Hospitals (CAHs). • No material impact on Medicare payments.

  16. Disproportionate Share Hospital (DSH) Payments • DSH adjustment is calculated using Supplemental Security Income (SSI) fraction, and Medicaid fraction. • Data drawn from CMS Medicare Provider Analysis and Review (MedPAR) and SSI eligibility data provided by the Social Security Administration. • SSI is determined by CMS matching Medicare records and SSI eligibility records for each patient. • CMS proposes to revise data matching process for FY 2011 and beyond.

  17. Direct graduate medical education • The agency is proposing to create a process for hospitals to submit their Medicare GME affiliation agreements to CMS electronically. • Clarifies definition of residents in approved medical residency programs for the purpose of receiving Medicare IME and direct GME payments. • Specifically: • Jr. faculty who continue training with Sr. faculty to learn highly specialized skills, but not in an approved training program, should not be considered as residents. • The Jr. faculty should bill for their services under the PFS.

  18. New technology add-on payments • FY 2010 technologies: • CardioWest™ Temporary Total Artificial Heart System (continuation) • Spiration® IBV® valve system to limit airflow into leaking lung (continuation) • FY 2011 applications: • AutoLitt™ laser for brain tumor removal (requests comments) • LipiScan™ coronary imaging system (requests comments) • LipiScan™ coronary imaging system with Intravascular Ultrasound (requests comments)

  19. Outliers • To qualify for outlier payments in FY 11, the cost of the case must be more than the DRG, including add-ons, plus the fixed-loss threshold of $23,970 for CMS to then cover 80% of the balance. • This is up from the FY 10 threshold of $23,140.

  20. CRNA pass through • Certified Registered Nurse Anesthetists (CRNA) services are paid based on reasonable costs for certain rural and critical access hospitals (CAHs). • Previously, urban hospitals that reclassified as rural or those in Lugar Counties were ineligible for these payments. • Proposes to allow urban hospitals/CAHs reclassified as rural to receive CRNA pass-through payments, but does not proposed to allow Lugar County hospitals to do so.

  21. Critical Access Hospitals (CAHs) • Proposes that once a CAH elects to receive payments under Method II, it will remain until terminated • Proposes to clarify the policy concerning when provider taxes are allowable under Medicare • Medicare contractors will determine the allowability of provider taxes on a case-by-case basis and determine if a reduction is necessary to account for payments received that are associated with the assessed tax.

  22. PPACA provisions • Market basket reduction of 0.25% for inpatient and outpatient services • Hospital wage index • Extension of Section 508 hospital wage reclassifications through FY 2011 • Wage index floor of 1.00 for hospitals located in “frontier” states (Wyoming, Montana, North Dakota, South Dakota and Utah) • Restore wage comparison for reclassifications to 84% for urban and 80% for rural • Rural and imputed floors budget neutrality calculated on a national basis • Bonuses for hospitals in counties in bottom quartile for lowest adjusted total Medicare per beneficiary spending • Extension of Medicare reasonable costs payments for certain clinical diagnostic laboratory tests furnished to hospital patients in certain rural areas • Extension of the Rural Community Hospital Demonstration Program • Extension of the Medicare-dependent hospital (MDH) program • Temporary improvements to inpatient low-volume adjustment • Technical correction related to critical access hospital services • Extension of and revisions to Medicare Rural Hospital Flexibility Program

  23. Practical implications to think about? • Delayed ability to model changes due to expected changes. • Payment cuts due to behavioral offset in FYs 11-15? • Increase in payments due to geographic variation bonus? • Increase in payments due to reversed AWI policies? • Additional burden associated with new quality measures reporting requirements • Additional resources required to join proprietary registries? • Staff/systems/costs to test EHR submission of measures? • Increase in DSH payments? • Increase in payments for CRNA services? • Compliance with changes to cost-reporting changes?

  24. Contact information Danielle A. Lloyd, MPH Senior Director, Reimbursement Policy Premier Inc. 444 N. Capitol St, NW, Suite 625 Washington, DC 20001-1511 Phone: 202.879.8002 Fax: 202.393.0864 E-mail: danielle_lloyd@premierinc.com Web site: http://www.premierinc.com/

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