Medicare Program: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; New Categories for Hospital Outpatient Department Prior Authorization Process; Clinical Laboratory Fee Schedule: Laboratory Date of Service Policy; Overall Hospital Quality Star Rating Methodology; Physician-Owned Hospitals; Notice of Closure of Two Teaching Hospitals and Opportunity To Apply for Available Slots, Radiation Oncology Model; and Reporting Requirements for Hospitals and Critical Access Hospitals (CAHs) To Report COVID-19 Therapeutic Inventory and Usage and To Report Acute Respiratory Illness During the Public Health Emergency (PHE) for Coronavirus Disease 2019 (COVID-19)
| Court | Centers For Medicare & Medicaid Services |
| Citation | 85 FR 85866 |
| Published date | 29 December 2020 |
| Section | Rules and Regulations |
| Record Number | 2020-26819 |
Federal Register, Volume 85 Issue 249 (Tuesday, December 29, 2020)
[Federal Register Volume 85, Number 249 (Tuesday, December 29, 2020)]
[Rules and Regulations]
[Pages 85866-86305]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-26819]
[[Page 85865]]
Vol. 85
Tuesday,
No. 249
December 29, 2020
Part II
Book 2 of 2 Books
Pages 85865-86455Department of Health and Human Services-----------------------------------------------------------------------
Centers for Medicare & Medicaid Services
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42 CFR Parts 410, 411, 412, et al.
Medicare Program: Hospital Outpatient Prospective Payment and
Ambulatory Surgical Center Payment Systems and Quality Reporting
Programs; New Categories for Hospital Outpatient Department Prior
Authorization Process; Clinical Laboratory Fee Schedule: Laboratory
Date of Service Policy; Overall Hospital Quality Star Rating
Methodology; Physician-Owned Hospitals; Notice of Closure of Two
Teaching Hospitals and Opportunity To Apply for Available Slots,
Radiation Oncology Model; and Reporting Requirements for Hospitals and
Critical Access Hospitals (CAHs) To Report COVID-19 Therapeutic
Inventory and Usage and To Report Acute Respiratory Illness During the
Public Health Emergency (PHE) for Coronavirus Disease 2019 (COVID-19);
Final Rule
Federal Register / Vol. 85 , No. 249 / Tuesday, December 29, 2020 /
Rules and Regulations
[[Page 85866]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 410, 411, 412, 414, 416, 419, 482, 485, 512
[CMS-1736-FC, 1736-IFC]
RIN 0938-AU12
Medicare Program: Hospital Outpatient Prospective Payment and
Ambulatory Surgical Center Payment Systems and Quality Reporting
Programs; New Categories for Hospital Outpatient Department Prior
Authorization Process; Clinical Laboratory Fee Schedule: Laboratory
Date of Service Policy; Overall Hospital Quality Star Rating
Methodology; Physician-Owned Hospitals; Notice of Closure of Two
Teaching Hospitals and Opportunity To Apply for Available Slots,
Radiation Oncology Model; and Reporting Requirements for Hospitals and
Critical Access Hospitals (CAHs) To Report COVID-19 Therapeutic
Inventory and Usage and To Report Acute Respiratory Illness During the
Public Health Emergency (PHE) for Coronavirus Disease 2019 (COVID-19)
AGENCY: Centers for Medicare & Medicaid Services (CMS), Health and
Human Services (HHS).
ACTION: Final rule with comment period and interim final rule with
comment period.
-----------------------------------------------------------------------
SUMMARY: This final rule with comment period revises the Medicare
hospital outpatient prospective payment system (OPPS) and the Medicare
ambulatory surgical center (ASC) payment system for Calendar Year (CY)
2021 based on our continuing experience with these systems. In this
final rule with comment period, we describe the changes to the amounts
and factors used to determine the payment rates for Medicare services
paid under the OPPS and those paid under the ASC payment system. Also,
this final rule with comment period updates and refines the
requirements for the Hospital Outpatient Quality Reporting (OQR)
Program and the ASC Quality Reporting (ASCQR) Program. In addition,
this final rule with comment period establishes and updates the Overall
Hospital Quality Star Rating beginning with the CY 2021; removes
certain restrictions on the expansion of physician-owned hospitals that
qualify as ``high Medicaid facilities,'' and clarifies that certain
beds are counted toward a hospital's baseline number of operating
rooms, procedure rooms, and beds; adds two new service categories to
the Hospital Outpatient Department (OPD) Prior Authorization Process;
provides notice of the closure of two teaching hospitals and the
opportunity to apply for available slots for purposes of indirect
medical education (IME) and direct graduate medical education (DGME)
payments; and revises the Clinical Laboratory Date of Service (DOS)
policy. This interim final rule with comment period modifies the
Radiation Oncology Model (RO Model) Model performance period for CY
2021, and establishes new requirements in the hospital and critical
access hospital (CAH) Conditions of Participation (CoPs) for tracking
of COVID-19 therapeutic inventory and usage and for tracking of the
incidence and impact of Acute Respiratory Illness (including, but not
limited to, Seasonal Influenza Virus, Influenza-like Illness, and
Severe Acute Respiratory Infection) during the ongoing COVID-19 public
health emergency (PHE).
DATES:
Effective date: This rule is effective January 1, 2021, with the
exceptions of amendatory instructions 21 and 23 (amending 42 CFR 482.42
and 485.640) and 25 through 31 (amending 42 CFR 512.205, 512.210,
512.217, 512.220, 512.245, 512.255, and 512.285), which are effective
on December 4, 2021.
Comment period: To be assured consideration, comments on the
payment classifications assigned to the interim APC assignments and/or
status indicators of new or replacement Level II HCPCS codes in this
final rule with comment period (CMS-1736-FC) must be received at one of
the addresses provided in the ADDRESSES section no later than 5 p.m.
EST on January 4, 2021.
To be assured consideration, comments on the Reporting Requirements
for Hospitals and CAHs to Report Acute Respiratory Illness During the
PHE for COVID-19, instructions 21 and 23 amending Sec. Sec. 482.42 and
485.640, and the Radiation Oncology (RO) Model, instructions 25 through
31 amending 42 CFR 512.205, 512.210, 512.217, 512.220, 512.245,
512.255, and 512.285 in this interim final rule with comment period
(CMS-1736-IFC) must be received at one of the addresses provided below,
no later than 5 p.m. on February 2, 2021.
Applicability dates: The provisions related to the Radiation
Oncology (RO) Model contained in section XXI of this interim final rule
with comment period are applicable beginning July 1, 2021.
ADDRESSES: In commenting, please refer to file code CMS-1736-FC or CMS-
1736-IFC as appropriate, when commenting on the issues in this final
rule with comment period and interim final rule with comment period.
Because of staff and resource limitations, we cannot accept comments by
facsimile (FAX) transmission.
Comments, including mass comment submissions, must be submitted in
one of the following three ways (please choose only one of the ways
listed):
1. Electronically. You may (and we encourage you to) submit
electronic comments on this regulation to http://www.regulations.gov.
Follow the instructions under the ``submit a comment'' tab.
2. By regular mail. You may mail written comments to the following
address ONLY: Centers for Medicare & Medicaid Services, Department of
Health and Human Services, Attention: CMS-1736-FC or CMS-1736-IFC, P.O.
Box 8010, Baltimore, MD 21244-1850.
Please allow sufficient time for mailed comments to be received
before the close of the comment period.
3. By express or overnight mail. You may send written comments via
express or overnight mail to the following address ONLY: Centers for
Medicare & Medicaid Services, Department of Health and Human Services,
Attention: CMS-1736-FC or CMS-1736-IFC, Mail Stop C4-26-05, 7500
Security Boulevard, Baltimore, MD 21244-1850.
b. For delivery in Baltimore, MD--Centers for Medicare & Medicaid
Services, Department of Health and Human Services, 7500 Security
Boulevard, Baltimore, MD 21244-1850.
For information on viewing public comments, we refer readers to the
beginning of the SUPPLEMENTARY INFORMATION section.
FOR FURTHER INFORMATION CONTACT: Advisory Panel on Hospital Outpatient
Payment (HOP Panel), contact the HOP Panel mailbox at
[email protected].
Ambulatory Surgical Center (ASC) Payment System, contact Scott
Talaga via email [email protected] or Mitali Dayal via email
[email protected].
Ambulatory Surgical Center Quality Reporting (ASCQR) Program
Administration, Validation, and Reconsideration Issues, contact Anita
Bhatia via email at [email protected].
Ambulatory Surgical Center Quality Reporting (ASCQR) Program
Measures, contact Cyra Duncan via email [email protected].
Blood and Blood Products, contact Josh McFeeters via email
[email protected]. Cancer
[[Page 85867]]
Hospital Payments, contact Scott Talaga via email
[email protected].
CMS Web Posting of the OPPS and ASC Payment Files, contact Chuck
Braver via email [email protected].
Composite APCs (Low Dose Brachytherapy and Multiple Imaging),
contact Au'Sha Washington via email [email protected].
Comprehensive APCs (C-APCs), contact Lela Strong-Holloway via email
[email protected], or Mitali Dayal via email
[email protected].
Hospital Outpatient Quality Reporting (OQR) Program Administration,
Validation, and Reconsideration Issues, contact Shaili Patel via email
[email protected].
Hospital Outpatient Quality Reporting (OQR) Program Measures,
contact Nicole P. Crenshaw via email [email protected].
Hospital Outpatient Visits (Emergency Department Visits and
Critical Care Visits), contact Elise Barringer via email
[email protected].
Hospital Quality Star Rating Methodology, contact Annese Abdullah-
Mclaughlin via email [email protected].
Inpatient Only (IPO) Procedures List, contact Au'Sha Washington via
email [email protected], or Allison Bramlett via email
[email protected], or Lela Strong-Holloway via email
[email protected].
Medical Review of Certain Inpatient Hospital Admissions under
Medicare Part A for CY 2021 and Subsequent Years (2-Midnight Rule),
contact Elise Barringer via email [email protected].
New Technology Intraocular Lenses (NTIOLs), contact Scott Talaga
via email [email protected].
No Cost/Full Credit and Partial Credit Devices, contact Scott
Talaga via email [email protected].
OPPS Brachytherapy, contact Scott Talaga via email
[email protected].
OPPS Data (APC Weights, Conversion Factor, Copayments, Cost-to-
Charge Ratios (CCRs), Data Claims, Geometric Mean Calculation, Outlier
Payments, and Wage Index), contact Erick Chuang via email
[email protected], or Scott Talaga via email
[email protected], or Josh McFeeters via email at
[email protected].
OPPS Drugs, Radiopharmaceuticals, Biologicals, and Biosimilar
Products, contact Josh McFeeters via email at
[email protected], or Gil Ngan via email at
[email protected] or, or Cory Duke via email at
[email protected].
OPPS New Technology Procedures/Services, contact the New Technology
APC mailbox at [email protected].gov.
OPPS Packaged Items/Services, contact Lela Strong-Holloway via
email [email protected], or Mitali Dayal via email at
[email protected].
OPPS Pass-Through Devices, contact the Device Pass-Through mailbox
at [email protected].
OPPS Status Indicators (SI) and Comment Indicators (CI), contact
Marina Kushnirova via email [email protected].
Partial Hospitalization Program (PHP) and Community Mental Health
Center (CMHC) Issues, contact the PHP Payment Policy Mailbox at
[email protected].
Prior Authorization Process and Requirements for Certain Covered
Outpatient Department Services, contact Thomas Kessler via email at
[email protected].
Rural Hospital Payments, contact Josh McFeeters via email at
[email protected].
Skin Substitutes, contact Josh McFeeters via email
[email protected].
Supervision of Outpatient Therapeutic Services in Hospitals and
CAHs, contact Josh McFeeters via email [email protected].
All Other Issues Related to Hospital Outpatient and Ambulatory
Surgical Center Payments Not Previously Identified, contact Elise
Barringer via email [email protected] or at 410-786-9222.
RO Model, contact [email protected] or at 844-711-2664,
Option 5.
CAPT Scott Cooper, USPHS, (410) 786-9465, for the hospital and CAH
COVID-19 Therapeutic Inventory and Usage reporting requirements and for
the Acute Respiratory Illness (including, but not limited to, Seasonal
Influenza Virus, Influenza-like Illness, and Severe Acute Respiratory
Infection) reporting requirements.
SUPPLEMENTARY INFORMATION:
Inspection of Public Comments: All comments received before the
close of the comment period are available for viewing by the public,
including any personally identifiable or confidential business
information that is included in a comment. We post all comments
received before the close of the comment period on the following
website as soon as possible after they have been received: http://www.regulations.gov/. Follow the search instructions on that website to
view public comments. CMS will not post on Regulations.gov public
comments that make threats to individuals or institutions or suggest
that the individual will take actions to harm the individual. CMS
continues to encourage individuals not to submit duplicative comments.
We will post acceptable comments from multiple unique commenters even
if the content is identical or nearly identical to other comments.
Addenda Available Only Through the Internet on the CMS Website
In the past, a majority of the Addenda referred to in our OPPS/ASC
proposed and final rules were published in the Federal Register as part
of the annual rulemakings. However, beginning with the CY 2012 OPPS/ASC
proposed rule, all of the Addenda no longer appear in the Federal
Register as part of the annual OPPS/ASC proposed and final rules to
decrease administrative burden and reduce costs associated with
publishing lengthy tables. Instead, these Addenda are published and
available only on the CMS website. The Addenda relating to the OPPS are
available at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.
The Addenda relating to the ASC payment system are available at:
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ASCPayment/ASC-Regulations-and-Notices.
Current Procedural Terminology (CPT) Copyright Notice
Throughout this final rule with comment period, we use CPT codes
and descriptions to refer to a variety of services. We note that CPT
codes and descriptions are copyright 2019 American Medical Association.
All Rights Reserved. CPT is a registered trademark of the American
Medical Association (AMA). Applicable Federal Acquisition Regulations
(FAR and Defense Federal Acquisition Regulations (DFAR) apply.
Table of Contents
I. Summary and Background
A. Executive Summary of This Document
B. Legislative and Regulatory Authority for the Hospital OPPS
C. Excluded OPPS Services and Hospitals
D. Prior Rulemaking
E. Advisory Panel on Hospital Outpatient Payment (the HOP Panel
or the Panel)
F. Public Comments Received in Response to the CY 2021 OPPS/ASC
Proposed Rule
[[Page 85868]]
G. Public Comments Received on the CY 2020 OPPS/ASC Final Rule
With Comment Period
II. Updates Affecting OPPS Payments
A. Recalibration of APC Relative Payment Weights
B. Conversion Factor Update
C. Wage Index Changes
D. Statewide Average Default Cost-to-Charge Ratios (CCRs)
E. Adjustment for Rural Sole Community Hospitals (SCHs) and
Essential Access Community Hospitals (EACHs) Under Section
1833(t)(13)(B) of the Act for CY 2021
F. Payment Adjustment for Certain Cancer Hospitals for CY 2021
G. Hospital Outpatient Outlier Payments
H. Calculation of an Adjusted Medicare Payment From the National
Unadjusted Medicare Payment
I. Beneficiary Copayments
III. OPPS Ambulatory Payment Classification (APC) Group Policies
A. OPPS Treatment of New and Revised HCPCS Codes
B. OPPS Changes--Variations Within APCs
C. New Technology APCs
D. OPPS APC-Specific Policies
IV. OPPS Payment for Devices
A. Pass-Through Payments for Devices
B. Device-Intensive Procedures
V. OPPS Payment Changes for Drugs, Biologicals, and
Radiopharmaceuticals
A. OPPS Transitional Pass-Through Payment for Additional Costs
of Drugs, Biologicals, and Radiopharmaceuticals
B. OPPS Payment for Drugs, Biologicals, and Radiopharmaceuticals
Without Pass-Through Payment Status
VI. Estimate of OPPS Transitional Pass-Through Spending for Drugs,
Biologicals, Radiopharmaceuticals, and Devices
A. Background
B. Estimate of Pass-Through Spending
VII. OPPS Payment for Hospital Outpatient Visits and Critical Care
Services
VIII. Payment for Partial Hospitalization Services
A. Background
B. PHP APC Update for CY 2021
C. Outlier Policy for CMHCs
IX. Services That Will Be Paid Only as Inpatient Services
A. Background
B. Changes to the Inpatient Only (IPO) List
X. Nonrecurring Policy Changes
A. Changes in the Level of Supervision of Outpatient Therapeutic
Services in Hospitals and Critical Access Hospitals (CAHs)
B. Medical Review of Certain Inpatient Hospital Admissions Under
Medicare Part A for CY 2021 and Subsequent Years
XI. CY 2021 OPPS Payment Status and Comment Indicators
A. CY 2021 OPPS Payment Status Indicator Definitions
B. CY 2021 Comment Indicator Definitions
XII. MedPAC Recommendations
A. OPPS Payment Rates Update
B. ASC Conversion Factor Update
C. ASC Cost Data
XIII. Updates to the Ambulatory Surgical Center (ASC) Payment System
A. Background
B. ASC Treatment of New and Revised Codes
C. Update to the List of ASC Covered Surgical Procedures and
Covered Ancillary Services
D. Update and Payment for ASC Covered Surgical Procedures and
Covered Ancillary Services
E. New Technology Intraocular Lenses (NTIOLs)
F. ASC Payment and Comment Indicators
G. Calculation of the ASC Payment Rates and the ASC Conversion
Factor
XIV. Requirements for the Hospital Outpatient Quality Reporting
(OQR) Program
A. Background
B. Hospital OQR Program Quality Measures
C. Administrative Requirements
D. Form, Manner, and Timing of Data Submitted for the Hospital
OQR Program
E. Payment Reduction for Hospitals That Fail To Meet the
Hospital OQR Program Requirements for the CY 2021 Payment
Determination
XV. Requirements for the Ambulatory Surgical Center Quality
Reporting (ASCQR) Program
A. Background
B. ASCQR Program Quality Measures
C. Administrative Requirements
D. Form, Manner, and Timing of Data Submitted for the ASCQR
Program
E. Payment Reduction for ASCs That Fail To Meet the ASCQR
Program Requirements
XVI. Overall Hospital Quality Star Rating Methodology for Public
Release in CY 2021 and Subsequent Years
A. Background
B. Critical Access Hospitals in the Overall Star Rating
C. Veterans Health Administration Hospitals in the Overall Star
Rating
D. History of the Overall Hospital Quality Star Rating
E. Current and Proposed Overall Star Rating Methodology
F. Preview Period
G. Overall Star Rating Suppressions
XVII. Addition of New Service Categories for Hospital Outpatient
Department (OPD) Prior Authorization Process
A. Background
B. Controlling Unnecessary Increases in the Volume of Covered
OPD Services
XVIII. Clinical Laboratory Fee Schedule: Revisions to the Laboratory
Date of Service Policy
A. Background on the Medicare Part B Laboratory Date of Service
Policy
B. Medicare DOS Policy and the ``14-Day Rule''
C. Billing and Payment for Laboratory Services Under the OPPS
D. ADLTs Under the New Private Payor Rate-Based CLFS
E. Additional Laboratory DOS Policy Exception for the Hospital
Outpatient Setting
F. Revision to the Laboratory DOS Policy for Cancer-Related
Protein-Based MAAAs
XIX. Physician-Owned Hospitals
A. Background
B. Prohibition on Facility Expansion
C. Deference to State Law for Purposes of Determining the Number
of Beds for Which a Hospital Is Licensed
XX. Notice of Closure of Two Teaching Hospitals and Opportunity To
Apply for Available Slots
A. Background Section
B. Notice of Closure of Westlake Community Hospital, Located in
Melrose Park, IL, and the Application Process--Round 18
C. Notice of Closure of Astria Regional Medical Center, Located
in Yakima, WA, and the Application Process--Round 19
D. Application Process for Available Resident Slots
XXI. Radiation Oncology (RO) Model
A. Model Performance Period for the Radiation Oncology Model
B. Waiver of Proposed Rulemaking
XXII. Reporting Requirements for Hospitals and Critical Access
Hospitals (CAHs) to Report COVID-19 Therapeutic Inventory and Usage
and To Report Acute Respiratory Illness During the Public Health
Emergency (PHE) for Coronavirus Disease 2019 (COVID-19)
XXIII. Files Available to the Public via the Internet
XXIV. Collection of Information Requirements
A. Statutory Requirement for Solicitation of Comments
B. ICRs for the Hospital OQR Program
C. ICRs for the ASCQR Program
D. ICRs for Addition of New Service Categories for Hospital
Outpatient Department (OPD) Prior Authorization Process
E. ICRs for the Overall Hospital Quality Star Ratings
F. ICRs for Physician-Owned Hospitals
XXV. Waiver of the 30-Day and 60-Day Delayed Effective Dates for the
Final Rule With Comment Period and Waiver of Proposed Rulemaking for
Reporting Requirements for Hospitals and Critical Access Hospitals
(CAHs) To Report COVID-19 Therapeutic Inventory and Usage and to
Report Acute Respiratory Illness During the PHE for COVID-19 Interim
Final Rule With Comment Period (IFC)
A. Waiver of the 30-Day and 60-Day Delayed Effective Dates for
the Final Rule With Comment Period
B. Waiver of Proposed Rulemaking for Reporting Requirements for
Hospitals and Critical Access Hospitals (CAHs) To Report Acute
Respiratory Illness During the PHE for COVID-19 Interim Final Rule
With Comment Period (IFC)
XXVI. Response to Comments
XXVII. Economic Analyses
A. Statement of Need
B. Overall Impact for the Provisions of This Final Rule With
Comment Period
C. Detailed Economic Analyses
D. Regulatory Review Costs
E. Regulatory Flexibility Act (RFA) Analysis
F. Unfunded Mandates Reform Act Analysis
G. Reducing Regulation and Controlling Regulatory Costs
[[Page 85869]]
H. Conclusion
XXVIII. Federalism Analysis
I. Summary and Background
A. Executive Summary of This Document
1. Purpose
In this final rule with comment period and interim final rule with
comment period, we are updating the payment policies and payment rates
for services furnished to Medicare beneficiaries in hospital outpatient
departments (HOPDs) and ambulatory surgical centers (ASCs), beginning
January 1, 2021. Section 1833(t) of the Social Security Act (the Act)
requires us to annually review and update the payment rates for
services payable under the Hospital Outpatient Prospective Payment
System (OPPS). Specifically, section 1833(t)(9)(A) of the Act requires
the Secretary to review certain components of the OPPS not less often
than annually, and to revise the groups, the relative payment weights,
and the wage and other adjustments that take into account changes in
medical practices, changes in technology, and the addition of new
services, new cost data, and other relevant information and factors. In
addition, under section 1833(i)(D)(v) of the Act, we annually review
and update the ASC payment rates. This final rule with comment period
also includes additional policy changes made in accordance with our
experience with the OPPS and the ASC payment system and recent changes
in our statutory authority. We describe these and various other
statutory authorities in the relevant sections of this final rule with
comment period. In addition, this final rule with comment period
updates and refines the requirements for the Hospital Outpatient
Quality Reporting (OQR) Program and the ASC Quality Reporting (ASCQR)
Program.
2. Summary of the Major Provisions
OPPS Update: For CY 2021, we are increasing the payment
rates under the OPPS by an Outpatient Department (OPD) fee schedule
increase factor of 2.4 percent. This increase factor is based on the
final hospital inpatient market basket percentage increase of 2.4
percent for inpatient services paid under the hospital inpatient
prospective payment system (IPPS). Based on this update, we estimate
that total payments to OPPS providers (including beneficiary cost-
sharing and estimated changes in enrollment, utilization, and case-mix)
for calendar year (CY) 2021 would be approximately $83.888 billion, an
increase of approximately $7.541 billion compared to estimated CY 2020
OPPS payments.
We are continuing to implement the statutory 2.0 percentage point
reduction in payments for hospitals that fail to meet the hospital
outpatient quality reporting requirements by applying a reporting
factor of 0.9805 to the OPPS payments and copayments for all applicable
services.
Partial Hospitalization Update: For CY 2021 OPPS/ASC final
rule with comment period, CMS is maintaining the unified rate structure
established in CY 2017, with a single PHP APC for each provider type
for days with 3 or more services per day. We are using the CMHC and
hospital-based PHP (HB PHP) geometric mean per diem costs, consistent
with existing policy, using updated data for each provider type.
Accordingly, we are calculating the CY 2021 PHP APC per diem rates for
HB PHPs and CMHC PHPs based on updated cost and claims data. Given that
the final calculated geometric mean per diem costs are much higher than
the proposed cost floors, we are not extending the cost floors to CY
2021 and subsequent years.
Changes to the Inpatient Only (IPO) List: For CY 2021, we
are eliminating the IPO list over the course of 3 calendar years
beginning with the removal of 266 musculoskeletal-related services. We
are also removing 32 additional HCPCS codes from the IPO list for CY
2021 based on public comments.
Medical Review of Certain Inpatient Hospital Admissions
under Medicare Part A for CY 2021 and Subsequent Years (2-Midnight
Rule): For CY 2021, we are finalizing a policy to exempt procedures
that are removed from the inpatient only (IPO) list under the OPPS
beginning on January 1, 2021 from site-of-service claim denials,
Beneficiary and Family-Centered Care Quality Improvement Organization
(BFCC-QIO) referrals to Recovery Audit Contractor (RAC) for persistent
noncompliance with the 2-midnight rule, and RAC reviews for ``patient
status'' (that is, site-of-service) until such procedures are more
commonly billed in the outpatient setting.
340B--Acquired Drugs: We are continuing our current policy
of paying an adjusted amount of ASP minus 22.5 percent for drugs and
biologicals acquired under the 340B program. We are continuing to
exempt Rural SCHs, PPS-exempt cancer hospitals and children's hospitals
from our 340B payment policy.
Comprehensive APCs: For CY 2021, we are creating two new
comprehensive APCs (C-APCs): C-APC 5378 (Level 8 Urology and Related
Services) and C-APC 5465 (Level 5 Neurostimulator and Related
Procedures). Adding these C-APCs increases the total number of C-APCs
to 69.
Device Pass-Through Payment Applications: For CY 2021, we
evaluated five applications for device pass-through payments. Two of
these applications (CUSTOMFLEX[supreg] ARTIFICIALIRIS and EXALT\TM\
Model D Single-Use Duodenoscope) received preliminary approval for
pass-through payment status through our quarterly review process. Based
on our review and public comments received, we are continuing the pass-
through payment status for CUSTOMFLEX[supreg] ARTIFICIALIRIS and
EXALT\TM\ Model D Single-Use Duodenoscope and approving the remaining
three applications for device pass-through payment status.
Changes to the Level of Supervision of Outpatient
Therapeutic Services in Hospitals and Critical Access Hospitals: For CY
2021 and subsequent years, we are changing the minimum default level of
supervision for non-surgical extended duration therapeutic services
(NSEDTS) to general supervision for the entire service, including the
initiation portion of the service, for which we had previously required
direct supervision. This is consistent with the minimum required level
of general supervision that currently applies for most outpatient
hospital therapeutic services. We are finalizing our proposed policy to
permit direct supervision of pulmonary rehabilitation, cardiac
rehabilitation, and intensive cardiac rehabilitation services using
virtual presence of the physician through audio/video real-time
communications technology subject to the clinical judgment of the
supervising physician until the later of the end of the calendar year
in which the PHE ends or December 31, 2021.
Cancer Hospital Payment Adjustment: For CY 2021, we are
continuing to provide additional payments to cancer hospitals so that a
cancer hospital's payment-to-cost ratio (PCR) after the additional
payments is equal to the weighted average PCR for the other OPPS
hospitals using the most recently submitted or settled cost report
data. However, section 16002(b) of the 21st Century Cures Act requires
that this weighted average PCR be reduced by 1.0 percentage point.
Based on the data and the required 1.0 percentage point reduction, a
target PCR of 0.89 will be used to determine the CY 2021 cancer
hospital payment adjustment to be paid at cost report settlement. That
is, the payment adjustments will be the additional payments needed to
result in
[[Page 85870]]
a PCR equal to 0.89 for each cancer hospital.
ASC Payment Update: For CYs 2019 through 2023, we adopted
a policy to update the ASC payment system using the hospital market
basket update. Using the hospital market basket methodology, for CY
2021, we are increasing payment rates under the ASC payment system by
2.4 percent for ASCs that meet the quality reporting requirements under
the ASCQR Program. This increase is based on a hospital market basket
percentage increase of 2.4 percent minus a multifactor productivity
adjustment of 0.0 percentage point. Based on this update, we estimate
that total payments to ASCs (including beneficiary cost-sharing and
estimated changes in enrollment, utilization, and case-mix) for CY 2021
would be approximately 5.42 billion, an increase of approximately 120
million compared to estimated CY 2020 Medicare payments.
Changes to the List of ASC Covered Surgical Procedures:
For CY 2021, we are adding eleven procedures to the ASC covered
procedures list (CPL), including total hip arthroplasty (CPT 27130).
Additionally, we are revising the criteria we use to add covered
surgical procedures to the ASC CPL, providing that certain criteria we
used to add covered surgical procedures to the ASC CPL in the past will
now be factors for physicians to consider in deciding whether a
specific beneficiary should receive a covered surgical procedure in an
ASC, and adopting a notification process for surgical procedures the
public believes can be added to the ASC CPL under the criteria we are
retaining. Using our revised criteria, we are adding an additional 267
surgical procedures to the ASC CPL beginning in CY 2021.
Hospital Outpatient Quality Reporting (OQR) and Ambulatory
Surgical Center Quality Reporting (ASCQR) Programs: For the Hospital
OQR and ASCQR Programs, we are updating and refining requirements to
further meaningful measurement and reporting for quality of care
provided in these outpatient settings while limiting compliance burden.
We are revising and codifying previously finalized administrative
procedures and are codifying an expanded review and corrections process
to further the programs' alignment while clarifying program
requirements. We are not making any measure additions or removals for
either program.
Overall Hospital Quality Star Ratings: We are establishing
and updating the methodology that will be used to calculate the Overall
Hospital Quality Star Ratings beginning with 2021 and for subsequent
years. We are updating and simplifying how the ratings are calculated,
with policies such as adopting a simple average of measure scores
instead of the latent variable model and reducing the total number of
measure groups from seven to five measure groups due to the removal of
measures through the Meaningful Measure Initiative. Additionally, we
are increasing the comparability of star ratings by peer grouping
hospitals by the number of measure groups. These changes will simplify
the methodology, and therefore, reduce provider burden, improve the
predictability of the star ratings, and increase the comparability
between hospital star ratings. We did not finalize our proposals
related to stratification of the Readmissions group by dual-eligible
patients.
Addition of New Service Categories for Hospital Outpatient
Department Prior Authorization Process: We are adding the following two
categories of services to the prior authorization process for hospital
outpatient departments beginning for dates of service on or after July
1, 2021: (1) Cervical fusion with disc removal and (2) implanted spinal
neurostimulators.
Clinical Laboratory Date of Service (DOS) Policy: We are
excluding certain protein-based Multianalyte Assays with Algorithmic
Analyses (MAAAs), which are not generally performed in the HOPD
setting, from the OPPS packaging policy and adding them to the
laboratory DOS exception at 42 CFR 414.510(b)(5).
Physician-Owned Hospitals: We are removing unnecessary
regulatory restrictions on high Medicaid facilities and including beds
in a physician-owned hospital's baseline consistent with state law.
Radiation Oncology Model (RO Model): On September 29,
2020, we published a final rule in the Federal Register (85 FR 61114)
entitled ``Specialty Care Models to Improve Quality of Care and Reduce
Expenditures'' that finalized the Radiation Oncology Model (RO Model).
To ensure that participation in the RO Model during the public health
emergency (PHE) for the Coronavirus disease 2019 (COVID-19) pandemic
does not further strain RO participants' capacity, we are revising the
RO Model's Model performance period to begin on July 1, 2021 and end
December 31, 2025 in this interim final rule with comment period. We
are requesting comments on this change.
Reporting Requirements for Hospitals and Critical Access
Hospitals (CAHs) to Report COVID-19 Therapeutic Inventory and Usage and
to Report Acute Respiratory Illness During the Public Health Emergency
(PHE) for Coronavirus Disease 2019 (COVID-19): This interim final rule
with comment period establishes new requirements in the hospital and
critical access hospital (CAH) Conditions of Participation (CoPs) for
tracking COVID-19 therapeutic inventory and usage and for tracking the
incidence and impact of Acute Respiratory Illness (including, but not
limited to, Seasonal Influenza Virus, Influenza-like Illness, and
Severe Acute Respiratory Infection) during the ongoing COVID-19 PHE;
and for providing this information and data to the Secretary of Health
and Human Services (Secretary) in such form and manner, and at such
timing and frequency, as the Secretary may prescribe during the Public
Health Emergency (PHE).
3. Summary of Costs and Benefit
In section XXVII and XXVIII of this final rule with comment period
and interim final rule with comment period, we set forth a detailed
analysis of the regulatory and federalism impacts that the changes will
have on affected entities and beneficiaries. Key estimated impacts are
described below.
a. Impacts of All OPPS Changes
Table 79 in section XXVII.C of the CY 2021 OPPS/ASC final rule with
comment period displays the distributional impact of all the OPPS
changes on various groups of hospitals and CMHCs for CY 2021 compared
to all estimated OPPS payments in CY 2020. We estimate that the
policies in the CY 2021 OPPS/ASC final rule with comment period will
result in a 2.4 percent overall increase in OPPS payments to providers.
We estimate that total OPPS payments for CY 2021, including beneficiary
cost-sharing, to the approximately 3,665 facilities paid under the OPPS
(including general acute care hospitals, children's hospitals, cancer
hospitals, and CMHCs) will increase by approximately $1.61 billion
compared to CY 2020 payments, excluding our estimated changes in
enrollment, utilization, and case-mix.
We estimated the isolated impact of our OPPS policies on CMHCs
because CMHCs are only paid for partial hospitalization services under
the OPPS. Continuing the provider-specific structure we adopted
beginning in CY 2011, and basing payment fully on the type of provider
furnishing the service, we estimate an 11.9 percent increase in CY 2021
payments to CMHCs relative to their CY 2020 payments.
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b. Impacts of the Updated Wage Indexes
We estimate that our update of the wage indexes based on the FY
2021 IPPS final rule wage indexes will result in an estimated increase
in payments of 0.2 percent for urban hospitals under the OPPS and an
estimated increase in payments of 0.4 percent for rural hospitals.
These wage indexes include the continued implementation of the OMB
labor market area delineations based on 2010 Decennial Census data,
with updates, as discussed in section II.C. of this final rule with
comment period.
c. Impacts of the Rural Adjustment and the Cancer Hospital Payment
Adjustment
There are no significant impacts of our CY 2021 payment policies
for hospitals that are eligible for the rural adjustment or for the
cancer hospital payment adjustment. We are not making any change in
policies for determining the rural hospital payment adjustments. While
we are implementing the reduction to the cancer hospital payment
adjustment for CY 2021 required by section 1833(t)(18)(C) of the Act,
as added by section 16002(b) of the 21st Century Cures Act, the target
payment-to-cost ratio (PCR) for CY 2021 is 0.89, equivalent to the 0.89
target PCR for CY 2020, and therefore has no budget neutrality
adjustment.
d. Impacts of the OPD Fee Schedule Increase Factor
For the CY 2021 OPPS/ASC, we are establishing an OPD fee schedule
increase factor of 2.4 percent and applying that increase factor to the
conversion factor for CY 2021. As a result of the OPD fee schedule
increase factor and other budget neutrality adjustments, we estimate
that urban hospitals will experience an increase in payments of
approximately 2.6 percent and that rural hospitals would experience an
increase in payments of 2.9 percent. Classifying hospitals by teaching
status, we estimate nonteaching hospitals will experience an increase
in payments of 2.9 percent, minor teaching hospitals will experience an
increase in payments of 3.0 percent, and major teaching hospitals will
experience an increase in payments of 2.0 percent. We also classified
hospitals by the type of ownership. We estimate that hospitals with
voluntary ownership will experience an increase of 2.6 percent in
payments, while hospitals with government ownership will experience an
increase of 2.2 percent in payments. We estimate that hospitals with
proprietary ownership will experience an increase of 3.5 percent in
payments.
e. Impacts of the ASC Payment Update
For impact purposes, the surgical procedures on the ASC covered
surgical procedure list are aggregated into surgical specialty groups
using CPT and HCPCS code range definitions. The percentage change in
estimated total payments by specialty groups under the CY 2021 payment
rates, compared to estimated CY 2020 payment rates, generally ranges
between an increase of 2 and 5 percent, depending on the service, with
some exceptions. We estimate the impact of applying the hospital market
basket update to ASC payment rates will be an increase in payments of
$120 million under the ASC payment system in CY 2021.
B. Legislative and Regulatory Authority for the Hospital OPPS
When Title XVIII of the Act was enacted, Medicare payment for
hospital outpatient services was based on hospital-specific costs. In
an effort to ensure that Medicare and its beneficiaries pay
appropriately for services and to encourage more efficient delivery of
care, the Congress mandated replacement of the reasonable cost-based
payment methodology with a prospective payment system (PPS). The
Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33) added section
1833(t) to the Act, authorizing implementation of a PPS for hospital
outpatient services. The OPPS was first implemented for services
furnished on or after August 1, 2000. Implementing regulations for the
OPPS are located at 42 CFR parts 410 and 419.
The Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of
1999 (BBRA) (Pub. L. 106-113) made major changes in the hospital OPPS.
The following Acts made additional changes to the OPPS: The Medicare,
Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000
(BIPA) (Pub. L. 106-554); The Medicare Prescription Drug, Improvement,
and Modernization Act of 2003 (MMA) (Pub. L. 108-173); the Deficit
Reduction Act of 2005 (DRA) (Pub. L. 109-171), enacted on February 8,
2006; the Medicare Improvements and Extension Act under Division B of
Title I of the Tax Relief and Health Care Act of 2006 (MIEA-TRHCA)
(Pub. L. 109-432), enacted on December 20, 2006; the Medicare,
Medicaid, and SCHIP Extension Act of 2007 (MMSEA) (Pub. L. 110-173),
enacted on December 29, 2007; the Medicare Improvements for Patients
and Providers Act of 2008 (MIPPA) (Pub. L. 110-275), enacted on July
15, 2008; the Patient Protection and Affordable Care Act (Pub. L. 111-
148), enacted on March 23, 2010, as amended by the Health Care and
Education Reconciliation Act of 2010 (Pub. L. 111-152), enacted on
March 30, 2010 (these two public laws are collectively known as the
Affordable Care Act); the Medicare and Medicaid Extenders Act of 2010
(MMEA, Pub. L. 111-309); the Temporary Payroll Tax Cut Continuation Act
of 2011 (TPTCCA, Pub. L. 112-78), enacted on December 23, 2011; the
Middle Class Tax Relief and Job Creation Act of 2012 (MCTRJCA, Pub. L.
112-96), enacted on February 22, 2012; the American Taxpayer Relief Act
of 2012 (Pub. L. 112-240), enacted January 2, 2013; the Pathway for SGR
Reform Act of 2013 (Pub. L. 113-67) enacted on December 26, 2013; the
Protecting Access to Medicare Act of 2014 (PAMA, Pub. L. 113-93),
enacted on March 27, 2014; the Medicare Access and CHIP Reauthorization
Act (MACRA) of 2015 (Pub. L. 114-10), enacted April 16, 2015; the
Bipartisan Budget Act of 2015 (Pub. L. 114-74), enacted November 2,
2015; the Consolidated Appropriations Act, 2016 (Pub. L. 114-113),
enacted on December 18, 2015, the 21st Century Cures Act (Pub. L. 114-
255), enacted on December 13, 2016; the Consolidated Appropriations
Act, 2018 (Pub. L. 115-141), enacted on March 23, 2018; and the
Substance Use-Disorder Prevention that Promotes Opioid Recovery and
Treatment for Patients and Communities Act (Pub. L. 115-271), enacted
on October 24, 2018.
Under the OPPS, we generally pay for hospital Part B services on a
rate-per-service basis that varies according to the APC group to which
the service is assigned. We use the Healthcare Common Procedure Coding
System (HCPCS) (which includes certain Current Procedural Terminology
(CPT) codes) to identify and group the services within each APC. The
OPPS includes payment for most hospital outpatient services, except
those identified in section I.C. of the CY 2021 OPPS/ASC final rule.
Section 1833(t)(1)(B) of the Act provides for payment under the OPPS
for hospital outpatient services designated by the Secretary (which
includes partial hospitalization services furnished by CMHCs), and
certain inpatient hospital services that are paid under Medicare Part
B.
The OPPS rate is an unadjusted national payment amount that
includes the Medicare payment and the beneficiary copayment. This rate
is divided into a labor-related amount and a nonlabor-related amount.
The labor-related amount is adjusted for area wage
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differences using the hospital inpatient wage index value for the
locality in which the hospital or CMHC is located.
All services and items within an APC group are comparable
clinically and with respect to resource use, as required by section
1833(t)(2)(B) of the Act. In accordance with section 1833(t)(2)(B) of
the Act, subject to certain exceptions, items and services within an
APC group cannot be considered comparable with respect to the use of
resources if the highest median cost (or mean cost, if elected by the
Secretary) for an item or service in the APC group is more than 2 times
greater than the lowest median cost (or mean cost, if elected by the
Secretary) for an item or service within the same APC group (referred
to as the ``2 times rule''). In implementing this provision, we
generally use the cost of the item or service assigned to an APC group.
For new technology items and services, special payments under the
OPPS may be made in one of two ways. Section 1833(t)(6) of the Act
provides for temporary additional payments, which we refer to as
``transitional pass-through payments,'' for at least 2 but not more
than 3 years for certain drugs, biological agents, brachytherapy
devices used for the treatment of cancer, and categories of other
medical devices. For new technology services that are not eligible for
transitional pass-through payments, and for which we lack sufficient
clinical information and cost data to appropriately assign them to a
clinical APC group, we have established special APC groups based on
costs, which we refer to as New Technology APCs. These New Technology
APCs are designated by cost bands which allow us to provide appropriate
and consistent payment for designated new procedures that are not yet
reflected in our claims data. Similar to pass-through payments, an
assignment to a New Technology APC is temporary; that is, we retain a
service within a New Technology APC until we acquire sufficient data to
assign it to a clinically appropriate APC group.
C. Excluded OPPS Services and Hospitals
Section 1833(t)(1)(B)(i) of the Act authorizes the Secretary to
designate the hospital outpatient services that are paid under the
OPPS. While most hospital outpatient services are payable under the
OPPS, section 1833(t)(1)(B)(iv) of the Act excludes payment for
ambulance, physical and occupational therapy, and speech-language
pathology services, for which payment is made under a fee schedule. It
also excludes screening mammography, diagnostic mammography, and
effective January 1, 2011, an annual wellness visit providing
personalized prevention plan services. The Secretary exercises the
authority granted under the statute to also exclude from the OPPS
certain services that are paid under fee schedules or other payment
systems. Such excluded services include, for example, the professional
services of physicians and nonphysician practitioners paid under the
Medicare Physician Fee Schedule (MPFS); certain laboratory services
paid under the Clinical Laboratory Fee Schedule (CLFS); services for
beneficiaries with end-stage renal disease (ESRD) that are paid under
the ESRD prospective payment system; and services and procedures that
require an inpatient stay that are paid under the hospital IPPS. In
addition, section 1833(t)(1)(B)(v) of the Act does not include
applicable items and services (as defined in subparagraph (A) of
paragraph (21)) that are furnished on or after January 1, 2017 by an
off-campus outpatient department of a provider (as defined in
subparagraph (B) of paragraph (21)). We set forth the services that are
excluded from payment under the OPPS in regulations at 42 CFR 419.22.
Under Sec. 419.20(b) of the regulations, we specify the types of
hospitals that are excluded from payment under the OPPS. These excluded
hospitals are:
Critical access hospitals (CAHs);
Hospitals located in Maryland and paid under Maryland's
All-Payer or Total Cost of Care Model;
Hospitals located outside of the 50 States, the District
of Columbia, and Puerto Rico; and
Indian Health Service (IHS) hospitals.
D. Prior Rulemaking
On April 7, 2000, we published in the Federal Register a final rule
with comment period (65 FR 18434) to implement a prospective payment
system for hospital outpatient services. The hospital OPPS was first
implemented for services furnished on or after August 1, 2000. Section
1833(t)(9)(A) of the Act requires the Secretary to review certain
components of the OPPS, not less often than annually, and to revise the
groups, the relative payment weights, and the wage and other
adjustments to take into account changes in medical practices, changes
in technology, the addition of new services, new cost data, and other
relevant information and factors.
Since initially implementing the OPPS, we have published final
rules in the Federal Register annually to implement statutory
requirements and changes arising from our continuing experience with
this system. These rules can be viewed on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.html.
E. Advisory Panel on Hospital Outpatient Payment (the HOP Panel or the
Panel)
1. Authority of the Panel
Section 1833(t)(9)(A) of the Act, as amended by section 201(h) of
Public Law 106-113, and redesignated by section 202(a)(2) of Public Law
106-113, requires that we consult with an expert outside advisory panel
composed of an appropriate selection of representatives of providers to
annually review (and advise the Secretary concerning) the clinical
integrity of the payment groups and their weights under the OPPS. In CY
2000, based on section 1833(t)(9)(A) of the Act, the Secretary
established the Advisory Panel on Ambulatory Payment Classification
Groups (APC Panel) to fulfill this requirement. In CY 2011, based on
section 222 of the Public Health Service Act, which gives discretionary
authority to the Secretary to convene advisory councils and committees,
the Secretary expanded the panel's scope to include the supervision of
hospital outpatient therapeutic services in addition to the APC groups
and weights. To reflect this new role of the panel, the Secretary
changed the panel's name to the Advisory Panel on Hospital Outpatient
Payment (the HOP Panel or the Panel). The HOP Panel is not restricted
to using data compiled by CMS, and in conducting its review, it may use
data collected or developed by organizations outside the Department.
2. Establishment of the Panel
On November 21, 2000, the Secretary signed the initial charter
establishing the Panel, and, at that time, named the APC Panel. This
expert panel is composed of appropriate representatives of providers
(currently employed full-time, not as consultants, in their respective
areas of expertise) who review clinical data and advise CMS about the
clinical integrity of the APC groups and their payment weights. Since
CY 2012, the Panel also is charged with advising the Secretary on the
appropriate level of supervision for individual hospital outpatient
therapeutic services. The Panel is technical in nature, and it is
governed by the provisions of the Federal Advisory Committee Act
(FACA). The
[[Page 85873]]
current charter specifies, among other requirements, that the Panel--
May advise on the clinical integrity of Ambulatory Payment
Classification (APC) groups and their associated weights;
May advise on the appropriate supervision level for
hospital outpatient services;
May advise on OPPS APC rates for ASC covered surgical
procedures;
Continues to be technical in nature;
Is governed by the provisions of the FACA;
Has a Designated Federal Official (DFO); and
Is chaired by a Federal Official designated by the
Secretary.
The Panel's charter was amended on November 15, 2011, renaming the
Panel and expanding the Panel's authority to include supervision of
hospital outpatient therapeutic services and to add critical access
hospital (CAH) representation to its membership. The Panel's charter
was also amended on November 6, 2014 (80 FR 23009), and the number of
members was revised from up to 19 to up to 15 members. The Panel's
current charter was approved on November 20, 2020, for a 2-year period.
The current Panel membership and other information pertaining to
the Panel, including its charter, Federal Register notices, membership,
meeting dates, agenda topics, and meeting reports, can be viewed on the
CMS website at: https://www.cms.gov/Regulations-and-Guidance/Guidance/FACA/AdvisoryPanelonAmbulatoryPaymentClassificationGroups.html.
3. Panel Meetings and Organizational Structure
The Panel has held many meetings, with the last meeting taking
place on August 31, 2020. Prior to each meeting, we publish a notice in
the Federal Register to announce the meeting, new members, and any
other changes of which the public should be aware. Beginning in CY
2017, we have transitioned to one meeting per year (81 FR 31941). In CY
2018, we published a Federal Register notice requesting nominations to
fill vacancies on the Panel (83 FR 3715). As published in this notice,
CMS is accepting nominations on a continuous basis.
In addition, the Panel has established an administrative structure
that, in part, currently includes the use of three subcommittee
workgroups to provide preparatory meeting and subject support to the
larger panel. The three current subcommittees include the following:
APC Groups and Status Indicator Assignments Subcommittee,
which advises and provides recommendations to the Panel on the
appropriate status indicators to be assigned to HCPCS codes, including
but not limited to whether a HCPCS code or a category of codes should
be packaged or separately paid, as well as the appropriate APC
assignment of HCPCS codes regarding services for which separate payment
is made;
Data Subcommittee, which is responsible for studying the
data issues confronting the Panel and for recommending options for
resolving them; and
Visits and Observation Subcommittee, which reviews and
makes recommendations to the Panel on all technical issues pertaining
to observation services and hospital outpatient visits paid under the
OPPS.
Each of these workgroup subcommittees was established by a majority
vote from the full Panel during a scheduled Panel meeting, and the
Panel recommended at the August 31, 2020, meeting that the
subcommittees continue. We accepted this recommendation.
For discussions of earlier Panel meetings and recommendations, we
refer readers to previously published OPPS/ASC proposed and final
rules, the CMS website mentioned earlier in this section, and the FACA
database at http://facadatabase.gov.
F. Public Comments Received in Response to the CY 2021 OPPS/ASC
Proposed Rule
We received approximately 1,350 timely pieces of correspondence on
the CY 2021 OPPS/ASC proposed rule that appeared in the Federal
Register on August 12, 2020 (85 FR 48772). We note that we received
some public comments that were outside the scope of the CY 2021 OPPS/
ASC proposed rule. Out-of-scope-public comments are not addressed in
this CY 2021 OPPS/ASC final rule with comment period. Summaries of
those public comments that are within the scope of the proposed rule
and our responses are set forth in the various sections of this final
rule with comment period under the appropriate headings.
G. Public Comments Received on the CY 2020 OPPS/ASC Final Rule With
Comment Period
We received approximately 22 timely pieces of correspondence on the
CY 2020 OPPS/ASC final rule with comment period that appeared in the
Federal Register on November 12, 2019 (84 FR 61142), most of which were
outside of the scope of the final rule. In-scope comments related to
the interim APC assignments and/or status indicators of new or
replacement Level II HCPCS codes (identified with comment indicator
``NI'' in OPPS Addendum B, ASC Addendum AA, and ASC Addendum BB to that
final rule). Summaries of the public comments on topics that were open
to comment and our responses to them are set forth in various sections
of this final rule with comment period under the appropriate subject-
matter headings. Summaries of the public comments on new or replacement
Level II HCPCS codes are set forth in the CY 2021 OPPS/ASC proposed
rule and this final rule with comment period under the appropriate
subject matter headings.
II. Updates Affecting OPPS Payments
A. Recalibration of APC Relative Payment Weights
1. Database Construction
a. Database Source and Methodology
Section 1833(t)(9)(A) of the Act requires that the Secretary review
not less often than annually and revise the relative payment weights
for APCs. In the April 7, 2000 OPPS final rule with comment period (65
FR 18482), we explained in detail how we calculated the relative
payment weights that were implemented on August 1, 2000 for each APC
group.
For the CY 2021 OPPS/ASC proposed rule (85 FR 48779), we proposed
to recalibrate the APC relative payment weights for services furnished
on or after January 1, 2021, and before January 1, 2022 (CY 2021),
using the same basic methodology that we described in the CY 2020 OPPS/
ASC final rule with comment period (84 FR 61149), using updated CY 2019
claims data. That is, as we proposed, we recalibrate the relative
payment weights for each APC based on claims and cost report data for
hospital outpatient department (HOPD) services, using the most recent
available data to construct a database for calculating APC group
weights.
For the purpose of recalibrating the proposed APC relative payment
weights for CY 2021, we began with approximately 167 million final
action claims (claims for which all disputes and adjustments have been
resolved and payment has been made) for HOPD services furnished on or
after January 1, 2019, and before January 1, 2020, before applying our
exclusionary criteria and other methodological adjustments. After the
application of those data processing changes, we used approximately 87
million final action claims to develop the proposed CY 2021 OPPS
payment weights. For exact numbers of claims used and additional
details on the
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claims accounting process, we refer readers to the claims accounting
narrative under supporting documentation for the CY 2021 OPPS/ASC
proposed rule on the CMS website at: http://www.cms.gov/Medicare/
Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html.
Addendum N to the CY 2021 OPPS/ASC proposed rule (which is
available via the internet on the CMS website) included the proposed
list of bypass codes for CY 2021. The proposed list of bypass codes
contained codes that were reported on claims for services in CY 2019
and, therefore, included codes that were in effect in CY 2019 and used
for billing, but were deleted for CY 2020. We retained these deleted
bypass codes on the proposed CY 2021 bypass list because these codes
existed in CY 2019 and were covered OPD services in that period, and CY
2019 claims data were used to calculate proposed CY 2021 payment rates.
Keeping these deleted bypass codes on the bypass list potentially
allows us to create more ``pseudo'' single procedure claims for
ratesetting purposes. ``Overlap bypass codes'' that are members of the
proposed multiple imaging composite APCs were identified by asterisks
(*) in the third column of Addendum N to the proposed rule. HCPCS codes
that we proposed to add for CY 2021 were identified by asterisks (*) in
the fourth column of Addendum N.
b. Calculation and Use of Cost-to-Charge Ratios (CCRs)
For CY 2021, in the CY 2020 OPPS/ASC proposed rule (85 FR 48779),
we proposed to continue to use the hospital-specific overall ancillary
and departmental cost-to-charge ratios (CCRs) to convert charges to
estimated costs through application of a revenue code-to-cost center
crosswalk. To calculate the APC costs on which the CY 2021 APC payment
rates are based, we calculated hospital-specific overall ancillary CCRs
and hospital-specific departmental CCRs for each hospital for which we
had CY 2019 claims data by comparing these claims data to the most
recently available hospital cost reports, which, in most cases, are
from CY 2018. For the proposed CY 2021 OPPS payment rates, we used the
set of claims processed during CY 2019. We applied the hospital-
specific CCR to the hospital's charges at the most detailed level
possible, based on a revenue code-to-cost center crosswalk that
contains a hierarchy of CCRs used to estimate costs from charges for
each revenue code. To ensure the completeness of the revenue code-to-
cost center crosswalk, we reviewed changes to the list of revenue codes
for CY 2019 (the year of claims data we used to calculate the proposed
CY 2021 OPPS payment rates) and updates to the NUBC 2019 Data
Specifications Manual. That crosswalk is available for review and
continuous comment on the CMS website at: http://www.cms.gov/Medicare/
Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html.
In accordance with our longstanding policy, we calculate CCRs for
the standard and nonstandard cost centers accepted by the electronic
cost report database. In general, the most detailed level at which we
calculate CCRs is the hospital-specific departmental level. For a
discussion of the hospital-specific overall ancillary CCR calculation,
we refer readers to the CY 2007 OPPS/ASC final rule with comment period
(71 FR 67983 through 67985). The calculation of blood costs is a
longstanding exception (since the CY 2005 OPPS) to this general
methodology for calculation of CCRs used for converting charges to
costs on each claim. This exception is discussed in detail in the CY
2007 OPPS/ASC final rule with comment period and discussed further in
section II.A.2.a.(1) of the proposed rule and this final rule with
comment period.
In the CY 2014 OPPS/ASC final rule with comment period (78 FR 74840
through 74847), we finalized our policy of creating new cost centers
and distinct CCRs for implantable devices, magnetic resonance imaging
(MRIs), computed tomography (CT) scans, and cardiac catheterization.
However, in response to the CY 2014 OPPS/ASC proposed rule, commenters
reported that some hospitals used a less precise ``square feet''
allocation methodology for the costs of large moveable equipment like
CT scan and MRI machines. They indicated that while we recommended
using two alternative allocation methods, ``direct assignment'' or
``dollar value,'' as a more accurate methodology for directly assigning
equipment costs, industry analysis suggested that approximately only
half of the reported cost centers for CT scans and MRIs rely on these
preferred methodologies. In response to concerns from commenters, we
finalized a policy for the CY 2014 OPPS/ASC final rule with comment
period (78 FR 74847) to remove claims from providers that use a cost
allocation method of ``square feet'' to calculate CCRs used to estimate
costs associated with the APCs for CT and MRI. Further, we finalized a
transitional policy to estimate the imaging APC relative payment
weights using only CT and MRI cost data from providers that do not use
``square feet'' as the cost allocation statistic. We provided that this
finalized policy would sunset in 4 years to provide sufficient time for
hospitals to transition to a more accurate cost allocation method and
for the related data to be available for ratesetting purposes (78 FR
74847). Therefore, beginning in CY 2018 with the sunset of the
transition policy, we would estimate the imaging APC relative payment
weights using cost data from all providers, regardless of the cost
allocation statistic employed. However, in the CY 2018 OPPS/ASC final
rule with comment period (82 FR 59228 and 59229) and in the CY 2019
OPPS/ASC final rule with comment period (83 FR 58831), we finalized a
policy to extend the transition policy for 1 additional year and we
continued to remove claims from providers that use a cost allocation
method of ``square feet'' to calculate CT and MRI CCRs for the CY 2018
OPPS and the CY 2019 OPPS.
As we discussed in the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59228), some stakeholders have raised concerns regarding
using claims from all providers to calculate CT and MRI CCRs,
regardless of the cost allocations statistic employed (78 FR 74840
through 74847). Stakeholders noted that providers continue to use the
``square feet'' cost allocation method and that including claims from
such providers would cause significant reductions in the imaging APC
payment rates.
Table 1 demonstrates the relative effect on imaging APC payments
after removing cost data for providers that report CT and MRI standard
cost centers using ``square feet'' as the cost allocation method by
extracting HCRIS data on Worksheet B-1. Table 2 provides statistical
values based on the CT and MRI standard cost center CCRs using the
different cost allocation methods.
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[GRAPHIC] [TIFF OMITTED] TR29DE20.000
[GRAPHIC] [TIFF OMITTED] TR29DE20.001
Our analysis shows that since the CY 2014 OPPS in which we
established the transition policy, the number of valid MRI CCRs has
increased by 18.7 percent to 2,199 providers and the number of valid CT
CCRs has increased by 16.5 percent to 2,280 providers. Table 1 displays
the impact on OPPS payment rates for CY 2021 if claims from providers
that report using the ``square feet'' cost allocation method were
removed. This can be attributed to the generally lower CCR values from
providers that use a ``square feet'' cost allocation method as shown in
Table 1.
We note that the CT and MRI cost center CCRs have been available
for ratesetting since the CY 2014 OPPS in which we established the
transition policy. Since the initial 4-year transition, we had extended
the transition an additional 2 years to offer providers flexibility in
applying cost allocation methodologies for CT and MRI cost centers
other than ``square feet.'' In the CY 2020 OPPS/ASC final rule with
comment period (84 FR 61152), we finalized a 2-year phased-in approach,
as suggested by some commenters, that applied 50 percent of the payment
impact from ending the transition in CY 2020 and 100 percent of the
payment impact from ending the transition in CY 2021.
We believe we have provided sufficient time for providers to adopt
an alternative cost allocation methodology for CT and MRI cost centers
if they intended to do so and many providers continue to use the
``square feet'' cost allocation methodology, which we believe indicates
that these providers believe this methodology is a sufficient method
for attributing costs to this cost center. Additionally, we generally
believe that increasing the amount of claims data available for use in
ratesetting improves our ratesetting process. Therefore, as finalized
in the CY 2020 OPPS/ASC final rule with comment period (84 FR 61152),
in the CY 2021 OPPS we are using all claims with valid CT and MRI cost
center CCRs, including those that use a ``square feet'' cost allocation
method, to estimate costs for the APCs for CT and MRI identified in
Table 1.
The Deficit Reduction Act (DRA) of 2005 requires Medicare to limit
Medicare payment for certain imaging services covered by the Physician
Fee Schedule (PFS) to not exceed what Medicare pays for these services
under the OPPS. As required by law, for certain imaging services paid
for under the PFS, we cap the technical component of the PFS payment
amount for the applicable year at the OPPS payment amount (71 FR 69659
through
[[Page 85876]]
69661). As we stated in the CY 2014 OPPS/ASC final rule with comment
period (78 FR 74845), we have noted the potential impact the CT and MRI
CCRs may have on other payment systems. We understand that payment
reductions for imaging services under the OPPS could have significant
payment impacts under the PFS where the technical component payment for
many imaging services is capped at the OPPS amount. We will continue to
monitor OPPS imaging payments in the future and consider potential
impacts of payment changes on the PFS and the ASC payment system.
Comment: Several commenters requested that CMS not use the CT and
MRI-specific cost centers and instead estimate cost using the single
diagnostic radiology cost center, believing that this will solve the
inaccurate reporting of costs for CT and MR services. Commenters stated
that many hospitals have ``near zero'' CT and MRI CCRs and the existing
cost centers are inaccurate, too low, and depressing the valuation of
APCs that include CT and MRI services. One commenter recommended that
CMS establish detailed instructions for nonstandard cost centers to
improve the accuracy of the cost center data used to calculate CT and
MRI CCRs. Commenters also noted that the impact of our proposal may
diminish beneficiary access to medical imaging services for
beneficiaries, specifically noting low OPPS payments for cardiac
computed tomography angiography (CCTA). Several commenters noted that
the use of separate CT and MRI CCRs creates unintended consequences on
the technical component of CT and MRI codes in the Medicare Physician
Fee Schedule and on the payment rate under the ASC payment system for
these codes.
Response: We appreciate the thoughtful comments and analysis
regarding the use of the CT and MRI cost center CCRs. However, as
discussed in the CY 2020 OPPS/ASC final rule (84 FR 61152), we
finalized a policy to end the transition policy and use all data
submitted (including all providers, regardless of cost allocation
method) in the CY 2021 OPPS. We did not propose to make any changes in
the CY 2021 OPPS and are not modifying the policy at this time.
2. Final Data Development and Calculation of Costs Used for Ratesetting
In this section of this final rule with comment period, we discuss
the use of claims to calculate the OPPS payment rates for CY 2021. The
Hospital OPPS page on the CMS website on which this final rule with
comment period is posted (http://www.cms.gov/Medicare/Medicare-Fee-for-
Service-Payment/HospitalOutpatientPPS/index.html) provides an
accounting of claims used in the development of the final payment
rates. That accounting provides additional detail regarding the number
of claims derived at each stage of the process. In addition, later in
this section we discuss the file of claims that comprises the data set
that is available upon payment of an administrative fee under a CMS
data use agreement. The CMS website, http://www.cms.gov/Medicare/
Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html,
includes information about obtaining the ``OPPS Limited Data Set,''
which now includes the additional variables previously available only
in the OPPS Identifiable Data Set, including ICD-10-CM diagnosis codes
and revenue code payment amounts. This file is derived from the CY 2019
claims that were used to calculate the final payment rates for this CY
2021 OPPS/ASC final rule with comment period.
Previously, the OPPS established the scaled relative weights, on
which payments are based using APC median costs, a process described in
the CY 2012 OPPS/ASC final rule with comment period (76 FR 74188).
However, as discussed in more detail in section II.A.2.f. of the CY
2013 OPPS/ASC final rule with comment period (77 FR 68259 through
68271), we finalized the use of geometric mean costs to calculate the
relative weights on which the CY 2013 OPPS payment rates were based.
While this policy changed the cost metric on which the relative
payments are based, the data process in general remained the same,
under the methodologies that we used to obtain appropriate claims data
and accurate cost information in determining estimated service cost.
For CY 2021, we are finalizing our proposal to continue to use
geometric mean costs to calculate the relative weights on which the
final CY 2021 OPPS payment rates are based.
We used the methodology described in sections II.A.2.a. through
II.A.2.c. of the CY 2021 OPPS/ASC final rule with comment period to
calculate the costs we used to establish the relative payment weights
used in calculating the OPPS payment rates for CY 2021 shown in Addenda
A and B to the CY 2021 OPPS/ASC final rule with comment period (which
are available via the internet on the CMS website). We referred readers
to section II.A.4. of the CY 2021 OPPS/ASC final rule with comment
period for a discussion of the conversion of APC costs to scaled
payment weights.
We note that under the OPPS, CY 2019 was the first year in which
the claims data used for setting payment rates (CY 2017 data) contained
lines with the modifier ``PN'', which indicates nonexcepted items and
services furnished and billed by off-campus provider-based departments
(PBDs) of hospitals. Because nonexcepted services are not paid under
the OPPS, in the CY 2019 OPPS/ASC final rule with comment period (83 FR
58832), we finalized a policy to remove those claim lines reported with
modifier ``PN'' from the claims data used in ratesetting for the CY
2019 OPPS and subsequent years. For the CY 2021 OPPS, we will continue
to remove these claim lines with modifier ``PN'' from the ratesetting
process.
For details of the claims accounting process used in the CY 2021
OPPS/ASC final rule with comment period, we refer readers to the claims
accounting narrative under supporting documentation for this CY 2021
OPPS/ASC final rule with comment period on the CMS website at: http://www.cms .gov/Medicare/Medicare-Fee-for-Service-Payment/
HospitalOutpatientPPS/index.html.
a. Calculation of Single Procedure APC Criteria-Based Costs
(1) Blood and Blood Products
(a) Methodology
Since the implementation of the OPPS in August 2000, we have made
separate payments for blood and blood products through APCs rather than
packaging payment for them into payments for the procedures with which
they are administered. Hospital payments for the costs of blood and
blood products, as well as for the costs of collecting, processing, and
storing blood and blood products, are made through the OPPS payments
for specific blood product APCs.
We proposed to continue to establish payment rates for blood and
blood products using our blood-specific CCR methodology, which utilizes
actual or simulated CCRs from the most recently available hospital cost
reports to convert hospital charges for blood and blood products to
costs. This methodology has been our standard ratesetting methodology
for blood and blood products since CY 2005. It was developed in
response to data analysis indicating that there was a significant
difference in CCRs for those hospitals with and without blood-specific
cost centers, and past public comments indicating that the former OPPS
policy of defaulting to the overall hospital CCR for hospitals not
reporting a blood-
[[Page 85877]]
specific cost center often resulted in an underestimation of the true
hospital costs for blood and blood products. Specifically, to address
the differences in CCRs and to better reflect hospitals' costs, we
proposed to continue to simulate blood CCRs for each hospital that does
not report a blood cost center by calculating the ratio of the blood-
specific CCRs to hospitals' overall CCRs for those hospitals that do
report costs and charges for blood cost centers. We also proposed to
apply this mean ratio to the overall CCRs of hospitals not reporting
costs and charges for blood cost centers on their cost reports to
simulate blood-specific CCRs for those hospitals. We proposed to
calculate the costs upon which the proposed CY 2021 payment rates for
blood and blood products are based using the actual blood-specific CCR
for hospitals that reported costs and charges for a blood cost center
and a hospital-specific, simulated blood-specific CCR for hospitals
that did not report costs and charges for a blood cost center.
We continue to believe that the hospital-specific, simulated blood-
specific, CCR methodology better responds to the absence of a blood-
specific CCR for a hospital than alternative methodologies, such as
defaulting to the overall hospital CCR or applying an average blood-
specific CCR across hospitals. Because this methodology takes into
account the unique charging and cost accounting structure of each
hospital, we believe that it yields more accurate estimated costs for
these products. We continue to believe that this methodology in CY 2021
will result in costs for blood and blood products that appropriately
reflect the relative estimated costs of these products for hospitals
without blood cost centers and, therefore, for these blood products in
general.
We note that we defined a comprehensive APC (C-APC) as a
classification for the provision of a primary service and all
adjunctive services provided to support the delivery of the primary
service. Under this policy, we include the costs of blood and blood
products when calculating the overall costs of these C-APCs. We
proposed to continue to apply the blood-specific CCR methodology
described in this section when calculating the costs of the blood and
blood products that appear on claims with services assigned to the C-
APCs. Because the costs of blood and blood products will be reflected
in the overall costs of the C-APCs (and, as a result, in the proposed
payment rates of the C-APCs), we proposed not to make separate payments
for blood and blood products when they appear on the same claims as
services assigned to the C-APCs (we refer readers to the CY 2015 OPPS/
ASC final rule with comment period (79 FR 66796)). We refer readers to
Addendum B the CY 2021 OPPS/ASC proposed rule (which is available via
the internet on the CMS website) for the proposed CY 2021 payment rates
for blood and blood products (which are generally identified with
status indicator ``R''). For a more detailed discussion of the blood-
specific CCR methodology, we refer readers to the CY 2005 OPPS proposed
rule (69 FR 50524 through 50525). For a full history of OPPS payment
for blood and blood products, we refer readers to the CY 2008 OPPS/ASC
final rule with comment period (72 FR 66807 through 66810).
For CY 2021, we proposed to continue to establish payment rates for
blood and blood products using our blood-specific CCR methodology. We
did not receive any comments on our proposal to establish payment rates
for blood and blood products using our blood-specific CCR methodology
and we are finalizing this policy as proposed.
(b) Payment for Blood Not Otherwise Classified (NOC) Code
Recently, providers and stakeholders in the blood products field
have reported that product development for new blood products has
accelerated. There may be several additional new blood products
entering the market by the end of CY 2021, compared to only one or two
new products entering the market over the previous 15 to 20 years. To
encourage providers to use these new products, providers and
stakeholders requested that we establish a new HCPCS code to allow for
payment for unclassified blood products prior to these products
receiving their own HCPCS code. Under the OPPS, unclassified procedures
are generally assigned to the lowest APC payment level of an APC
family. However, since blood products are each assigned to their own
unique APC, the concept of a lowest APC payment level does not apply in
this context.
Starting January 1, 2020, we established a new HCPCS code, P9099
(Blood component or product not otherwise classified) which allows
providers to report unclassified blood products. We assigned HCPCS code
P9099 to status indicator ``E2'' (Not payable by Medicare when
submitted on an outpatient claim) for CY 2020. We took this action
because HCPCS code P9099 potentially could be reported for multiple
products with different costs during the same period of time.
Therefore, we could not identify an individual blood product HCPCS code
that would have a similar cost to HCPCS code P9099, and were not able
to crosswalk a payment rate from an established blood product HCPCS
code to HCPCS code P9099. Some stakeholders expressed concerns that
assigning HCPCS code P9099 to a non-payable status in the OPPS meant
that hospitals would receive no payment when they used unclassified
blood products. Also, claim lines billed with P9099 are rejected by
Medicare, which prevents providers from tracking the utilization of
unclassified blood products.
Because of the challenges of determining an appropriate payment
rate for unclassified blood products, we stated in the CY 2021 OPPS/ASC
proposed rule that we were considering packaging the cost of
unclassified blood products into their affiliated primary medical
procedure. Although we typically do not package blood products under
the OPPS, for unclassified blood products, we stated that we do not
believe it is possible to accurately determine an appropriate rate that
would apply for all of the products (potentially several, with varying
costs) that may be reported using HCPCS code P9099. Packaging the cost
of unclassified blood products into the payment for the primary medical
service by assigning HCPCS code P9099 a status indicator of ``N'' would
allow providers to report the cost of unclassified blood products to
Medicare. Over time, the costs of unspecified blood products would be
reflected in the payment rate for the primary medical service if the
blood product remains unclassified. However, we stated that we expect
that most blood products would seek and be granted more specific coding
such that the unclassified HCPCS code P9099 would no longer be
applicable. We also explained that we believe that packaging the costs
of unclassified blood products would be an improvement over the current
non-payable status for HCPCS code P9099 as it would allow for tracking
of the costs and utilization of unclassified blood products.
Another option we considered for the CY 2021 OPPS/ASC proposed
rule, but ultimately rejected was similar to our policy under the OPPS
to assign NOC codes to the lowest APC within the appropriate clinical
family. We stated that we could have cross-walked and assigned the same
payment rate for HCPCS code P9099 as HCPCS code P9043 (Infusion, plasma
protein fraction (human), 5 percent, 50 ml), which is the lowest cost
blood product with a
[[Page 85878]]
proposed CY 2021 payment rate of $8.02 per unit. This option would have
provided a small, separate payment for each unclassified blood product
service, and, similar to our proposal to package the costs of HCPCS
code P9099 into their primary procedure, would have allowed for
tracking of the cost and utilization for unclassified blood products.
However, given that the cross-walked payment rate is potentially
significantly lower than the cost of the product, we concluded that
providers may find that packaging the cost of unclassified blood
products into another medical service may generate more payment for the
products over time.
Thus, for CY 2021, we proposed to package the cost of unclassified
blood products reported by HCPCS code P9099 into the cost of the
associated primary procedure. We proposed to change the status
indicator for HCPCS code P9099 from ``E2'' (not payable by Medicare in
the OPPS) to ``N'' (payment is packaged into other services in the
OPPS). In addition, we also sought comment on the alternative proposal
to make HCPCS code P9099 separately payable with a payment rate
equivalent to the payment rate for the lowest cost blood product, HCPCS
code P9043 (Infusion, plasma protein fraction (human), 5 percent, 50
ml), with a proposed CY 2021 payment rate of $8.02 per unit. We stated
that if we were to adopt this option as our final policy, we would also
change the status indicator for HCPCS code P9099 from ``E2'' (not
payable by Medicare in the OPPS) to ``R'' (blood and blood products,
paid under OPPS).
Comment: Multiple commenters opposed our proposal to reassign HCPCS
code P9099 to status indicator ``N'' and package the payment for
unclassified blood products into the associated primary procedure.
Commenters were concerned that because blood products are usually
separately paid in the OPPS, APC payment rates for the associated
procedures would not reflect the cost of the unclassified blood
products, and that it would take a long time before providers would see
any changes in payments that would include the cost of unclassified
blood products. One commenter was also concerned that packaging the
cost of unclassified blood products would make providers less likely to
report HCPCS code P9099, making it harder to track the utilization of
unclassified blood products, and reluctant to use blood products that
would not receive separate payment.
Response: We agree with the concerns expressed by the commenters,
and we have considered these concerns in determining the payment policy
for the blood NOC code.
Comment: One commenter supported our proposal to reassign HCPCS
code P9099 to status indicator ``N'' and package the payment for
unclassified blood products into the associated primary procedure. The
commenter also encouraged us to work with manufacturers and blood
product stakeholders to move quickly to establish individual HCPCS
codes for these new blood products.
Response: We appreciate the commenter's support for our proposal
and we also support the request that codes be established in a timely
manner for unclassified blood products.
Comment: Multiple commenters opposed our alternative proposal to
pay services billed with HCPCS code P9099 at the lowest payment rate
for a blood product in the OPPS, which is $7.79 per unit. The
commenters believe the payment rate will be too low for new,
unclassified blood products and may discourage manufacturers from
pursuing new innovations in the blood products field.
Response: We understand the concerns of the commenters who believe
paying for unclassified blood products at the lowest payment rate for a
separately payable blood product in the OPPS does not provide adequate
payment for new, unclassified blood products. However, our goal is to
limit the time it is necessary for providers to report HCPCS code P9099
until a new blood product has an individual HCPCS code established for
the product. Once a new blood product has an individual HCPCS code, it
will allow for a payment for the new service that is better aligned
with its costs and make it easier to track utilization for the service.
Establishing a payment rate for the blood NOC code that is equal to the
payment rate for the lowest payment rate for a separately payable blood
product is consistent with OPPS policy for other major categories of
medical care where the payment rate for the unclassified service is
equal to the lowest-paying APC in an APC series for that category of
service.
Comment: The CMS HOP Panel and multiple commenters requested that
unclassified blood products be separately paid using a weighted average
of the payment rates of all separately payable blood products in the
OPPS. The average payment rate would be weighted by the number of units
billed for each service in the OPPS. Commenters believe a weighted
average would be consistent with OPPS policy to provide separate
payment for all blood products and would encourage the use of HCPCS
code P9099 to track the utilization of unclassified blood products
until the new products could receive individual HCPCS codes. The
weighted average also would provide a higher payment for services
billed with HCPCS code P9099 than the alternative proposal of assigning
the lowest payment rate for a separately payable blood product as
payment for unclassified blood products. Other commenters suggested
that unclassified blood products be paid either at charges reduced to
cost or at reasonable cost to appropriately compensate providers
billing unclassified blood products.
Response: Providing payment for HCPCS code P9099 through a weighted
average payment, charges reduced to cost, or reasonable cost could
provide incentives to discourage manufacturers of new blood products
from seeking individual HCPCS codes for their products. A weighted
average payment would encourage manufacturers of relatively inexpensive
unclassified blood products not to seek a HCPCS code for their products
because the payment using P9099 for the products would be substantially
higher than payment the products would receive once an individual code
is established for the blood products. In addition, the level of
payment from a weighted average payment may reduce the urgency of
manufacturers to seek an individual HCPCS cost even for higher-cost
products, which would delay our ability to track payment for individual
blood products. We have similar concerns about paying unclassified
blood products using either charges reduced to cost or reasonable cost.
Although these payment methods would accurately reflect the cost of
unclassified blood products to providers, there would be no incentive
for providers to manage their costs when using unclassified blood
products, and no incentives for the manufacturers to seek individual
HCPCS codes for the unclassified blood products. The OPPS is a
prospective payment system, and we want to limit rather than expand the
types of services within the OPPS that do not receive prospective
payment.
After reviewing the public comments, we are not finalizing our
original proposal to package HCPCS code P9099 into the associated
primary procedure. Instead, we are finalizing our alternative proposal
to make HCPCS code P9099 separately payable, assign it a status
indicator of ``R'', and pay the code at a rate equal to the lowest paid
separately payable blood product in the OPPS, which is P9043 (Infusion,
plasma protein fraction (human), 5 percent, 50 ml) with a payment rate
of $7.79 per unit. Our alternative proposal aligns
[[Page 85879]]
with our general policy in the OPPS to pay NOC codes at the lowest
available APC rate for a service category, while providing a payment
for unclassified blood products when a service is reported on the
claim. We believe our alternative proposal is superior to our original
proposal, which would not have provided any separate payment for blood
products reported using HCPCS code P9099. Our alternative proposal also
provides incentives for manufacturers to seek individual HCPCS codes
for new blood products, which helps us to track the utilization of
these new blood products and establish a payment rate for these new
products that better reflects their cost.
We decided to finalize our alternative proposal, as it gives
providers some payment for unclassified blood products, is consistent
with OPPS policy for other major categories of medical care where the
payment rate for the unclassified service is based on the lowest-paying
APC in an APC series for that category of service, while maintaining
incentives for manufacturers to establish individual HCPCS codes for
their new blood products in a timely manner.
(2) Brachytherapy Sources
Section 1833(t)(2)(H) of the Act mandates the creation of
additional groups of covered OPD services that classify devices of
brachytherapy consisting of a seed or seeds (or radioactive source)
(``brachytherapy sources'') separately from other services or groups of
services. The statute provides certain criteria for the additional
groups. For the history of OPPS payment for brachytherapy sources, we
refer readers to prior OPPS final rules, such as the CY 2012 OPPS/ASC
final rule with comment period (77 FR 68240 through 68241). As we have
stated in prior OPPS updates, we believe that adopting the general OPPS
prospective payment methodology for brachytherapy sources is
appropriate for a number of reasons (77 FR 68240). The general OPPS
methodology uses costs based on claims data to set the relative payment
weights for hospital outpatient services. This payment methodology
results in more consistent, predictable, and equitable payment amounts
per source across hospitals by averaging the extremely high and low
values, in contrast to payment based on hospitals' charges adjusted to
costs. We believe that the OPPS methodology, as opposed to payment
based on hospitals' charges adjusted to cost, also would provide
hospitals with incentives for efficiency in the provision of
brachytherapy services to Medicare beneficiaries. Moreover, this
approach is consistent with our payment methodology for the vast
majority of items and services paid under the OPPS. We refer readers to
the CY 2016 OPPS/ASC final rule with comment period (80 FR 70323
through 70325) for further discussion of the history of OPPS payment
for brachytherapy sources.
For CY 2021, except where otherwise indicated, we proposed to use
the costs derived from CY 2019 claims data to set the proposed CY 2021
payment rates for brachytherapy sources because CY 2019 is the year of
data we proposed to use to set the proposed payment rates for most
other items and services that would be paid under the CY 2021 OPPS.
With the exception of the proposed payment rate for brachytherapy
source C2645 (Brachytherapy planar source, palladium-103, per square
millimeter), we proposed to base the payment rates for brachytherapy
sources on the geometric mean unit costs for each source, consistent
with the methodology that we proposed for other items and services paid
under the OPPS, as discussed in section II.A.2. of the CY 2021 OPPS/ASC
proposed rule. We also proposed to continue the other payment policies
for brachytherapy sources that we finalized and first implemented in
the CY 2010 OPPS/ASC final rule with comment period (74 FR 60537). We
proposed to pay for the stranded and nonstranded not otherwise
specified (NOS) codes, HCPCS codes C2698 (Brachytherapy source,
stranded, not otherwise specified, per source) and C2699 (Brachytherapy
source, non-stranded, not otherwise specified, per source), at a rate
equal to the lowest stranded or nonstranded prospective payment rate
for such sources, respectively, on a per source basis (as opposed to,
for example, a per mCi), which is based on the policy we established in
the CY 2008 OPPS/ASC final rule with comment period (72 FR 66785). We
also proposed to continue the policy we first implemented in the CY
2010 OPPS/ASC final rule with comment period (74 FR 60537) regarding
payment for new brachytherapy sources for which we have no claims data,
based on the same reasons we discussed in the CY 2008 OPPS/ASC final
rule with comment period (72 FR 66786; which was delayed until January
1, 2010 by section 142 of Pub. L. 110-275). Specifically, this policy
is intended to enable us to assign new HCPCS codes for new
brachytherapy sources to their own APCs, with prospective payment rates
set based on our consideration of external data and other relevant
information regarding the expected costs of the sources to hospitals.
The proposed CY 2021 payment rates for brachytherapy sources are
included in Addendum B to the CY 2021 OPPS/ASC proposed rule (which is
available via the internet on the CMS website) and identified with
status indicator ``U''.
For CY 2018, we assigned status indicator ``U'' (Brachytherapy
Sources, Paid under OPPS; separate APC payment) to HCPCS code C2645
(Brachytherapy planar source, palladium-103, per square millimeter) in
the absence of claims data and established a payment rate using
external data (invoice price) at $4.69 per mm\2\. For CY 2019, in the
absence of sufficient claims data, we continued to establish a payment
rate for C2645 at $4.69 per mm\2\. Our CY 2018 claims data available
for the final CY 2020 OPPS/ASC final rule with comment period, included
two claims with a geometric mean cost for HCPCS code C2645 of $1.02 per
mm\2\. In response to comments from stakeholders, we agreed with
commenters that given the limited claims data available and a new
outpatient indication for C2645, a payment rate for HCPCS code C2645
based on the geometric mean cost of 1.02 per mm\2\ may not adequately
reflect the cost of HCPCS code C2645. In the CY 2020 OPPS/ASC final
rule with comment period, we finalized our policy to use our equitable
adjustment authority under section 1833(t)(2)(E) of the Act, which
states that the Secretary shall establish, in a budget neutral manner,
other adjustments as determined to be necessary to ensure equitable
payments, to maintain the CY 2019 payment rate of $4.69 per mm\2\ for
HCPCS code C2645 for CY 2020.
For CY 2021, we proposed to continue to assign status indicator
``U'' to HCPCS code C2645 (Brachytherapy planar source, palladium-103,
per square millimeter). For CY 2020, in the absence of sufficient
claims data, we continued to establish a payment rate for C2645 at
$4.69 per mm\2\. Our CY 2019 claims data available for the proposed CY
2021 rule included one claim with over 4,000 units of HCPCS code C2645.
The geometric mean cost of HCPCS code C2645 from this one claim is
$1.07 per mm\2\ for CY 2019. We do not believe that this one claim is
adequate to establish an APC payment rate for HCPCS code C2645 and to
discontinue our use of external data for this brachytherapy source.
Therefore, for CY 2021, we proposed to continue assigning the
brachytherapy source described by HCPCS code C2645 a payment rate of
$4.69 mm\2\ for CY 2021
[[Page 85880]]
through use of our equitable adjustment authority.
Comment: One commenter recommended that we should review outpatient
claims data for low-volume brachytherapy sources and consider removing
outliers to ensure appropriate and stable brachytherapy source
reimbursement in future years. The commenter contends that
brachytherapy source payments have fluctuated significantly since 2013
and may create barriers to access for individual cancer patients.
Response: We thank the commenter for their recommendation. As we
have stated in past rulemaking, the OPPS relies on the concept of
averaging, where the payment may be more or less than the estimated
cost of providing a service for a particular patient; however, with the
exception of outlier cases, we believe that such a prospective payment
is adequate to ensure access to appropriate care. We acknowledge that
payment for brachytherapy sources based on geometric mean costs from a
small set of claims may be more variable on a year-to-year basis when
compared to the geometric mean costs for brachytherapy sources from a
larger claims set. We will take the commenter's recommendation into
consideration in future rulemaking.
Comment: One commenter recommended that we exclude erroneous claims
data for C2642 (Brachytherapy source, stranded, cesium-131, per source)
from a particular hospital. The commenter stated the hospital reported
costs per source of $42.59 for C2642. Further, the commenter argued the
proposed payment rate for C2642 as a result of including the hospital's
claims information would threaten access to cancer therapy and would be
less than the actual amount paid by any hospital for this source over
the past decade.
Response: In our review of CY 2019 brachytherapy claims used for CY
2021 OPPS ratesetting, we did not find any erroneous billing of C2642
with respect to the particular hospital mentioned by the commenter.
OPPS relative payment weights based on geometric mean costs capture the
range of costs associated with services that are introduced slowly into
the system on a case-by-case or hospital-by-hospital basis. For these
reasons we believe it would be inappropriate to remove any outliers
when determining brachytherapy geometric mean costs and payment rates
for C2642.
After consideration of the public comments we received, we are
finalizing our proposal to assign the brachytherapy source described by
HCPCS code C2645 a payment rate of $4.69 per mm\2\ for CY 2021 through
use of our equitable adjustment authority.
We continue to invite hospitals and other parties to submit
recommendations to us for new codes to describe new brachytherapy
sources. Such recommendations should be direction via email to
[email protected] or by mail to the Division of Outpatient
Care, Mail Stop C4-01-26, Centers for Medicare and Medicaid Services,
7500 Security Boulevard, Baltimore, MD 21244. We will continue to add
new brachytherapy source codes and descriptors to our systems for
payment on a quarterly basis.
b. Comprehensive APCs (C-APCs) for CY 2021
(1) Background
In the CY 2014 OPPS/ASC final rule with comment period (78 FR 74861
through 74910), we finalized a comprehensive payment policy that
packages payment for adjunctive and secondary items, services, and
procedures into the most costly primary procedure under the OPPS at the
claim level. The policy was finalized in CY 2014, but the effective
date was delayed until January 1, 2015, to allow additional time for
further analysis, opportunity for public comment, and systems
preparation. The comprehensive APC (C-APC) policy was implemented
effective January 1, 2015, with modifications and clarifications in
response to public comments received regarding specific provisions of
the C-APC policy (79 FR 66798 through 66810).
A C-APC is defined as a classification for the provision of a
primary service and all adjunctive services provided to support the
delivery of the primary service. We established C-APCs as a category
broadly for OPPS payment and implemented 25 C-APCs beginning in CY 2015
(79 FR 66809 through 66810). In the CY 2016 OPPS/ASC final rule with
comment period (80 FR 70332), we finalized 10 additional C-APCs to be
paid under the existing C-APC payment policy and added 1 additional
level to both the Orthopedic Surgery and Vascular Procedures clinical
families, which increased the total number of C-APCs to 37 for CY 2016.
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79584
through 79585), we finalized another 25 C-APCs for a total of 62 C-
APCs. In the CY 2018 OPPS/ASC final rule with comment period, we did
not change the total number of C-APCs from 62. In the CY 2019 OPPS/ASC
final rule with comment period, we created 3 new C-APCs, increasing the
total number to 65 (83 FR 58844 through 58846). Most recently in the CY
2020 OPPS/ASC final rule with comment period, we created two new C-
APCs, increasing the total number to 67 C-APCs (84 FR 61158 through
61166).
Under our C-APC policy, we designate a service described by a HCPCS
code assigned to a C-APC as the primary service when the service is
identified by OPPS status indicator ``J1''. When such a primary service
is reported on a hospital outpatient claim, taking into consideration
the few exceptions that are discussed below, we make payment for all
other items and services reported on the hospital outpatient claim as
being integral, ancillary, supportive, dependent, and adjunctive to the
primary service (hereinafter collectively referred to as ``adjunctive
services'') and representing components of a complete comprehensive
service (78 FR 74865 and 79 FR 66799). Payments for adjunctive services
are packaged into the payments for the primary services. This results
in a single prospective payment for each of the primary, comprehensive
services based on the costs of all reported services at the claim
level.
Services excluded from the C-APC policy under the OPPS include
services that are not covered OPD services, services that cannot by
statute be paid for under the OPPS, and services that are required by
statute to be separately paid. This includes certain mammography and
ambulance services that are not covered OPD services in accordance with
section 1833(t)(1)(B)(iv) of the Act; brachytherapy seeds, which also
are required by statute to receive separate payment under section
1833(t)(2)(H) of the Act; pass-through payment drugs and devices, which
also require separate payment under section 1833(t)(6) of the Act;
self-administered drugs (SADs) that are not otherwise packaged as
supplies because they are not covered under Medicare Part B under
section 1861(s)(2)(B) of the Act; and certain preventive services (78
FR 74865 and 79 FR 66800 through 66801). A list of services excluded
from the C-APC policy is included in Addendum J to the CY 2021 OPPS/ASC
proposed rule (which is available via the internet on the CMS website).
In the interim final with request for comments (IFC) entitled,
``Additional Policy and Regulatory Revisions in Response to the COVID-
19 Public Health Emergency'', published on November 6, 2020, we stated
that effective for services furnished on or
[[Page 85881]]
after the effective date of the IFC and until the end of the PHE for
COVID-19, there is an exception to the OPPS C-APC policy to ensure
separate payment for new COVID-19 treatments that meet certain criteria
(85 FR 71158 through 71160). Under this exception, any new COVID-19
treatment that meets the two following criteria will, for the remainder
of the PHE for COVID-19, always be separately paid and will not be
packaged into a C-APC when it is provided on the same claim as the
primary C-APC service. First, the treatment must be a drug or
biological product (which could include a blood product) authorized to
treat COVID-19, as indicated in section ``I. Criteria for Issuance of
Authorization'' of the letter of authorization for the drug or
biological product, or the drug or biological product must be approved
by the FDA for treating COVID-19. Second, the emergency use
authorization (EUA) for the drug or biological product (which could
include a blood product) must authorize the use of the product in the
outpatient setting or not limit its use to the inpatient setting, or
the product must be approved by the FDA to treat COVID-19 disease and
not limit its use to the inpatient setting. For further information
regarding the exception to the C-APC policy for COVID-19 treatments,
please refer to the IFC (85 FR 71158 through 71160).
The C-APC policy payment methodology set forth in the CY 2014 OPPS/
ASC final rule with comment period for the C-APCs and modified and
implemented beginning in CY 2015 is summarized as follows (78 FR 74887
and 79 FR 66800):
Basic Methodology. As stated in the CY 2015 OPPS/ASC final rule
with comment period, we define the C-APC payment policy as including
all covered OPD services on a hospital outpatient claim reporting a
primary service that is assigned to status indicator ``J1'', excluding
services that are not covered OPD services or that cannot by statute be
paid for under the OPPS. Services and procedures described by HCPCS
codes assigned to status indicator ``J1'' are assigned to C-APCs based
on our usual APC assignment methodology by evaluating the geometric
mean costs of the primary service claims to establish resource
similarity and the clinical characteristics of each procedure to
establish clinical similarity within each APC.
In the CY 2016 OPPS/ASC final rule with comment period, we expanded
the C-APC payment methodology to qualifying extended assessment and
management encounters through the ``Comprehensive Observation
Services'' C-APC (C-APC 8011). Services within this APC are assigned
status indicator ``J2''. Specifically, we make a payment through C-APC
8011 for a claim that:
Does not contain a procedure described by a HCPCS code to
which we have assigned status indicator ``T;''
Contains 8 or more units of services described by HCPCS
code G0378 (Hospital observation services, per hour);
Contains services provided on the same date of service or
1 day before the date of service for HCPCS code G0378 that are
described by one of the following codes: HCPCS code G0379 (Direct
admission of patient for hospital observation care) on the same date of
service as HCPCS code G0378; CPT code 99281 (Emergency department visit
for the evaluation and management of a patient (Level 1)); CPT code
99282 (Emergency department visit for the evaluation and management of
a patient (Level 2)); CPT code 99283 (Emergency department visit for
the evaluation and management of a patient (Level 3)); CPT code 99284
(Emergency department visit for the evaluation and management of a
patient (Level 4)); CPT code 99285 (Emergency department visit for the
evaluation and management of a patient (Level 5)) or HCPCS code G0380
(Type B emergency department visit (Level 1)); HCPCS code G0381 (Type B
emergency department visit (Level 2)); HCPCS code G0382 (Type B
emergency department visit (Level 3)); HCPCS code G0383 (Type B
emergency department visit (Level 4)); HCPCS code G0384 (Type B
emergency department visit (Level 5)); CPT code 99291 (Critical care,
evaluation and management of the critically ill or critically injured
patient; first 30-74 minutes); or HCPCS code G0463 (Hospital outpatient
clinic visit for assessment and management of a patient); and
Does not contain services described by a HCPCS code to
which we have assigned status indicator ``J1''.
The assignment of status indicator ``J2'' to a specific combination
of services performed in combination with each other allows for all
other OPPS payable services and items reported on the claim (excluding
services that are not covered OPD services or that cannot by statute be
paid for under the OPPS) to be deemed adjunctive services representing
components of a comprehensive service and resulting in a single
prospective payment for the comprehensive service based on the costs of
all reported services on the claim (80 FR 70333 through 70336).
Services included under the C-APC payment packaging policy, that
is, services that are typically adjunctive to the primary service and
provided during the delivery of the comprehensive service, include
diagnostic procedures, laboratory tests, and other diagnostic tests and
treatments that assist in the delivery of the primary procedure; visits
and evaluations performed in association with the procedure; uncoded
services and supplies used during the service; durable medical
equipment as well as prosthetic and orthotic items and supplies when
provided as part of the outpatient service; and any other components
reported by HCPCS codes that represent services that are provided
during the complete comprehensive service (78 FR 74865 and 79 FR
66800).
In addition, payment for hospital outpatient department services
that are similar to therapy services and delivered either by therapists
or nontherapists is included as part of the payment for the packaged
complete comprehensive service. These services that are provided during
the perioperative period are adjunctive services and are deemed not to
be therapy services as described in section 1834(k) of the Act,
regardless of whether the services are delivered by therapists or other
nontherapist health care workers. We have previously noted that therapy
services are those provided by therapists under a plan of care in
accordance with section 1835(a)(2)(C) and section 1835(a)(2)(D) of the
Act and are paid for under section 1834(k) of the Act, subject to
annual therapy caps as applicable (78 FR 74867 and 79 FR 66800).
However, certain other services similar to therapy services are
considered and paid for as hospital outpatient department services.
Payment for these nontherapy outpatient department services that are
reported with therapy codes and provided with a comprehensive service
is included in the payment for the packaged complete comprehensive
service. We note that these services, even though they are reported
with therapy codes, are hospital outpatient department services and not
therapy services. We refer readers to the July 2016 OPPS Change Request
9658 (Transmittal 3523) for further instructions on reporting these
services in the context of a C-APC service.
Items included in the packaged payment provided in conjunction with
the primary service also include all drugs, biologicals, and
radiopharmaceuticals, regardless of cost, except those drugs with pass-
through payment status and SADs, unless they function as packaged
supplies (78 FR 74868 through 74869 and 74909 and 79 FR 66800). We
refer readers to Section
[[Page 85882]]
50.2M, Chapter 15, of the Medicare Benefit Policy Manual for a
description of our policy on SADs treated as hospital outpatient
supplies, including lists of SADs that function as supplies and those
that do not function as supplies.
We define each hospital outpatient claim reporting a single unit of
a single primary service assigned to status indicator ``J1'' as a
single ``J1'' unit procedure claim (78 FR 74871 and 79 FR 66801). Line
item charges for services included on the C-APC claim are converted to
line item costs, which are then summed to develop the estimated APC
costs. These claims are then assigned one unit of the service with
status indicator ``J1'' and later used to develop the geometric mean
costs for the C-APC relative payment weights. (We note that we use the
term ``comprehensive'' to describe the geometric mean cost of a claim
reporting ``J1'' service(s) or the geometric mean cost of a C-APC,
inclusive of all of the items and services included in the C-APC
service payment bundle.) Charges for services that would otherwise be
separately payable are added to the charges for the primary service.
This process differs from our traditional cost accounting methodology
only in that all such services on the claim are packaged (except
certain services as described above). We apply our standard data trims,
which exclude claims with extremely high primary units or extreme
costs.
The comprehensive geometric mean costs are used to establish
resource similarity and, along with clinical similarity, dictate the
assignment of the primary services to the C-APCs. We establish a
ranking of each primary service (single unit only) to be assigned to
status indicator ``J1'' according to its comprehensive geometric mean
costs. For the minority of claims reporting more than one primary
service assigned to status indicator ``J1'' or units thereof, we
identify one ``J1'' service as the primary service for the claim based
on our cost-based ranking of primary services. We then assign these
multiple ``J1'' procedure claims to the C-APC to which the service
designated as the primary service is assigned. If the reported ``J1''
services on a claim map to different C-APCs, we designate the ``J1''
service assigned to the C-APC with the highest comprehensive geometric
mean cost as the primary service for that claim. If the reported
multiple ``J1'' services on a claim map to the same C-APC, we designate
the most costly service (at the HCPCS code level) as the primary
service for that claim. This process results in initial assignments of
claims for the primary services assigned to status indicator ``J1'' to
the most appropriate C-APCs based on both single and multiple procedure
claims reporting these services and clinical and resource homogeneity.
Complexity Adjustments. We use complexity adjustments to provide
increased payment for certain comprehensive services. We apply a
complexity adjustment by promoting qualifying paired ``J1'' service
code combinations or paired code combinations of ``J1'' services and
certain add-on codes (as described further below) from the originating
C-APC (the C-APC to which the designated primary service is first
assigned) to the next higher paying C-APC in the same clinical family
of C-APCs. We apply this type of complexity adjustment when the paired
code combination represents a complex, costly form or version of the
primary service according to the following criteria:
Frequency of 25 or more claims reporting the code
combination (frequency threshold); and
Violation of the 2 times rule, as stated in section
1833(t)(2) of the Act and section III.B.2. of the CY 2021 OPPS/ASC
proposed rule, in the originating C-APC (cost threshold).
These criteria identify paired code combinations that occur
commonly and exhibit materially greater resource requirements than the
primary service. The CY 2017 OPPS/ASC final rule with comment period
(81 FR 79582) included a revision to the complexity adjustment
eligibility criteria. Specifically, we finalized a policy to
discontinue the requirement that a code combination (that qualifies for
a complexity adjustment by satisfying the frequency and cost criteria
thresholds described above) also not create a 2 times rule violation in
the higher level or receiving APC.
After designating a single primary service for a claim, we evaluate
that service in combination with each of the other procedure codes
reported on the claim assigned to status indicator ``J1'' (or certain
add-on codes) to determine if there are paired code combinations that
meet the complexity adjustment criteria. For a new HCPCS code, we
determine initial C-APC assignment and qualification for a complexity
adjustment using the best available information, crosswalking the new
HCPCS code to a predecessor code(s) when appropriate.
Once we have determined that a particular code combination of
``J1'' services (or combinations of ``J1'' services reported in
conjunction with certain add-on codes) represents a complex version of
the primary service because it is sufficiently costly, frequent, and a
subset of the primary comprehensive service overall according to the
criteria described above, we promote the claim including the complex
version of the primary service as described by the code combination to
the next higher cost C-APC within the clinical family, unless the
primary service is already assigned to the highest cost APC within the
C-APC clinical family or assigned to the only C-APC in a clinical
family. We do not create new APCs with a comprehensive geometric mean
cost that is higher than the highest geometric mean cost (or only) C-
APC in a clinical family just to accommodate potential complexity
adjustments. Therefore, the highest payment for any claim including a
code combination for services assigned to a C-APC would be the highest
paying C-APC in the clinical family (79 FR 66802).
We package payment for all add-on codes into the payment for the C-
APC. However, certain primary service add-on combinations may qualify
for a complexity adjustment. As noted in the CY 2016 OPPS/ASC final
rule with comment period (80 FR 70331), all add-on codes that can be
appropriately reported in combination with a base code that describes a
primary ``J1'' service are evaluated for a complexity adjustment.
To determine which combinations of primary service codes reported
in conjunction with an add-on code may qualify for a complexity
adjustment for CY 2021, we proposed to apply the frequency and cost
criteria thresholds discussed above, testing claims reporting one unit
of a single primary service assigned to status indicator ``J1'' and any
number of units of a single add-on code for the primary ``J1'' service.
If the frequency and cost criteria thresholds for a complexity
adjustment are met and reassignment to the next higher cost APC in the
clinical family is appropriate (based on meeting the criteria outlined
above), we make a complexity adjustment for the code combination; that
is, we reassign the primary service code reported in conjunction with
the add-on code to the next higher cost C-APC within the same clinical
family of C-APCs. As previously stated, we package payment for add-on
codes into the C-APC payment rate. If any add-on code reported in
conjunction with the ``J1'' primary service code does not qualify for a
complexity adjustment, payment for the add-on service continues to be
packaged into the payment for the
[[Page 85883]]
primary service and is not reassigned to the next higher cost C-APC. We
listed the complexity adjustments for ``J1'' and add-on code
combinations for CY 2021, along with all of the other proposed
complexity adjustments, in Addendum J to the CY 2021 OPPS/ASC proposed
rule (which is available via the internet on the CMS website).
Addendum J to the CY 2021 OPPS/ASC proposed rule includes the cost
statistics for each code combination that would qualify for a
complexity adjustment (including primary code and add-on code
combinations). Addendum J to the CY 2021 OPPS/ASC proposed rule also
contains summary cost statistics for each of the paired code
combinations that describe a complex code combination that would
qualify for a complexity adjustment and are proposed to be reassigned
to the next higher cost C-APC within the clinical family. The combined
statistics for all proposed reassigned complex code combinations are
represented by an alphanumeric code with the first 4 digits of the
designated primary service followed by a letter. For example, the
proposed geometric mean cost listed in Addendum J for the code
combination described by complexity adjustment assignment 3320R, which
is assigned to C-APC 5224 (Level 4 Pacemaker and Similar Procedures),
includes all paired code combinations that are proposed to be
reassigned to C-APC 5224 when CPT code 33208 is the primary code.
Providing the information contained in Addendum J to the CY 2021 OPPS/
ASC proposed rule allows stakeholders the opportunity to better assess
the impact associated with the proposed reassignment of claims with
each of the paired code combinations eligible for a complexity
adjustment.
Comment: A commenter stated that CMS should not use claims data
from complexity adjustment code pairs in calculating the geometric mean
cost for the next higher paying APC to which the complexity adjusted
code pair is assigned and that doing so can decrease the geometric mean
cost of APCs with a low number of claims, specifically C-APC 5493--
Level 3 Intraocular Procedures. The commenter stated that CMS did not
intend to include the costs of complexity-adjusted code pairs in
calculating the geometric mean cost for the higher-paying APCs to which
the complexity-adjustment code pair is assigned when the C-APC
complexity adjustment policy was initially established and that
complexity adjustments were intended as payment adjustments for complex
versions of the comprehensive service only. To further support their
claim that CMS intended for complexity adjustments to only provide
higher payment for claims including complex comprehensive services, the
commenter noted that, unlike other HCPCS codes with a significant
number of claims assigned to an APC, complexity adjusted code pairs are
not evaluated for a 2 times rule violation in the higher-paying APC to
which they are promoted.
Response: We disagree with the commenter's assertion regarding the
policy of including the costs of a complexity adjusted code pair in the
calculation of the geometric mean costs of the next higher paying C-APC
to which the code pair is assigned. The current C-APC complexity
adjustment policy, including the calculation of the geometric mean cost
of APCs that include complexity-adjusted code pairs, was initially
described in the CY 2014 OPPS/ASC final rule with comment period (78 FR
74887). In that rule, we stated the following: ``We then considered
reassigning complex subsets of claims for each primary service HCPCS
code. All claims reporting more than one procedure described by HCPCS
codes assigned to status indicator ``J1'' are evaluated for the
existence of commonly occurring combinations of procedure codes
reported on claims that exhibit a materially greater comprehensive
geometric mean cost relative to the geometric mean cost of the claims
reporting that primary HCPCS code. This indicates that the subset of
procedures identified by the secondary HCPCS code has increased
resource requirements relative to less complex subsets of that
procedure. If a combination of procedure codes reported on claims is
identified that meets these requirements, that is, commonly occurring
and exhibiting materially greater resource requirements, it is further
evaluated to confirm clinical validity as a complex subset of the
primary procedure and the combination of procedure codes is then
identified as complex, and primary service claims with that combination
of procedure codes are subsequently reassigned as appropriate. If a
combination of procedure codes does not meet the requirement for a
materially different cost or does not occur commonly, it is not
considered to be a complex, and primary service claims with that
combination of procedure codes are not reassigned. All combinations of
procedures described by HCPCS codes assigned to status indicator ``J1''
for each primary HCPCS code are similarly evaluated.
Once all combinations of procedures described by HCPCS codes
assigned to status indicator ``J1'' have been evaluated, all claims
identified for reassignment for each primary service are combined and
the group is assigned to a higher level comprehensive APC within a
clinical family of comprehensive APCs, that is, an APC with greater
estimated resource requirements than the initially assigned
comprehensive APC and with appropriate clinical homogeneity. We
assessed resource variation for reassigned claims within the receiving
APC using the geometric mean cost for all reassigned claims for the
primary service relative to other services assigned to that APC using
the 2 times rule criteria. For new HCPCS codes and codes without data,
we will use the best data available to us to identify combinations of
procedures that represent a more complex form of the primary procedure
and warrant reassignment to a higher level APC. We will reevaluate our
APC assignments, and identification and APC placement of complex claims
once claims data become available. We then recalculate all APC
comprehensive geometric mean costs and ensure clinical and resource
homogeneity.''
We believe that the final statement clearly communicates our policy
of including the costs of the complexity-adjusted codes pairs in
calculating the geometric mean cost for the higher-paying APCs to which
the complexity-adjustment code pairs are assigned. While the commenter
is correct that we no longer require that a code combination (that
qualifies for a complexity adjustment by satisfying the frequency and
cost criteria thresholds described above) not create a 2 times rule
violation in the higher level or receiving APC, this change was based
on our belief that the requirement was not useful because most code
combinations fall below our established frequency threshold for
considering 2 times rule violations (81 FR 79582). In summary, we do
not believe it is necessary to change the current policy that includes
the costs of the paired code combinations in the next higher-paying APC
at this time.
Comment: Several commenters requested that CMS alter the
established C-APC complexity adjustment eligibility criteria to allow
additional code combinations to qualify for complexity adjustments. We
also received several comments requesting that CMS modify its
complexity adjustment criteria by eliminating the claims frequency
requirement to determine eligibility for the complexity adjustment and
expanding the eligibility for a complexity adjustment to other APCs
besides C-APCs to apply the
[[Page 85884]]
complexity adjustment to all blue light cystoscopy with Cysview
procedures in the HOPD, even those assigned to clinical APCs.
Response: We appreciate these comments. However, at this time, we
do not believe changes to the C-APC complexity adjustment criteria are
necessary or that we should make exceptions to the criteria to allow
claims with the code combinations suggested by the commenters to
receive complexity adjustments. As stated previously (81 FR 79582), we
continue to believe that the complexity adjustment criteria, which
require a frequency of 25 or more claims reporting a code combination
and a violation of the 2 times rule in the originating C-APC in order
to receive payment in the next higher cost C-APC within the clinical
family, are adequate to determine if a combination of procedures
represents a complex, costly subset of the primary service. If a code
combination meets these criteria, the combination receives payment at
the next higher cost C-APC. Code combinations that do not meet these
criteria receive the C-APC payment rate associated with the primary
``J1'' service. A minimum of 25 claims is already a very low threshold
for a national payment system. Lowering the minimum of 25 claims
further could lead to unnecessary complexity adjustments for service
combinations that are rarely performed.
With regard to the requests for complexity adjustments for blue
light cystoscopy procedures involving the use of Cysview, in CY 2018 we
created a HCPCS C-code (C9738--Adjunctive blue light cystoscopy with
fluorescent imaging agent (list separately in addition to code for
primary procedure)) to describe blue light cystoscopy with fluorescent
imaging agent and allowed this code to be eligible for complexity
adjustments when billed with procedure codes used to describe white
light cystoscopy of the bladder, although this code is not a ``J1''
service or an add-on code for the primary ``J1'' service. For CY 2021,
there is one code combination, of the six total available combinations
involving C9738 and procedure codes used to describe white light
cystoscopy, that qualifies for a complexity adjustment (HCPCS code
52204 Cystourethroscopy, with biopsy(s) + C9738 Adjunctive blue light
cystoscopy with fluorescent imaging agent (list separately in addition
to code for primary procedure)). The remaining five code combinations
do not meet the cost and frequency criteria to qualify for a complexity
adjustment. At this time, we do not believe that further modifications
to the C-APC complexity adjustment policy, including allowing services
assigned to clinical APCs to qualify for complexity adjustments, are
necessary to allow for complexity adjustments for these procedures.
After consideration of the public comments we received on the
proposed complexity adjustment policy, we are finalizing the C-APC
complexity adjustment policy for CY 2021, as proposed, without
modification.
(2) Exclusion of Procedures Assigned to New Technology APCs From the C-
APC Policy
Services that are assigned to New Technology APCs are typically new
procedures that do not have sufficient claims history to establish an
accurate payment for the procedures. Beginning in CY 2002, we retain
services within New Technology APC groups until we gather sufficient
claims data to enable us to assign the service to an appropriate
clinical APC. This policy allows us to move a service from a New
Technology APC in less than 2 years if sufficient data are available.
It also allows us to retain a service in a New Technology APC for more
than 2 years if sufficient data upon which to base a decision for
reassignment have not been collected (82 FR 59277).
The C-APC payment policy packages payment for adjunctive and
secondary items, services, and procedures into the most costly primary
procedure under the OPPS at the claim level. Prior to CY 2019, when a
procedure assigned to a New Technology APC was included on the claim
with a primary procedure, identified by OPPS status indicator ``J1'',
payment for the new technology service was typically packaged into the
payment for the primary procedure. Because the new technology service
was not separately paid in this scenario, the overall number of single
claims available to determine an appropriate clinical APC for the new
service was reduced. This was contrary to the objective of the New
Technology APC payment policy, which is to gather sufficient claims
data to enable us to assign the service to an appropriate clinical APC.
To address this issue and ensure that there is sufficient claims
data for services assigned to New Technology APCs, in the CY 2019 OPPS/
ASC final rule with comment period (83 FR 58847), we finalized
excluding payment for any procedure that is assigned to a New
Technology APC (APCs 1491 through 1599 and APCs 1901 through 1908) from
being packaged when included on a claim with a ``J1'' service assigned
to a C-APC. In the CY 2020 OPPS/ASC final rule with comment period, we
finalized that payment for services assigned to a New Technology APC
would be excluded from being packaged into the payment for
comprehensive observation services assigned status indicator ``J2''
when they are included on a claim with a ``J2'' service starting in CY
2020 (84 FR 61167).
(3) Additional C-APCs for CY 2021
For CY 2021 and subsequent years, we proposed to continue to apply
the C-APC payment policy methodology. We refer readers to the CY 2017
OPPS/ASC final rule with comment period (81 FR 79583) for a discussion
of the C-APC payment policy methodology and revisions.
Each year, in accordance with section 1833(t)(9)(A) of the Act, we
review and revise the services within each APC group and the APC
assignments under the OPPS. As a result of our annual review of the
services and the APC assignments under the OPPS, we did not propose to
convert any conventional APCs to C-APCs in CY 2021. However, as
discussed in section III.D.7, we proposed to create an additional level
in the ``Urology and Related Services'' APC series and, as discussed in
section III.D.1, we proposed to create an additional level in the
``Neurostimulator and Related Procedures'' APC series. Table 3 lists
the proposed C-APCs for CY 2021, all of which were established in past
rules.
Comment: Commenters supported the creation of the two new proposed
C-APCs, based on resource cost and clinical characteristics.
Response: We appreciate the commenters' support.
Comment: Several commenters expressed concern that the C-APC
payment rates may not adequately reflect the costs associated with
services. These comments stated that the C-APC methodology does not
account for the complexity of certain care processes, fails to capture
the necessary claims, and the resulting data may lead to inaccurate
payment rates that will negatively impact access to services.
Commenters also had concerns around the claims data used for
ratesetting, due to variations in clinical practice and billing
patterns across the hospitals that submit these claims, and urged CMS
to consider alternatives to the current methodology. Some commenters
were concerned that hospitals are not correctly charging for procedures
assigned to C-APCs and urged CMS to invest in policies and education
for hospitals regarding correct
[[Page 85885]]
billing patterns. These commenters also requested that CMS provide an
analysis of the impact of the C-APC policy on affected procedures and
patient access to services. One commenter requested that CMS review and
use Part B claims data in order to estimate costs for the appropriate
C-APCs for CY 2021 ratesetting.
Response: We appreciate the comments. We continue to believe that
the current C-APC methodology is appropriate. We also note that, in the
CY 2018 OPPS/ASC final rule with comment period (82 FR 59246), we
conducted an analysis of the effects of the C-APC policy. The analysis
used claims data for the CY 2016 OPPS/ASC final rule with comment
period, the CY 2017 OPPS/ASC final rule with comment period, and the CY
2018 OPPS/ASC proposed rule, which were for the period from CY 2014
(before C-APCs became effective) to CY 2016. We looked at separately
payable codes that were then assigned to C-APCs and, overall, we
observed an increase in claim line frequency, units billed, and
Medicare payment for those procedures, which suggest that the C-APC
payment policy did not adversely affect access to care or reduce
payments to hospitals and is working as intended.
Comment: Several commenters requested that CMS discontinue the C-
APC payment policy for all surgical insertion codes required for
brachytherapy treatment. The commenters stated concerns about how the
C-APC methodology impacts radiation oncology, particularly the delivery
of brachytherapy for the treatment of cervical cancer. They also stated
that they oppose C-APC payment for cancer care given the complexity of
coding, serial billing for cancer care, and potentially different sites
of service for the initial surgical device insertion and subsequent
treatment delivery or other supportive services. These commenters
suggested that CMS allow brachytherapy to be reported through the
traditional APC methodology, move procedures to a higher C-APC, or
separately pay for preparation and planning services to fully account
for accurate reflection of the costs associated with these procedures.
Response: While we continue to believe that the C-APC policy is
appropriately applied to these surgical procedures, we will continue to
examine these concerns and will determine if any modifications to this
policy are warranted in future rulemaking.
Comment: One commenter urged CMS to eliminate the C-APC policy for
single-session stereotactic radiosurgery codes (77371 and 77372). The
commenter requested that CMS continue to make separate payments for the
10 planning and preparation codes related to SRS and include the HCPCS
code for IMRT planning (77301) on the list of planning and preparation
codes, stating that the service has become more common in single
fraction radiosurgery treatment planning.
Response: At this time, we do not believe that it is necessary to
discontinue the C-APCs that include single session SRS procedures. We
continue to believe that the C-APC policy is appropriately applied to
these surgical procedures for the reasons cited when this policy was
first adopted and note that the commenters did not provide any
empirical evidence to support their claims that the existing C-APC
policy does not adequately pay for these procedures. Also, we will
continue in CY 2021 to pay separately for the 10 planning and
preparation services (HCPCS codes 70551, 70552, 70553, 77011, 77014,
77280, 77285, 77290, 77295, and 77336) adjunctive to the delivery of
the SRS treatment using either the Cobalt-60-based or LINAC-based
technology when furnished to a beneficiary within 1 month of the SRS
treatment for CY 2021.
Comment: We received one comment requesting that CMS carefully
consider the proper location of care before establishing a C-APC for
autologous hematopoietic stem cell transplant.
Response: We thank the commenter for this comment. This comment
relates to a recommendation from last year's Advisory Panel on Hospital
Outpatient Payment (HOP Panel), which recommended that CMS consider
creating a C-APC for autologous stem cell transplantation and that CMS
provide a rationale if it decides not to create such an APC. In the CY
2020 OPPS/ASC final rule with comment period, we evaluated the
possibility of creating this C-APC and found that it was not
appropriate to create a C-APC for autologous hematopoietic stem cell
transplant at that time for the reasons discussed in that rule (84 FR
61162).
After consideration of the public comments we received, we are
finalizing the proposed C-APCs for CY 2021. Table 3 below lists the
final C-APCs for CY 2021. All C-APCs are displayed in Addendum J to
this final rule with comment period (which is available via the
internet on the CMS website). Addendum J to this final rule with
comment period also contains all of the data related to the C-APC
payment policy methodology, including the list of complexity
adjustments and other information for CY 2021.
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c. Calculation of Composite APC Criteria-Based Costs
As discussed in the CY 2008 OPPS/ASC final rule with comment period
(72 FR 66613), we believe it is important that the OPPS enhance
incentives for hospitals to provide necessary, high quality care as
efficiently as possible. For CY 2008, we developed composite APCs to
provide a single payment for groups of services that are typically
performed together during a single clinical encounter and that result
in the provision of a complete service.
[[Page 85888]]
Combining payment for multiple, independent services into a single OPPS
payment in this way enables hospitals to manage their resources with
maximum flexibility by monitoring and adjusting the volume and
efficiency of services themselves. An additional advantage to the
composite APC model is that we can use data from correctly coded
multiple procedure claims to calculate payment rates for the specified
combinations of services, rather than relying upon single procedure
claims which may be low in volume and/or incorrectly coded. Under the
OPPS, we currently have composite policies for mental health services
and multiple imaging services. (We note that, in the CY 2018 OPPS/ASC
final rule with comment period, we finalized a policy to delete the
composite APC 8001 (LDR Prostate Brachytherapy Composite) for CY 2018
and subsequent years.) We refer readers to the CY 2008 OPPS/ASC final
rule with comment period (72 FR 66611 through 66614 and 66650 through
66652) for a full discussion of the development of the composite APC
methodology, and the CY 2012 OPPS/ASC final rule with comment period
(76 FR 74163) and the CY 2018 OPPS/ASC final rule with comment period
(82 FR 59241 through 59242 and 59246 through 52950) for more recent
background.
(1) Mental Health Services Composite APC
We proposed to continue our longstanding policy of limiting the
aggregate payment for specified less resource-intensive mental health
services furnished on the same date to the payment for a day of partial
hospitalization services provided by a hospital, which we consider to
be the most resource-intensive of all outpatient mental health
services. We refer readers to the April 7, 2000 OPPS final rule with
comment period (65 FR 18452 through 18455) for the initial discussion
of this longstanding policy and the CY 2012 OPPS/ASC final rule with
comment period (76 FR 74168) for more recent background.
In the CY 2017 OPPS/ASC final rule with comment period (81 FR 79588
through 79589), we finalized a policy to combine the existing Level 1
and Level 2 hospital-based PHP APCs into a single hospital-based PHP
APC, and thereby discontinue APCs 5861 (Level 1--Partial
Hospitalization (3 services) for Hospital-Based PHPs) and 5862 (Level--
2 Partial Hospitalization (4 or more services) for Hospital-Based PHPs)
and replace them with APC 5863 (Partial Hospitalization (3 or more
services per day)).
In the CY 2018 OPPS/ASC proposed rule and final rule with comment
period (82 FR 33580 through 33581 and 59246 through 59247,
respectively), we proposed and finalized the policy for CY 2018 and
subsequent years that, when the aggregate payment for specified mental
health services provided by one hospital to a single beneficiary on a
single date of service, based on the payment rates associated with the
APCs for the individual services, exceeds the maximum per diem payment
rate for partial hospitalization services provided by a hospital, those
specified mental health services will be paid through composite APC
8010 (Mental Health Services Composite). In addition, we set the
payment rate for composite APC 8010 for CY 2018 at the same payment
rate that will be paid for APC 5863, which is the maximum partial
hospitalization per diem payment rate for a hospital, and finalized a
policy that the hospital will continue to be paid the payment rate for
composite APC 8010. Under this policy, the I/OCE will continue to
determine whether to pay for these specified mental health services
individually, or to make a single payment at the same payment rate
established for APC 5863 for all of the specified mental health
services furnished by the hospital on that single date of service. We
continue to believe that the costs associated with administering a
partial hospitalization program at a hospital represent the most
resource intensive of all outpatient mental health services. Therefore,
we do not believe that we should pay more for mental health services
under the OPPS than the highest partial hospitalization per diem
payment rate for hospitals.
We proposed that when the aggregate payment for specified mental
health services provided by one hospital to a single beneficiary on a
single date of service, based on the payment rates associated with the
APCs for the individual services, exceeds the maximum per diem payment
rate for partial hospitalization services provided by a hospital, those
specified mental health services would be paid through composite APC
8010 for CY 2021. In addition, we proposed to set the proposed payment
rate for composite APC 8010 at the same payment rate that we proposed
for APC 5863, which is the maximum partial hospitalization per diem
payment rate for a hospital, and that the hospital continue to be paid
the proposed payment rate for composite APC 8010.
We did not receive any public comment on these proposals.
Therefore, we are finalizing our proposal, without modification, that
when the aggregate payment for specified mental health services
provided by one hospital to a single beneficiary on a single date of
service, based on the payment rates associated with the APCs for the
individual services, exceeds the maximum per diem payment rate for
partial hospitalization services provided by a hospital, those
specified mental health services would be paid through composite APC
8010 for CY 2021. In addition, we are finalizing our proposal to set
the payment rate for composite APC 8010 for CY 2021 at the same payment
rate that we set for APC 5863, which is the maximum partial
hospitalization per diem payment rate for a hospital.
(2) Multiple Imaging Composite APCs (APCs 8004, 8005, 8006, 8007, and
8008)
Effective January 1, 2009, we provide a single payment each time a
hospital submits a claim for more than one imaging procedure within an
imaging family on the same date of service, to reflect and promote the
efficiencies hospitals can achieve when performing multiple imaging
procedures during a single session (73 FR 41448 through 41450). We
utilize three imaging families based on imaging modality for purposes
of this methodology: (1) Ultrasound; (2) computed tomography (CT) and
computed tomographic angiography (CTA); and (3) magnetic resonance
imaging (MRI) and magnetic resonance angiography (MRA). The HCPCS codes
subject to the multiple imaging composite policy and their respective
families are listed in Table 12 of the CY 2014 OPPS/ASC final rule with
comment period (78 FR 74920 through 74924).
While there are three imaging families, there are five multiple
imaging composite APCs due to the statutory requirement under section
1833(t)(2)(G) of the Act that we differentiate payment for OPPS imaging
services provided with and without contrast. While the ultrasound
procedures included under the policy do not involve contrast, both CT/
CTA and MRI/MRA scans can be provided either with or without contrast.
The five multiple imaging composite APCs established in CY 2009 are:
APC 8004 (Ultrasound Composite);
APC 8005 (CT and CTA without Contrast Composite);
APC 8006 (CT and CTA with Contrast Composite);
APC 8007 (MRI and MRA without Contrast Composite); and
APC 8008 (MRI and MRA with Contrast Composite).
We define the single imaging session for the ``with contrast''
composite APCs
[[Page 85889]]
as having at least one or more imaging procedures from the same family
performed with contrast on the same date of service. For example, if
the hospital performs an MRI without contrast during the same session
as at least one other MRI with contrast, the hospital will receive
payment based on the payment rate for APC 8008, the ``with contrast''
composite APC.
We make a single payment for those imaging procedures that qualify
for payment based on the composite APC payment rate, which includes any
packaged services furnished on the same date of service. The standard
(noncomposite) APC assignments continue to apply for single imaging
procedures and multiple imaging procedures performed across families.
For a full discussion of the development of the multiple imaging
composite APC methodology, we refer readers to the CY 2009 OPPS/ASC
final rule with comment period (73 FR 68559 through 68569).
For CY 2021, we proposed to continue to pay for all multiple
imaging procedures within an imaging family performed on the same date
of service using the multiple imaging composite APC payment
methodology. We continue to believe that this policy would reflect and
promote the efficiencies hospitals can achieve when performing multiple
imaging procedures during a single session.
The proposed CY 2021 payment rates for the five multiple imaging
composite APCs (APCs 8004, 8005, 8006, 8007, and 8008) were based on
proposed geometric mean costs calculated from CY 2019 claims available
for the CY 2021 OPPS/ASC proposed rule that qualified for composite
payment under the current policy (that is, those claims reporting more
than one procedure within the same family on a single date of service).
To calculate the proposed geometric mean costs, we used the same
methodology that we have used to calculate the geometric mean costs for
these composite APCs since CY 2014, as described in the CY 2014 OPPS/
ASC final rule with comment period (78 FR 74918). The imaging HCPCS
codes referred to as ``overlap bypass codes'' that we removed from the
bypass list for purposes of calculating the proposed multiple imaging
composite APC geometric mean costs, in accordance with our established
methodology as stated in the CY 2014 OPPS/ASC final rule with comment
period (78 FR 74918), are identified by asterisks in Addendum N to this
CY 2021 OPPS/ASC proposed rule (which is available via the internet on
the CMS website) and are discussed in more detail in section II.A.1.b.
of this CY 2021 OPPS/ASC proposed rule.
For the CY 2021 OPPS/ASC proposed rule, we were able to identify
approximately 964,000 ``single session'' claims out of an estimated 4.9
million potential claims for payment through composite APCs from our
ratesetting claims data, which represents approximately 14 percent of
all eligible claims, to calculate the proposed CY 2021 geometric mean
costs for the multiple imaging composite APCs. Table 4 of the CY 2021
OPPS/ASC proposed rule lists the proposed HCPCS codes that would be
subject to the multiple imaging composite APC policy and their
respective families and approximate composite APC proposed geometric
mean costs for CY 2021.
We did not receive any public comments on this proposal. Therefore,
we are finalizing our proposal to continue the use of multiple imaging
composite APCs to pay for services providing more than one imaging
procedure from the same family on the same date, without modification.
Table 4 lists the HCPCS codes that will be subject to the multiple
imaging composite APC policy and their respective families and
approximate composite APC final geometric mean costs for CY 2021.
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3. Changes to Packaged Items and Services
a. Background and Rationale for Packaging in the OPPS
Like other prospective payment systems, the OPPS relies on the
concept of averaging to establish a payment rate for services. The
payment may be more or less than the estimated cost of providing a
specific service or a bundle of specific services for a particular
beneficiary. The OPPS packages payments for multiple interrelated items
and services into a single payment to create incentives for hospitals
to furnish services most efficiently and to manage their resources with
maximum flexibility. Our packaging policies support our strategic goal
of using larger payment bundles in the OPPS to maximize hospitals'
incentives to provide care in the most efficient manner. For example,
where there are a variety of devices, drugs, items, and supplies that
could be used to furnish a service, some of which are more costly than
others, packaging encourages hospitals to use the most cost-efficient
item that meets the patient's needs, rather than to routinely use a
more expensive item, which may occur if separate payment is provided
for the item.
Packaging also encourages hospitals to effectively negotiate with
manufacturers and suppliers to reduce the purchase price of items and
services or to explore alternative group purchasing arrangements,
thereby encouraging the most economical health care delivery.
Similarly, packaging encourages hospitals to establish protocols that
ensure that necessary services are furnished, while scrutinizing the
services ordered by practitioners to maximize the efficient use of
hospital resources. Packaging payments into larger payment bundles
promotes the predictability and accuracy of payment for services over
time. Finally, packaging may reduce the importance of refining service-
specific payment because packaged payments include costs associated
with higher cost cases requiring many ancillary items and services and
lower cost cases requiring fewer ancillary items and services. Because
packaging encourages efficiency and is an essential component of a
prospective payment system, packaging payments for items and services
that are typically integral, ancillary, supportive, dependent, or
adjunctive to a primary service has been a fundamental part of the OPPS
since its implementation in August 2000. For an extensive discussion of
the history and background of the OPPS packaging policy, we refer
readers to the CY 2000 OPPS final rule (65 FR 18434), the CY 2008 OPPS/
ASC final rule with comment period (72 FR 66580), the CY 2014 OPPS/ASC
final rule with comment period (78 FR 74925), the CY 2015 OPPS/ASC
final rule with comment period (79 FR 66817), the CY 2016 OPPS/ASC
final rule with comment period (80 FR 70343), the CY 2017 OPPS/ASC
final rule with comment period (81 FR 79592), the CY 2018 OPPS/ASC
final rule with comment period (82 FR 59250), the CY 2019 OPPS/ASC
final rule with comment period (83 FR 58854), and the CY 2020 OPPS/ASC
final rule with comment period (84 FR 61173). As we continue to develop
larger payment groups that more broadly reflect services provided in an
encounter or episode of care, we have expanded the OPPS packaging
policies. Most, but not necessarily all, categories of items and
services currently packaged in the OPPS are listed in 42 CFR 419.2(b).
Our overarching goal is to make payments for all services under the
OPPS more consistent with those of a prospective payment system and
less like those of a per-service fee schedule, which pays separately
for each coded item. As a part of this effort, we have continued to
examine the payment for items and services provided under the OPPS to
determine which OPPS services can be packaged to further achieve the
objective of advancing the OPPS toward a more prospective payment
system.
For CY 2021, we examined the items and services currently provided
under the OPPS, reviewing categories of integral, ancillary,
supportive, dependent, or adjunctive items and services for which we
believe payment would be appropriately packaged into payment for the
primary service that they support. Specifically, we examined the HCPCS
code definitions (including CPT code descriptors) and outpatient
hospital billing patterns to determine whether there were categories of
codes for which packaging would be appropriate according to existing
OPPS packaging policies or a logical expansion of those existing OPPS
packaging policies. In CY 2021, we proposed no changes to this policy.
We will continue to conditionally package the costs of selected newly
identified ancillary services into payment for a primary service where
we believe that the packaged item or service is integral, ancillary,
supportive, dependent, or adjunctive to the provision of care that was
reported by the primary service HCPCS code. Below we discuss the
proposed changes to the packaging policies in CY 2021.
Comment: We received one comment asking CMS for an update regarding
a comment solicitation from the CY 2018 OPPS/ASC Proposed Rule
regarding the ``Comment Solicitation on Packaging of
[[Page 85895]]
Items and Services Under the OPPS'' (82 FR 33588).
Response: We thank the commenter for their inquiry. As noted in our
response in the CY 2018 OPPS/ASC final rule with comment period, we
appreciated the comments we received in response to this comment
solicitation and will take them into consideration as we continue to
explore and evaluate packaging policies that apply under the OPPS (82
FR 59254).
Comment: We received a comment on balancing packaging policy with
market access concerns after pass-through status expires. The commenter
noted that some packaging policies create incentives that could limit
patient access to certain items, services, and care. They requested
that CMS reconsider packaging policies, especially in the ASC and HOPD
setting, and review packaging decisions on a case-by-case basis upon
pass-through status expiration and not via the ``integral to'' policy,
applying a holistic separate payment policy for innovations.
Specifically, this commenter asked CMS to evaluate drugs and devices on
a case-by-case basis in order to determine the item's packaging status
after pass-through expires. This commenter also stated CMS should take
into consideration the drug or device's clinical value when determining
packaging status.
Response: We thank the commenter for their input. We continue to
believe our packaging policies support our strategic goal of using
larger payment bundles to maximize incentives to provide care in the
most efficient manner. However, we will take this comment into
consideration for future rulemaking.
Comment: We received several comments from patient advocates,
physicians, drug manufacturers, and professional medical societies
regarding payment for blue light cystoscopy procedures involving
Cysview[supreg] (hexaminolevulinate HCl) (described by HCPCS code
C9275). Cysview[supreg] is a drug that functions as a supply in a
diagnostic test or procedure and therefore payment for this product is
packaged with payment for the primary procedure in the OPPS and ASC
settings. Commenters stated that utilization of Cysview[supreg] is low
in the HOPD and ASC settings, which they attributed to the fact that
Cysview is packaged as a drug that functions as a supply in a
diagnostic test or procedure. Commenters indicated that packaged
payment does not adequately pay for the blue light cystoscopy
procedures, particularly in the ASC setting where payment is generally
approximately 55 percent of the HOPD payment. Commenters believe that
providers have been deterred from the use of this technology,
especially in the ASC setting, and as a result, a significant
percentage of beneficiaries are not able to access the procedure.
Commenters also stated that there has been literature published
showing that Blue Light Cystoscopy with Cysview[supreg] is more
effective than white light cystoscopy alone at detecting and
eliminating nonmuscle invasive bladder cancer tumors, leading to a
reduction in bladder cancer recurrence.
Commenters made various recommendations for payment for blue light
cystoscopy procedures involving Cysview[supreg], including to pay
separately for Cysview[supreg] when it is used with blue light
cystoscopy in the HOPD and ASC settings, similar to the policy
finalized for Exparel[supreg] in the CY 2019 OPPS/ASC final rule with
comment period (83 FR 58860), or to utilize our equitable adjustment
authority at section 1833(t)(2)(E) of the Act to provide an ``add-on''
or ``drug intensive'' payment to ASCs when using Cysview[supreg] in
blue light cystoscopy procedures. Other commenters requested separate
payment for all diagnostic imaging drugs (radiopharmaceuticals and
contrast agents).
Response: We acknowledge the concerns of the numerous stakeholders
who commented on this issue and understand the importance of blue light
cystoscopy procedures involving Cysview[supreg]. Cysview has been
packaged as a drug, biological, or radiopharmaceutical that functions
as a supply in a diagnostic test or procedure since CY 2014 (78 FR
74930). As we stated in the CY 2018 OPPS/ASC final rule with comment
period (82 FR 59244), we recognize that blue light cystoscopy
represents an additional elective but distinguishable service as
compared to white light cystoscopy that, in some cases, may allow
greater detection of bladder tumors in beneficiaries relative to white
light cystoscopy alone. Given the additional equipment, supplies,
operating room time, and other resources required to perform blue light
cystoscopy in addition to white light cystoscopy, in CY 2018, we
created a new HCPCS C-code to describe blue light cystoscopy and since
CY 2018 have allowed for complexity adjustments to higher paying C-APCs
for qualifying white light and blue light cystoscopy code combinations.
At this time, we continue to believe that Cysview[supreg] is a drug
that functions as a supply in a diagnostic test or procedure, and
therefore, payment for this drug should be packaged with payment for
the diagnostic procedure. Therefore, we do not believe it is necessary
to pay separately for Cysview[supreg] when it is used with blue light
cystoscopy in either the HOPD or ASC setting. We also do not believe
that it would be appropriate to utilize our equitable adjustment
authority at section 1833(t)(2)(E) of the Act to provide an ``add-on''
or ``drug intensive'' payment to ASCs when using Cysview[supreg] in
blue light cystoscopy procedures, as our equitable adjustment authority
at section (t)(2)(E) only authorizes adjustments under the OPPS, not
the ASC payment system. We do not have any evidence to show that
separate payment for blue light cystoscopy procedures involving Cysview
is required, based on commenter concerns regarding utilization and
access issues for Cysview. However, we will continue to examine payment
for blue light cystoscopy procedures involving Cysview to determine if
any changes to this policy would be appropriate in future rulemaking.
Comment: Some commenters requested that we eliminate the packaging
policy for drugs that function as a supply when used in a diagnostic
test or procedure.
Response: In the CY 2014 OPPS/ASC final rule with comment period,
we established a policy to package drugs, biologicals, and
radiopharmaceuticals that function as supplies when used in a
diagnostic test or procedure. In particular, we referred to drugs,
biologicals, and radiopharmaceuticals that function as supplies as a
part of a larger, more encompassing service or procedure, namely, the
diagnostic test or procedure in which the drug, biological, or
radiopharmaceutical is employed (78 FR 74927). At this time, we do not
believe it is necessary to eliminate this policy. As previously noted,
the OPPS packages payments for multiple interrelated items and services
into a single payment to create incentives for hospitals to furnish
services most efficiently and to manage their resources with maximum
flexibility. Our packaging policies support our strategic goal of using
larger payment bundles in the OPPS to maximize hospitals' incentives to
provide care in the most efficient manner.
Comment: One commenter requested separate payment for add-on codes
for Fractional Flow Reserve Studies (FFR/iFR) and Intravascular
Ultrasound (IVUS). The commenter stated that they believe the packaging
of these codes will disincentivize physicians to perform these adjunct
procedures because of cost. The codes are:
[[Page 85896]]
93571--Intravascular doppler velocity and/or pressure
derived coronary flow reserve measurement (coronary vessel or graft)
during coronary angiography including pharmacologically induced stress;
initial vessel (list separately in addition to code for primary
procedure);
93572--Intravascular doppler velocity and/or pressure
derived coronary flow reserve measurement (coronary vessel or graft)
during coronary angiography including pharmacologically induced stress;
each additional vessel (list separately in addition to code for primary
procedure));
92978--Endoluminal imaging of coronary vessel or graft
using intravascular ultrasound (ivus) or optical coherence tomography
(oct) during diagnostic evaluation and/or therapeutic intervention
including imaging supervision, interpretation and report; initial
vessel (list separately in addition to code for primary procedure); and
92979--Endoluminal imaging of coronary vessel or graft
using intravascular ultrasound (ivus) or optical coherence tomography
(oct) during diagnostic evaluation and/or therapeutic intervention
including imaging supervision, interpretation and report; each
additional vessel (list separately in addition to code for primary
procedure)).
Response: As stated in the CY 2008 OPPS/ASC final rule with comment
period (72 FR 66630), we continue to believe that IVUS and FFR are
dependent services that are always provided in association with a
primary service. Add-on codes represent services that are integral,
ancillary, supportive, dependent, or adjunctive items and services for
which we believe payment is appropriately packaged into payment for the
primary service that they support. As we have noted in past rules, add-
on codes do not represent standalone procedures and are inclusive to
other procedures performed at the same time (79 FR 66818). We continue
to believe it is unnecessary to provide separate payment for the
previously mentioned add-on codes at this time.
b. Packaging Policy for Non-Opioid Pain Management Therapies
(1) Background on OPPS/ASC Non-Opioid Pain Management Packaging
Policies
In the CY 2018 OPPS/ASC proposed rule (82 FR 33588), within the
framework of existing packaging categories, such as drugs that function
as supplies in a surgical procedure or diagnostic test or procedure, we
requested stakeholder feedback on common clinical scenarios involving
currently packaged items and services described by HCPCS codes that
stakeholders believe should not be packaged under the OPPS. We also
expressed interest in stakeholder feedback on common clinical scenarios
involving separately payable HCPCS codes for which payment would be
most appropriately packaged under the OPPS. Commenters who responded to
the CY 2018 OPPS/ASC proposed rule expressed a variety of views on
packaging under the OPPS. The public comments ranged from requests to
unpackage most items and services that are unconditionally packaged
under the OPPS, including drugs and devices, to specific requests for
separate payment for a specific drug or device.
In the CY 2018 OPPS/ASC final rule with comment period (82 FR
52485), we reiterated our position with regard to payment for
Exparel[supreg], a non-opioid analgesic that functions as a surgical
supply, stating that we believed that payment for this drug is
appropriately packaged with the primary surgical procedure. We also
stated in the CY 2018 OPPS/ASC final rule with comment period that we
would continue to explore and evaluate packaging policies under the
OPPS and consider these policies in future rulemaking.
In the CY 2019 OPPS/ASC final rule with comment period (83 FR 58855
through 58860), we finalized a policy to unpackage and pay separately
at ASP+6 percent for the cost of non-opioid pain management drugs that
function as surgical supplies when they are furnished in the ASC
setting for CY 2019, due to decreased utilization in the ASC setting.
For the CY 2020 OPPS/ASC proposed rule (84 FR 39423 through 39427),
as required by section 1833(t)(22)(A)(i) of the Act, as added by
section 6082(a) of the SUPPORT Act, we reviewed payments under the OPPS
for opioids and evidence-based non-opioid alternatives for pain
management (including drugs and devices, nerve blocks, surgical
injections, and neuromodulation) with a goal of ensuring that there are
not financial incentives to use opioids instead of non-opioid
alternatives. We used currently available data to analyze the payment
and utilization patterns associated with specific non-opioid
alternatives, including drugs that function as a supply, nerve blocks,
and neuromodulation products, to determine whether our packaging
policies have reduced the use of non-opioid alternatives. For the CY
2020 OPPS/ASC proposed rule (84 FR 39423 through 39427), we proposed to
continue our policy to pay separately at ASP+6 percent for the cost of
non-opioid pain management drugs that function as surgical supplies in
the performance of surgical procedures when they are furnished in the
ASC setting and to continue to package payment for non-opioid pain
management drugs that function as surgical supplies in the performance
of surgical procedures in the hospital outpatient department setting
for CY 2020. In the CY 2020 OPPS/ASC final rule with comment period (84
FR 61173 through 61180), after reviewing data from stakeholders and
Medicare claims data, we did not find compelling evidence to suggest
that revisions to our OPPS payment policies for non-opioid pain
management alternatives were necessary for CY 2020. We finalized our
proposal to continue to unpackage and pay separately at ASP+6 percent
for the cost of non-opioid pain management drugs that function as
surgical supplies when furnished in the ASC setting for CY 2020. Under
this policy, the only drug that met these criteria in CY 2020 was
Exparel.
(2) Evaluation and CY 2021 Payment for Non-Opioid Alternatives
Section 1833(t)(22)(A)(i) of the Act, as added by section 6082(a)
of the SUPPORT Act, states that the Secretary must review payments
under the OPPS for opioids and evidence-based non-opioid alternatives
for pain management (including drugs and devices, nerve blocks,
surgical injections, and neuromodulation) with a goal of ensuring that
there are not financial incentives to use opioids instead of non-opioid
alternatives. As part of this review, under section 1833(t)(22)(A)(iii)
of the Act, the Secretary must consider the extent to which revisions
to such payments (such as the creation of additional groups of covered
OPD services to separately classify those procedures that utilize
opioids and non-opioid alternatives for pain management) would reduce
the payment incentives for using opioids instead of non-opioid
alternatives for pain management. In conducting this review and
considering any revisions, the Secretary must focus on covered OPD
services (or groups of services) assigned to C-APCs, APCs that include
surgical services, or services determined by the Secretary that
generally involve treatment for pain management. If the Secretary
identifies revisions to payments pursuant to section
1833(t)(22)(A)(iii) of the Act, section
[[Page 85897]]
1833(t)(22)(C) of the Act requires the Secretary to, as determined
appropriate, begin making revisions for services furnished on or after
January 1, 2020. Any revisions under this paragraph are required to be
treated as adjustments for purposes of paragraph (9)(B), which requires
any adjustments to be made in a budget neutral manner.
As noted in the background section above, we conducted an
evaluation to determine whether there are payment incentives for using
opioids instead of non-opioid alternatives in the CY 2020 OPPS/ASC
final rule with comment period (84 FR 61176 through 61180). The results
of our review and evaluation of our claims data did not provide
evidence to indicate that the OPPS packaging policy had the unintended
consequence of discouraging the use of non-opioid treatments for
postsurgical pain management in the hospital outpatient department.
Higher utilization may be a potential indicator that the packaged
payment is not causing an access to care issue and that the payment
rate for the primary procedure adequately reflects the cost of the
drug. Our updated review of claims data showed a continued decline in
the utilization of Exparel[supreg] in the ASC setting, which supported
our proposal to continue paying separately for Exparel[supreg] in the
ASC setting. Decreased utilization could potentially indicate that the
packaging policy is discouraging use of that treatment and that
providers are choosing less expensive treatments. However, it is
difficult to attribute causality of changes in utilization to Medicare
packaging payment policy only. We believe that unpackaging and paying
separately for Exparel addresses decreased utilization because it
eliminates any potential Medicare payment disincentive for the use of
this non-opioid alternative, rather than prescription opioids.
We believe we fulfilled the statutory requirement to review
payments for opioids and evidence-based non-opioid alternatives to
ensure that there are not financial incentives to use opioids instead
of non-opioid alternatives in CY 2020 OPPS/ASC rulemaking. We are
committed to evaluating our current policies to adjust payment
methodologies, if necessary, in order to ensure appropriate access for
beneficiaries amid the current opioid epidemic. However, we did not
believe conducting a similar CY 2021 review would yield significantly
different outcomes or new evidence that would prompt us to change our
payment policies under the OPPS or ASC payment system.
Therefore, for CY 2021, we proposed to continue our policy to pay
separately at ASP+6 percent for the cost of non-opioid pain management
drugs that function as surgical supplies in the performance of surgical
procedures when they are furnished in the ASC setting and to continue
to package payment for non-opioid pain management drugs that function
as surgical supplies in the performance of surgical procedures in the
hospital outpatient department setting for CY 2021.
Comment: Multiple commenters, including medical specialty societies
and drug manufacturers, requested that we pay separately for Exparel
and other drugs that may function as surgical supplies in the hospital
outpatient setting. Some of these commenters noted that Exparel is more
frequently used in this setting and the use of non-opioid pain
management treatments should also be encouraged in the hospital
outpatient department. Commenters believed that separate payment in the
hospital outpatient department would significantly increase
utilization, which would be beneficial in reducing opioid use.
Response: As we stated in the CY 2019 and CY 2020 OPPS/ASC final
rules with comment period (83 FR 58856 and 84 FR 61177, respectively),
we do not believe that there is sufficient evidence that non-opioid
pain management drugs should be paid separately in the hospital
outpatient setting at this time. The commenters did not provide
convincing evidence that the OPPS packaging policy for Exparel (or
other non-opioid drugs) creates a barrier to use of Exparel in the
hospital setting. Further, while we received some public comments
suggesting that, as a result of using Exparel in the OPPS setting,
providers may prescribe fewer opioids for Medicare beneficiaries, we do
not believe that the OPPS payment policy presents a barrier to use of
Exparel or affects the likelihood that providers will prescribe fewer
opioids in the HOPD setting. Several drugs are packaged under the OPPS
and payment for such drugs is included in the payment for the
associated primary procedure. We were not persuaded by the information
supplied by commenters suggesting that some providers avoid use of non-
opioid alternatives in the outpatient hospital setting (including
Exparel) solely because of the OPPS packaged payment policy, as there
was no evidence in our review and evaluation of claims data in the CY
2020 OPPS/ASC final rule with comment period (84 FR 61176 through
61180) to indicate that the OPPS packaging policy had the unintended
consequence of discouraging the use of non-opioid treatments for
postsurgical pain management in the hospital outpatient department. As
noted above, we do not believe conducting a similar CY 2021 review
would yield significantly different outcomes or new evidence that would
prompt us to change our payment policy. Based on previously conducted
analysis, we observed increasing Exparel utilization in the HOPD
setting with the total units increasing from 14.8 million in 2018 to
19.5 million in 2019, despite the drug payment being packaged into the
procedure payment in the OPPS setting. This upward trend has been
consistent since 2015, as the data shows approximately 6.5 million
total units in 2015 and 8.1 million total units in 2016. Therefore, we
do not believe that the current OPPS payment methodology for Exparel or
other non-opioid pain management drugs presents a widespread barrier to
their use.
In addition, increased use in the hospital outpatient setting not
only supports the notion that the packaged payment for Exparel is not
causing an access to care issue, but also that the payment rate for
primary procedures in the HOPD using Exparel adequately reflects the
cost of the drug. That is, because Exparel is commonly used and billed
under the OPPS, the APC rates for the primary procedures reflect such
utilization. Therefore, the increased utilization in the OPPS setting
seems to indicate that the payment amount is sufficient for hospitals
to furnish the drug. We remind readers that the OPPS is a prospective
payment system, not a cost-based system and, by design, is based on a
system of averages under which payment for certain cases may exceed the
costs incurred, while for others, it may not. The OPPS packages
payments for multiple interrelated items and services into a single
payment to create incentives for hospitals to furnish services most
efficiently and to manage their resources with maximum flexibility. Our
packaging policies support our strategic goal of using larger payment
bundles in the OPPS to maximize hospitals' incentives to provide care
in the most efficient manner. We continue to invite stakeholders to
share evidence, such as published peer-reviewed literature, on these
non-opioid alternatives. We also intend to continue to analyze the
evidence and monitor utilization of non-opioid alternatives in the HOPD
setting for potential future rulemaking.
Comment: Some commenters encouraged CMS to establish permanent
separate payment for drugs that are currently on drug pass-through
status in
[[Page 85898]]
the OPPS and ASC settings, such as Dexycu (HCPCS code J1095). Regarding
Dexycu specifically, the commenters stated they were conducting a new,
comprehensive study of a longitudinal claim dataset that will provide
deeper insights into the association between cataract surgery and
opioid utilization, as well as the role of Dexycu in reducing the
prescribing of opioids.
Response: We refer readers to section V.A., ``OPPS Transitional
Pass-Through Payment for Additional Costs of Drugs, Biologicals, and
Radiopharmaceuticals'' of this final rule with comment period regarding
pass-through payments under the OPPS. Dexycu will receive separate
payment due to its drug pass-through status through CY 2021. We will
determine whether separate payment for this drug should be applied
under the policy to pay separately for non-opioid pain management drugs
that function as a surgical supply when furnished in the ASC setting
when Dexycu's pass-through status expires. We thank commenters for
conducting studies regarding their specific products and look forward
to reviewing the results.
Comment: Several commenters requested that the drug Omidria, CPT
J1097, (phenylephrine 10.16 mg/ml and ketorolac 2.88 mg/ml ophthalmic
irrigation solution, 1 ml), be excluded from the OPPS policy to package
drugs that function as surgical supplies once its pass-through status
expires on September 30, 2020. Omidria is indicated for maintaining
pupil size by preventing intraoperative miosis and reducing
postoperative ocular pain in cataract or intraocular surgeries. The
commenters stated that there is extensive clinical evidence and medical
literature which supports their claims that Omidria reduces dependence
on opioids for patients undergoing cataract surgery and postoperative
prescription opioids. The commenters asserted that Omidria meets all of
the requirements in regulation to qualify for separate payment in the
ASC setting, as Omidria is FDA-approved for intraocular use in cataract
procedures, a pain management drug, a non-opioid, and functions as a
surgical supply during cataract surgery according to CMS' definition of
a surgical supply. Commenters asserted that the use of Omidria
decreases patients' need for fentanyl during surgeries and provided a
manuscript stating that Omidria reduces opioid use based on pill counts
after surgery.
Response: We thank commenters for their feedback on Omidria.
Omidria received pass-through status for a 3-year period from 2015 to
2017. After expiration of its pass-through status, payment for Omidria
was packaged under both the OPPS and the ASC payment system.
Subsequently, Omidria's pass-through status under the OPPS was
reinstated beginning on October 1, 2018 through September 30, 2020, as
required by section 1833(t)(6)(G) of the Act, as added by section
1301(a)(1)(C) of the Consolidated Appropriations Act of 2018 (Pub. L.
115-141), which means that Omidria continued to be paid separately
under the ASC payment system through September 30, 2020.
Our previous review of the clinical evidence submitted indicated
that the studies the commenter supplied were not sufficient to
demonstrate that Omidria reduces opioid use. Moreover, the results of a
CMS analysis of cataract procedures performed on Medicare beneficiaries
in HOPDs and ASCs between January 2015 and July 2019, which compared
procedures performed with Omidria to procedures performed without
Omidria, did not demonstrate a significant decrease in fentanyl
utilization during the cataract surgeries in the HOPDs and ASCs when
Omidria was used. Our findings also did not suggest any decrease in
opioid utilization post-surgery for procedures involving Omidria.
However, we will continue to apply separate payment for non-opioid
pain management drugs that function as surgical supplies when furnished
in the ASC setting for CY 2021, as discussed in section XIII.D.3, and
as we have described in regulation at 42 CFR 416.164 and 416.171(b)(1).
After careful consideration of the commenters' assertion that Omidria
meets this definition, we believe that Omidria does qualify as a non-
opioid pain management drug that functions as a surgical supply and are
excluding Omidria from packaging under the ASC payment system beginning
October 1, 2020 and in CY 2021, in accordance with this policy.
Comment: Two commenters briefly mentioned the drug IV acetaminophen
(CPT code J0131), which they believe may reduce opioid usage if CMS
paid separately for the drug. These commenters believed IV
acetaminophen decreases use of post-operative opioids.
Response: We thank commenters for their comments. We do not find it
appropriate to pay separately for IV acetaminophen as suggested by the
commenters due to our drug packaging threshold policies. We remind
stakeholders of our drug packaging threshold policies, as described in
section V.B.1.a to this final rule with comment period. In accordance
with section 1833(t)(16)(B) of the Act, we finalized our proposal to
set the drug packaging threshold for CY 2021 to $130. To the extent
that the items and services mentioned by the commenters are effective
alternatives to opioid prescriptions, we encourage providers to use
them when medically necessary. Additionally, please see section
XIII.D.3 for a full discussion on our policies in the ASC setting.
Comment: Commenters suggested modified payment for ``pain block''
CPT codes 64415, 64416, 64417, 64445, 64446, 64447, 64448, and 64450.
Two commenters stated that providers use these pain blocks to mitigate
the post-operative pain that is otherwise typically addressed with
short-term opioid use. Additionally, a few commenters stated that CPT
code J1096 (Dexamethasone, lacrimal ophthalmic insert, 0.1 mg) used for
treatment of ocular inflammation and pain following ophthalmic surgery
is administered through CPT code 0356T (Insertion of drug-eluting
implant (including punctal dilation and implant removal when performed)
into lacrimal canaliculus, each). These commenters felt CPT code 0356T,
which describes the administration of the drug, should also receive
separate or additional payment due to the purported clinical benefits
of the drug, including treatment of pain.
Response: We thank the commenters for their suggestions. At this
time, we have not found compelling evidence for the non-opioid pain
management alternatives described above to warrant separate or modified
payment under the OPPS or ASC payment systems for CY 2021.
Additionally, we do not believe that the ``pain blocks'' described by
stakeholders qualify as non-opioid pain management drugs that function
as a surgical supply as the codes provided by stakeholders are used to
describe procedures under the OPPS and not drugs. To the extent that
the items and services mentioned by the commenters are effective
alternatives to opioid prescriptions, we encourage providers to use
them when medically necessary. For a greater discussion of CPT code
0356T, please see section III. D. (Administration of Lacrimal
Ophthalmic Insert Into Lacrimal Canaliculus (APC 5692)) of this final
rule with comment period.
Comment: Commenters also requested separate payments for various
non-opioid pain management treatments, such as ERAS[supreg] protocols
or spinal cord stimulators (SCS), that they believe decrease the number
of opioid prescriptions beneficiaries receive during and following an
outpatient visit or procedure. For SCS, several commenters noted that
this therapy may lead to a reduction in the use of opioids
[[Page 85899]]
for chronic pain patients. They noted that neurostimulation is a key
alternative to opioid prescription for pain management and recommended
that CMS increase access to SCS.
Response: We appreciate the commenters' information on this topic.
At this time, we have not found compelling evidence for the non-opioid
pain management alternatives described above to warrant separate
payment under the OPPS or ASC payment systems for CY 2021. However, we
plan to take these comments and suggestions into consideration for
future rulemaking. We agree that providing incentives to avoid or
reduce opioid prescriptions may be one of several strategies for
addressing the opioid epidemic. To the extent that the items and
services mentioned by the commenters are effective alternatives to
opioid drugs, we encourage providers to use them when medically
appropriate.
We look forward to working with stakeholders as we further consider
suggested refinements to the OPPS and the ASC payment system that will
encourage use of medically necessary items and services that have
demonstrated efficacy in decreasing opioid prescriptions and/or opioid
abuse or misuse during or after an outpatient visit or procedure.
After consideration of the public comments we received, we are
finalizing the proposed policy, without modification, to unpackage and
pay separately at ASP+6 percent for the cost of non-opioid pain
management drugs that function as surgical supplies when they are
furnished in the ASC setting for CY 2021. We will continue to analyze
the issue of access to non-opioid pain management alternatives in the
OPPS and the ASC settings as part of any subsequent reviews we conduct
under section 1833(t)(22)(A)(ii). We are continuing to examine whether
there are other non-opioid pain management alternatives for which our
payment policy should be revised to allow separate payment. We will be
reviewing evidence-based support, such as published peer-reviewed
literature, that we could use to determine whether these products help
to deter or avoid prescription opioid use and addiction as well as
evidence that the current packaged payment for such non-opioid
alternatives presents a barrier to access to care and therefore
warrants revised, including possibly separate, payment under the OPPS.
This policy is also discussed in section XIII.D.3 of this final rule
with comment period.
c. Clinical Diagnostic Laboratory Tests Packaging Policy
(1) Background
Prior to CY 2014, clinical diagnostic laboratory tests were
excluded from payment under the hospital OPPS because they were paid
separately under the Clinical Laboratory Fee Schedule (CLFS). Section
1833(t)(1)(B)(i) of the Act authorizes the Secretary to designate the
hospital outpatient services that are paid under the OPPS. Under this
authority, the Secretary excluded from the OPPS those services that are
paid under fee schedules or other payment systems. Because laboratory
services are paid separately under the CLFS, laboratory tests were
excluded from separate payment under the OPPS. We codified this policy
at 42 CFR 419.22(l).
However, in CY 2014, we revised the categories of packaged items
and services under the OPPS to include certain laboratory tests. We
stated that certain laboratory tests, similar to other covered
outpatient services that are packaged under the OPPS, are typically
integral, ancillary, supportive, dependent, or adjunctive to a primary
hospital outpatient service and should be packaged under the hospital
OPPS. We stated that laboratory tests and their results support
clinical decision making for a broad spectrum of primary services
provided in the hospital outpatient setting, including surgery and
diagnostic evaluations (78 FR 74939). Consequently, we finalized the
policy to package payment for most laboratory tests in the OPPS when
they are integral, ancillary, supportive, dependent, or adjunctive to a
primary service or services provided in the hospital outpatient setting
(78 FR 74939 through 74942 and 42 CFR 419.2(b)(17)). In the same final
rule, we clarified that certain laboratory tests would be excluded from
packaging. Specifically, we stated that laboratory tests would be paid
separately under the CLFS when the laboratory test is the only service
provided to a beneficiary or when a laboratory test is conducted on the
same date of service (DOS) as the primary service but is ordered for a
different purpose than the primary service by a practitioner different
than the practitioner who ordered the primary service or when the
laboratory test is a molecular pathology test (78 FR 74942). As
explained in the CY 2014 OPPS/ASC final rule, we excluded molecular
pathology tests from packaging because we believe these tests are
relatively new and may have a different pattern of clinical use, which
may make them generally less tied to a primary service in the hospital
outpatient setting than the more common and routine laboratory tests
that we package (78 FR 74939). Based on these changes, we revised the
regulation text at Sec. Sec. [thinsp]419.2(b) and 419.22(l) to reflect
this laboratory test packaging policy.
In CY 2016, we made some modifications to this policy (80 FR 70348
through 70350). First, we clarified that all molecular pathology tests
would be excluded from our packaging policy, including any new codes
that also describe molecular pathology tests. In the CY 2014 OPPS/ASC
final rule, we stated that only those molecular pathology codes
described by CPT codes in the ranges of 81200 through 81383, 81400
through 81408, and 81479 were excluded from OPPS packaging (78 FR 74939
through 74942). However, in 2016, we expanded this policy to include
not only the original code range but also all new molecular pathology
test codes (80 FR 70348). Secondly, we excluded preventive laboratory
tests from OPPS packaging and provided that they would be paid
separately under the CLFS. Laboratory tests that are considered
preventive are listed in Section 1.2, Chapter 18 of the Medicare Claims
Processing Manual (Pub. L. 100-04). As stated in the CY 2016 OPPS/ASC
final rule, we make an exception to conditional packaging of ancillary
services for ancillary services that are also preventive services (80
FR 70348). For consistency, we excluded from OPPS packaging those
laboratory tests that are classified as preventive services. In
addition, we modified our conditional packaging policy so that
laboratory tests provided during the same outpatient stay (rather than
specifically provided on the same DOS as the primary service) are
considered as integral, ancillary, supportive, dependent, or adjunctive
to a primary service or services, except when a laboratory test is
ordered for a different diagnosis and by a different practitioner than
the practitioner who ordered the other hospital outpatient services. We
explained in the CY 2016 OPPS/ASC final rule that this modification did
not affect our policy to provide separate payment for laboratory tests:
(1) If they are the only services furnished to an outpatient and are
the only services on a claim and have a payment rate on the CLFS; or
(2) if they are ordered for a different diagnosis than another hospital
outpatient service by a practitioner different than the practitioner
who ordered the other hospital outpatient service (80 FR 70349 through
70350).
In CY 2017, we modified the policy to remove the ``unrelated''
laboratory test exclusion and to expand the laboratory
[[Page 85900]]
test packaging exclusion to apply to laboratory tests designated as
advanced diagnostic laboratory tests (ADLTs) under the CLFS. We
clarified that the exception would only apply to those ADLTs that meet
the criteria of section 1834A(d)(5)(A) of the Act, which are defined as
tests that provide an analysis of multiple biomarkers of DNA, RNA, or
proteins combined with a unique algorithm to yield a single patient-
specific result (81 FR 79592 through 79594).
(2) Current Categories of Clinical Diagnostic Laboratory Tests Excluded
From OPPS Packaging
As we discussed in the CY 2021 OPPS/ASC proposed rule (85 FR
48798), under our current policy, certain clinical diagnostic
laboratory tests (CDLTs) that are listed on the CLFS are packaged as
integral, ancillary, supportive, dependent, or adjunctive to the
primary service or services provided in the hospital outpatient setting
during the same outpatient encounter and billed on the same claim.
While we package most CDLTs under the OPPS, when a CDLT is listed on
the CLFS and meets one of the following four criteria, we do not pay
for the test under the OPPS, but rather, we pay for it under the CLFS
when it is: (1) The only service provided to a beneficiary on a claim;
(2) considered a preventive service; (3) a molecular pathology test; or
(4) an ADLT that meets the criteria of section 1834A(d)(5)(A) of the
Act. Generally, when laboratory tests are not packaged under the OPPS
and are listed on the CLFS, they are paid under the CLFS instead of the
OPPS.
(3) New Category of Laboratory Tests Excluded From OPPS Packaging
(a) Background on Protein-Based MAAAs
As part of recent rulemaking cycles, stakeholders have suggested
that some protein-based Multianalyte Assays with Algorithmic Analyses
tests (MAAAs) may have a pattern of clinical use that makes them
relatively unconnected to the primary hospital outpatient service (84
FR 61439). In the CY 2018 OPPS/ASC final rule (82 FR 59299), we stated
that stakeholders indicated that certain protein-based MAAAs,
specifically those described by CPT codes 81490, 81503, 81535, 81536,
81538, and 81539, are generally not performed in the HOPD setting and
have similar clinical patterns of use as the DNA and RNA-based MAAA
tests that are assigned to status indicator ``A'' under the OPPS and
are paid separately under the CLFS. Notably, all of the tests described
by these CPT codes (with the exception of CPT code 81490, which we
discuss below) are cancer-related protein-based MAAAs. In the same
final rule, stakeholders suggested that, based on the June 23, 2016
CLFS final rule entitled ``Medicare Program; Medicare Clinical
Diagnostic Laboratory Tests Payment System,'' in which CMS defined an
ADLT under section 1834A(d)(5)(A) of the Act to include DNA, RNA, and
protein-based tests, they believe that the reference to ``protein-based
tests'' in the definition applies equally to the tests they identified,
that is, protein-based MAAAs. Consequently, the stakeholders believed
that protein-based MAAAs should be excluded from OPPS packaging and
paid separately under the CLFS. As we noted in the CY 2021 OPPS/ASC
proposed rule, one of the protein-based MAAAs previously requested by
stakeholders to be excluded from OPPS packaging policy is CPT code
81538 (Oncology (lung), mass spectrometric 8-protein signature,
including amyloid a, utilizing serum, prognostic and predictive
algorithm reported as good versus poor overall survival), which has
been designated as an ADLT under section 1834A(d)(5)(A) of the Act as
of December 21, 2018. Therefore, CPT code 81538 is currently excluded
from the OPPS packaging policy and paid under the CLFS instead of the
OPPS when it also meets the laboratory DOS requirements.
(b) CY 2021 Cancer-Related Protein-Based MAAAs
As discussed in the CY 2021 OPPS/ASC proposed rule (85 FR 49032),
we have continued to consider previous stakeholder requests to exclude
some protein-based MAAAs from the OPPS packaging policy. We stated
that, after further review of this issue, we believe that cancer-
related protein-based MAAAs, in particular, may be relatively
unconnected to the primary hospital outpatient service during which the
specimen was collected from the patient. Similar to molecular pathology
tests, which are currently excluded from the OPPS packaging policy,
cancer-related protein-based MAAAs appear to have a different pattern
of clinical use, which may make them generally less tied to the primary
service in the hospital outpatient setting than the more common and
routine laboratory tests that are packaged.
As we noted previously in the CY 2021 OPPS/ASC proposed rule and in
this section of the final rule, commenters to the CY 2018 OPPS/ASC
final rule identified specific cancer-related protein-based MAAAs as
tests that are generally not performed in the HOPD setting (82 FR
59299). In fact, those tests identified by commenters are used to guide
future surgical procedures and chemotherapeutic interventions.
Treatments that are based on the results of cancer-related protein-
based MAAAs are typically furnished after the patient is no longer in
the hospital, in which case they are not tied to the same hospital
outpatient encounter during which the specimen was collected.
For these reasons, we proposed to exclude cancer-related protein-
based MAAAs from the OPPS packaging policy and pay for them separately
under the CLFS.
In the CY 2021 OPPS/ASC proposed rule (85 FR 48799), we explained
that the AMA CPT 2020 manual currently describes MAAAs, in part, as
``procedures that utilize multiple results derived from panels of
analyses of various types, including molecular pathology assays,
fluorescent in situ hybridization assays, and non-nucleic acid based
assays (for example, proteins, polypeptides, lipids, carbohydrates).''
\1\ Additionally, the AMA CPT 2020 manual provides a MAAA code
descriptor format which includes several specific characteristics,
including but not limited to disease type (for example, oncology,
autoimmune, tissue rejection), and material(s) analyzed (for example,
DNA, RNA, protein, antibody). We noted that as the AMA CPT 2020 manual
describes a MAAA, and the code descriptor of each MAAA distinguishes
MAAAs that are cancer-related assays from those that test for other
disease types, the AMA CPT manual is a potentially instructive tool to
identify cancer-related MAAA tests that are ``protein-based''.
Accordingly, in following the AMA CPT 2020 manual intent to identify
MAAA tests that are cancer-related, and, of those tests, identifying
the ones whose test analytes are proteins, we have determined there are
currently six cancer-related protein-based MAAAs: CPT codes 81500,
81503, 81535, 81536, 81538 and 81539. As discussed previously in the CY
2021 OPPS/ASC proposed rule and in this section of the final rule, CPT
code 81538 has been designated as an ADLT under section 1834A(d)(5)(A)
of the Act as of December 21, 2018 and therefore, is already paid under
the CLFS instead of the OPPS. As such, we proposed to assign status
indicator ``A'' (``Not paid under OPPS. Paid by MACs under a fee
schedule or payment system other than
[[Page 85901]]
OPPS'') to cancer-related protein-based MAAAs as described by CPT codes
81500, 81503, 81535, 81536, and 81539. We also proposed that we would
apply this policy to cancer-related protein-based MAAAs that do not
currently exist, but that are developed in the future. Additionally, we
stated that we intend to continue to study the list of laboratory tests
excluded from the OPPS packaging policy and determine whether any
additional changes are warranted and may consider proposing future
changes to the laboratory DOS policy through notice-and-comment
rulemaking.
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In the CY 2021 OPPS/ASC proposed rule (85 FR 49032), we noted that
commenters to the CY 2018 OPPS/ASC proposed rule also identified CPT
code 81490 as a protein-based MAAA that should be excluded from the
OPPS packaging policy and paid outside of the OPPS. However, we stated
that we believed that the results for the test described by CPT code
81490 are used to determine disease activity in rheumatoid arthritis
patients, guide current therapy to reduce further joint damage, and may
be tied to the primary hospital outpatient service, that is, the
hospital outpatient encounter during which the specimen was collected.
Therefore, we stated that we believed that payment for CPT code 81490
remains appropriately packaged under the OPPS.
We refer readers to section XVIII. of the CY 2021 OPPS/ASC proposed
rule and section XVIII. of this final rule with comment period, which
describe the related proposal to revise the laboratory DOS policy for
cancer-related protein-based MAAAs.
We received public comments on the proposal to exclude cancer-
related protein-based MAAAs from the OPPS packaging policy and pay for
them separately under the CLFS. The following is a summary of the
comments we received and our responses.
Comment: Generally, commenters supported the proposal to exclude
cancer-related protein-based MAAAs from the OPPS packaging policy and
add them to the list of test codes subject to the laboratory DOS
exception for the hospital outpatient setting, leading to the test
being paid at the CLFS rate and requiring that the laboratory bill
Medicare for the test instead of seeking payment from the hospital.
Commenters stated that changes to this policy will lead to improved
beneficiary access to diagnostic tests while also reducing hospital
administrative burden.
Response: We appreciate the support from commenters for our
proposed revisions to the OPPS packaging policy for CDLTs. We agree
that the revisions to the laboratory DOS policy that we proposed in the
CY 2021 OPPS/ASC proposed rule and finalized in section XVIII of this
final rule with comment period may potentially serve to reduce delay in
access to laboratory tests by minimizing the likelihood that a hospital
will postpone ordering a test until at least 14 days after the patient
is discharged from the hospital outpatient department, or even cancel
the order in order to avoid having to bill Medicare for the test under
the laboratory DOS policy.
Comment: In addition to excluding the cancer-related protein-based
MAAAs from OPPS packaging, several commenters suggested a similar
change for pathology tests. Specifically, they recommended revising the
existing laboratory test packaging policy to allow separate payment
under the CLFS for the technical component of pathology tests.
Response: We appreciate the feedback and will consider the issue
for future rulemaking.
Comment: Some commenters recommended further expansion of the list
of test codes excluded from OPPS packaging to include various other
CDLTs, including all protein-based MAAAs, AMA CPT Proprietary
Laboratory Analyses (PLA) test codes that may have similar
characteristics to AMA CPT MAAA tests but are not currently categorized
as AMA CPT MAAA test codes, and several specific CPT test codes,
including the OVERA test from Aspira Labs (CPT 0003U), EPI assay by
Bio-Techne (CPT 0005U), TissueCypher assay from Cernostics (CPT 0108U),
and KidneyIntelX (CPT 0105U).
Commenters also noted that while PLA test codes are not
automatically included in the outpatient laboratory test packaging
exclusion, some tests described by PLA codes are included under these
policies if they qualify as a molecular pathology test or Criterion A
ADLT. Therefore, the commenters asserted that CMS should continue its
historical practice of applying the laboratory test packaging exclusion
to PLA test codes as occurs with molecular pathology tests and ADLTs
that have been assigned PLA codes.
Response: We believe that the commenters' suggested modifications
to the list of codes excluded from OPPS packaging to include various
CDLTs, including all protein-based MAAAs, AMA CPT PLA test codes that
may have similar characteristics to AMA CPT MAAA tests but are not
currently categorized as AMA CPT MAAA codes, and several specific AMA
CPT test codes, are inconsistent with the current OPPS packaging policy
and would result in allowing the laboratory to bill Medicare directly
for a test that should be incorporated into the hospital OPPS bundled
rate. CMS does not believe that all AMA CPT PLA test codes demonstrate
a different pattern of clinical use that makes them less tied to the
primary service in the hospital outpatient setting such that they
should be included in the list of codes excepted from the OPPS
packaging policy. Commenters asserted that these tests, as a group,
should be excluded from OPPS packaging policy because the results of
these tests may inform future interventions beyond the hospital
outpatient encounter during which the specimen was collected and may be
used by other health care providers to developed long-term plans for
treatment. However, we are not convinced based on the commenters'
descriptions of these tests that they are generally unconnected to the
hospital encounter, the chief requirement for exclusion from OPPS
packaging. Although commenters noted that the recommended tests may be
utilized for the development of longer-term treatment plans, it is not
clear that the clinical usage of these tests reaches the threshold of
being ``generally unconnected'' to the hospital encounter.
Any addition to the list of test codes excluded from OPPS packaging
requires careful evaluation as to whether a different pattern of
clinical use makes a test generally less tied to a primary service in
the hospital outpatient setting than the more common and routine
laboratory tests that we package. For instance, as noted in the CY 2021
OPPS/ASC proposed rule (85 FR 49035), in response to the changes in the
laboratory DOS policy outlined in the CY 2018 OPPS/ASC final rule with
comment period, stakeholders stated that some entities performing
molecular pathology testing included on the list of codes excluded from
OPPS packaging and subject to the laboratory DOS exception, such as
blood banks and blood centers, may perform molecular pathology testing
to enable hospitals to prevent adverse conditions associated with blood
transfusions, rather than perform molecular pathology testing for
diagnostic purposes. This led us to consider whether the molecular
pathology testing performed by blood banks and centers is appropriately
separable from the hospital stay.
We do not believe all protein-based MAAAs would meet this standard
for exclusion from OPPS packaging. CMS has considered expanding the
list of codes excluded from OPPS packaging to
[[Page 85902]]
include various additional categories of codes, including protein-based
MAAAs. However, we note that some protein-based MAAAs include simple
and commonly used protein analytes that may also be commonly performed
to assist in managing patient care during a hospital outpatient
encounter. Therefore, we believe that we cannot conclude that this
category of tests is generally less tied to a primary service in the
hospital outpatient setting, as some protein-based MAAA tests use
common routine protein analytes that are appropriately packaged into
OPPS payment. For these reasons, CMS does not believe that all protein-
based MAAAs should be included in the list of codes excluded from the
OPPS packaging policy.
However, we note that a protein-based MAAA that is designated by
CMS as an ADLT under paragraph (1) of the definition of an ADLT in
Sec. 414.502 would be added to the list of codes excluded from OPPS
packaging, in accordance with our established policy.
Comment: Commenters also recommended that we exclude a particular
protein-based MAAA test described by CPT code 81490 from the OPPS
packaging policy. Commenters asserted that the use of the test
described by CPT code 81490 is unconnected to the hospital outpatient
encounter during which the specimen is collected and that the results
of the test are used to determine potential future interventions
outside of the hospital outpatient encounter. Commenters stated that
this test appears to be generally less tied to a primary service in the
hospital outpatient setting and does not appear to be a common or
routine laboratory test that would otherwise be packaged into OPPS
payment.
Response: In the CY 2021 OPPS/ASC proposed rule (85 FR 48799), we
stated that we believed the results for the test described by CPT code
81490 are used to determine disease activity in rheumatoid arthritis
patients, guide current therapy to reduce further joint damage, and may
be tied to the primary hospital outpatient service, that is, the
hospital outpatient encounter during which the specimen was collected.
Therefore, we stated that we believed that payment for CPT code 81490
remains appropriately packaged under the OPPS.
However, given commenter feedback, we are convinced that the
pattern of clinical use for CPT code 81490 is generally unconnected to
the hospital outpatient encounter during which the specimen is
collected as it is typically used to determine potential interventions
outside of the hospital outpatient encounter and is generally used by
the rheumatologist to make longer-term changes in RA treatment.
Commenters informed us that physicians and patients utilize the
objective information provided by the results of the test to make
longer-term modifications in treatment, to monitor disease activity,
and to prevent joint damage progression, and the results generally
would not be utilized for purposes of the hospital outpatient
encounter. The commenters further stated that the output of the test is
used to assess disease activity, including evaluating response to
therapy, directing choice of second-line treatment in patients with
inadequate response to the current first line therapy, and identifying
patients in stable remission for therapy reduction. The test results
appear to guide longer-term therapies and treatments; therefore, we
believe that this test, identified by CPT code 81490, is generally less
tied to the primary service the patient receives in the hospital
outpatient setting and does not appear to be a common or routine
laboratory test that would otherwise be packaged into OPPS payment.
Consequently, we believe that CPT code 81490 should be excluded from
OPPS packaging policy.
As stated previously, we intend to continue to study the list of
laboratory tests excluded from the OPPS packaging policy to determine
whether any additional changes are warranted and may consider proposing
future changes to this policy and the laboratory DOS policy through
notice-and-comment rulemaking.
In conclusion, we continue to believe that cancer-related protein-
based MAAAs, that is, those represented by CPT codes 81500, 81503,
81535, 81536 and 81539, appear to have a different pattern of clinical
use that make them generally less tied to a primary service in the
hospital outpatient setting than the more common and routine laboratory
tests that are packaged. We also believe that, given the similarity in
its clinical pattern of use to the cancer-related protein-based MAAAs,
CPT code 81490 should also be added to the list of codes excluded from
the OPPS packaging and subject to the laboratory DOS exception at Sec.
414.510(b)(5), which is discussed in section III.XX in this final rule.
For the reasons discussed, we are revising the list of test codes
excluded from the OPPS packaging policy to include CPT codes 81500,
81503, 81535, 81536, 81539, and 81490. We are also finalizing that we
will exclude cancer-related protein-based MAAAs that do not currently
exist, but that are developed in the future, from the OPPS packaging
policy.
4. Calculation of OPPS Scaled Payment Weights
We established a policy in the CY 2013 OPPS/ASC final rule with
comment period (77 FR 68283) of using geometric mean-based APC costs to
calculate relative payment weights under the OPPS. In the CY 2020 OPPS/
ASC final rule with comment period (84 FR 61180 through 61182), we
applied this policy and calculated the relative payment weights for
each APC for CY 2020 that were shown in Addenda A and B to that final
rule with comment period (which were made available via the internet on
the CMS website) using the APC costs discussed in sections II.A.1. and
II.A.2. of that final rule with comment period. For CY 2021, as we did
for CY 2020, we proposed to continue to apply the policy established in
CY 2013 and calculate relative payment weights for each APC for CY 2021
using geometric mean-based APC costs.
For CY 2012 and CY 2013, outpatient clinic visits were assigned to
one of five levels of clinic visit APCs, with APC 0606 representing a
mid-level clinic visit. In the CY 2014 OPPS/ASC final rule with comment
period (78 FR 75036 through 75043), we finalized a policy that created
alphanumeric HCPCS code G0463 (Hospital outpatient clinic visit for
assessment and management of a patient), representing any and all
clinic visits under the OPPS. HCPCS code G0463 was assigned to APC 0634
(Hospital Clinic Visits). We also finalized a policy to use CY 2012
claims data to develop the CY 2014 OPPS payment rates for HCPCS code
G0463 based on the total geometric mean cost of the levels one through
five CPT E/M codes for clinic visits previously recognized under the
OPPS (CPT codes 99201 through 99205 and 99211 through 99215). In
addition, we finalized a policy to no longer recognize a distinction
between new and established patient clinic visits.
For CY 2016, we deleted APC 0634 and reassigned the outpatient
clinic visit HCPCS code G0463 to APC 5012 (Level 2 Examinations and
Related Services) (80 FR 70372). For CY 2021, as we did for CY 2020, we
proposed to continue to standardize all of the relative payment weights
to APC 5012. We believe that standardizing relative payment weights to
the geometric mean of the APC to which HCPCS code G0463 is assigned
maintains consistency in calculating unscaled weights that represent
the cost of some of the most frequently provided OPPS services. For
[[Page 85903]]
CY 2021, as we did for CY 2020, we proposed to assign APC 5012 a
relative payment weight of 1.00 and to divide the geometric mean cost
of each APC by the geometric mean cost for APC 5012 to derive the
unscaled relative payment weight for each APC. The choice of the APC on
which to standardize the relative payment weights does not affect
payments made under the OPPS because we scale the weights for budget
neutrality.
We note that in the CY 2019 OPPS/ASC final rule with comment period
(83 FR 59004 through 59015) and the CY 2020 OPPS/ASC final rule with
comment period (84 FR 61365 through 61369), we discuss our policy,
implemented on January 1, 2019, to control for unnecessary increases in
the volume of covered outpatient department services by paying for
clinic visits furnished at excepted off-campus provider-based
department (PBD) at a reduced rate. While the volume associated with
these visits is included in the impact model, and thus used in
calculating the weight scalar, the policy has a negligible effect on
the scalar. Specifically, under this policy, there is no change to the
relativity of the OPPS payment weights because the adjustment is made
at the payment level rather than in the cost modeling. Further, under
this policy, the savings that result from the change in payments for
these clinic visits are not budget neutral. Therefore, the impact of
this policy will generally not be reflected in the budget neutrality
adjustments, whether the adjustment is to the OPPS relative weights or
to the OPPS conversion factor. We note that the volume control method
for clinic visit services furnished by non-excepted off-campus PBDs is
subject to litigation. For a full discussion of this policy and the
litigation, we refer readers to the CY 2020 OPPS/ASC final rule with
comment period (84 FR 61142).
Section 1833(t)(9)(B) of the Act requires that APC reclassification
and recalibration changes, wage index changes, and other adjustments be
made in a budget neutral manner. Budget neutrality ensures that the
estimated aggregate weight under the OPPS for CY 2021 is neither
greater than nor less than the estimated aggregate weight that would
have been calculated without the changes. To comply with this
requirement concerning the APC changes, we proposed to compare the
estimated aggregate weight using the CY 2020 scaled relative payment
weights to the estimated aggregate weight using the proposed CY 2021
unscaled relative payment weights.
For CY 2020, we multiplied the CY 2020 scaled APC relative payment
weight applicable to a service paid under the OPPS by the volume of
that service from CY 2019 claims to calculate the total relative
payment weight for each service. We then added together the total
relative payment weight for each of these services in order to
calculate an estimated aggregate weight for the year. For CY 2021, we
proposed to apply the same process using the estimated CY 2021 unscaled
relative payment weights rather than scaled relative payment weights.
We proposed to calculate the weight scalar by dividing the CY 2020
estimated aggregate weight by the unscaled CY 2021 estimated aggregate
weight.
For a detailed discussion of the weight scalar calculation, we
refer readers to the OPPS claims accounting document available on the
CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html. Click on the CY 2021 OPPS
proposed rule link and open the claims accounting document link at the
bottom of the page.
We proposed to compare the estimated unscaled relative payment
weights in CY 2021 to the estimated total relative payment weights in
CY 2020 using CY 2019 claims data, holding all other components of the
payment system constant to isolate changes in total weight. Based on
this comparison, we proposed to adjust the calculated CY 2021 unscaled
relative payment weights for purposes of budget neutrality. We proposed
to adjust the estimated CY 2021 unscaled relative payment weights by
multiplying them by a proposed weight scalar of 1.4443 to ensure that
the proposed CY 2021 relative payment weights are scaled to be budget
neutral. The proposed CY 2021 relative payment weights listed in
Addenda A and B to the CY 2021 OPPS/ASC proposed rule (which are
available via the internet on the CMS website) are scaled and
incorporate the recalibration adjustments discussed in sections II.A.1.
and II.A.2. of the CY 2021 OPPS/ASC proposed rule.
Section 1833(t)(14) of the Act provides the payment rates for
certain SCODs. Section 1833(t)(14)(H) of the Act provides that
additional expenditures resulting from this paragraph shall not be
taken into account in establishing the conversion factor, weighting,
and other adjustment factors for 2004 and 2005 under paragraph (9), but
shall be taken into account for subsequent years. Therefore, the cost
of those SCODs (as discussed in section V.B.2. of proposed rule) is
included in the budget neutrality calculations for the CY 2021 OPPS.
We did not receive any public comments on the proposed weight
scalar calculation. Therefore, we are finalizing our proposal to use
the calculation process described in the proposed rule, without
modification, for CY 2021. Using updated final rule claims data, we are
updating the estimated CY 2021 unscaled relative payment weights by
multiplying them by a weight scalar of 1.4341 to ensure that the final
CY 2021 relative payment weights are scaled to be budget neutral. The
final CY 2021 relative payments weights listed in Addenda A and B to
this final rule with comment period (which are available via the
internet on the CMS website) were scaled and incorporate the
recalibration adjustments discussed in sections II.A.1. and II.A.2. of
this final rule with comment period.
B. Conversion Factor Update
Section 1833(t)(3)(C)(ii) of the Act requires the Secretary to
update the conversion factor used to determine the payment rates under
the OPPS on an annual basis by applying the OPD fee schedule increase
factor. For purposes of section 1833(t)(3)(C)(iv) of the Act, subject
to sections 1833(t)(17) and 1833(t)(3)(F) of the Act, the OPD fee
schedule increase factor is equal to the hospital inpatient market
basket percentage increase applicable to hospital discharges under
section 1886(b)(3)(B)(iii) of the Act. In the FY 2021 IPPS/LTCH PPS
proposed rule (85 FR 32738), consistent with current law, based on IHS
Global, Inc.'s fourth quarter 2019 forecast of the FY 2021 market
basket increase, the proposed FY 2021 IPPS market basket update was 3.0
percent. Accordingly, we proposed a CY 2021 OPD fee schedule increase
factor of 3.0 percent.
Specifically, section 1833(t)(3)(F)(i) of the Act requires that,
for 2012 and subsequent years, the OPD fee schedule increase factor
under subparagraph (C)(iv) be reduced by the productivity adjustment
described in section 1886(b)(3)(B)(xi)(II) of the Act. Section
1886(b)(3)(B)(xi)(II) of the Act defines the productivity adjustment as
equal to the 10-year moving average of changes in annual economy-wide,
private nonfarm business multifactor productivity (MFP) (as projected
by the Secretary for the 10-year period ending with the applicable
fiscal year, year, cost reporting period, or other annual period) (the
``MFP adjustment''). In the FY 2012 IPPS/LTCH PPS final rule (76 FR
51689 through 51692), we finalized our methodology for calculating and
[[Page 85904]]
applying the MFP adjustment, and then revised this methodology, as
discussed in the FY 2016 IPPS/LTCH PPS final rule (80 FR 49509). In the
FY 2021 IPPS/LTCH PPS proposed rule (85 FR 32739), the proposed MFP
adjustment for FY 2021 was 0.4 percentage point.
Therefore, we proposed that the MFP adjustment for the CY 2021 OPPS
would be 0.4 percentage point. We also proposed that if more recent
data become subsequently available after the publication of the CY 2021
OPPS/ASC proposed rule (for example, a more recent estimate of the
market basket increase and/or the MFP adjustment), we would use such
updated data, if appropriate, to determine the CY 2021 market basket
update and the MFP adjustment, which are components in calculating the
OPD fee schedule increase factor under sections 1833(t)(3)(C)(iv) and
1833(t)(3)(F) of the Act, in the CY 2021 OPPS/ASC final rule.
We note that section 1833(t)(3)(F) of the Act provides that
application of this subparagraph may result in the OPD fee schedule
increase factor under section 1833(t)(3)(C)(iv) of the Act being less
than 0.0 percent for a year, and may result in OPPS payment rates being
less than rates for the preceding year. As described in further detail
below, we proposed for CY 2021 an OPD fee schedule increase factor of
2.6 percent for the CY 2021 OPPS (which is the proposed estimate of the
hospital inpatient market basket percentage increase of 3.0 percent,
less the proposed 0.4 percentage point MFP adjustment).
We proposed that hospitals that fail to meet the Hospital OQR
Program reporting requirements would be subject to an additional
reduction of 2.0 percentage points from the OPD fee schedule increase
factor adjustment to the conversion factor that would be used to
calculate the OPPS payment rates for their services, as required by
section 1833(t)(17) of the Act. For further discussion of the Hospital
OQR Program, we refer readers to section XIV. of the proposed rule.
The adjustment described in section 1833(t)(3)(F)(ii) was required
only through 2019. The requirement in section 1833(t)(3)(F)(i) of the
Act that we reduce the OPD fee schedule increase factor by the
productivity adjustment described in section 1886(b)(3)(B)(xi)(II),
however, applies for 2012 and subsequent years, and thus, continues to
apply. In the CY 2020 OPPS/ASC final rule with comment period, we
inadvertently did not amend the regulation at 42 CFR
419.32(b)(1)(iv)(B) to reflect that the adjustment required by section
1833(t)(3)(F)(i) of the Act is the only adjustment under section
1833(t)(3)(F) that applies in CY 2020 and subsequent years.
Accordingly, we proposed to amend our regulation at 42 CFR
419.32(b)(1)(iv)(B) by adding a new paragraph (b)(1)(iv)(B)(11) to
provide that, for CY 2020 and subsequent years, we reduce the OPD fee
schedule increase factor by the MFP adjustment as determined by CMS.
To set the OPPS conversion factor for CY 2021, we proposed to
increase the CY 2020 conversion factor of $80.793 by 2.6 percent. In
accordance with section 1833(t)(9)(B) of the Act, we proposed further
to adjust the conversion factor for CY 2021 to ensure that any
revisions made to the wage index and rural adjustment were made on a
budget neutral basis. We proposed to calculate an overall budget
neutrality factor of 1.0017 for wage index changes. This adjustment was
comprised of a 1.0027 proposed budget neutrality adjustment, using our
standard calculation of comparing proposed total estimated payments
from our simulation model using the proposed FY 2021 IPPS wage indexes
to those payments using the FY 2020 IPPS wage indexes, as adopted on a
calendar year basis for the OPPS as well as a 0.9990 proposed budget
neutrality adjustment for the proposed CY 2021 5 percent cap on wage
index decreases to ensure that this transition wage index is
implemented in a budget neutral manner, consistent with the proposed FY
2021 IPPS wage index policy (85 FR 32706). We stated in the proposed
rule that we believed it was appropriate to ensure that the proposed
wage index transition policy (that is, the proposed CY 2021 5 percent
cap on wage index decreases) did not increase estimated aggregate
payments under the OPPS beyond the payments that would be made without
this transition policy. We proposed to calculate this budget neutrality
adjustment by comparing total estimated OPPS payments using the FY 2021
IPPS wage index, adopted on a calendar year basis for the OPPS, where a
5 percent cap on wage index decreases is not applied to total estimated
OPPS payments where the 5 percent cap on wage index decreases is
applied. We stated in the proposed rule that these two proposed wage
index budget neutrality adjustments would maintain budget neutrality
for the proposed CY 2021 OPPS wage index (which, as we discuss in
section II.C of the proposed rule, would use the FY 2021 IPPS post-
reclassified wage index and any adjustments, including without
limitation any adjustments finalized under the IPPS related to the
proposed adoption of the revised OMB delineations).
We did not receive any public comments on our proposed methodology
for calculating the wage index budget neutrality adjustment as
discussed above. Therefore, for the reasons discussed above and in the
CY 2021 OPPS/ASC proposed rule (85 FR 48801), we are finalizing our
methodology for calculating the wage index budget neutrality adjustment
as proposed, without modification. For CY 2021, based on updated data
for this final rule with comment period, we are finalizing an overall
budget neutrality factor of 1.0012 for wage index changes. This
adjustment is comprised of a 1.0020 budget neutrality adjustment using
our standard calculation of comparing total estimated payments from our
simulation model using the final FY 2021 IPPS wage indexes to those
payments using the FY 2020 IPPS wage indexes, as adopted on a calendar
year basis for the OPPS, as well as a 0.9992 budget neutrality
adjustment for the CY 2021 5 percent cap on wage index decreases to
ensure that this transition wage index is implemented in a budget
neutral manner.
For the CY 2021 OPPS, we proposed to maintain the current rural
adjustment policy, as discussed in section II.E. of the CY 2021 OPPS/
ASC proposed rule. Therefore, the proposed budget neutrality factor for
the rural adjustment was 1.0000.
We proposed to continue previously established policies for
implementing the cancer hospital payment adjustment described in
section 1833(t)(18) of the Act, as discussed in section II.F. of the CY
2021 OPPS/ASC proposed rule. We proposed to calculate a CY 2021 budget
neutrality adjustment factor for the cancer hospital payment adjustment
by comparing estimated total CY 2021 payments under section 1833(t) of
the Act, including the proposed CY 2021 cancer hospital payment
adjustment, to estimated CY 2021 total payments using the CY 2020 final
cancer hospital payment adjustment, as required under section
1833(t)(18)(B) of the Act. The proposed CY 2021 estimated payments
applying the proposed CY 2021 cancer hospital payment adjustment were
the same as estimated payments applying the CY 2020 final cancer
hospital payment adjustment. Therefore, we proposed to apply a budget
neutrality adjustment factor of 1.0000 to the conversion factor for the
cancer hospital payment adjustment. In accordance with section
1833(t)(18)(C), as added by section 16002(b) of the 21st Century Cures
Act (Pub. L. 114-255), we
[[Page 85905]]
proposed to apply a budget neutrality factor calculated as if the
proposed cancer hospital adjustment target payment-to-cost ratio was
0.90, not the 0.89 target payment-to-cost ratio we applied as stated in
section II.F. of the proposed rule.
For the CY 2021 OPPS/ASC proposed rule, we estimated that proposed
pass-through spending for drugs, biologicals, and devices for CY 2021
would equal approximately $783.2 million, which represented 0.93
percent of total projected CY 2021 OPPS spending. Therefore, we stated
that the proposed conversion factor would be adjusted by the difference
between the 0.88 percent estimate of pass-through spending for CY 2020
and the 0.93 percent estimate of proposed pass-through spending for CY
2021, resulting in a proposed decrease to the conversion factor for CY
2021 of 0.05 percent.
We also estimated a 0.85 percent upward adjustment to nondrug OPPS
payment rates as a result of our payment proposal for separately
payable nonpass-through drugs purchased under the 340B Program at a net
rate of ASP minus 28.7 percent. Applying the proposed payment policy
for drugs purchased under the 340B Program, as described in section
V.B.6. of the CY 2021 OPPS/ASC proposed rule, would have resulted in an
estimated reduction of approximately $427 million in separately paid
OPPS drug payments. To ensure budget neutrality under the OPPS after
applying this proposed payment methodology for drugs purchased under
the 340B Program, we proposed to apply an offset of approximately $427
million to the OPPS conversion factor, which would result in an
adjustment of 1.0085 to the OPPS conversion factor.
Proposed estimated payments for outliers would remain at 1.0
percent of total OPPS payments for CY 2021. We estimated for the
proposed rule that outlier payments would be 1.01 percent of total OPPS
payments in CY 2020; the 1.00 percent for proposed outlier payments in
CY 2021 would constitute a 0.01 percent decrease in payment in CY 2021
relative to CY 2020.
For the CY 2021 OPPS/ASC proposed rule, we also proposed that
hospitals that fail to meet the reporting requirements of the Hospital
OQR Program would continue to be subject to a further reduction of 2.0
percentage points to the OPD fee schedule increase factor. For
hospitals that fail to meet the requirements of the Hospital OQR
Program, we proposed to make all other adjustments discussed above, but
use a reduced OPD fee schedule update factor of 0.6 percent (that is,
the proposed OPD fee schedule increase factor of 2.6 percent further
reduced by 2.0 percentage points). This would result in a proposed
reduced conversion factor for CY 2021 of $82.065 for hospitals that
fail to meet the Hospital OQR Program requirements (a difference of
1.632 in the conversion factor relative to hospitals that met the
requirements).
In summary, for CY 2021, we proposed to amend Sec. 419.32 by
adding a new paragraph (b)(1)(iv)(B)(11) to reflect the reductions to
the OPD fee schedule increase factor that are required for CY 2020, CY
2021, and subsequent years to satisfy the statutory requirements of
section 1833(t)(3)(F) of the Act. We proposed to use a reduced
conversion factor of $82.065 in the calculation of payments for
hospitals that fail to meet the Hospital OQR Program requirements (a
difference of -1.632 in the conversion factor relative to hospitals
that met the requirements).
For CY 2021, we proposed to use a conversion factor of $83.697 in
the calculation of the national unadjusted payment rates for those
items and services for which payment rates are calculated using
geometric mean costs; that is, the proposed OPD fee schedule increase
factor of 2.6 percent for CY 2021, the required proposed wage index
budget neutrality adjustment of approximately 1.0017, the proposed
cancer hospital payment adjustment of 1.0000, the proposed budget
neutrality adjustment of 1.0085 applying the proposed payment
methodology of ASP minus 28.7 percent for CY 2021 for drugs purchased
under the 340B Program, and the proposed adjustment of 0.05 percentage
point of projected OPPS spending for the difference in pass-through
spending that resulted in a proposed conversion factor for CY 2021 of
$83.697.
Comment: One commenter suggested that we eliminate the MFP
adjustment because of economic uncertainty as a result of the COVID-19
pandemic. The commenter stated that CMS rules for fiscal year 2021 had
a 0.0 percent multifactor productivity adjustment.
Response: We note that under section 1886(b)(3)(B)(xi)(I) of the
Act, the Secretary is required to reduce the hospital market basket
percentage increase by the 10-year moving average of changes in annual
economy-wide, private nonfarm business MFP.
Comment: Multiple commenters supported our proposed CY 2021 OPD fee
schedule increase factor percentage increase of 2.6 percent.
Response: We appreciate the support of the commenters.
After reviewing the public comments we received, we are finalizing
these proposals with modification. For CY 2021, we proposed to continue
previously established policies for implementing the cancer hospital
payment adjustment described in section 1833(t)(18) of the Act
(discussed in section II.F. of this final rule with comment period).
Based on the final rule updated data used in calculating the cancer
hospital payment adjustment in section II.F. of this final rule with
comment period, the target payment-to-cost ratio for the cancer
hospital payment adjustment, which was 0.89 for CY 2020, is also 0.89
for CY 2021. As a result, we are applying a budget neutrality
adjustment factor of 1.0000 to the conversion factor for the cancer
hospital payment adjustment. We are implementing our alternative
proposal for CY 2021 for the payment of drugs acquired through the 340B
program. Drugs obtained through the 340B program will be paid at a net
rate of ASP minus 22.5 percent. This has been the payment rate for
drugs acquired through the 340B program in the OPPS since the policy
was initially established in CY 2018. Since there is no change in the
net payment rate, the final budget neutral adjustment factor regarding
the payment of drugs acquired through the 340B program is 1.0000.
For this CY 2021 OPPS/ASC final rule with comment period, as
published in the FY 2021 IPPS/LTCH PPS final rule, based on IGI's 2020
second quarter forecast with historical data through the first quarter
of 2020, the hospital market basket update for CY 2021 is 2.4 percent.
As described in the FY 2021 IPPS/LTCH PPS final rule (85 FR 58797),
it has typically been our practice to base the projection of the market
basket price proxies and MFP for the IPPS/LTCH final rule on the second
quarter IGI forecast. At the time of the FY 2021 IPPS/LTCH final rule,
the 10-year moving average growth of MFP for FY 2021 based on IGI's
second quarter 2020 forecast was 0.7 percentage point. However, for the
FY 2021 IPPS/LTCH final rule, we finalized the use of the IGI June 2020
macroeconomic forecast for MFP because it represented a more recent
forecast, and we believed it was important to use more recent data
during this period when economic trends, particularly employment and
labor productivity, are notably uncertain because of the COVID-19
pandemic. Based on these more recent data available for the FY 2021
IPPS/LTCH final rule, the current estimate of the 10-year moving
average growth of MFP for FY 2021 was -0.1 percentage point (85 FR
58797).
[[Page 85906]]
Mechanically subtracting the negative 10-year moving average growth
of MFP from the hospital market basket percentage increase using the
data from the IGI June 2020 macroeconomic forecast would have resulted
in a 0.1 percentage point increase in the FY 2021 market basket update.
However, we explained that under section 1886(b)(3)(B)(xi)(I) of the
Act, the Secretary is required to reduce (not increase) the hospital
market basket percentage increase by changes in economy-wide
productivity. Accordingly, we applied a 0.0 percent MFP adjustment to
the FY 2021 IPPS market basket percentage increase.
Section 1833(t)(3)(F)(i) of the Act also requires us to reduce (not
increase) the OPD fee schedule increase factor by the MFP adjustment
described in section 1886(b)(3)(B)(xi)(II) of the Act. Accordingly, we
are applying a 0.0 percentage point MFP adjustment to the CY 2021 OPD
fee schedule increase factor for the OPPS.
As a result of these finalized policies, the OPD fee schedule
increase factor for the CY 2021 OPPS is 2.4 percent (which reflects the
2.4 percent final estimate of the hospital inpatient market basket
percentage increase with a 0.0 percentage point MFP adjustment since
the 10-year moving average growth in MFP was estimated to be less than
0.0 percent). For CY 2021, we are using a conversion factor of $82.797
in the calculation of the national unadjusted payment rates for those
items and services for which payment rates are calculated using
geometric mean costs; that is, the OPD fee schedule increase factor of
2.4 percent for CY 2021, the required wage index budget neutrality
adjustment of 1.0012, the budget neutrality adjustment of 1.0000
applying the final payment methodology for drugs purchased under the
340B Program for CY 2021 of ASP minus 22.5 percent, and the adjustment
of 0.04 percentage point of projected OPPS spending for the difference
in pass-through spending that results in a conversion factor for CY
2021 of $82.797.
We also are finalizing our proposal to amend the regulation at 42
CFR 419.32(b)(1)(iv)(B) by adding a new paragraph (b)(1)(iv)(B)(11) to
provide that, for CY 2020 and subsequent years, we reduce the OPD fee
schedule increase factor by the MFP adjustment as determined by CMS.
C. Wage Index Changes
Section 1833(t)(2)(D) of the Act requires the Secretary to
determine a wage adjustment factor to adjust the portion of payment and
coinsurance attributable to labor-related costs for relative
differences in labor and labor-related costs across geographic regions
in a budget neutral manner (codified at 42 CFR 419.43(a)). This portion
of the OPPS payment rate is called the OPPS labor-related share. Budget
neutrality is discussed in section II.B. of the CY 2021 OPPS/ASC
proposed rule.
The OPPS labor-related share is 60 percent of the national OPPS
payment. This labor-related share is based on a regression analysis
that determined that, for all hospitals, approximately 60 percent of
the costs of services paid under the OPPS were attributable to wage
costs. We confirmed that this labor-related share for outpatient
services is appropriate during our regression analysis for the payment
adjustment for rural hospitals in the CY 2006 OPPS final rule with
comment period (70 FR 68553). We proposed to continue this policy for
the CY 2021 OPPS (85 FR 48802). We referred readers to section II.H. of
the CY 2021 OPPS/ASC proposed rule for a description and an example of
how the wage index for a particular hospital is used to determine
payment for the hospital. We did not receive any public comments on
this proposal. Accordingly, for the reasons discussed above and in the
CY 2021 OPPS/ASC proposed rule, we are finalizing our proposal, without
modification, to continue this policy for the CY 2021 OPPS.
As discussed in the claims accounting narrative included with the
supporting documentation for this final rule with comment period (which
is available via the internet on the CMS website), for estimating APC
costs, we are standardizing 60 percent of estimated claims costs for
geographic area wage variation using the same FY 2021 pre-reclassified
wage index that we use under the IPPS to standardize costs. This
standardization process removes the effects of differences in area wage
levels from the determination of a national unadjusted OPPS payment
rate and copayment amount.
Under 42 CFR 419.41(c)(1) and 419.43(c) (published in the OPPS
April 7, 2000 final rule with comment period (65 FR 18495 and 18545)),
the OPPS adopted the final fiscal year IPPS post-reclassified wage
index as the calendar year wage index for adjusting the OPPS standard
payment amounts for labor market differences. Therefore, the wage index
that applies to a particular acute care, short-stay hospital under the
IPPS also applies to that hospital under the OPPS. As initially
explained in the September 8, 1998 OPPS proposed rule (63 FR 47576), we
believe that using the IPPS wage index as the source of an adjustment
factor for the OPPS is reasonable and logical, given the inseparable,
subordinate status of the HOPD within the hospital overall. In
accordance with section 1886(d)(3)(E) of the Act, the IPPS wage index
is updated annually.
The Affordable Care Act contained several provisions affecting the
wage index. These provisions were discussed in the CY 2012 OPPS/ASC
final rule with comment period (76 FR 74191). Section 10324 of the
Affordable Care Act added section 1886(d)(3)(E)(iii)(II) to the Act,
which defines a frontier State and amended section 1833(t) of the Act
to add paragraph (19), which requires a frontier State wage index floor
of 1.00 in certain cases, and states that the frontier State floor
shall not be applied in a budget neutral manner. We codified these
requirements at Sec. 419.43(c)(2) and (3) of our regulations. For CY
2021, we proposed to implement this provision in the same manner as we
have since CY 2011 (85 FR 48802). Under this policy, the frontier State
hospitals would receive a wage index of 1.00 if the otherwise
applicable wage index (including reclassification, the rural floor, and
rural floor budget neutrality) is less than 1.00. Because the HOPD
receives a wage index based on the geographic location of the specific
inpatient hospital with which it is associated, we stated that the
frontier State wage index adjustment applicable for the inpatient
hospital also would apply for any associated HOPD. We referred readers
to the FY 2011 through FY 2020 IPPS/LTCH PPS final rules for
discussions regarding this provision, including our methodology for
identifying which areas meet the definition of ``frontier States'' as
provided for in section 1886(d)(3)(E)(iii)(II) of the Act: for FY 2011,
75 FR 50160 through 50161; for FY 2012, 76 FR 51793, 51795, and 51825;
for FY 2013, 77 FR 53369 through 53370; for FY 2014, 78 FR 50590
through 50591; for FY 2015, 79 FR 49971; for FY 2016, 80 FR 49498; for
FY 2017, 81 FR 56922; for FY 2018, 82 FR 38142; for FY 2019, 83 FR
41380; and for FY 2020, 84 FR 42312. We did not receive any public
comments on this proposal. Accordingly, for the reasons discussed above
and in the CY 2021 OPPS/ASC proposed rule, we are finalizing our
proposal, without modification, to continue to implement the frontier
State floor under the OPPS in the same manner as we have since CY 2011.
In addition to the changes required by the Affordable Care Act, we
noted in the CY 2021 OPPS/ASC proposed rule (85
[[Page 85907]]
FR 48802) that the FY 2021 IPPS wage indexes continue to reflect a
number of adjustments implemented in past years, including, but not
limited to, reclassification of hospitals to different geographic
areas, the rural floor provisions, an adjustment for occupational mix,
an adjustment to the wage index based on commuting patterns of
employees (the out-migration adjustment), and an adjustment to the wage
index for certain low wage index hospitals to help address wage index
disparities between low and high wage index hospitals. We referred
readers to the FY 2021 IPPS/LTCH PPS proposed rule (85 FR 32695 through
32734) for a detailed discussion of all proposed changes to the FY 2021
IPPS wage indexes.
Furthermore, as discussed in the FY 2015 IPPS/LTCH PPS final rule
(79 FR 49951 through 49963) and in each subsequent IPPS/LTCH PPS final
rule, including the FY 2021 IPPS/LTCH PPS final rule (85 FR 58743), the
Office of Management and Budget (OMB) issued revisions to the labor
market area delineations on February 28, 2013 (based on 2010 Decennial
Census data), that included a number of significant changes, such as
new Core Based Statistical Areas (CBSAs), urban counties that became
rural, rural counties that became urban, and existing CBSAs that were
split apart (OMB Bulletin 13-01). This bulletin can be found at:
https://obamawhitehouse.archives.gov/sites/default/files/omb/bulletins/2013/b13-01.pdf. In the FY 2015 IPPS/LTCH PPS final rule (79 FR 49950
through 49985), for purposes of the IPPS, we adopted the use of the OMB
statistical area delineations contained in OMB Bulletin No. 13-01,
effective October 1, 2014. For purposes of the OPPS, in the CY 2015
OPPS/ASC final rule with comment period (79 FR 66826 through 66828), we
adopted the use of the OMB statistical area delineations contained in
OMB Bulletin No. 13-01, effective January 1, 2015, beginning with the
CY 2015 OPPS wage indexes. In the FY 2017 IPPS/LTCH PPS final rule (81
FR 56913), we adopted revisions to statistical areas contained in OMB
Bulletin No. 15-01, issued on July 15, 2015, which provided updates to
and superseded OMB Bulletin No. 13-01 that was issued on February 28,
2013. For purposes of the OPPS, in the CY 2017 OPPS/ASC final rule with
comment period (81 FR 79598), we adopted the revisions to the OMB
statistical area delineations contained in OMB Bulletin No. 15-01,
effective January 1, 2017, beginning with the CY 2017 OPPS wage
indexes.
On August 15, 2017, OMB issued OMB Bulletin No. 17-01, which
provided updates to and superseded OMB Bulletin No. 15-01 that was
issued on July 15, 2015. The attachments to OMB Bulletin No. 17-01
provided detailed information on the update to the statistical areas
since July 15, 2015, and were based on the application of the 2010
Standards for Delineating Metropolitan and Micropolitan Statistical
Areas to Census Bureau population estimates for July 1, 2014 and July
1, 2015. In the CY 2019 OPPS/ASC final rule with comment period (83 FR
58863 through 58865), we adopted the updates set forth in OMB Bulletin
No. 17-01, effective January 1, 2019, beginning with the CY 2019 wage
index.
On April 10, 2018 OMB issued OMB Bulletin No. 18-03 which
superseded the August 15, 2017 OMB Bulletin No. 17-01. On September 14,
2018, OMB issued OMB Bulletin No. 18-04 which superseded the April 10,
2018 OMB Bulletin No. 18-03. Typically, interim OMB bulletins (those
issued between decennial censuses) have only contained minor
modifications to labor market delineations. However, as we stated in
the FY 2021 IPPS/LTCH PPS proposed and final rules (85 FR 32696 through
32697 and 58743), the April 10, 2018 OMB Bulletin No. 18-03 and the
September 14, 2018 OMB Bulletin No. 18-04 included more modifications
to the labor market areas than are typical for OMB bulletins issued
between decennial censuses, including some material modifications that
have a number of downstream effects, such as IPPS hospital
reclassification changes. These bulletins established revised
delineations for Metropolitan Statistical Areas, Micropolitan
Statistical Areas, and Combined Statistical Areas, and provided
guidance on the use of the delineations of these statistical areas. A
copy of OMB Bulletin No. 18-04 may be obtained at https://www.whitehouse.gov/wpcontent/uploads/2018/09/Bulletin-18-04.pdf.
According to OMB, ``[t]his bulletin provides the delineations of all
Metropolitan Statistical Areas, Metropolitan Divisions, Micropolitan
Statistical Areas, Combined Statistical Areas, and New England City and
Town Areas in the United States and Puerto Rico based on the standards
published on June 28, 2010 (75 FR 37246), and Census Bureau data.''
As noted previously, while OMB Bulletin No. 18-04 is not based on
new census data, it includes some material changes to the OMB
statistical area delineations. Specifically, as we stated in the CY
2021 OPPS/ASC proposed rule (85 FR 48803), under the revised OMB
delineations, there would be some new CBSAs, urban counties that would
become rural, rural counties that would become urban, and some existing
CBSAs that would be split apart. In addition, we stated in the FY 2021
IPPS/LTCH PPS proposed rule that the revised OMB delineations would
affect various hospital reclassifications, the outmigration adjustment
(established by section 505 of Pub. L. 108-173), and treatment of
hospitals located in certain rural counties (that is, ``Lugar''
hospitals) under section 1886(d)(8)(B) of the Act. In the CY 2021 OPPS/
ASC proposed rule, we referred readers to the FY 2021 IPPS/LTCH PPS
proposed rule for a complete discussion of the revised OMB delineations
we proposed to adopt under the IPPS and the effects of these revisions
on the FY 2021 IPPS wage indexes (85 FR 32696 through 32707, 32717
through 32728). We stated in the FY 2021 IPPS/LTCH PPS proposed rule
that we believe using the revised delineations based on OMB Bulletin
No. 18-04 would increase the integrity of the IPPS wage index system by
creating a more accurate representation of geographic variations in
wage levels. Therefore, in the FY 2021 IPPS/LTCH PPS proposed rule, we
proposed to implement the revised OMB delineations as described in the
September 14, 2018 OMB Bulletin No. 18-04, effective October 1, 2020
beginning with the FY 2021 IPPS wage index. In addition, in the FY 2021
IPPS/LTCH PPS proposed rule, we proposed to apply a 5 percent cap for
FY 2021 on any decrease in a hospital's final wage index from the
hospital's final wage index for FY 2020 as a proposed transition wage
index to help mitigate any significant negative impacts of adopting the
revised OMB delineations (85 FR 32706 through 32707). As discussed in
the FY 2021 IPPS/LTCH PPS final rule (85 FR 58742 through 58755), as we
proposed, we adopted the revised OMB delineations as described in the
September 14, 2018 OMB Bulletin No. 18-04, effective October 1, 2020
beginning with the FY 2021 IPPS wage index and a 5 percent cap for FY
2021 on any decrease in a hospital's final wage index from the
hospital's final wage index for FY 2020.
As further discussed below, in the CY 2021 OPPS/ASC proposed rule
(85 FR 48803), we proposed to use the FY 2021 IPPS post-reclassified
wage index including the updated OMB delineations and related IPPS wage
index adjustments to calculate the CY 2021 OPPS wage indexes. Similar
to our discussion in the FY 2021 IPPS/LTCH PPS proposed rule, we stated
in the CY
[[Page 85908]]
2021 OPPS/ASC proposed rule that we believe using the revised
delineations based on OMB Bulletin No. 18-04 would increase the
integrity of the OPPS wage index system by creating a more accurate
representation of geographic variations in wage levels.
A summary of the comments we received regarding the updated OMB
delineations and our responses to those comments appear below:
Comment: One commenter supported our proposed adoption of the
revised OMB delineations, but several commenters opposed our proposed
implementation of the revised OMB delineations. These commenters stated
that CMS is not bound to adopt the revised delineations, and suggested
that CMS delay adoption of the revised delineations until the
completion of the 2020 decennial census. Several comments specifically
cited the lack of advance notice and the significant negative financial
impacts to hospitals in several counties in the New York-Newark-Jersey
City MSA resulting from the adoption of the revised delineations.
Additional commenters recommended that CMS engage further with
stakeholders to develop more comprehensive wage index reform to address
the disparities that exist within the current wage index system.
Response: We appreciate these comments. We refer readers to the FY
2021 IPPS/LTCH PPS final rule (85 FR 58744 through 58753) for a
detailed discussion of the implementation of the revised OMB
delineations and for responses to these and other comments relating to
the revised delineations.
Consistent with our longstanding policy, we proposed in the CY 2021
OPPS/ASC proposed rule (85 FR 48803) to use the FY 2021 IPPS post-
reclassified wage index, which is based on the updated statistical area
delineations set forth in OMB Bulletin No. 18-04, in determining the
wage adjustments for both the OPPS payment and copayment rates for CY
2021. Thus, as discussed in the CY 2021 OPPS/ASC proposed rule (85 FR
48803), any adjustments for the FY 2021 IPPS post-reclassified wage
index, including without limitation a one year 5 percent cap on any
wage index decrease, would be reflected in the final CY 2021 OPPS wage
index beginning on January 1, 2021. As we explained in the CY 2021
OPPS/ASC proposed rule, we continue to believe that using the IPPS
post-reclassified wage index as the source of an adjustment factor for
the OPPS is reasonable and logical given the inseparable, subordinate
status of the HOPD within the hospital overall. For this reason, as
discussed later in this section, we are finalizing our proposal to use
the FY 2021 IPPS post-reclassified wage index and applicable IPPS wage
index adjustments in determining the wage adjustments for both the OPPS
payment rate and the copayment rates for CY 2021. As noted above, in
the FY 2021 IPPS/LTCH PPS final rule (85 FR 58742 through 58755), for
purposes of calculating the IPPS wage index, we adopted the revised OMB
delineations as described in OMB Bulletin No. 18-04 effective October
1, 2020. Thus, effective January 1, 2021, the OPPS wage index also will
be based on these updated OMB delineations. As we explained in the CY
2021 OPPS/ASC proposed rule, we believe using the revised delineations
based on OMB Bulletin No. 18-04 will increase the integrity of the wage
index system by creating a more accurate representation of geographic
variations in wage levels.
We concur with commenters that CMS is not bound by statute to use
the OMB definitions in calculating the OPPS wage index. However, we
believe we have broad authority under section 1833(t)(2)(D) of the Act
to determine the methodology for calculating the OPPS wage index,
including the labor market areas used for the OPPS wage index. As
discussed above, we believe using the IPPS post-reclassified wage
index, which is based on the revised OMB delineations, in determining
the wage adjustments for both the OPPS payment rate and the copayment
rate for CY 2021 is reasonable and logical given the inseparable,
subordinate status of the HOPD within the hospital overall. In
addition, consistent with our discussion in the FY 2021 IPPS/LTCH PPS
final rule (85 FR 58745), we believe it is important to use the updated
labor market area delineations in order to maintain a more accurate and
up-to-date payment system that reflects the reality of current labor
market conditions. In response to comments citing a lack of advance
notice provided to hospitals regarding the proposed adoption of the
revised delineations, as we stated in the FY 2021 IPPS/LTCH PPS final
rule (85 FR 58746), the delineation files produced by OMB have been
public for nearly 2 years, and OMB definitions and criteria are subject
to separate notice and comment rulemaking. Finally, we note that to
help mitigate significant negative impacts of the revised OMB
delineations, consistent with the FY 2021 IPPS wage index, the CY 2021
OPPS wage index will reflect a 5 percent cap on any wage index decrease
compared to a hospital's final CY 2020 wage index. For these reasons,
we do not believe it is necessary or appropriate to delay or alter
implementation of the revised delineations.
In response to commenters who recommended that CMS engage further
with stakeholders to develop a more comprehensive wage index reform to
address wage index disparities, we appreciate the continued interest in
wage index reform. As we noted in the FY 2021 IPPS/LTCH PPS final rule
(85 FR 58745), as a first step toward comprehensive wage index reform,
the FY 2021 President's Budget proposes the Secretary conduct and
report on a demonstration to improve the Medicare inpatient hospital
wage index.
After consideration of the public comments we received, for the
reasons discussed above and in the CY 2021 OPPS/ASC proposed rule, we
are finalizing, without modification, our proposal to adopt the revised
OMB delineations as described in the September 14, 2018 OMB Bulletin
No. 18-04, and related IPPS wage index adjustments to calculate the CY
2021 OPPS wage index effective beginning January 1, 2021.
CBSAs are made up of one or more constituent counties. Each CBSA
and constituent county has its own unique identifying codes. The FY
2018 IPPS/LTCH PPS final rule (82 FR 38130) discussed the two different
lists of codes to identify counties: Social Security Administration
(SSA) codes and Federal Information Processing Standard (FIPS) codes.
Historically, CMS listed and used SSA and FIPS county codes to identify
and crosswalk counties to CBSA codes for purposes of the IPPS and OPPS
wage indexes. However, the SSA county codes are no longer being
maintained and updated, although the FIPS codes continue to be
maintained by the U.S. Census Bureau. The Census Bureau's most current
statistical area information is derived from ongoing census data
received since 2010; the most recent data are from 2015. The Census
Bureau maintains a complete list of changes to counties or county
equivalent entities on the website at: https://www.census.gov/geo/reference/county-changes.html (which, as of May 6, 2019, migrated to:
https://www.census.gov/programs-surveys/geography.html). In the FY 2018
IPPS/LTCH PPS final rule (82 FR 38130), for purposes of crosswalking
counties to CBSAs for the IPPS wage index, we finalized our proposal to
discontinue the use of the SSA county codes and begin using only the
FIPS county codes. Similarly, for the purposes of crosswalking counties
to CBSAs for the OPPS wage index, in the CY 2018 OPPS/ASC final rule
with comment period (82 FR 59260), we finalized our proposal to
discontinue
[[Page 85909]]
the use of SSA county codes and begin using only the FIPS county codes.
For CY 2021, under the OPPS, we are continuing to use only the FIPS
county codes for purposes of crosswalking counties to CBSAs.
In the CY 2021 OPPS/ASC proposed rule (85 FR 48803), we proposed to
use the FY 2021 IPPS post-reclassified wage index for urban and rural
areas as the wage index for the OPPS to determine the wage adjustments
for both the OPPS payment rate and the copayment rate for CY 2021.
Therefore, we stated that any adjustments for the FY 2021 IPPS post-
reclassified wage index, including, but not limited to, any adjustments
that we may finalize related to the proposed adoption of the revised
OMB delineations (such as a cap on wage index decreases and revisions
to hospital reclassifications), would be reflected in the final CY 2021
OPPS wage index beginning on January 1, 2021. (In the proposed rule, we
referred readers to the FY 2021 IPPS/LTCH PPS proposed rule (85 FR
32695 through 32734) and the proposed FY 2021 hospital wage index files
posted on the CMS website.) With regard to budget neutrality for the CY
2021 OPPS wage index, in the proposed rule, we referred readers to
section II.B. of the CY 2021 OPPS/ASC proposed rule. We stated that we
continue to believe that using the IPPS post-reclassified wage index as
the source of an adjustment factor for the OPPS is reasonable and
logical, given the inseparable, subordinate status of the HOPD within
the hospital overall.
We received comments regarding certain adjustments included in the
FY 2021 IPPS post-reclassified wage index (which would be reflected in
the CY 2021 OPPS wage index). A summary of those comments and our
responses appear below:
Comment: Some commenters, while opposing the proposed adoption of
revised OMB delineations, generally supported the concept of the 5
percent cap on any wage index decrease for FY 2021 (if the delineations
are finalized). Some commenters requested that CMS reduce the amount of
potential reduction in FY 2021, and extend transition adjustments to
affected hospitals in future years. Other commenters suggested a
multiple year transition period. One commenter requested that we apply
the 5 percent cap policy to wage index increases as well.
Response: We thank the commenters for their suggestions. We refer
readers to the FY 2021 IPPS/LTCH PPS final rule (85 FR 85753 through
58755) for a detailed discussion of our rationale for adopting a one
year 5 percent cap on any wage index decrease and for responses to
these and other comments regarding this transition wage index.
As discussed previously, in the CY 2021 OPPS/ASC proposed rule (85
FR 48803), we proposed to use the FY 2021 IPPS post-reclassified wage
index, including any adjustments such as the one year 5 percent cap on
wage index decreases, as the wage index for the OPPS to determine the
wage adjustments for both the OPPS payment rate and the copayment rate
for CY 2021. We continue to believe that using the IPPS post-
reclassified wage index, including any adjustments, as the source of an
adjustment factor for the OPPS is reasonable and logical given the
inseparable, subordinate status of the HOPD within the hospital
overall, and thus, as discussed below, we are finalizing this proposal
without modification.
In response to the commenter that requested we also apply the 5
percent cap to wage index increases, we note that as we explained in
the FY 2021 IPPS/LTCH PPS final rule (85 FR 58753 through 58755), the
purpose of the 5 percent cap is to mitigate significant wage index
decreases and provide wage index stability for affected hospitals in
light of our adoption of the revised OMB delineations. The purpose of
the 5 percent cap is not to curtail the positive impact of such
revisions. Thus, we do not think it would be appropriate to apply the
cap to wage index increases as well.
Comments: Many commenters thanked CMS for implementing the IPPS low
wage index hospital policy (pursuant to which CMS increases the IPPS
wage index for certain low wage index hospitals) beginning in FY 2020
in response to rural and other health care stakeholders' requests that
CMS address ``circularity'' in the wage index (the cyclical effect of
hospitals with relatively high wages receiving higher reimbursement due
to relatively high wage indexes, which allows them to afford paying
higher wages) and halt the ``death spiral'' perpetuating wage index
disparities where relatively low wage index hospitals are forced to
keep wages low due to low Medicare reimbursements that lag behind areas
with higher wage indexes.
Other commenters opposed continuing the low wage index hospital
policy in FY 2021. The commenters stated that the policy fails to
recognize the legitimate differences in geographic labor markets.
Commenters also noted that there is no requirement for hospitals to use
the increased reimbursement to boost employee compensation, and
suggested CMS begin evaluating the cost report data filed by hospitals
in the lowest quartile to ascertain whether the increased funds are
being used to raise employee compensation in deciding whether to
continue this policy for FY 2022. Some commenters stated that the data
lag CMS described in its rationale applies equally to all hospitals,
not only those in the lowest quartile. Commenters questioned CMS's
statutory authority to promulgate this IPPS policy under 42 U.S.C.
1395ww(d)(3)(E), which requires the agency to adjust payments to
reflect area differences in wages, because it artificially inflates
wage index values and creates a wage index system not based on actual
data. These commenters stated that CMS is using the wage index as a
policy vehicle, not as a technical correction, and needs Congressional
authority to provide additional funding to low-wage hospitals.
Response: We appreciate the many comments we received regarding our
policy to provide an increase in the IPPS wage index beginning in FY
2020 for hospitals with wage index values below the 25th percentile
wage index value for a year (referred to as the low wage index hospital
policy). We note that we did not propose or finalize any changes to
this policy in the FY 2021 IPPS/LTCH PPS proposed and final rules. We
refer readers to the FY 2020 IPPS/LTCH PPS final rule (84 FR 42326
through 42332) and FY 2021 IPPS/LTCH PPS final rule (85 FR 58765
through 58768) for a detailed discussion of the IPPS low wage index
hospital policy and for responses to these and other comments regarding
this policy. In the CY 2021 OPPS/ASC proposed rule (85 FR 48803), we
proposed to use the FY 2021 IPPS post-reclassified wage index including
any adjustments, such as the IPPS low wage index hospital policy, as
the wage index for the OPPS to determine the wage adjustments for both
the OPPS payment rate and the copayment rate for CY 2021. We continue
to believe that using the IPPS post-reclassified wage index, including
any adjustments, as the source of an adjustment factor for the OPPS is
reasonable and logical given the inseparable, subordinate status of the
HOPD within the hospital overall, and thus, as discussed below, we are
finalizing this proposal without modification.
Comment: Many commenters supported increasing the wage index values
of low-wage hospitals, but suggested that CMS do so in a non-budget-
neutral manner. Commenters stated that this redistribution is
counterproductive to CMS's larger goals
[[Page 85910]]
of high quality care and healthcare access because it forces high-wage,
mostly urban hospitals to bear the cost of supporting lower-wage
hospitals. Commenters stated that the budget neutrality adjustment
penalizes many hospitals, including rural hospitals. Other commenters
requested that CMS ensure that the budget neutrality adjustment factor
not apply to hospitals falling below the 25th percentile.
Response: We refer readers to the FY 2020 IPPS/LTCH PPS final rule
(84 FR 42328 through 42332) and FY 2021 IPPS/LTCH PPS final rule (85 FR
58765 through 58768) for a detailed discussion of the budget neutrality
adjustment for the IPPS low wage index hospital policy and for
responses to these and other comments regarding this adjustment.
We refer readers to section II.B. of this final rule with comment
period for a discussion of the OPPS wage index budget neutrality
adjustment.
Comment: Many commenters recommended that CMS develop a
comprehensive, long-term approach to wage index reform in place of the
low wage index hospital policy finalized in the FY 2020 IPPS/LTCH PPS
final rule. Two commenters suggested alternative solutions to address
wage index disparities, including a national wage index floor for all
hospitals. Other commenters recommended that CMS proactively address
the effects of COVID-19, which the commenters believed would exacerbate
wage index disparities, by excluding wage data collected during the
public health emergency from future wage index calculations.
Response: We appreciate the commenters' suggested alternatives. We
received similar comments in response to the FY 2021 IPPS/LTCH PPS
proposed rule (85 FR 58767 through 58768). In the FY 2021 IPPS/LTCH PPS
final rule (85 FR 58768), we stated that we considered these comments
to be outside the scope of the FY 2021 IPPS/LTCH PPS proposed rule, and
thus we did not address them in that final rule but stated that we may
consider them in future rulemaking. Similarly, we consider these
comments to be outside the scope of the CY 2021 OPPS/ASC proposed rule
and thus are not addressing them in this final rule with comment
period.
Comment: Multiple commenters specifically supported CMS's
continuation of the policy, adopted in the FY 2020 IPPS/LTCH PPS final
rule (84 FR 42332 through 42336), to exclude the wage data of urban
hospitals that reclassify to rural when calculating each state's rural
floor. Commenters stated that the change to the calculation of the
rural floor limits the ability of hospitals to game the system and
supports the overall goal of making the wage index reflective of
variances in labor markets.
Response: We appreciate the commenters' support of our policy to
exclude the wage data of hospitals reclassified under Sec. 412.103
from the IPPS rural floor calculation. As stated in the FY 2020 IPPS/
LTCH PPS final rule, we believe this policy is necessary and
appropriate to address the unanticipated effects of rural
reclassifications on the rural floor and the resulting wage index
disparities, including the effects of the manipulation of the rural
floor by certain hospitals (84 FR 42333 through 42336). We refer
readers to the FY 2020 IPPS/LTCH PPS final rule (84 FR 42332 through
42336) and the FY 2021 IPPS/LTCH PPS final rule (85 FR 58768) for a
detailed discussion of this policy and for responses to these and other
comments regarding this policy.
Comment: One commenter supported our proposals regarding the wage
index and requested that we carry over policies from the IPPS to the
OPPS to ensure consistency in hospital payments.
Response: We appreciate the commenter's support of our proposals
regarding the wage index. As we discuss below, we are finalizing our
proposal to use the FY 2021 IPPS post-reclassified wage index for urban
and rural areas (including any applicable adjustments for the FY 2021
IPPS post-reclassified wage index), as the wage index for the OPPS to
determine the wage adjustments for both the OPPS payment rate and the
copayment rate for CY 2021.
After consideration of the comments received, for the reasons
discussed in this final rule with comment period and in the CY 2021
OPPS/ASC proposed rule, we are finalizing, without modification, our
proposal to use the FY 2021 IPPS post-reclassified wage index for urban
and rural areas, based on the revised OMB delineations set forth in OMB
Bulletin No. 18-04, as the wage index for the OPPS to determine the
wage adjustments for both the OPPS payment rate and the copayment rate
for CY 2021. Therefore, any applicable adjustments for the FY 2021 IPPS
post-reclassified wage index (including, but not limited to, the low
wage index hospital policy, the one year 5 percent cap on wage index
decreases, the rural floor, and the frontier State floor) will be
reflected in the final CY 2021 OPPS wage index beginning on January 1,
2021. We continue to believe that using the IPPS post-reclassified wage
index as the source of an adjustment factor for the OPPS is reasonable
and logical given the inseparable, subordinate status of the HOPD
within the hospital overall.
Hospitals that are paid under the OPPS, but not under the IPPS, do
not have an assigned hospital wage index under the IPPS. Therefore, for
non-IPPS hospitals paid under the OPPS, it is our longstanding policy
to assign the wage index that would be applicable if the hospital was
paid under the IPPS, based on its geographic location and any
applicable wage index adjustments. In the CY 2021 OPPS/ASC proposed
rule, we proposed to continue this policy for CY 2021, and included a
brief summary of the major FY 2021 IPPS wage index policies and
adjustments that we proposed to apply to these hospitals under the OPPS
for CY 2021, which we have summarized below. We referred readers to the
FY 2021 IPPS/LTCH PPS proposed rule (85 FR 32695 through 32734) for a
detailed discussion of the proposed changes to the FY 2021 IPPS wage
indexes.
It has been our longstanding policy to allow non-IPPS hospitals
paid under the OPPS to qualify for the out-migration adjustment if they
are located in a section 505 out-migration county (section 505 of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003
(MMA)). Applying this adjustment is consistent with our policy of
adopting IPPS wage index policies for hospitals paid under the OPPS. We
note that, because non-IPPS hospitals cannot reclassify, they are
eligible for the out-migration wage index adjustment if they are
located in a section 505 out-migration county. This is the same out-
migration adjustment policy that applies if the hospital were paid
under the IPPS. For CY 2021, we proposed to continue our policy of
allowing non-IPPS hospitals paid under the OPPS to qualify for the
outmigration adjustment if they are located in a section 505 out-
migration county (section 505 of the MMA). Furthermore, we stated in
the proposed rule that the wage index that would apply for CY 2021 to
non-IPPS hospitals paid under the OPPS would continue to include the
rural floor adjustment and adjustments to the wage index finalized in
the FY 2020 IPPS/LTCH PPS final rule to address wage index disparities
(84 FR 42325 through 42337). In addition, we proposed that the wage
index that would apply to non-IPPS hospitals paid under the OPPS would
include any adjustments we may finalize for the FY 2021 IPPS post-
reclassified wage index related to the adoption of the revised OMB
delineations, as discussed in the CY 2021 OPPS/ASC proposed rule. We
did not receive any public comments on these proposals. Accordingly,
for the
[[Page 85911]]
reasons discussed above and in the CY 2021 OPPS/ASC proposed rule, we
are finalizing these proposals, without modification.
For CMHCs, for CY 2021, we proposed to continue to calculate the
wage index by using the post-reclassification IPPS wage index based on
the CBSA where the CMHC is located. We also proposed that the wage
index that would apply to CMHCs would include any adjustments we may
finalize for the FY 2021 IPPS post-reclassified wage index related to
the adoption of the revised OMB delineations, as discussed in the CY
2021 OPPS/ASC proposed rule. In addition, we proposed that the wage
index that would apply to CMHCs for CY 2021 would continue to include
the rural floor adjustment and adjustments to the wage index finalized
in the FY 2020 IPPS/LTCH PPS final rule to address wage index
disparities. Also, we proposed that the wage index that would apply to
CMHCs would not include the outmigration adjustment because that
adjustment only applies to hospitals. We did not receive any public
comments on these proposals. Therefore, for the reasons discussed above
and in the CY 2021 OPPS/ASC proposed rule, we are finalizing these
proposals without modification.
Table 4A associated with the FY 2021 IPPS/LTCH PPS final rule
(available via the internet on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/index)
identifies counties eligible for the out-migration adjustment. Table 2
associated with the FY 2021 IPPS/LTCH PPS final rule (available for
download via the website above) identifies IPPS hospitals that receive
the out-migration adjustment for FY 2021. We are including the
outmigration adjustment information from Table 2 associated with the FY
2021 IPPS/LTCH PPS final rule as Addendum L to this CY 2021 OPPS/ASC
final rule with comment period with the addition of non-IPPS hospitals
that will receive the section 505 outmigration adjustment under this CY
2021 OPPS/ASC final rule with comment period. Addendum L is available
via the internet on the CMS website. We refer readers to the CMS
website for the OPPS at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index. At this link, readers will
find a link to the final FY 2021 IPPS wage index tables and Addendum L.
D. Statewide Average Default Cost-To-Charge Ratios (CCRs)
In addition to using CCRs to estimate costs from charges on claims
for ratesetting, we use overall hospital-specific CCRs calculated from
the hospital's most recent cost report to determine outlier payments,
payments for pass-through devices, and monthly interim transitional
corridor payments under the OPPS during the PPS year. For certain
hospitals, under the regulations at 42 CFR 419.43(d)(5)(iii), we use
the statewide average default CCRs to determine the payments mentioned
earlier if it is not possible to determine an accurate CCR for a
hospital in certain circumstances. This includes hospitals that are
new, hospitals that have not accepted assignment of an existing
hospital's provider agreement, and hospitals that have not yet
submitted a cost report. We also use the statewide average default CCRs
to determine payments for hospitals whose CCR falls outside the
predetermined ceiling threshold for a valid CCR or for hospitals in
which the most recent cost report reflects an all-inclusive rate status
(Medicare Claims Processing Manual (Pub. 100-04), Chapter 4, Section
10.11).
We discussed our policy for using default CCRs, including setting
the ceiling threshold for a valid CCR, in the CY 2009 OPPS/ASC final
rule with comment period (73 FR 68594 through 68599) in the context of
our adoption of an outlier reconciliation policy for cost reports
beginning on or after January 1, 2009. For details on our process for
calculating the statewide average CCRs, we refer readers to the CY 2021
OPPS proposed rule Claims Accounting Narrative that is posted on our
website. We proposed to update the default ratios for CY 2021 using the
most recent cost report data. We stated that we would update these
ratios in this final rule with comment period if more recent cost
report data are available.
We are no longer publishing a table in the Federal Register
containing the statewide average CCRs in the annual OPPS proposed rule
and final rule with comment period. These CCRs with the upper limit
will be available for download with each OPPS CY proposed rule and
final rule on the CMS website. We refer readers to our website at:
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.html;
click on the link on the left of the page titled ``Hospital Outpatient
Regulations and Notices'' and then select the relevant regulation to
download the statewide CCRs and upper limit in the Downloads section of
the web page.
We did not receive any public comments on our proposal to use
statewide average default CCRs if a MAC cannot calculate a CCR for a
hospital and to use these CCRs to adjust charges to costs on claims
data for setting the final CY 2021 OPPS relative payment weights.
Therefore, we are finalizing our proposal without modification.
E. Adjustment for Rural Sole Community Hospitals (SCHs) and Essential
Access Community Hospitals (EACHs) Under Section 1833(t)(13)(B) of the
Act for CY 2021
In the CY 2006 OPPS final rule with comment period (70 FR 68556),
we finalized a payment increase for rural sole community hospitals
(SCHs) of 7.1 percent for all services and procedures paid under the
OPPS, excluding drugs, biologicals, brachytherapy sources, and devices
paid under the pass-through payment policy, in accordance with section
1833(t)(13)(B) of the Act, as added by section 411 of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003 (MMA)
(Pub. L. 108-173). Section 1833(t)(13) of the Act provided the
Secretary the authority to make an adjustment to OPPS payments for
rural hospitals, effective January 1, 2006, if justified by a study of
the difference in costs by APC between hospitals in rural areas and
hospitals in urban areas. Our analysis showed a difference in costs for
rural SCHs. Therefore, for the CY 2006 OPPS, we finalized a payment
adjustment for rural SCHs of 7.1 percent for all services and
procedures paid under the OPPS, excluding separately payable drugs and
biologicals, brachytherapy sources, items paid at charges reduced to
costs, and devices paid under the pass-through payment policy, in
accordance with section 1833(t)(13)(B) of the Act.
In the CY 2007 OPPS/ASC final rule with comment period (71 FR 68010
and 68227), for purposes of receiving this rural adjustment, we revised
our regulations at Sec. 419.43(g) to clarify that essential access
community hospitals (EACHs) are also eligible to receive the rural SCH
adjustment, assuming these entities otherwise meet the rural adjustment
criteria. Currently, two hospitals are classified as EACHs, and as of
CY 1998, under section 4201(c) of Public Law 105-33, a hospital can no
longer become newly classified as an EACH.
This adjustment for rural SCHs is budget neutral and applied before
calculating outlier payments and
[[Page 85912]]
copayments. We stated in the CY 2006 OPPS final rule with comment
period (70 FR 68560) that we would not reestablish the adjustment
amount on an annual basis, but we may review the adjustment in the
future and, if appropriate, would revise the adjustment. We provided
the same 7.1 percent adjustment to rural SCHs, including EACHs, again
in CYs 2008 through 2020. Further, in the CY 2009 OPPS/ASC final rule
with comment period (73 FR 68590), we updated the regulations at Sec.
419.43(g)(4) to specify, in general terms, that items paid at charges
adjusted to costs by application of a hospital-specific CCR are
excluded from the 7.1 percent payment adjustment.
For CY 2021, we proposed to continue the current policy of a 7.1
percent payment adjustment that is done in a budget neutral manner for
rural SCHs, including EACHs, for all services and procedures paid under
the OPPS, excluding separately payable drugs and biologicals,
brachytherapy sources, items paid at charges reduced to costs, and
devices paid under the pass-through payment policy.
Comment: Multiple commenters supported the proposal to continue the
7.1 percent payment adjustment.
Response: We appreciate the commenters' support.
Comment: Multiple commenters requested that CMS make the 7.1
percent rural adjustment permanent. The commenters appreciated the
policy that CMS adopted in CY 2019 and reaffirmed in CY 2020 where we
stated that the 7.1 percent rural adjustment would continue to be in
place until our data support establishing a different rural adjustment
percentage. However, the commenters believed that this policy still
does not provide enough certainty for rural SCHs and EACHs to know
whether they should take into account the rural SCH adjustment when
attempting to calculate expected revenues for their hospital budgets.
Response: We thank the commenters for their input. We believe that
our current policy, which states that the 7.1 percent payment
adjustment for rural SCHs and EACHs will remain in effect until our
data show that a different percentage for the rural payment adjustment
is necessary, provides sufficient budget predictability for rural SCHs
and EACHs. Providers would receive notice in a proposed rule and have
the opportunity to provide comments before any changes to the rural
adjustment percentage would be implemented.
Comment: One commenter requested that CMS expand the payment
adjustment for rural SCHs and EACHs to additional types of hospitals.
The commenter requested that the payment adjustment apply to include
urban SCHs because, according to the commenter, urban SCHs care for
patient populations similar to rural SCHs and EACHs, face similar
financial challenges to rural SCHs and EACHs, and act as safety net
providers for rural areas despite their designation as urban providers.
The same commenter requested that the payment adjustment also apply to
Medicare-dependent hospitals (MDHs) because, according to the
commenter, these hospitals face similar financial challenges to rural
SCHs and EACHs, and MDHs play a similar safety net role to rural SCHs
and EACHs, especially for Medicare. The commenter asked that CMS study
whether it would be appropriate to provide a payment adjustment to MDHs
that is similar to the current adjustment for rural SCHs.
Response: We thank the commenters for their comments. The analysis
we did to compare costs of urban providers to those of rural providers
did not support an add-on adjustment for providers other than rural
SCHs and EACHs. In addition, section 1833(t)(13)(B) of the Act
authorizes an adjustment for rural hospitals only. Accordingly, we do
not believe we have a basis to expand the payment adjustment to any
providers other than rural SCHs and EACHs under our authority at
section 1833(t)(13)(B) of the Act.
After consideration of the public comments we received, we are
finalizing our proposal, without modification, to continue the current
policy of a 7.1 percent payment adjustment that is done in a budget
neutral manner for rural SCHs, including EACHs, for all services and
procedures paid under the OPPS, excluding separately payable drugs and
biologicals, devices paid under the pass-through payment policy, and
items paid at charges reduced to costs.
F. Payment Adjustment for Certain Cancer Hospitals for CY 2021
1. Background
Since the inception of the OPPS, which was authorized by the
Balanced Budget Act of 1997 (BBA) (Pub. L. 105-33), Medicare has paid
the 11 hospitals that meet the criteria for cancer hospitals identified
in section 1886(d)(1)(B)(v) of the Act under the OPPS for covered
outpatient hospital services. These cancer hospitals are exempted from
payment under the IPPS. With the Medicare, Medicaid and SCHIP Balanced
Budget Refinement Act of 1999 (Pub. L. 106-113), the Congress
established section 1833(t)(7) of the Act, ``Transitional Adjustment to
Limit Decline in Payment,'' to determine OPPS payments to cancer and
children's hospitals based on their pre-BBA payment amount (often
referred to as ``held harmless'').
As required under section 1833(t)(7)(D)(ii) of the Act, a cancer
hospital receives the full amount of the difference between payments
for covered outpatient services under the OPPS and a ``pre-BBA
amount.'' That is, cancer hospitals are permanently held harmless to
their ``pre-BBA amount,'' and they receive transitional outpatient
payments (TOPs) or hold harmless payments to ensure that they do not
receive a payment that is lower in amount under the OPPS than the
payment amount they would have received before implementation of the
OPPS, as set forth in section 1833(t)(7)(F) of the Act. The ``pre-BBA
amount'' is the product of the hospital's reasonable costs for covered
outpatient services occurring in the current year and the base payment-
to-cost ratio (PCR) for the hospital defined in section
1833(t)(7)(F)(ii) of the Act. The ``pre-BBA amount'' and the
determination of the base PCR are defined at 42 CFR 419.70(f). TOPs are
calculated on Worksheet E, Part B, of the Hospital Cost Report or the
Hospital Health Care Complex Cost Report (Form CMS-2552-96 or Form CMS-
2552-10, respectively), as applicable each year. Section 1833(t)(7)(I)
of the Act exempts TOPs from budget neutrality calculations.
Section 3138 of the Affordable Care Act amended section 1833(t) of
the Act by adding a new paragraph (18), which instructs the Secretary
to conduct a study to determine if, under the OPPS, outpatient costs
incurred by cancer hospitals described in section 1886(d)(1)(B)(v) of
the Act with respect to APC groups exceed outpatient costs incurred by
other hospitals furnishing services under section 1833(t) of the Act,
as determined appropriate by the Secretary. Section 1833(t)(18)(A) of
the Act requires the Secretary to take into consideration the cost of
drugs and biologicals incurred by cancer hospitals and other hospitals.
Section 1833(t)(18)(B) of the Act provides that, if the Secretary
determines that cancer hospitals' costs are higher than those of other
hospitals, the Secretary shall provide an appropriate adjustment under
section 1833(t)(2)(E) of the Act to reflect these higher costs. In
2011, after conducting the study required by section 1833(t)(18)(A) of
the Act, we determined that outpatient costs incurred by the 11
specified cancer
[[Page 85913]]
hospitals were greater than the costs incurred by other OPPS hospitals.
For a complete discussion regarding the cancer hospital cost study, we
refer readers to the CY 2012 OPPS/ASC final rule with comment period
(76 FR 74200 through 74201).
Based on these findings, we finalized a policy to provide a payment
adjustment to the 11 specified cancer hospitals that reflects their
higher outpatient costs, as discussed in the CY 2012 OPPS/ASC final
rule with comment period (76 FR 74202 through 74206). Specifically, we
adopted a policy to provide additional payments to the cancer hospitals
so that each cancer hospital's final PCR for services provided in a
given calendar year is equal to the weighted average PCR (which we
refer to as the ``target PCR'') for other hospitals paid under the
OPPS. The target PCR is set in advance of the calendar year and is
calculated using the most recently submitted or settled cost report
data that are available at the time of final rulemaking for the
calendar year. The amount of the payment adjustment is made on an
aggregate basis at cost report settlement. We note that the changes
made by section 1833(t)(18) of the Act do not affect the existing
statutory provisions that provide for TOPs for cancer hospitals. The
TOPs are assessed, as usual, after all payments, including the cancer
hospital payment adjustment, have been made for a cost reporting
period. For CYs 2012 and 2013, the target PCR for purposes of the
cancer hospital payment adjustment was 0.91. For CY 2014, the target
PCR was 0.90. For CY 2015, the target PCR was 0.90. For CY 2016, the
target PCR was 0.92, as discussed in the CY 2016 OPPS/ASC final rule
with comment period (80 FR 70362 through 70363). For CY 2017, the
target PCR was 0.91, as discussed in the CY 2017 OPPS/ASC final rule
with comment period (81 FR 79603 through 79604). For CY 2018, the
target PCR was 0.88, as discussed in the CY 2018 OPPS/ASC final rule
with comment period (82 FR 59265 through 59266). For CY 2019, the
target PCR was 0.88, as discussed in the CY 2019 OPPS/ASC final rule
with comment period (83 FR 58871 through 58873). For CY 2020, the
target PCR was 0.89, as discussed in the CY 2020 OPPS/ASC final rule
with comment period (83 FR 61190 through 61192).
2. Policy for CY 2021
Section 16002(b) of the 21st Century Cures Act (Pub. L. 114-255)
amended section 1833(t)(18) of the Act by adding subparagraph (C),
which requires that in applying Sec. 419.43(i) (that is, the payment
adjustment for certain cancer hospitals) for services furnished on or
after January 1, 2018, the target PCR adjustment be reduced by 1.0
percentage point less than what would otherwise apply. Section 16002(b)
also provides that, in addition to the percentage reduction, the
Secretary may consider making an additional percentage point reduction
to the target PCR that takes into account payment rates for applicable
items and services described under section 1833(t)(21)(C) of the Act
for hospitals that are not cancer hospitals described under section
1886(d)(1)(B)(v) of the Act. Further, in making any budget neutrality
adjustment under section 1833(t) of the Act, the Secretary shall not
take into account the reduced expenditures that result from application
of section 1833(t)(18)(C) of the Act.
We proposed to provide additional payments to the 11 specified
cancer hospitals so that each cancer hospital's final PCR is equal to
the weighted average PCR (or ``target PCR'') for the other OPPS
hospitals, using the most recent submitted or settled cost report data
that were available at the time of the development of the proposed
rule, reduced by 1.0 percentage point, to comply with section 16002(b)
of the 21st Century Cures Act.
We did not propose an additional reduction beyond the 1.0
percentage point reduction required by section 16002(b) for CY 2021. To
calculate the proposed CY 2021 target PCR, we used the same extract of
cost report data from HCRIS, as discussed in section II.A. of this CY
2021 OPPS/ASC proposed rule, used to estimate costs for the CY 2021
OPPS. Using these cost report data, we included data from Worksheet E,
Part B, for each hospital, using data from each hospital's most recent
cost report, whether as submitted or settled.
We then limited the dataset to the hospitals with CY 2019 claims
data that we used to model the impact of the proposed CY 2021 APC
relative payment weights (3,527 hospitals) because it is appropriate to
use the same set of hospitals that are being used to calibrate the
modeled CY 2021 OPPS. The cost report data for the hospitals in this
dataset were from cost report periods with fiscal year ends ranging
from 2014 to 2019. We then removed the cost report data of the 49
hospitals located in Puerto Rico from our dataset because we did not
believe their cost structure reflected the costs of most hospitals paid
under the OPPS, and, therefore, their inclusion may bias the
calculation of hospital-weighted statistics. We also removed the cost
report data of 14 hospitals because these hospitals had cost report
data that were not complete (missing aggregate OPPS payments, missing
aggregate cost data, or missing both), so that all cost reports in the
study would have both the payment and cost data necessary to calculate
a PCR for each hospital, leading to a proposed analytic file of 3,464
hospitals with cost report data.
Using this smaller dataset of cost report data, we estimate that,
on average, the OPPS payments to other hospitals furnishing services
under the OPPS were approximately 90 percent of reasonable cost
(weighted average PCR of 0.90). Therefore, after applying the 1.0
percentage point reduction, as required by section 16002(b) of the 21st
Century Cures Act, we proposed that the payment amount associated with
the cancer hospital payment adjustment to be determined at cost report
settlement would be the additional payment needed to result in a
proposed target PCR equal to 0.89 for each cancer hospital.
We did not receive any public comments on our proposals. Therefore,
we are finalizing our proposed cancer hospital payment adjustment
methodology without modification. For this final rule with comment
period, we are using the most recent cost report data through June 30,
2020 to update the adjustment. This update yields a target PCR of 0.90.
We limited the dataset to the hospitals with CY 2019 claims data that
we used to model the impact of the CY 2021 APC relative payment weights
(3,555 hospitals) because it is appropriate to use the same set of
hospitals that we are using to calibrate the modeled CY 2021 OPPS. The
cost report data for the hospitals in the dataset were from cost report
periods with fiscal year ends ranging from 2014 to 2019. We then
removed the cost report data of the 47 hospitals located in Puerto Rico
from our dataset because we do not believe their cost structure
reflects the cost of most hospitals paid under the OPPS and, therefore,
their inclusion may bias the calculation of hospital-weighted
statistics. We also removed the cost report data of 14 hospitals
because these hospitals had cost report data that were not complete
(missing aggregate OPPS payments, missing aggregate cost data, or
missing both), so that all cost report in the study would have both the
payment and cost data necessary to calculate a PCR for each hospital,
leading to an analytic file of 3,494 hospitals with cost report data.
Using this smaller dataset of cost report data, we estimated a
target PCR of 0.90. Therefore, after applying the 1.0 percentage point
reduction as required by section 1602(b) of the 21st Century
[[Page 85914]]
Cures Act, we are finalizing that the payment amount associated with
the cancer hospital adjustment to be determined at cost report
settlement will be the additional payment needed to result in a PCR
equal to 0.89 for each cancer hospital.
Table 5 shows the estimated percentage increase in OPPS payments to
each cancer hospital for CY 2021, due to the cancer hospital payment
adjustment policy. The actual amount of the CY 2021 cancer hospital
payment adjustment for each cancer hospital will be determined at cost
report settlement and will depend on each hospital's CY 2021 payments
and costs. We note that the requirements contained in section
1833(t)(18) of the Act do not affect the existing statutory provisions
that provide for TOPs for cancer hospitals. The TOPs will be assessed,
as usual, after all payments, including the cancer hospital payment
adjustment, have been made for a cost reporting period.
[GRAPHIC] [TIFF OMITTED] TR29DE20.009
G. Hospital Outpatient Outlier Payments
1. Background
The OPPS provides outlier payments to hospitals to help mitigate
the financial risk associated with high-cost and complex procedures,
where a very costly service could present a hospital with significant
financial loss. As explained in the CY 2015 OPPS/ASC final rule with
comment period (79 FR 66832 through 66834), we set our projected target
for aggregate outlier payments at 1.0 percent of the estimated
aggregate total payments under the OPPS for the prospective year.
Outlier payments are provided on a service-by-service basis when the
cost of a service exceeds the APC payment amount multiplier threshold
(the APC payment amount multiplied by a certain amount) as well as the
APC payment amount plus a fixed-dollar amount threshold (the APC
payment plus a certain amount of dollars). In CY 2020, the outlier
threshold was met when the hospital's cost of furnishing a service
exceeded 1.75 times (the multiplier threshold) the APC payment amount
and exceeded the APC payment amount plus $5,075 (the fixed-dollar
amount threshold) (84 FR 61192 through 61194). If the cost of a service
exceeds both the multiplier threshold and the fixed-dollar threshold,
the outlier payment is calculated as 50 percent of the amount by which
the cost of furnishing the service exceeds 1.75 times the APC payment
amount. Beginning with CY 2009 payments, outlier payments are subject
to a reconciliation process similar to the IPPS outlier reconciliation
process for cost reports, as discussed in the CY 2009 OPPS/ASC final
rule with comment period (73 FR 68594 through 68599).
It has been our policy to report the actual amount of outlier
payments as a percent of total spending in the claims being used to
model the OPPS. Our estimate of total outlier payments as a percent of
total CY 2019 OPPS payments, using CY 2019 claims available for the CY
2021 OPPS/ASC proposed rule, was approximately 1.0 percent of the total
aggregated OPPS payments. Therefore, for CY 2019, we estimated that we
paid the outlier target of 1.0 percent of total aggregated OPPS
payments. Using an updated claims dataset for this CY 2021 OPPS/ASC
final rule, we estimate that we paid approximately 0.97 percent of the
total aggregated OPPS payments in outliers for CY 2019.
For the CY 2021 OPPS/ASC proposed rule, using CY 2019 claims data
and CY
[[Page 85915]]
2020 payment rates, we estimated that the aggregate outlier payments
for CY 2020 would be approximately 1.01 percent of the total CY 2020
OPPS payments. We provided estimated CY 2021 outlier payments for
hospitals and CMHCs with claims included in the claims data that we
used to model impacts in the Hospital-Specific Impacts--Provider-
Specific Data file on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html.
2. Outlier Calculation for CY 2021
In the CY 2021 OPPS/ASC proposed rule (85 FR 48807 through 48808),
for CY 2021, we proposed to continue our policy of estimating outlier
payments to be 1.0 percent of the estimated aggregate total payments
under the OPPS. We proposed that a portion of that 1.0 percent, an
amount equal to less than 0.01 percent of outlier payments (or 0.0001
percent of total OPPS payments), would be allocated to CMHCs for PHP
outlier payments. This is the amount of estimated outlier payments that
would result from the proposed CMHC outlier threshold as a proportion
of total estimated OPPS outlier payments. As discussed in section
VIII.C. of the CY 2021 OPPS/ASC proposed rule, we proposed to continue
our longstanding policy that if a CMHC's cost for partial
hospitalization services, paid under APC 5853 (Partial Hospitalization
for CMHCs), exceeds 3.40 times the payment rate for proposed APC 5853,
the outlier payment would be calculated as 50 percent of the amount by
which the cost exceeds 3.40 times the proposed APC 5853 payment rate.
For further discussion of CMHC outlier payments, we refer readers
to section VIII.C. of the CY 2021 OPPS/ASC proposed rule and this final
rule with comment period.
To ensure that the estimated CY 2021 aggregate outlier payments
would equal 1.0 percent of estimated aggregate total payments under the
OPPS, we proposed that the hospital outlier threshold be set so that
outlier payments would be triggered when a hospital's cost of
furnishing a service exceeds 1.75 times the APC payment amount and
exceeds the APC payment amount plus $5,300.
We calculated the proposed fixed-dollar threshold of $5,300 using
the standard methodology most recently used for CY 2020 (84 FR 61192
through 61194). For purposes of estimating outlier payments for the
proposed rule, we used the hospital-specific overall ancillary CCRs
available in the April 2020 update to the Outpatient Provider-Specific
File (OPSF). The OPSF contains provider-specific data, such as the most
current CCRs, which are maintained by the MACs and used by the OPPS
Pricer to pay claims. The claims that we use to model each OPPS update
lag by 2 years.
In order to estimate the CY 2021 hospital outlier payments for the
proposed rule, we inflated the charges on the CY 2019 claims using the
same inflation factor of 1.131096 that we used to estimate the IPPS
fixed-dollar outlier threshold for the FY 2021 IPPS/LTCH PPS proposed
rule (85 FR 32908). We used an inflation factor of 1.06353 to estimate
CY 2020 charges from the CY 2019 charges reported on CY 2019 claims.
The methodology for determining this charge inflation factor is
discussed in the FY 2020 IPPS/LTCH PPS final rule (84 FR 42626 through
42630). As we stated in the CY 2005 OPPS final rule with comment period
(69 FR 65845), we believe that the use of these charge inflation
factors is appropriate for the OPPS because, with the exception of the
inpatient routine service cost centers, hospitals use the same
ancillary and outpatient cost centers to capture costs and charges for
inpatient and outpatient services.
As noted in the CY 2007 OPPS/ASC final rule with comment period (71
FR 68011), we are concerned that we could systematically overestimate
the OPPS hospital outlier threshold if we did not apply a CCR inflation
adjustment factor. Therefore, we proposed to apply the same CCR
inflation adjustment factor that we proposed to apply for the FY 2021
IPPS outlier calculation to the CCRs used to simulate the proposed CY
2021 OPPS outlier payments to determine the fixed-dollar threshold.
Specifically, for CY 2021, we proposed to apply an adjustment factor of
0.975271 to the CCRs that were in the April 2020 OPSF to trend them
forward from CY 2020 to CY 2021. The methodology for calculating the
proposed adjustment is discussed in the FY 2021 IPPS/LTCH PPS proposed
rule (85 FR 32908 through 32909).
To model hospital outlier payments for the proposed rule, we
applied the overall CCRs from the April 2020 OPSF after adjustment
(using the proposed CCR inflation adjustment factor of 0.97571 to
approximate CY 2021 CCRs) to charges on CY 2019 claims that were
adjusted (using the proposed charge inflation factor of 1.131096 to
approximate CY 2021 charges). We simulated aggregated CY 2021 hospital
outlier payments using these costs for several different fixed-dollar
thresholds, holding the 1.75 multiplier threshold constant and assuming
that outlier payments would continue to be made at 50 percent of the
amount by which the cost of furnishing the service would exceed 1.75
times the APC payment amount, until the total outlier payments equaled
1.0 percent of aggregated estimated total CY 2021 OPPS payments. We
estimated that a proposed fixed-dollar threshold of $5,300, combined
with the proposed multiplier threshold of 1.75 times the APC payment
rate, would allocate 1.0 percent of aggregated total OPPS payments to
outlier payments. For CMHCs, we proposed that, if a CMHC's cost for
partial hospitalization services, paid under APC 5853, exceeds 3.40
times the payment rate for APC 5853, the outlier payment would be
calculated as 50 percent of the amount by which the cost exceeds 3.40
times the APC 5853 payment rate.
Section 1833(t)(17)(A) of the Act, which applies to hospitals, as
defined under section 1886(d)(1)(B) of the Act, requires that hospitals
that fail to report data required for the quality measures selected by
the Secretary, in the form and manner required by the Secretary under
section 1833(t)(17)(B) of the Act, incur a 2.0 percentage point
reduction to their OPD fee schedule increase factor; that is, the
annual payment update factor. The application of a reduced OPD fee
schedule increase factor results in reduced national unadjusted payment
rates that will apply to certain outpatient items and services
furnished by hospitals that are required to report outpatient quality
data and that fail to meet the Hospital OQR Program requirements. For
hospitals that fail to meet the Hospital OQR Program requirements, as
we proposed, we are continuing the policy that we implemented in CY
2010 that the hospitals' costs will be compared to the reduced payments
for purposes of outlier eligibility and payment calculation. For more
information on the Hospital OQR Program, we refer readers to section
XIV. of this CY 2021 OPPS/ASC final rule with comment period.
We received no public comments on our proposal. Therefore, we are
finalizing our proposal, without modification, to continue our policy
of estimating outlier payments to be 1.0 percent of the estimated
aggregate total payments under the OPPS and to use our established
methodology to set the OPPS outlier fixed-dollar loss threshold for CY
2021.
3. Final Outlier Calculation
Consistent with historical practice, we used updated data for this
final rule with comment period for outlier calculations. For CY 2021,
we are
[[Page 85916]]
applying the overall CCRs from the October 2020 OPSF file after
adjustment (using the CCR inflation adjustment factor of 0.974495 to
approximate CY 2021 CCRs) to charges on CY 2019 claims that were
adjusted using a charge inflation factor of 1.13218 to approximate CY
2021 charges. These are the same CCR adjustment and charge inflation
factors that were used to set the IPPS fixed-dollar threshold for the
FY 2021 IPPS/LTCH PPS final rule (85 FR 59039 through 59040). We
simulated aggregated CY 2021 hospital outlier payments using these
costs for several different fixed-dollar thresholds, holding the 1.75
multiple-threshold constant and assuming that outlier payments will
continue to be made at 50 percent of the amount by which the cost of
furnishing the service would exceed 1.75 times the APC payment amount,
until the total outlier payment equaled 1.0 percent of aggregated
estimated total CY 2021 OPPS payments. We estimated that a fixed-dollar
threshold of $5,300 combined with the multiple-threshold of 1.75 times
the APC payment rate, will allocate the 1.0 percent of aggregated total
OPPS payments to outlier payments.
For CMHCs, if a CMHC's cost for partial hospitalization services,
paid under APC 5853, exceeds 3.40 times the payment rate the outlier
payment will be calculated as 50 percent of the amount by which the
cost exceeds 3.40 times APC 5853.
H. Calculation of an Adjusted Medicare Payment From the National
Unadjusted Medicare Payment
The basic methodology for determining prospective payment rates for
HOPD services under the OPPS is set forth in existing regulations at 42
CFR part 419, subparts C and D. For this CY 2021 OPPS/ASC final rule
with comment period, the payment rate for most services and procedures
for which payment is made under the OPPS is the product of the
conversion factor calculated in accordance with section II.B. of this
final rule with comment period and the relative payment weight
determined under section II.A. of this final rule with comment period.
Therefore, the national unadjusted payment rate for most APCs contained
in Addendum A to this final rule with comment period (which is
available via the internet on the CMS website) and for most HCPCS codes
to which separate payment under the OPPS has been assigned in Addendum
B to this final rule with comment period (which is available via the
internet on the CMS website) was calculated by multiplying the final CY
2021 scaled weight for the APC by the CY 2021 conversion factor.
We note that section 1833(t)(17) of the Act, which applies to
hospitals, as defined under section 1886(d)(1)(B) of the Act, requires
that hospitals that fail to submit data required to be submitted on
quality measures selected by the Secretary, in the form and manner and
at a time specified by the Secretary, incur a reduction of 2.0
percentage points to their OPD fee schedule increase factor, that is,
the annual payment update factor. The application of a reduced OPD fee
schedule increase factor results in reduced national unadjusted payment
rates that apply to certain outpatient items and services provided by
hospitals that are required to report outpatient quality data and that
fail to meet the Hospital OQR Program (formerly referred to as the
Hospital Outpatient Quality Data Reporting Program (HOP QDRP))
requirements. For further discussion of the payment reduction for
hospitals that fail to meet the requirements of the Hospital OQR
Program, we refer readers to section XIV of this final rule with
comment period.
We demonstrate the steps used to determine the APC payments that
will be made in a CY under the OPPS to a hospital that fulfills the
Hospital OQR Program requirements and to a hospital that fails to meet
the Hospital OQR Program requirements for a service that has any of the
following status indicator assignments: ``J1'', ``J2'', ``P'', ``Q1'',
``Q2'', ``Q3'', ``Q4'', ``R'', ``S'', ``T'', ``U'', or ``V'' (as
defined in Addendum D1 to the final rule, which is available via the
internet on the CMS website), in a circumstance in which the multiple
procedure discount does not apply, the procedure is not bilateral, and
conditionally packaged services (status indicator of ``Q1'' and ``Q2'')
qualify for separate payment. We noted that, although blood and blood
products with status indicator ``R'' and brachytherapy sources with
status indicator ``U'' are not subject to wage adjustment, they are
subject to reduced payments when a hospital fails to meet the Hospital
OQR Program requirements.
Individual providers interested in calculating the payment amount
that they will receive for a specific service from the national
unadjusted payment rates presented in Addenda A and B to this final
rule with comment period (which are available via the internet on the
CMS website) should follow the formulas presented in the following
steps. For purposes of the payment calculations below, we refer to the
national unadjusted payment rate for hospitals that meet the
requirements of the Hospital OQR Program as the ``full'' national
unadjusted payment rate. We refer to the national unadjusted payment
rate for hospitals that fail to meet the requirements of the Hospital
OQR Program as the ``reduced'' national unadjusted payment rate. The
reduced national unadjusted payment rate is calculated by multiplying
the reporting ratio of 0.9805 times the ``full'' national unadjusted
payment rate. The national unadjusted payment rate used in the
calculations below is either the full national unadjusted payment rate
or the reduced national unadjusted payment rate, depending on whether
the hospital met its Hospital OQR Program requirements to receive the
full CY 2021 OPPS fee schedule increase factor.
Step 1. Calculate 60 percent (the labor-related portion) of the
national unadjusted payment rate. Since the initial implementation of
the OPPS, we have used 60 percent to represent our estimate of that
portion of costs attributable, on average, to labor. We refer readers
to the April 7, 2000 OPPS final rule with comment period (65 FR 18496
through 18497) for a detailed discussion of how we derived this
percentage. During our regression analysis for the payment adjustment
for rural hospitals in the CY 2006 OPPS final rule with comment period
(70 FR 68553), we confirmed that this labor-related share for hospital
outpatient services is appropriate.
The formula below is a mathematical representation of Step 1 and
identifies the labor-related portion of a specific payment rate for a
specific service.
X is the labor-related portion of the national unadjusted payment
rate.
X = .60 * (national unadjusted payment rate).
Step 2. Determine the wage index area in which the hospital is
located and identify the wage index level that applies to the specific
hospital. We note that, for the CY 2021 OPPS wage index, we are
adopting the updated OMB delineations based on OMB Bulletin No. 18-04
and any related IPPS wage index adjustments that were finalized in the
FY 2021 IPPS/LTCH PPS final rule, as discussed in section II.C. of this
final rule with comment period. The wage index values assigned to each
area reflect the geographic statistical areas (which are based upon OMB
standards) to which hospitals are assigned for FY 2021 under the IPPS,
reclassifications through the Medicare Geographic Classification Review
Board (MGCRB), section 1886(d)(8)(B) ``Lugar'' hospitals, and
reclassifications under section 1886(d)(8)(E) of the Act, as
implemented in Sec. 412.103 of the regulations. We also are continuing
to apply for the CY 2021
[[Page 85917]]
OPPS wage index any other adjustments for the FY 2021 IPPS post-
reclassified wage index, including, but not limited to, the rural floor
adjustment, a wage index floor of 1.00 in frontier states, in
accordance with section 10324 of the Affordable Care Act of 2010, and
an adjustment to the wage index for certain low wage index hospitals.
For further discussion of the wage index we are applying for the CY
2021 OPPS, we refer readers to section II.C. of this final rule with
comment period.
Step 3. Adjust the wage index of hospitals located in certain
qualifying counties that have a relatively high percentage of hospital
employees who reside in the county, but who work in a different county
with a higher wage index, in accordance with section 505 of Public Law
108-173. Addendum L to this final rule with comment period (which is
available via the internet on the CMS website) contains the qualifying
counties and the associated wage index increase developed for the final
FY 2021 IPPS wage index, which are listed in Table 2 associated with
the FY 2021 IPPS/LTCH PPS final rule and available via the internet on
the CMS website at: http://www.cms.gov/Medicare/Medicare-Fee-for-
Service-Payment/AcuteInpatientPPS/index.html. (Click on the link on the
left side of the screen titled ``FY 2021 IPPS Final Rule Home Page''
and select ``FY 2021 Final Rule Tables.'') This step is to be followed
only if the hospital is not reclassified or redesignated under section
1886(d)(8) or section 1886(d)(10) of the Act.
Step 4. Multiply the applicable wage index determined under Steps 2
and 3 by the amount determined under Step 1 that represents the labor-
related portion of the national unadjusted payment rate.
The formula below is a mathematical representation of Step 4 and
adjusts the labor-related portion of the national unadjusted payment
rate for the specific service by the wage index.
Xa is the labor-related portion of the national unadjusted payment
rate (wage adjusted).
Xa = .60 * (national unadjusted payment rate) *
applicable wage index.
Step 5. Calculate 40 percent (the nonlabor-related portion) of the
national unadjusted payment rate and add that amount to the resulting
product of Step 4. The result is the wage index adjusted payment rate
for the relevant wage index area.
The formula below is a mathematical representation of Step 5 and
calculates the remaining portion of the national payment rate, the
amount not attributable to labor, and the adjusted payment for the
specific service.
Y is the nonlabor-related portion of the national unadjusted
payment rate.
Y = .40 * (national unadjusted payment rate).
Adjusted Medicare Payment = Y + Xa.
Step 6. If a provider is an SCH, as set forth in the regulations at
Sec. 412.92, or an EACH, which is considered to be an SCH under
section 1886(d)(5)(D)(iii)(III) of the Act, and located in a rural
area, as defined in Sec. 412.64(b), or is treated as being located in
a rural area under Sec. 412.103, multiply the wage index adjusted
payment rate by 1.071 to calculate the total payment.
The formula below is a mathematical representation of Step 6 and
applies the rural adjustment for rural SCHs.
Adjusted Medicare Payment (SCH or EACH) = Adjusted Medicare Payment
* 1.071.
We are providing examples below of the calculation of both the full
and reduced national unadjusted payment rates that will apply to
certain outpatient items and services performed by hospitals that meet
and that fail to meet the Hospital OQR Program requirements, using the
steps outlined previously. For purposes of this example, we are using a
provider that is located in Brooklyn, New York that is assigned to CBSA
35614. This provider bills one service that is assigned to APC 5071
(Level 1 Excision/Biopsy/Incision and Drainage). The final CY 2021 full
national unadjusted payment rate for APC 5071 is $621.97. The reduced
national unadjusted payment rate for APC 5071 for a hospital that fails
to meet the Hospital OQR Program requirements is $609.84. This reduced
rate is calculated by multiplying the reporting ratio of 0.9805 by the
full unadjusted payment rate for APC 5071.
The final FY 2021 wage index for a provider located in CBSA 35614
in New York, which includes the adoption of IPPS 2021 wage index
policies, is 1.3468. The labor-related portion of the final full
national unadjusted payment is approximately $502.60 (.60 * $621.97 *
1.3468). The labor-related portion of the reduced national unadjusted
payment is approximately $492.80 (.60 * $609.84 * 1.3468). The
nonlabor-related portion of the full national unadjusted payment is
approximately $248.79 (.40 * $621.97). The nonlabor-related portion of
the reduced national unadjusted payment is approximately $243.94 (.40 *
$609.84). The sum of the labor-related and nonlabor-related portions of
the full national adjusted payment is approximately $751.39 ($502.60 +
$248.79). The sum of the portions of the reduced national adjusted
payment is approximately $736.74 ($492.80 + $243.94).
We did not receive any public comments on these steps under the
methodology that we included in the proposed rule to determine the APC
payments for CY 2021. Therefore, we are using the steps in the
methodology specified above, to demonstrate the calculation of the
final CY 2021 OPPS payments using the same parameters.
I. Beneficiary Copayments
1. Background
Section 1833(t)(3)(B) of the Act requires the Secretary to set
rules for determining the unadjusted copayment amounts to be paid by
beneficiaries for covered OPD services. Section 1833(t)(8)(C)(ii) of
the Act specifies that the Secretary must reduce the national
unadjusted copayment amount for a covered OPD service (or group of such
services) furnished in a year in a manner so that the effective
copayment rate (determined on a national unadjusted basis) for that
service in the year does not exceed a specified percentage. As
specified in section 1833(t)(8)(C)(ii)(V) of the Act, the effective
copayment rate for a covered OPD service paid under the OPPS in CY
2006, and in CYs thereafter, shall not exceed 40 percent of the APC
payment rate.
Section 1833(t)(3)(B)(ii) of the Act provides that, for a covered
OPD service (or group of such services) furnished in a year, the
national unadjusted copayment amount cannot be less than 20 percent of
the OPD fee schedule amount. However, section 1833(t)(8)(C)(i) of the
Act limits the amount of beneficiary copayment that may be collected
for a procedure (including items such as drugs and biologicals)
performed in a year to the amount of the inpatient hospital deductible
for that year.
Section 4104 of the Affordable Care Act eliminated the Medicare
Part B coinsurance for preventive services furnished on and after
January 1, 2011, that meet certain requirements, including flexible
sigmoidoscopies and screening colonoscopies, and waived the Part B
deductible for screening colonoscopies that become diagnostic during
the procedure. Our discussion of the changes made by the Affordable
Care Act with regard to copayments for preventive services furnished on
and after January 1, 2011, may be found in section XII.B. of the CY
2011 OPPS/ASC final rule with comment period (75 FR 72013).
2. OPPS Copayment Policy
For CY 2021, we proposed to determine copayment amounts for new
[[Page 85918]]
and revised APCs using the same methodology that we implemented
beginning in CY 2004. (We refer readers to the November 7, 2003 OPPS
final rule with comment period (68 FR 63458).) In addition, we proposed
to use the same standard rounding principles that we have historically
used in instances where the application of our standard copayment
methodology would result in a copayment amount that is less than 20
percent and cannot be rounded, under standard rounding principles, to
20 percent. (We refer readers to the CY 2008 OPPS/ASC final rule with
comment period (72 FR 66687) in which we discuss our rationale for
applying these rounding principles.) The proposed national unadjusted
copayment amounts for services payable under the OPPS that would be
effective January 1, 2021 are included in Addenda A and B to the
proposed rule with comment period (which are available via the internet
on the CMS website).
We did not receive any public comments on the proposed copayment
amounts for new and revised APCs using the same methodology we
implemented beginning in CY 2004 or the standard rounding principles we
apply to our copayment amounts. Therefore, we are finalizing our
proposed copayment policies, without modification.
As discussed in section XIV.E. of the CY 2021 OPPS/ASC proposed
rule and this final rule with comment period, for CY 2021, the Medicare
beneficiary's minimum unadjusted copayment and national unadjusted
copayment for a service to which a reduced national unadjusted payment
rate applies will equal the product of the reporting ratio and the
national unadjusted copayment, or the product of the reporting ratio
and the minimum unadjusted copayment, respectively, for the service.
We note that OPPS copayments may increase or decrease each year
based on changes in the calculated APC payment rates, due to updated
cost report and claims data, and any changes to the OPPS cost modeling
process. However, as described in the CY 2004 OPPS final rule with
comment period, the development of the copayment methodology generally
moves beneficiary copayments closer to 20 percent of OPPS APC payments
(68 FR 63458 through 63459).
In the CY 2004 OPPS final rule with comment period (68 FR 63459),
we adopted a new methodology to calculate unadjusted copayment amounts
in situations including reorganizing APCs, and we finalized the
following rules to determine copayment amounts in CY 2004 and
subsequent years.
When an APC group consists solely of HCPCS codes that were
not paid under the OPPS the prior year because they were packaged or
excluded or are new codes, the unadjusted copayment amount would be 20
percent of the APC payment rate.
If a new APC that did not exist during the prior year is
created and consists of HCPCS codes previously assigned to other APCs,
the copayment amount is calculated as the product of the APC payment
rate and the lowest coinsurance percentage of the codes comprising the
new APC.
If no codes are added to or removed from an APC and, after
recalibration of its relative payment weight, the new payment rate is
equal to or greater than the prior year's rate, the copayment amount
remains constant (unless the resulting coinsurance percentage is less
than 20 percent).
If no codes are added to or removed from an APC and, after
recalibration of its relative payment weight, the new payment rate is
less than the prior year's rate, the copayment amount is calculated as
the product of the new payment rate and the prior year's coinsurance
percentage.
If HCPCS codes are added to or deleted from an APC and,
after recalibrating its relative payment weight, holding its unadjusted
copayment amount constant results in a decrease in the coinsurance
percentage for the reconfigured APC, the copayment amount would not
change (unless retaining the copayment amount would result in a
coinsurance rate less than 20 percent).
If HCPCS codes are added to an APC and, after
recalibrating its relative payment weight, holding its unadjusted
copayment amount constant results in an increase in the coinsurance
percentage for the reconfigured APC, the copayment amount would be
calculated as the product of the payment rate of the reconfigured APC
and the lowest coinsurance percentage of the codes being added to the
reconfigured APC.
We noted in the CY 2004 OPPS final rule with comment period that we
would seek to lower the copayment percentage for a service in an APC
from the prior year if the copayment percentage was greater than 20
percent. We noted that this principle was consistent with section
1833(t)(8)(C)(ii) of the Act, which accelerates the reduction in the
national unadjusted coinsurance rate so that beneficiary liability will
eventually equal 20 percent of the OPPS payment rate for all OPPS
services to which a copayment applies, and with section 1833(t)(3)(B)
of the Act, which achieves a 20-percent copayment percentage when fully
phased in and gives the Secretary the authority to set rules for
determining copayment amounts for new services. We further noted that
the use of this methodology would, in general, reduce the beneficiary
coinsurance rate and copayment amount for APCs for which the payment
rate changes as the result of the reconfiguration of APCs and/or
recalibration of relative payment weights (68 FR 63459).
3. Calculation of an Adjusted Copayment Amount for an APC Group
Individuals interested in calculating the national copayment
liability for a Medicare beneficiary for a given service provided by a
hospital that met or failed to meet its Hospital OQR Program
requirements should follow the formulas presented in the following
steps.
Step 1. Calculate the beneficiary payment percentage for the APC by
dividing the APC's national unadjusted copayment by its payment rate.
For example, using APC 5071, $124.40 is approximately 20 percent of the
full national unadjusted payment rate of $621.97. For APCs with only a
minimum unadjusted copayment in Addenda A and B to this final rule
(which are available via the internet on the CMS website), the
beneficiary payment percentage is 20 percent.
The formula below is a mathematical representation of Step 1 and
calculates the national copayment as a percentage of national payment
for a given service.
B is the beneficiary payment percentage.
B = National unadjusted copayment for APC/national unadjusted
payment rate for APC.
Step 2. Calculate the appropriate wage-adjusted payment rate for
the APC for the provider in question, as indicated in Steps 2 through 4
under section II.H. of this final rule with comment period. Calculate
the rural adjustment for eligible providers, as indicated in Step 6
under section II.H. of this final rule with comment period.
Step 3. Multiply the percentage calculated in Step 1 by the payment
rate calculated in Step 2. The result is the wage-adjusted copayment
amount for the APC.
The formula below is a mathematical representation of Step 3 and
applies the beneficiary payment percentage to the adjusted payment rate
for a service calculated under section II.H. of this final rule with
comment period, with and without the rural adjustment, to
[[Page 85919]]
calculate the adjusted beneficiary copayment for a given service.
Wage-adjusted copayment amount for the APC = Adjusted Medicare
Payment * B.
Wage-adjusted copayment amount for the APC (SCH or EACH) =
(Adjusted Medicare Payment * 1.071) * B.
Step 4. For a hospital that failed to meet its Hospital OQR Program
requirements, multiply the copayment calculated in Step 3 by the
reporting ratio of 0.9805.
The finalized unadjusted copayments for services payable under the
OPPS that will be effective January 1, 2021, are shown in Addenda A and
B to this final rule with comment period (which are available via the
internet on the CMS website). We note that the finalized national
unadjusted payment rates and copayment rates shown in Addenda A and B
to this final rule with comment period reflect the CY 2021 OPD fee
schedule increase factor discussed in section II.B. of this final rule
with comment period.
In addition, as noted earlier, section 1833(t)(8)(C)(i) of the Act
limits the amount of beneficiary copayment that may be collected for a
procedure performed in a year to the amount of the inpatient hospital
deductible for that year.
III. OPPS Ambulatory Payment Classification (APC) Group Policies
A. OPPS Treatment of New and Revised HCPCS Codes
Payments for OPPS procedures, services, and items are generally
based on medical billing codes, specifically, Healthcare Common
Procedure Coding System (HCPCS) codes, that are reported on hospital
outpatient department (HOPD) claims. The HCPCS is divided into two
principal subsystems, referred to as Level I and Level II of the HCPCS.
Level I is comprised of Current Procedural Terminology (CPT), a numeric
and alphanumeric coding system maintained by the American Medical
Association (AMA), and consists of Category I, II, and III CPT codes.
Level II, which is maintained by Centers for Medicare & Medicaid
Services (CMS), is a standardized coding system that is used primarily
to identify products, supplies, and services not included in the CPT
codes. HCPCS codes are used to report surgical procedures, medical
services, items, and supplies under the hospital OPPS. Specifically,
CMS recognizes the following codes on OPPS claims:
Category I CPT codes, which describe surgical procedures,
diagnostic and therapeutic services, and vaccine codes;
Category III CPT codes, which describe new and emerging
technologies, services, and procedures; and
Level II HCPCS codes (also known as alphanumeric codes),
which are used primarily to identify drugs, devices, ambulance
services, durable medical equipment, orthotics, prosthetics, supplies,
temporary surgical procedures, and medical services not described by
CPT codes.
CPT codes are established by the AMA while the Level II HCPCS codes
are established by the CMS HCPCS Workgroup. These codes are updated and
changed throughout the year. CPT and Level II HCPCS code changes that
affect the OPPS are published through the annual rulemaking cycle and
through the OPPS quarterly update Change Requests (CRs). Generally,
these code changes are effective January 1, April 1, July 1, or October
1. CPT code changes are released by the AMA via their website while
Level II HCPCS code changes are released to the public via the CMS
HCPCS website. CMS recognizes the release of new CPT and Level II HCPCS
codes and makes the codes effective (that is, the codes can be reported
on Medicare claims) outside of the formal rulemaking process via OPPS
quarterly update CRs. Based on our review, we assign the new codes to
interim status indicators (SIs) and APCs. These interim assignments are
finalized in the OPPS/ASC final rules with comment period. This
quarterly process offers hospitals access to codes that more accurately
describe items or services furnished and provides payment for these
items or services in a timelier manner than if we waited for the annual
rulemaking process. We solicit public comments on the new CPT and Level
II HCPCS codes and finalize policies for these codes through our annual
rulemaking process.
We note that, under the OPPS, the APC assignment determines the
payment rate for an item, procedure, or service. Those items,
procedures, or services not paid separately under the hospital OPPS are
assigned to appropriate SIs. Certain payment SIs provide separate
payment while other payment SIs do not. In section XI. (CY 2021 OPPS
Payment Status and Comment Indicators) of this final rule with comment
period, we discuss the various SIs used under the OPPS. We also provide
a complete list of the SIs and their definitions in Addendum D1 to this
CY 2021 OPPS/ASC final rule with comment period.
1. HCPCS Codes That Were Effective April 1, 2020 for Which We Solicited
Public Comments in the CY 2021 OPPS/ASC Proposed Rule
For the April 2020 update, there were no new CPT codes. However,
thirteen new Level II HCPCS codes were established and made effective
on April 1, 2020. These codes and their long descriptors were included
in Table 6 of the proposed rule and are now listed in Table 6 of this
final rule with comment period. Through the April 2020 OPPS quarterly
update CR (Transmittal 10013, Change Request 11691, dated March 25,
2020), we recognized several new Level II HCPCS codes for separate
payment under the OPPS. In the CY 2021 OPPS/ASC proposed rule (85 FR
48812 through 48813), we solicited public comments on the proposed APC
and status indicator (SI) assignments for these Level II HCPCS codes,
which were listed in Table 6 of the proposed rule.
We did not receive any public comments on the proposed OPPS APC and
SI assignments for the new Level II HCPCS codes implemented in April
2020. Therefore, we are finalizing the proposed APC and SI assignments
for these codes, as indicated in Table 6. We note that several of the
HCPCS C-codes have been replaced with HCPCS J-codes, effective January
1, 2021. Their replacement codes are listed in Table 6. The final
payment rates for these codes can be found in Addendum B to this final
rule with comment period. In addition, the SI definitions can be found
in Addendum D1 to this final rule with comment period. Both Addendum B
and Addendum D1 are available via the internet on the CMS website.
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3. October 2020 HCPCS Codes for Which We Are Soliciting Public Comments
in This CY 2021 OPPS/ASC Final Rule With Comment Period
As has been our practice in the past, we incorporate those new
HCPCS codes that are effective October 1 in the final rule with comment
period, thereby updating the OPPS for the following calendar year, as
displayed in Table 8 of the proposed rule and reprinted as Table 8 of
this final rule with comment period. These codes are released to the
public through the October OPPS
[[Page 85930]]
quarterly update CRs and via the CMS HCPCS website (for Level II HCPCS
codes). For CY 2021, these codes are flagged with comment indicator
``NI'' in Addendum B to this OPPS/ASC final rule with comment period to
indicate that we are assigning them an interim payment status which is
subject to public comment. Specifically, the interim SI and APC
assignments for codes flagged with comment indicator ``NI'' are open to
public comment in this final rule with comment period, and we will
respond to these public comments in the OPPS/ASC final rule with
comment period for the next year's OPPS/ASC update.
In the CY 2021 OPPS/ASC proposed rule (85 FR 48823), we proposed to
continue this process for CY 2021. Specifically, for CY 2021, we
proposed to include in Addendum B to the CY 2021 OPPS/ASC final rule
with comment period the new HCPCS codes effective October 1, 2020 that
would be incorporated in the October 2020 OPPS quarterly update CR.
Also, as stated above, the October 1, 2020 codes are flagged with
comment indicator ``NI'' in Addendum B to this CY 2021 OPPS/ASC final
rule with comment period to indicate that we have assigned the codes an
interim OPPS payment status for CY 2021. We are inviting public
comments on the interim SI and APC assignments for these codes, if
applicable, that will be finalized in the CY 2021 OPPS/ASC final rule
with comment period.
We note that we received a comment related to HCPCS codes C9757
(Laminotomy (hemilaminectomy), with decompression of nerve root(s),
including partial facetectomy, foraminotomy and excision of herniated
intervertebral disc, and repair of annular defect with implantation of
bone anchored annular closure device, including annular defect
measurement, alignment and sizing assessment, and image guidance; 1
interspace, lumbar) and P9099 (Blood component or product not otherwise
classified), which were assigned to comment indicator ``NI'' (new code;
comments will be accepted on the interim APC assignment) in Addendum B
of the CY 2020 OPPS/ASC final rule with comment period. The comments
and our responses can be found in section II.A.2(a)(1) (Blood Products)
and III.D. (APC-Specific Policies) of this CY 2021 OPPS/ASC final rule
with comment period.
4. January 2021 HCPCS Codes
a. New Level II HCPCS Codes for Which We Are Soliciting Public Comments
in this CY 2021 OPPS/ASC Final Rule With Comment Period
As shown in Table 8, and as stated in the CY 2021 OPPS/ASC proposed
rule (85 FR 48823 through 48825), consistent with past practice, we
solicit comments on the new Level II HCPCS codes that will be effective
January 1 in the OPPS/ASC final rule with comment period, thereby
allowing us to finalize the SIs and APC assignments for the codes in
the next OPPS/ASC final rule with comment period. Unlike the CPT codes
that are effective January 1 and are included in the OPPS/ASC proposed
rules, most Level II HCPCS codes are not released until sometime around
November to be effective January 1. Because these codes are not
available until November, we are unable to include them in the OPPS/ASC
proposed rules. Consequently, for CY 2021, we proposed to include in
Addendum B to the CY 2021 OPPS/ASC final rule with comment period the
new Level II HCPCS codes effective January 1, 2021, that would be
incorporated in the January 2021 OPPS quarterly update CR. These codes
will be released to the public through the January OPPS quarterly
update CRs and via the CMS HCPCS website (for Level II HCPCS codes).
For CY 2021, the Level II HCPCS codes effective January 1, 2021 are
flagged with comment indicator ``NI'' in Addendum B to this CY 2021
OPPS/ASC final rule with comment period to indicate that we have
assigned the codes an interim OPPS payment status for CY 2021. We are
inviting public comments on the interim SI and APC assignments for
these codes, if applicable, that will be finalized in the CY 2021 OPPS/
ASC final rule with comment period.
b. CPT Codes For Which We Solicited Public Comments in the CY 2021
OPPS/ASC Proposed Rule
For CY 2021, we received the CY 2021 CPT code updates that would be
effective January 1, 2021, from AMA in time for inclusion in the CY
2021 OPPS/ASC proposed rule. We note that in the CY 2015 OPPS/ASC final
rule with comment period (79 FR 66841 through 66844), we finalized a
revised process of assigning APC and SIs for new and revised Category I
and III CPT codes that would be effective January 1. Specifically, for
the new/revised CPT codes that we receive in a timely manner from the
AMA's CPT Editorial Panel, we finalized our proposal to include the
codes that would be effective January 1 in the OPPS/ASC proposed rules,
along with proposed APC and SI assignments for them, and to finalize
the APC and SI assignments in the OPPS/ASC final rules beginning with
the CY 2016 OPPS update. For those new/revised CPT codes that were
received too late for inclusion in the OPPS/ASC proposed rule, we
finalized our proposal to establish and use HCPCS G-codes that mirror
the predecessor CPT codes and retain the current APC and SI assignments
for a year until we can propose APC and SI assignments in the following
year's rulemaking cycle. We note that even if we find that we need to
create HCPCS G-codes in place of certain CPT codes for the PFS proposed
rule, we do not anticipate that these HCPCS G-codes will always be
necessary for OPPS purposes. We will make every effort to include
proposed APC and SI assignments for all new and revised CPT codes that
the AMA makes publicly available in time for us to include them in the
annual proposed rule, and to avoid the resort to HCPCS G-codes and the
resulting delay in utilization of the most current CPT codes. Also, we
finalized our proposal to make interim APC and SI assignments for CPT
codes that are not available in time for the proposed rule and that
describe wholly new services (such as new technologies or new surgical
procedures), solicit public comments, and finalize the specific APC and
SI assignments for those codes in the following year's final rule.
As stated above, for the CY 2021 OPPS update, we received the CY
2021 CPT codes from AMA in time for inclusion in the CY 2021 OPPS/ASC
proposed rule. The new, revised, and deleted CY 2021 Category I and III
CPT codes were included in Addendum B to the proposed rule (which is
available via the internet on the CMS website). We noted in the
proposed rule that the new and revised codes are assigned to new
comment indicator ``NP'' to indicate that the code is new for the next
calendar year or the code is an existing code with substantial revision
to its code descriptor in the next calendar year as compared to current
calendar year with a proposed APC assignment, and that comments will be
accepted on the proposed APC and SI assignments.
Further, we reminded readers that the CPT code descriptors that
appear in Addendum B are short descriptors and do not accurately
describe the complete procedure, service, or item described by the CPT
code. Therefore, we included the 5-digit placeholder codes and their
long descriptors for the new and revised CY 2021 CPT codes in Addendum
O to
[[Page 85931]]
the proposed rule (which is available via the internet on the CMS
website) so that the public could adequately comment on the proposed
APCs and SI assignments. The 5-digit placeholder codes were included in
Addendum O, specifically under the column labeled ``CY 2021 OPPS/ASC
Proposed Rule 5-Digit AMA Placeholder Code,'' to the proposed rule. We
noted that the final CPT code numbers would be included in this CY 2021
OPPS/ASC final rule with comment period. We also noted that not every
code listed in Addendum O is subject to public comment. For the new and
revised Category I and III CPT codes, we requested public comments on
only those codes that are assigned comment indicator ``NP''.
In summary, in the CY 2021 OPPS/ASC proposed rule, we solicited
public comments on the proposed CY 2021 SI and APC assignments for the
new and revised Category I and III CPT codes that will be effective
January 1, 2021. The CPT codes were listed in Addendum B to the
proposed rule with short descriptors only. We listed them again in
Addendum O to the proposed rule with long descriptors. We also proposed
to finalize the SI and APC assignments for these codes (with their
final CPT code numbers) in the CY 2021 OPPS/ASC final rule with comment
period. The proposed SI and APC assignments for these codes were
included in Addendum B to the proposed rule (which is available via the
internet on the CMS website).
Commenters addressed several of the new CPT codes that were
assigned to comment indicator ``NP'' in Addendum B to the CY 2021 OPPS/
ASC proposed rule. We have responded to those public comments in
sections III.C. (New Technology APCs), III.D. (OPPS APC-Specific
Policies), and IV. (OPPS Payment for Devices) of this CY 2021 OPPS/ASC
final rule with comment period.
The final SIs, APC assignments, and payment rates for the new CPT
codes that are effective January 1, 2021 can be found in Addendum B to
this final rule with comment period. In addition, the SI meanings can
be found in Addendum D1 (OPPS Payment Status Indicators for CY 2021) to
this final rule with comment period. Both Addendum B and D1 are
available via the internet on the CMS website.
Finally, Table 8, which is a reprint of Table 8 from the CY 2021
OPPS/ASC proposed rule, shows the comment timeframe for new and revised
HCPCS codes. The table provides information on our current process for
updating codes through our OPPS quarterly update CRs, seeking public
comments, and finalizing the treatment of these codes under the OPPS.
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B. OPPS Changes--Variations Within APCs
1. Background
Section 1833(t)(2)(A) of the Act requires the Secretary to develop
a classification system for covered hospital outpatient department
services. Section 1833(t)(2)(B) of the Act provides that the Secretary
may establish groups of covered OPD services within this classification
system, so that services classified within each group are comparable
clinically and with respect to the use of resources. In accordance with
these provisions, we developed a grouping classification system,
referred to as Ambulatory Payment Classifications (APCs), as set forth
in regulations at 42 CFR[thinsp]419.31. We use Level I (also known as
CPT codes) and Level II HCPCS codes (also known as alphanumeric codes)
to identify and
[[Page 85932]]
group the services within each APC. The APCs are organized such that
each group is homogeneous both clinically and in terms of resource use.
Using this classification system, we have established distinct groups
of similar services. We also have developed separate APC groups for
certain medical devices, drugs, biologicals, therapeutic
radiopharmaceuticals, and brachytherapy devices that are not packaged
into the payment for the procedure.
We have packaged into the payment for each procedure or service
within an APC group the costs associated with those items and services
that are typically ancillary and supportive to a primary diagnostic or
therapeutic modality and, in those cases, are an integral part of the
primary service they support. Therefore, we do not make separate
payment for these packaged items or services. In general, packaged
items and services include, but are not limited to, the items and
services listed in regulations at 42 CFR 419.2(b). A further discussion
of packaged services is included in section II.A.3. of this final rule
with comment period.
Under the OPPS, we generally pay for covered hospital outpatient
services on a rate-per-service basis, where the service may be reported
with one or more HCPCS codes. Payment varies according to the APC group
to which the independent service or combination of services is
assigned. In the CY 2021 OPPS/ASC proposed rule (85 FR 48799), for CY
2021, we proposed that each APC relative payment weight represents the
hospital cost of the services included in that APC, relative to the
hospital cost of the services included in APC 5012 (Clinic Visits and
Related Services). The APC relative payment weights are scaled to APC
5012 because it is the hospital clinic visit APC and clinic visits are
among the most frequently furnished services in the hospital outpatient
setting.
2. Application of the 2 Times Rule
Section 1833(t)(9)(A) of the Act requires the Secretary to review,
not less often than annually, and revise the APC groups, the relative
payment weights, and the wage and other adjustments described in
paragraph (2) to take into account changes in medical practice, changes
in technology, the addition of new services, new cost data, and other
relevant information and factors. Section 1833(t)(9)(A) of the Act also
requires the Secretary to consult with an expert outside advisory panel
composed of an appropriate selection of representatives of providers to
review (and advise the Secretary concerning) the clinical integrity of
the APC groups and the relative payment weights. We note that the
Hospital Outpatient Payment (HOP) Panel recommendations for specific
services for the CY 2021 OPPS update are discussed in the relevant
specific sections throughout this CY 2021 OPPS/ASC final rule with
comment period.
In addition, section 1833(t)(2) of the Act provides that, subject
to certain exceptions, the items and services within an APC group
cannot be considered comparable with respect to the use of resources if
the highest cost for an item or service in the group is more than 2
times greater than the lowest cost for an item or service within the
same group (referred to as the ``2 times rule''). The statute
authorizes the Secretary to make exceptions to the 2 times rule in
unusual cases, such as low-volume items and services (but the Secretary
may not make such an exception in the case of a drug or biological that
has been designated as an orphan drug under section 526 of the Federal
Food, Drug, and Cosmetic Act). In determining the APCs with a 2 times
rule violation, we consider only those HCPCS codes that are significant
based on the number of claims. We note that, for purposes of
identifying significant procedure codes for examination under the 2
times rule, we consider procedure codes that have more than 1,000
single major claims or procedure codes that both have more than 99
single major claims and contribute at least 2 percent of the single
major claims used to establish the APC cost to be significant (75 FR
71832). This longstanding definition of when a procedure code is
significant for purposes of the 2 times rule was selected because we
believe that a subset of 1,000 or fewer claims is negligible within the
set of approximately 100 million single procedure or single session
claims we use for establishing costs. Similarly, a procedure code for
which there are fewer than 99 single claims and that comprises less
than 2 percent of the single major claims within an APC will have a
negligible impact on the APC cost (75 FR 71832). In the CY 2021 OPPS/
ASC proposed rule (85 FR 48826 through 48827), for CY 2021, we proposed
to make exceptions to this limit on the variation of costs within each
APC group in unusual cases, such as for certain low-volume items and
services.
In the CY 2021 OPPS/ASC proposed rule, we identified the APCs with
violations of the 2 times rule. Therefore, we proposed changes to the
procedure codes assigned to these APCs in Addendum B to the proposed
rule. We noted that Addendum B does not appear in the printed version
of the Federal Register as part of the CY 2021 OPPS/ASC proposed rule.
Rather, it is published and made available via the internet on the CMS
website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/index.html. To eliminate a violation of
the 2 times rule and improve clinical and resource homogeneity, we
proposed to reassign these procedure codes to new APCs that contain
services that are similar with regard to both their clinical and
resource characteristics. In many cases, the proposed procedure code
reassignments and associated APC reconfigurations for CY 2021 included
in the proposed rule were related to changes in costs of services that
were observed in the CY 2019 claims data newly available for CY 2021
ratesetting. Addendum B to the CY 2021 OPPS/ASC proposed rule
identified with a comment indicator ``CH'' those procedure codes for
which we proposed a change to the APC assignment or SI, or both, that
were initially assigned in the July 1, 2020 OPPS Addendum B Update
(available via the internet on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Addendum-A-and-Addendum-B-Updates.html), which was the latest payment
rate file for 2019 prior to issuance of the proposed rule.
3. APC Exceptions to the 2 Times Rule
Taking into account the APC changes that we proposed to make for CY
2021 in the CY 2021 OPPS/ASC proposed rule, we reviewed all of the APCs
to determine which APCs would not meet the requirements of the 2 times
rule. We used the following criteria to evaluate whether to propose
exceptions to the 2 times rule for affected APCs:
Resource homogeneity;
Clinical homogeneity;
Hospital outpatient setting utilization;
Frequency of service (volume); and
Opportunity for upcoding and code fragments.
Based on the CY 2019 claims data available for the CY 2021 proposed
rule, we found 18 APCs with violations of the 2 times rule. We applied
the criteria as described above to identify the APCs for which we
proposed to make exceptions under the 2 times rule for CY 2021, and
found that all of the 18 APCs we identified met the criteria for an
exception to the 2 times rule based on the CY 2019 claims data
available for the proposed rule. We did not include in that
determination those APCs where
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a 2 times rule violation was not a relevant concept, such as APC 5401
(Dialysis), which only has two HCPCS codes assigned to it that have a
similar geometric mean costs and do not create a 2 time rule violation.
Therefore, we only identified those APCs, including those with
criteria-based costs, with violations of the 2 times rule.
We note that, for cases in which a recommendation by the HOP Panel
appears to result in or allow a violation of the 2 times rule, we may
accept the HOP Panel's recommendation because those recommendations are
based on explicit consideration (that is, a review of the latest OPPS
claims data and group discussion of the issue) of resource use,
clinical homogeneity, site of service, and the quality of the claims
data used to determine the APC payment rates.
Table 9 of the proposed rule listed the 18 APCs for which we
proposed to make an exception for under the 2 times rule for CY 2021
based on the criteria cited above and claims data submitted between
January 1, 2019, and December 31, 2019, and processed on or before
December 31, 2019. In the proposed rule, we stated that for the final
rule with comment period, we intended to use claims data for dates of
service between January 1, 2019, and December 31, 2019, that were
processed on or before June 30, 2020, and updated CCRs, if available.
We stated that the proposed geometric mean costs for covered hospital
outpatient services for these and all other APCs that were used in the
development of the proposed rule could be found on the CMS website at:
https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.
Based on the updated final rule CY 2019 claims data used for this
CY 2021 final rule with comment period, we found a total of 23 APCs
with violations of the 2 times rule. Of these 23 total APCs, 18 were
identified in the proposed rule and five are newly identified APCs. The
five newly identified APCs with violations of the 2 times rule include
the following:
APC 5101 (Level 1 Strapping and Cast Application)
APC 5161 (Level 1 ENT Procedures)
APC 5593 (Level 3 Nuclear Medicine and Related Services)
APC 5673 (Level 3 Pathology)
APC 5734 (Level 4 Minor Procedures)
Although we did not receive any comments on Table 9 of the proposed
rule, we did receive comments on APC assignments for specific HCPCS
codes. The comments, and our responses, can be found in section III.D.
(OPPS APC-Specific Policies) of this final rule with comment period.
After considering the public comments we received on APC
assignments and our analysis of the CY 2019 costs from hospital claims
and cost report data available for this CY 2021 final rule with comment
period, we are finalizing our proposals with some modifications.
Specifically, we are finalizing our proposal to except 18 of the 18
proposed APCs from the 2 times rule for CY 2021 and also excepting five
additional APCs (APCs 5101, 5161, 5593, 5673, and 5734) for a total of
23 APCs.
In summary, Table 9 lists the 23 APCs that we are excepting from
the 2 times rule for CY 2021 based on the criteria described earlier
and a review of updated claims data for dates of service between
January 1, 2019 and December 31, 2019, that were processed on or before
June 30, 2020, and updated CCRs, if available. We note that, for cases
in which a recommendation by the HOP Panel appears to result in or
allow a violation of the 2 times rule, we generally accept the HOP
Panel's recommendation because those recommendations are based on
explicit consideration of resource use, clinical homogeneity, site of
service, and the quality of the claims data used to determine the APC
payment rates. The geometric mean costs for hospital outpatient
services for these and all other APCs that were used in the development
of this final rule with comment period can be found on the CMS website
at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices.
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C. New Technology APCs
1. Background
In the CY 2002 OPPS final rule (66 FR 59903), we finalized changes
to the time period in which a service can be eligible for payment under
a New Technology APC. Beginning in CY 2002, we retain services within
New Technology APC groups until we gather sufficient claims data to
enable us to assign the service to an appropriate clinical APC. This
policy allows us to move a service from a New Technology APC in less
than 2 years if sufficient data are available. It also allows us to
retain a service in a New Technology APC for more than 2 years if
sufficient data upon which to base a decision for reassignment have not
been collected.
In the CY 2004 OPPS final rule with comment period (68 FR 63416),
we restructured the New Technology APCs to make the cost intervals more
consistent across payment levels and refined the cost bands for these
APCs to retain two parallel sets of New Technology APCs, one set with a
status indicator of ``S'' (Significant Procedures, Not Discounted when
Multiple. Paid under OPPS; separate APC payment) and the other set with
a status indicator of ``T'' (Significant Procedure, Multiple Reduction
Applies. Paid under OPPS; separate APC payment). These current New
Technology APC configurations allow us to price new technology services
more appropriately and consistently.
For CY 2020, there were 52 New Technology APC levels, ranging from
the lowest cost band assigned to APC 1491 (New Technology--Level 1A
($0-$10)) through the highest cost band assigned to APC 1908 (New
Technology--Level 52 ($145,001-$160,000)). We note that the cost bands
for the New Technology APCs, specifically, APCs 1491 through 1599 and
1901 through 1908, vary with increments ranging from $10 to $14,999.
These cost bands identify the APCs to which new technology procedures
and services with estimated service costs that fall within those cost
bands are assigned under the OPPS. Payment for each APC is made at the
mid-point of the APC's assigned cost band. For example, payment for New
Technology APC 1507 (New Technology--Level 7 ($501-$600)) is made at
$550.50.
Under the OPPS, one of our goals is to make payments that are
appropriate for the services that are necessary for the treatment of
Medicare beneficiaries. The OPPS, like other Medicare payment systems,
is budget neutral and increases are limited to the annual hospital
inpatient market basket increase adjusted for multifactor productivity.
We believe that our payment rates reflect the costs that are associated
with providing care to Medicare beneficiaries and are adequate to
ensure access to services (80 FR 70374).
For many emerging technologies, there is a transitional period
during which utilization may be low, often because providers are first
learning about the technologies and their clinical
[[Page 85935]]
utility. Quite often, parties request that Medicare make higher payment
amounts under the New Technology APCs for new procedures in that
transitional phase. These requests, and their accompanying estimates
for expected total patient utilization, often reflect very low rates of
patient use of expensive equipment, resulting in high per-use costs for
which requesters believe Medicare should make full payment. Medicare
does not, and we believe should not, assume responsibility for more
than its share of the costs of procedures based on projected
utilization for Medicare beneficiaries and does not set its payment
rates based on initial projections of low utilization for services that
require expensive capital equipment. For the OPPS, we rely on hospitals
to make informed business decisions regarding the acquisition of high-
cost capital equipment, taking into consideration their knowledge about
their entire patient base (Medicare beneficiaries included) and an
understanding of Medicare's and other payers' payment policies. We
refer readers to the CY 2013 OPPS/ASC final rule with comment period
(77 FR 68314) for further discussion regarding this payment policy.
We note that, in a budget neutral system, payments may not fully
cover hospitals' costs in a particular circumstance, including those
for the purchase and maintenance of capital equipment. We rely on
hospitals to make their decisions regarding the acquisition of high-
cost equipment with the understanding that the Medicare program must be
careful to establish its initial payment rates, including those made
through New Technology APCs, for new services that lack hospital claims
data based on realistic utilization projections for all such services
delivered in cost-efficient hospital outpatient settings. As the OPPS
acquires claims data regarding hospital costs associated with new
procedures, we regularly examine the claims data and any available new
information regarding the clinical aspects of new procedures to confirm
that our OPPS payments remain appropriate for procedures as they
transition into mainstream medical practice (77 FR 68314). For CY 2021,
we included the proposed payment rates for New Technology APCs 1491 to
1599 and 1901 through 1908 in Addendum A to this CY 2021 OPPS/ASC
proposed rule (which is available via the internet on the CMS website).
2. Establishing Payment Rates for Low-Volume New Technology Services
Services that are assigned to New Technology APCs are typically new
services that do not have sufficient claims history to establish an
accurate payment for the services. One of the objectives of
establishing New Technology APCs is to generate sufficient claims data
for a new service so that it can be assigned to an appropriate clinical
APC. Some services that are assigned to New Technology APCs have very
low annual volume, which we consider to be fewer than 100 claims. We
consider services with fewer than 100 claims annually to be low-volume
services because there is a higher probability that the payment data
for a service may not have a normal statistical distribution, which
could affect the quality of our standard cost methodology that is used
to assign services to an APC. In addition, services with fewer than 100
claims per year are not generally considered to be a significant
contributor to the APC ratesetting calculations and, therefore, are not
included in the assessment of the 2 times rule. As we explained in the
CY 2019 OPPS/ASC final rule with comment period (83 FR 58890), we were
concerned that the methodology we use to estimate the cost of a service
under the OPPS by calculating the geometric mean for all separately
paid claims for a HCPCS service code from the most recent available
year of claims data may not generate an accurate estimate of the actual
cost of the service for these low-volume services.
In accordance with section 1833(t)(2)(B) of the Act, services
classified within each APC must be comparable clinically and with
respect to the use of resources. As described earlier, assigning a
service to a new technology APC allows us to gather claims data to
price the service and assign it to the APC with services that use
similar resources and are clinically comparable. However, where
utilization of services assigned to a New Technology APC is low, it can
lead to wide variation in payment rates from year to year, resulting in
even lower utilization and potential barriers to access to new
technologies, which ultimately limits our ability to assign the service
to the appropriate clinical APC. To mitigate these issues, we
determined in the CY 2019 OPPS/ASC final rule with comment period that
it was appropriate to utilize our equitable adjustment authority at
section 1833(t)(2)(E) of the Act to adjust how we determined the costs
for low-volume services assigned to New Technology APCs (83 FR 58892
through 58893). We have utilized our equitable adjustment authority at
section 1833(t)(2)(E) of the Act, which states that the Secretary shall
establish, in a budget neutral manner, other adjustments as determined
to be necessary to ensure equitable payments, to estimate an
appropriate payment amount for low-volume new technology services in
the past (82 FR 59281). Although we have used this adjustment authority
on a case-by-case basis in the past, we stated in the CY 2019 OPPS/ASC
final rule with comment period that we believe it is appropriate to
adopt an adjustment for low-volume services assigned to New Technology
APCs in order to mitigate the wide payment fluctuations that have
occurred for new technology services with fewer than 100 claims and to
provide more predictable payment for these services.
For purposes of this adjustment, we stated that we believe that it
is appropriate to use up to 4 years of claims data in calculating the
applicable payment rate for the prospective year, rather than using
solely the most recent available year of claims data, when a service
assigned to a New Technology APC has a low annual volume of claims,
which, for purposes of this adjustment, we define as fewer than 100
claims annually. We adopted a policy to consider services with fewer
than 100 claims annually as low-volume services because there is a
higher probability that the payment data for a service may not have a
normal statistical distribution, which could affect the quality of our
standard cost methodology that is used to assign services to an APC. We
explained that we were concerned that the methodology we use to
estimate the cost of a service under the OPPS by calculating the
geometric mean for all separately paid claims for a HCPCS procedure
code from the most recent available year of claims data may not
generate an accurate estimate of the actual cost of the low-volume
service. Using multiple years of claims data will potentially allow for
more than 100 claims to be used to set the payment rate, which would,
in turn, create a more statistically reliable payment rate.
In addition, to better approximate the cost of a low-volume service
within a New Technology APC, we stated that we believe using the median
or arithmetic mean rather than the geometric mean (which ``trims'' the
costs of certain claims out) could be more appropriate in some
circumstances, given the extremely low volume of claims. Low claim
volumes increase the impact of ``outlier'' claims; that is, claims with
either a very low or very high payment
[[Page 85936]]
rate as compared to the average claim, which would have a substantial
impact on any statistical methodology used to estimate the most
appropriate payment rate for a service. We also explained that we
believe having the flexibility to utilize an alternative statistical
methodology to calculate the payment rate in the case of low-volume new
technology services would help to create a more stable payment rate.
Therefore, in the CY 2019 OPPS/ASC final rule with comment period (83
FR 58893), we established that, in each of our annual rulemakings, we
will seek public comments on which statistical methodology should be
used for each low-volume service assigned to a New Technology APC. In
the preamble of each annual rulemaking, we stated that we would present
the result of each statistical methodology and solicit public comment
on which methodology should be used to establish the payment rate for a
low-volume new technology service. In addition, we will use our
assessment of the resources used to perform a service and guidance from
the developer or manufacturer of the service, as well as other
stakeholders, to determine the most appropriate payment rate. Once we
identify the most appropriate payment rate for a service, we will
assign the service to the New Technology APC with the cost band that
includes its payment rate.
Accordingly, for CY 2021, we proposed to continue the policy we
adopted in CY 2019 under which we will utilize our equitable adjustment
authority under section 1833(t)(2)(E) of the Act to calculate the
geometric mean, arithmetic mean, and median using multiple years of
claims data to select the appropriate payment rate for purposes of
assigning services with fewer than 100 claims per year to a New
Technology APC. Additional details on our policy is available in the CY
2019 OPPS/ASC final rule with comment period (83 FR 58892 through
58893).
We did not receive any public comments on our proposal. Therefore,
we are finalizing our proposal without modification.
3. Procedures Assigned to New Technology APC Groups for CY 2021
As we described in the CY 2002 OPPS final rule with comment period
(66 FR 59902), we generally retain a procedure in the New Technology
APC to which it is initially assigned until we have obtained sufficient
claims data to justify reassignment of the procedure to a clinically
appropriate APC.
In addition, in cases where we find that our initial New Technology
APC assignment was based on inaccurate or inadequate information
(although it was the best information available at the time), where we
obtain new information that was not available at the time of our
initial New Technology APC assignment, or where the New Technology APCs
are restructured, we may, based on more recent resource utilization
information (including claims data) or the availability of refined New
Technology APC cost bands, reassign the procedure or service to a
different New Technology APC that more appropriately reflects its cost
(66 FR 59903).
Consistent with our current policy, for CY 2021, we proposed to
retain services within New Technology APC groups until we obtain
sufficient claims data to justify reassignment of the service to a
clinically appropriate APC. The flexibility associated with this policy
allows us to reassign a service from a New Technology APC in less than
2 years if sufficient claims data are available. It also allows us to
retain a service in a New Technology APC for more than 2 years if
sufficient claims data upon which to base a decision for reassignment
have not been obtained (66 FR 59902). We received no public comments on
our proposal. Therefore, we will implement our proposal without
modification.
a. Magnetic Resonance-Guided Focused Ultrasound Surgery (MRgFUS)
Currently, there are four CPT/HCPCS codes that describe magnetic
resonance image-guided, high-intensity focused ultrasound (MRgFUS)
procedures, three of which we proposed to continue to assign to
standard APCs, and one that we proposed to continue to assign to a New
Technology APC for CY 2021. These codes include CPT codes 0071T, 0072T,
and 0398T, and HCPCS code C9734. CPT codes 0071T and 0072T describe
procedures for the treatment of uterine fibroids, CPT code 0398T
describes procedures for the treatment of essential tremor, and HCPCS
code C9734 describes procedures for pain palliation for metastatic bone
cancer.
For the procedure described by CPT code 0398T, we have identified
169 paid claims for CY 2019 with a geometric mean of $12,027.76. The
number of claims for the service means that the procedure is no longer
a low-volume new technology service, and we will use the geometric mean
of the CY 2019 claims data to determine the cost of the service for its
APC assignment. We reviewed the OPPS to determine whether CPT code
0398T could be assigned to a clinical APC. The most appropriate
clinical APC family for the service would be the Neurostimulator and
Related Procedures APC series (APCs 5461 through 5464). However, there
was a large payment rate difference between Level 2 Neurostimulator and
Related Procedures (APC 5462) with a payment rate of $6,169.27 and
Level 3 Neurostimulator and Related Procedures (APC 5463) with a
payment rate of $19,737.37. Based on the geometric mean cost of CPT
code 0398T available for the CY 2021 OPPS/ASC proposed rule, we believe
the payment rate for APC 5462 would be too low for CPT code 0398T since
it is more than $6,000 less than the geometric mean cost for CPT code
0398T, and we believe the payment rate for APC 5463 would be too high
since it is around $6,800 more than the geometric mean cost for CPT
code 0398T.
In addition, given the significant difference in the payment rate
between APC 5462 and 5463, we believed a restructuring of the APC
family would be appropriate. We believed that creating an additional
payment level between the two existing APC levels would allow for a
smoother distribution of the costs between the different levels based
on their resource costs and clinical characteristics. Please refer to
section III.D.1 for detailed explanation of our proposal to reorganize
the Neurostimulator and Related Procedures APCs (APCs 5461-5464).
Reorganizing the Neurostimulator and Related Procedures APCs would
create a proposed Level 3 APC to be referred to as ``Proposed APC
5463'' with a payment rate of approximately $12,286 that is close to
the geometric mean of CPT code 0398T which is approximately $12,798.
The payment rate of proposed APC 5463 is representative of the cost of
the service described by CPT code 0398T. Therefore, we proposed to
reassign the service described by CPT code 0398T to the proposed new
Level 3 APC for Neurostimulator and Related Procedures (Proposed APC
5463) for CY 2021.
Comment: Multiple commenters supported our proposal to reassign CPT
code 0398T to proposed new APC 5463 (Level 3 Neurostimulator and
Related Procedures).
Response: We appreciate the support of the commenters for our
proposal.
The final rule data shows the payment rate for the new APC 5463
(Level 3 Neurostimulator and Related Procedures) is $11,236.21. While
this payment rate is lower than what was calculated for the proposed
rule, we continue to believe APC 5463 is an appropriate placement for
CPT code 0398T. After our review of the public comments, we have
decided to
[[Page 85937]]
implement our proposal to assign CPT code 0398T to APC 5463 for CY
2021. The final APC assignment, status indicator, and payment rate for
CPT code 0398T are found in Table 10. We refer readers to Addendum B of
the final rule for the final payment rates for all codes reportable
under the OPPS. Addendum B is available via the internet on the CMS
website.
[GRAPHIC] [TIFF OMITTED] TR29DE20.022
Retinal Prosthesis Implant Procedure
CPT code 0100T (Placement of a subconjunctival retinal prosthesis
receiver and pulse generator, and implantation of intra-ocular retinal
electrode array, with vitrectomy) describes the implantation of a
retinal prosthesis, specifically, a procedure involving the use of the
Argus[supreg] II Retinal Prosthesis System. This first retinal
prosthesis was approved by FDA in 2013 for adult patients diagnosed
with severe to profound retinitis pigmentosa. Pass-through payment
status was granted for the Argus[supreg] II device under HCPCS code
C1841 (Retinal prosthesis, includes all internal and external
components) beginning October 1, 2013, and this status expired on
December 31, 2015. We note that after pass-through payment status
expires for a medical device, the payment for the device is packaged
into the payment for the associated surgical procedure. Consequently,
for CY 2016, the device described by HCPCS code C1841 was assigned to
OPPS status indicator ``N'' to indicate that payment for the device is
packaged and included in the payment rate for the surgical procedure
described by CPT code 0100T. For CY 2016, the procedure described by
CPT code 0100T was assigned to New Technology APC 1599, with a payment
rate of $95,000, which was the highest paying New Technology APC for
that year. This payment included both the surgical procedure (CPT code
0100T) and the use of the Argus[supreg] II device (HCPCS code C1841).
However, stakeholders (including the device manufacturer and hospitals)
believed that the CY 2016 payment rate for the procedure involving the
Argus[supreg] II System was insufficient to cover the hospital cost of
performing the procedure, which includes the cost of the retinal
prosthesis at the retail price of approximately $145,000.
For CY 2017, analysis of the CY 2015 OPPS claims data used for the
CY 2017 OPPS/ASC final rule with comment period showed 9 single claims
(out of 13 total claims) for the procedure described by CPT code 0100T,
with a geometric mean cost of approximately $142,003 based on claims
submitted between January 1, 2015, through December 31, 2015, and
processed through June 30, 2016. Based on the CY 2015 OPPS claims data
available for the final rule with comment period and our understanding
of the Argus[supreg] II procedure, we reassigned the procedure
described by CPT code 0100T from New Technology APC 1599 to New
Technology APC 1906, with a final payment rate of $150,000.50 for CY
2017. We noted that this payment rate included the cost of both the
surgical procedure (CPT code 0100T) and the retinal prosthesis device
(HCPCS code C1841).
For CY 2018, the reported cost of the Argus[supreg] II procedure
based on CY 2016 hospital outpatient claims data for 6 claims used for
the CY 2018 OPPS/ASC final rule with comment period was approximately
$94,455, which was more than $55,000 less than the payment rate for the
procedure in CY 2017, but closer to the CY 2016 payment rate for the
procedure. We noted that the costs of the Argus[supreg] II procedure
are extraordinarily high compared to many other procedures paid under
the OPPS. In addition, the number of claims submitted has been very low
and has not exceeded 10 claims within a single year. We believed that
it is important to mitigate significant payment differences, especially
shifts of several tens of thousands of dollars, while also basing
payment rates on available cost information and claims data. In CY
2016, the payment rate for the Argus[supreg] II procedure was
$95,000.50. The payment rate increased to $150,000.50 in CY 2017. For
CY 2018, if we had established the payment rate based on updated final
rule claims data, the
[[Page 85938]]
payment rate would have decreased to $95,000.50 for CY 2018, a decrease
of $55,000 relative to CY 2017. We were concerned that these large
fluctuations in payment could potentially create an access to care
issue for the Argus[supreg] II procedure, and we wanted to establish a
payment rate to mitigate the potential sharp decline in payment from CY
2017 to CY 2018.
In accordance with section 1833(t)(2)(B) of the Act, we must
establish that services classified within each APC are comparable
clinically and with respect to the use of resources. Therefore, for CY
2018, we used our equitable adjustment authority under section
1833(t)(2)(E) of the Act, which states that the Secretary shall
establish, in a budget neutral manner, other adjustments as determined
to be necessary to ensure equitable payments, to maintain the payment
rate for this procedure, despite the lower geometric mean costs
available in the claims data used for the final rule with comment
period. For CY 2018, we reassigned the Argus[supreg] II procedure to
APC 1904 (New Technology--Level 50 ($115,001-$130,000)), which
established a payment rate for the Argus[supreg] II procedure of
$122,500.50, which was the arithmetic mean of the payment rates for the
procedure for CY 2016 and CY 2017.
For CY 2019, the reported cost of the Argus[supreg] II procedure
based on the geometric mean cost of 12 claims from the CY 2017 hospital
outpatient claims data was approximately $171,865, which was
approximately $49,364 more than the payment rate for the procedure for
CY 2018. In the CY 2019 OPPS/ASC final rule with comment period, we
continued to note that the costs of the Argus[supreg] II procedure are
extraordinarily high compared to many other procedures paid under the
OPPS (83 FR 58897 through 58898). In addition, the number of claims
submitted continued to be very low for the Argus[supreg] II procedure.
We stated that we continued to believe that it is important to mitigate
significant payment fluctuations for a procedure, especially shifts of
several tens of thousands of dollars, while also basing payment rates
on available cost information and claims data because we are concerned
that large decreases in the payment rate could potentially create an
access to care issue for the Argus[supreg] II procedure. In addition,
we indicated that we wanted to establish a payment rate to mitigate the
potential sharp increase in payment from CY 2018 to CY 2019, and
potentially ensure a more stable payment rate in future years.
As discussed in section III.C.2. of the CY 2019 OPPS/ASC final rule
with comment period (83 FR 58892 through 58893), we used our equitable
adjustment authority under section 1833(t)(2)(E) of the Act, which
states that the Secretary shall establish, in a budget neutral manner,
other adjustments as determined to be necessary to ensure equitable
payments, to establish a payment rate that is more representative of
the likely cost of the service. We stated that we believed the likely
cost of the Argus[supreg] II procedure is higher than the geometric
mean cost calculated from the claims data used for the CY 2018 OPPS/ASC
final rule with comment period but lower than the geometric mean cost
calculated from the claims data used for the CY 2019 OPPS/ASC final
rule with comment period.
For CY 2019, we analyzed claims data for the Argus[supreg] II
procedure using 3 years of available data from CY 2015 through CY 2017.
These data included claims from the last year that the Argus[supreg] II
received transitional device pass-through payments (CY 2015) and the
first 2 years since device pass-through payment status for the
Argus[supreg] II expired. We found that the geometric mean cost for the
procedure was approximately $145,808, the arithmetic mean cost was
approximately $151,367, and the median cost was approximately $151,266.
As we do each year, we reviewed claims data regarding hospital costs
associated with new procedures. We regularly examine the claims data
and any available new information regarding the clinical aspects of new
procedures to confirm that OPPS payments remain appropriate for
procedures like the Argus[supreg] II procedure as they transition into
mainstream medical practice (77 FR 68314). We noted that the proposed
payment rate included both the surgical procedure (CPT code 0100T) and
the use of the Argus[supreg] II device (HCPCS code C1841). For CY 2019,
the estimated costs using all three potential statistical methods for
determining APC assignment under the New Technology low-volume payment
policy fell within the cost band of New Technology APC 1908, which is
between $145,001 and $160,000. Therefore, we reassigned the
Argus[supreg] II procedure (CPT code 0100T) to APC 1908 (New
Technology--Level 52 ($145,001-$160,000)), with a payment rate of
$152,500.50 for CY 2019.
For CY 2020, we identified 35 claims reporting the procedure
described by CPT code 0100T for the 4-year period of CY 2015 through CY
2018. We found the geometric mean cost for the procedure described by
CPT code 0100T to be approximately $146,059, the arithmetic mean cost
to be approximately $152,123, and the median cost to be approximately
$151,267. All of the resulting estimates from using the three
statistical methodologies fell within the same New Technology APC cost
band ($145,001-$160,000), where the Argus[supreg] II procedure was
assigned for CY 2019. Consistent with our policy stated in section
III.C.2, we presented the result of each statistical methodology in the
proposed rule, and we sought public comments on which method should be
used to assign procedures described by CPT code 0100T to a New
Technology APC. All three potential statistical methodologies used to
estimate the cost of the Argus[supreg] II procedure fell within the
cost band for New Technology APC 1908, with the estimated cost being
between $145,001 and $160,000. Accordingly, we assigned CPT code 0100T
in APC 1908 (New Technology--Level 52 ($145,001-$160,000)), with a
payment rate of $152,500.50 for CY 2020.
For CY 2021, the number of reported claims for the Argus[supreg] II
procedure continues to be very low with a substantial fluctuation in
cost from year to year. The high annual variability of the cost of the
Argus[supreg] II procedure continues to make it difficult to establish
a consistent and stable payment rate for the procedure. As previously
mentioned, in accordance with section 1833(t)(2)(B) of the Act, we are
required to establish that services classified within each APC are
comparable clinically and with respect to the use of resources.
Therefore, for CY 2021, we proposed to apply the policy we adopted in
CY 2019, under which we utilize our equitable adjustment authority
under section 1833(t)(2)(E) of the Act to calculate the geometric mean,
arithmetic mean, and median costs using multiple years of claims data
to select the appropriate payment rate for purposes of assigning the
Argus[supreg] II procedure (CPT code 0100T) to a New Technology APC.
For CY 2021, we identified 35 claims reporting the procedure
described by CPT code 0100T for the 4-year period of CY 2016 through CY
2019. We found the geometric mean cost for the procedure described by
CPT code 0100T to be approximately $148,807, the arithmetic mean cost
to be approximately $154,504, and the median cost to be approximately
$151,974. All three potential statistical methodologies used to
estimate the cost of the Argus[supreg] II procedure fall within the
cost band for New Technology APC 1908, with the estimated cost being
between $145,001 and $160,000.
Accordingly, we proposed to maintain the assignment of the
procedure
[[Page 85939]]
described by CPT code 0100T in APC 1908 (New Technology--Level 52
($145,001-$160,000)), with a proposed payment rate of $152,500.50 for
CY 2021. We note that the proposed payment rate includes both the
surgical procedure (CPT code 0100T) and the use of the Argus[supreg] II
device (HCPCS code C1841). We refer readers to Addendum B to the
proposed rule for the proposed payment rates for all codes reportable
under the OPPS. Addendum B is available via the internet on the CMS
website.
For our analysis for the CY 2021 final rule, we identified 35
claims reporting the procedure described by CPT code 0100T for the 4-
year period of CY 2016 through CY 2019. We found the geometric mean
cost for the procedure described by CPT code 0100T to be approximately
$148,148, the arithmetic mean cost to be approximately $153,682, and
the median cost to be approximately $151,974. The slight differences
from the calculations using the proposed rule data are caused by
changes to the wage indexes of a few providers. All three potential
statistical methodologies used to estimate the cost of the
Argus[supreg] II procedure fall within the cost band for New Technology
APC 1908, with the estimated cost being between $145,001 and $160,000.
We received no public comments on our proposal. Therefore, we are
finalizing our proposal without modification. We will maintain the
assignment of the procedure described by CPT code 0100T in APC 1908
(New Technology--Level 52 ($145,001-$160,000)), with a payment rate of
$152,500.50 for CY 2021. We note that the final payment rate includes
both the surgical procedure (CPT code 0100T) and the use of the
Argus[supreg] II device (HCPCS code C1841). We refer readers to
Addendum B to the final rule for the final payment rates for all codes
reportable under the OPPS. Addendum B is available via the internet on
the CMS website.
c. Administration of Subretinal Therapies Requiring Vitrectomy (APC
1561)
CPT code J3398 (Injection, voretigene neparvovec-rzyl, 1 billion
vector genomes) is a gene therapy for a rare mutation-associated
retinal dystrophy. Voretigene neparvovec-rzyl (Luxturna[supreg]), was
approved by FDA in December of 2017, and is indicated as an adeno-
associated virus vector-based gene therapy indicated for the treatment
of patients with confirmed biallelic RPE65 mutation-associated retinal
dystrophy.\2\ This therapy is administered through a subretinal
injection, which stakeholders describe as an extremely delicate and
sensitive surgical procedure. The FDA package insert describes one of
the steps for administering Luxturna as, ``after completing a
vitrectomy, identify the intended site of administration. The
subretinal injection can be introduced via pars plana.'' \1\
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\2\ Luxturna. FDA Package Insert. Available: https://www.fda.gov/media/109906/download.
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Stakeholders, including the manufacturer of Luxturna[supreg],
recommended HCPCS code 67036 (Vitrectomy, mechanical, pars plana
approach) for the administration of the gene therapy.\3\ However, the
manufacturer contends the administration is not currently described by
any existing codes as HCPCS code 67036 (Vitrectomy, mechanical, pars
plana approach) does not account for the administration itself. For
HCPCS code J3398, a typical patient would receive a standard dose of
150 billion vector genomes, with an approximate payment rate of
$432,480 (we refer readers to Addendum B of the CY 2021 OPPS/ASC Final
Rule with comment period rule for the payment rate associated with
HCPCS code J3398).
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\3\ LUXTURNA REIMBURSEMENT GUIDE FOR TREATMENT CENTERS. https://mysparkgeneration.com/pdf/Reimbursement_Guide_for_Treatment_Centers_Interactive_010418_FINAL.pdf.
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It is important to note that HCPCS code J3398 was granted drug
pass-through status under the OPPS as of July 1, 2018 and is assigned
status indicator ``G''. (We refer readers to Addendum D of the CY 2021
OPPS/ASC Final rule for the list of status indicator definitions for
CY2021). HCPCS code J3398 is scheduled to have its drug pass-through
status expire June 30, 2021, at which point the code would be packaged
into the payment for any primary service with which it is billed when
that primary service is assigned to a comprehensive APC (C-APC). A C-
APC packages payment for adjunctive and secondary items, services, and
procedures into the most costly primary procedure. (For a full
discussion and background on C-APCs, see section II.A.2.b). Based on
information from the manufacturer of Luxturna, we believe that HCPCS
code J3398 (Injection, voretigene neparvovec-rzyl, 1 billion vector
genomes) would commonly be billed with the service described by HCPCS
code 67036 (Vitrectomy, mechanical, pars plana approach), which
describes the administration of the gene therapy, and which is assigned
to a comprehensive APC, (APC 5492--Level 2 Intraocular Procedures).
Thus, when its pass-through status expires, payment for HCPCS code
J3398, the primary therapy, would be packaged into payment for HCPCS
code 67036, its administration procedure.
CMS recognizes the need to accurately describe the unique
administration procedure that is required to administer the therapy
described by HCPCS code J3398. We proposed to establish a new HCPCS
code, C97X1 (Vitrectomy, mechanical, pars plana approach, with
subretinal injection of pharmacologic/biologic agent) to describe this
process. We believe that this new HCPCS code accurately describes the
service associated with intraocular administration of HCPCS code J3398.
CMS recognized that HCPCS code 67036 represents a similar procedure and
process that approximates similar resource utilization that is
associated with C97X1. CMS also recognized that it is not prudent for
the code that describes the administration of this gene therapy, C97X1,
to be assigned to the same C-APC to which HCPCS code 67036 is assigned,
as this would package the primary therapy, HCPCS code J3398, into the
code that represents the process to administer the gene therapy.
For CY 2021, we proposed to assign the services described by C97X1
to a new technology payment band based on the geometric mean cost for
HCPCS code 67036. For the CY 2021 OPPS/ASC Proposed Rule, HCPCS code
67036 had a geometric mean cost of $3,407.84. Therefore, for the
proposed rule we proposed to assign C97X1 to APC 1561--New Technology--
Level 24 ($3001-$3500). See Table 11 for proposed descriptors and APC
assignment.
[[Page 85940]]
[GRAPHIC] [TIFF OMITTED] TR29DE20.023
Comment: Commenters were largely supportive of our proposal to
create a ``C'' code to describe the administration of J3398 and assign
this newly created ``C'' code to New Technology APC 1561. Commenters
largely advised CMS to finalize our proposal as proposed.
Response: We thank the commenters for their support on our
proposal.
Comment: A small minority of commenters supported our approach to
create a ``C'' code to describe the administration of J3398 and assign
the newly created ``C'' code to a New Technology APC, but suggested
alternate APC placements. The commenters' suggested alternate APC
placements included APC 1562, based on a crosswalk of HCPCS code 67042,
as well as APC 1564. Additionally, one commenter expressed uncertainty
about when it would be appropriate to bill this code.
Response: We thank commenters for their feedback. Based on our
review, we believe assigning C9770 to APC 1561 based on the geometric
mean costs of HCPCS code 67036 is the most appropriate APC placement
for this code. Our clinical review along with an overwhelming number of
stakeholders have found that HCPCS code 67036 represents a similar
procedure and process that approximates similar resource utilization
that is associated with C9770. Additionally, regarding when C9770 may
be billed, we remind stakeholders that HOPDs and ASCs may bill C9770
under Medicare in the HOPD and ASC settings when reasonable and
necessary services are furnished. HCPCS C-codes are reportable only on
Medicare OPPS and ASC claims. HOPDs and ASCs are expected to make
appropriate coding decisions based on instructions and other
information available to them (for example, federal regulations, CMS
instructions, MAC instructions, etc.).
Based on the above discussion, for CY 2021 we are finalizing our
proposal without modification to establish C9770 and assign the code to
a New Technology APC based on the geometric mean cost of HCPCS code
67036. For CY 2021, HCPCS code 67036 has a geometric mean cost of
$3,435.61. Therefore, as shown in Table 12, for CY 2021 we are
finalizing our proposal to create C9770 (Vitrectomy, mechanical, pars
plana approach, with subretinal injection of pharmacologic/biologic
agent) and assign this code to APC 1561 (New Technology--Level 24
($3001-$3500)).
[GRAPHIC] [TIFF OMITTED] TR29DE20.024
d. Bronchoscopy With Transbronchial Ablation of Lesion(s) by Microwave
Energy
Effective January 1, 2019, CMS established HCPCS code C9751
(Bronchoscopy, rigid or flexible, transbronchial ablation of lesion(s)
by microwave energy, including fluoroscopic guidance, when performed,
with computed tomography acquisition(s) and 3-D rendering, computer-
assisted, image-guided navigation, and endobronchial ultrasound (EBUS)
guided transtracheal and/or transbronchial sampling (for example,
aspiration[s]/biopsy[ies]) and all mediastinal and/or hilar lymph node
stations or structures and therapeutic intervention(s)). This microwave
ablation procedure utilizes a flexible catheter to access the lung
tumor via a working channel and may be used as an alternative procedure
to a percutaneous microwave approach. Based on our review of the New
Technology APC application for this service and the service's clinical
similarity to existing services paid under the OPPS, we estimated the
likely cost of the procedure would be between $8,001 and $8,500.
In claims data available for CY 2019 for the CY 2021 OPPS/ASC
proposed rule, there were 4 claims reported for bronchoscopy with
transbronchial ablation of lesions by microwave energy. Given the low
volume of claims for the service, we proposed for CY 2021 to apply the
policy we adopted in CY 2019, under which we utilize our equitable
adjustment authority under section 1833(t)(2)(E) of the Act to
calculate the geometric mean, arithmetic mean, and median costs to
calculate an
[[Page 85941]]
appropriate payment rate for purposes of assigning bronchoscopy with
transbronchial ablation of lesions by microwave energy to a New
Technology APC. We found the geometric mean cost for the service to be
approximately $4,051, the arithmetic mean cost to be approximately
$4,067, and the median cost to be approximately $4,067. All three
potential statistical methodologies used to estimate the cost of the
service procedure fall within the cost band for New Technology APC
1563, with the estimated cost being between $4,001 and $4,500.
Accordingly, we proposed to change the assignment of the HCPCS code
C9751 to APC 1563 (New Technology--Level 26 ($4001-$4500)), with a
proposed payment rate of $4,250.50 for CY 2021.
Comment: Two commenters did not support our proposal to assign
HCPCS code C9751 to APC 1563 (New Technology--Level 26 ($4001-$4500)),
with a proposed payment rate of $4,250.50 for CY 2021. The commenters
stated that there was not enough claims data to change the APC
assignment for HCPCS code C9751, and that HCPCS code C9751 should
continue to be assigned to APC 1571 (New Technology--Level 34 ($8001-
$8500)) with a proposed payment rate of $8,250.50.
Response: Because of the low number of claims for HCPCS C9751, we
utilized our equitable adjustment authority under section 1833(t)(2)(E)
of the Act for our final rule analysis to calculate the geometric mean,
arithmetic mean, and median costs to calculate a payment rate to assign
bronchoscopy with transbronchial ablation of lesions by microwave
energy to a New Technology APC. Even though the number of claims are
small, it is the best data available to determine the cost of the
procedure. The assignment of HCPCS code C9751 to APC 1571 was based on
guidance from the developer of the procedure and our best estimates of
the cost of the procedure. The claims data, however limited, provide
evidence of the cost of the procedure based on service utilization
rather than having to forecast the cost of procedure.
Therefore, we decided to use our low-volume methodology for new
technology services to determine the payment rate for the service
described by HCPCS code C9751. We found for our final rule analysis
that the geometric mean cost for the service to be approximately
$2,693, the arithmetic mean cost to be approximately $3,086, and the
median cost to be approximately $3,708. The median was the statistical
methodology that estimated the highest cost for the service and
provides a reasonable estimate of the midpoint cost of the three claims
that have been paid for this service. The payment rate calculated using
this methodology falls within the cost band for New Technology APC 1562
(New Technology--Level 25 ($3501-$4000)). Based on our updated analysis
of the data, we have decided to implement our original proposal with
modifications. For CY 2021, we will change the assignment of HCPCS code
C9751 to APC 1562 (New Technology--Level 25 ($3501-$4000)) using our
equitable adjustment authority under section 1833(t)(2)(E) of the Act
and our low-volume new technology service methodology. The payment rate
for C9751 will be based on the median cost of claims reported for the
service since CY 2019 as the median cost is the highest estimated cost
for the service, and the median provides a reasonable estimate of the
midpoint cost of the three claims that have been paid for this service.
Details regarding HCPCS code C9751 are shown in Table 13. We refer
readers to Addendum B of the final rule for the final payment rates for
all codes reportable under the OPPS. Addendum B is available via the
internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR29DE20.025
e. Fractional Flow Reserve Derived From Computed Tomography (FFRCT)
Fractional Flow Reserve Derived from Computed Tomography (FFRCT),
also known by the trade name HeartFlow, is a noninvasive diagnostic
service that allows physicians to measure coronary artery disease in a
patient through the use of coronary CT scans. The HeartFlow procedure
is intended for clinically stable symptomatic patients with coronary
artery disease, and, in many cases, may avoid the need for an invasive
coronary angiogram procedure. HeartFlow uses a proprietary data
analysis process performed at a central facility to develop a three-
dimensional image of a patient's coronary arteries, which allows
physicians to identify the fractional flow reserve to assess whether or
not patients should undergo further invasive testing (that is, a
coronary angiogram).
For many services paid under the OPPS, payment for analytics that
are performed after the main diagnostic/
[[Page 85942]]
image procedure are packaged into the payment for the primary service.
However, in CY 2018, we determined that HeartFlow should receive a
separate payment because the service is performed by a separate entity
(that is, a HeartFlow technician who conducts computer analysis
offsite) rather than the provider performing the CT scan. We assigned
CPT code 0503T, which describes the analytics performed, to New
Technology APC 1516 (New Technology--Level 16 ($1,401-$1,500)), with a
payment rate of $1,450.50 based on pricing information provided by the
developer of the procedure that indicated the price of the procedure
was approximately $1,500. We did not have Medicare claims data in CY
2019 for CPT code 0503T, and we continued to assign the service to New
Technology APC 1516 (New Technology--Level 16 ($1,401-$1,500)), with a
payment rate of $1,450.50.
CY 2020 was the first year we had Medicare claims data to calculate
the cost of HCPCS code 0503T. For the CY 2020 OPPS/ASC final rule,
there were 957 claims with CPT code 0503T of which 101 of the claims
were single frequency claims that were used to calculate the geometric
mean of the procedure. We planned to use the geometric mean to report
the cost of HeartFlow. However, the number of single frequency claims
for CPT code 0503T was below the low-volume payment policy threshold
for the proposed rule, and the number of single frequency claims was
only two claims above the threshold for the new technology APC low-
volume policy for the final rule. Therefore, we decided to use our
equitable adjustment authority under section 1833(t)(2)(E) of the Act
to calculate the geometric mean, arithmetic mean, and median using the
CY 2018 claims data to determine an appropriate payment rate for
HeartFlow using our new technology APC low-volume payment policy. While
the number of single frequency claims was just above our threshold to
use the low-volume payment policy, we still had concerns about the
normal cost distribution of the claims used to calculate the payment
rate for HeartFlow, and we decided the low-volume payment policy would
be the best approach to address those concerns.
Our analysis found that the geometric mean cost for CPT code 0503T
was $768.26, the arithmetic mean cost for CPT code 0503T was $960.12
and that the median cost for CPT code 0503T was $900.28. Of the three
cost methods, the highest amount was for the arithmetic mean. The
arithmetic mean fell within the cost band for New Technology APC 1511
(New Technology--Level 11 ($901-$1000)) with a payment rate of $950.50.
The arithmetic mean helped to account for some of the higher costs of
CPT code 0503T identified by the developer and other stakeholders that
may not have been reflected by either the median or the geometric mean.
For CY 2021, we observed a significant increase in the number of
claims billed with CPT code 0503T that were available for the CY 2021
OPPS/ASC proposed rule. Specifically, using the most recently available
data for the CY 2021 OPPS/ASC proposed rule (that is, CY 2019), we
identified 2,820 claims billed with CPT code 0503T including 415 single
frequency claims. These totals were well above the threshold of 100
claims for a procedure to be evaluated using the new technology APC
low-volume policy. Therefore, we proposed to use our standard
methodology rather than the low-volume methodology we previously used
to determine the cost of CPT code 0503T.
Our analysis of the available claims data for the proposed rule
found the geometric mean cost for CPT code 0503T was approximately
$851. Therefore, we proposed to reassign the service described by CPT
code 0503T in order to adjust the payment rate to better reflect the
cost for the service. While we considered proposing to reassign CPT
code 0503T to APC 5724 (Level 4--Diagnostic Tests and Related
Services), which had a proposed payment rate of around $903 based on
the clinical and resource similarity to other services within that APC,
we did not propose such reassignment because the payment rate for the
new technology APC was closer to the geometric mean costs of CPT code
0503T. Nonetheless, we welcomed comments on whether reassignment to the
clinical APC would be more appropriate. Therefore, we proposed to
reassign the service described by CPT code 0503T to New Technology APC
1510 (New Technology--Level 10 ($801-$900)), with a proposed payment
rate of $850.50 for CY 2021.
Comment: The developer of HeartFlow and multiple other commenters
stated that the CPT code 0503T should not be assigned to New Technology
APC 1510. Instead, they suggested that the HeartFlow procedure be
assigned to APC 5593 (Level 3 Nuclear Medicine and Related Services)
with a payment rate of around $1,270. The developer asserted that even
though the payment for APC 5593 is substantially higher than the
estimated cost of CPT code 0503T, the cost of the service fits
reasonably well with the cost of other procedures assigned to APC 5593.
The developer and other commenters also assert that the HeartFlow
procedure has enough clinical similarity to other procedures currently
assigned to the nuclear medicine and related services family. According
to the developer and the other commenters, HeartFlow is comparable to
other nuclear medicine procedures that are image analysis tests
characterizing organ-specific function. The developer and the other
commenters also note that cardiac CT procedures, which are used to
identify coronary artery disease, are assigned to the nuclear medicine
APC family. Finally, the developer cited two examples of procedures in
the OPPS that are assigned to APCs where the procedure in question does
not have clinical similarity to the other procedures in the APC.
Response: We disagree with the suggestion that CPT code 0503T
should be assigned to APC 5593. The nuclear medicine and related
procedures APC family describes diagnostic and therapeutic procedures,
many of them involving imaging, where radiopharmaceuticals and other
nuclear materials are critical supplies for the performance of the
procedure. In comparison, HeartFlow is a computer algorithm that does
not directly take images nor is it used on its own to generate a
diagnosis for a patient. Instead, HeartFlow analyzes diagnostic images
obtained through other medical procedures and assists with the
interpretation of those diagnostic images to determine if a patient has
coronary artery disease. There is little clinical similarity between
the HeartFlow procedure and the procedures currently assigned to the
nuclear medicine and related procedures, and we cannot support
assigning CPT code 0503T to APC 5593.
Comment: Several commenters asserted the proposed payment rate for
CPT code 0503T is too low and does not reflect their individual
hospital's cost to use HeartFlow. Commenters mentioned cost issues,
including the $1,100 list price for each individual HeartFlow service
and the staff resources involved to transmit data to the HeartFlow
analysis facility and review the results of the analyses performed by
HeartFlow. Commenters suggested a range of potential payments for a
HeartFlow procedure from $1,051 up to $1,451, and they encouraged CMS
to use our equitable adjustment authority at section 1833(t)(2)(E) of
the Act to establish a payment rate that would more closely reflect the
costs the
[[Page 85943]]
commenters believe they are incurring to perform the HeartFlow
procedure.
Response: For this CY 2021 OPPS/ASC final rule, we identified 3,188
claims billed with CPT code 0503T including 465 single frequency claims
for CPT code 0503T. Our analysis has found that the geometric mean for
CPT code 0503T is $804.35, and the geometric mean cost falls within the
cost band for New Technology APC 1510 (New Technology--Level 10 ($801-
$900)), which is similar to our results for the proposed rule. However,
multiple commenters have noted that the FFRCT service costs $1,100 and
that there are additional staff costs related to the submission of
coronary CT image data for processing by HeartFlow.
HeartFlow is one of the first procedures utilizing artificial
intelligence to be separately payable in the OPPS, and providers are
still learning how to accurately report their charges to Medicare when
billing for artificial intelligence services. This is especially the
case for allocating the cost of staff resources between the HeartFlow
procedure and the coronary CT imaging services. Therefore, we feel it
would be appropriate to use our equitable adjustment authority under
section 1833(t)(2)(E) of the Act to assign CPT code 0503T to the same
New Technology APC in CY 2021 as in CY 2020 in order to provide payment
stability and equitable payment for providers as they continue to
become more familiar with the proper cost reporting for HeartFlow and
other artificial intelligence services. As mentioned earlier in this
section, CPT code 0503T was assigned to New Technology APC 1511 (New
Technology--Level 11 ($901-$1000)) with a payment rate of $950.50 for
CY 2020, and we will continue to assign CPT code 0503T to New
Technology APC 1511 for CY 2021.
After reviewing all of the public comments, we have decided to
finalize our proposal with modification by using our equitable
adjustment authority under section 1833(t)(2)(E) of the Act to continue
to assign CPT code 0503T to New Technology APC 1511 (New Technology--
Level 11 ($901-$1000)) for CY 2021. We refer readers to Addendum B of
the final rule for the final payment rates for all codes reportable
under the OPPS. Addendum B is available via the internet on the CMS
website.
f. Cardiac Positron Emission Tomography (PET)/Computed Tomography (CT)
Studies
Effective January 1, 2020, we assigned three CPT codes (78431,
78432, and 78433) that describe the services associated with cardiac
PET/CT studies to New Technology APCs. CPT code 78431 was assigned to
APC 1522 (New Technology--Level 22 ($2001-$2500)) with a payment rate
of $2,250.50. CPT codes 78432 and 78433 were assigned to APC 1523 (New
Technology--Level 23 ($2501-$3000)) with a payment rate of $2,750.50.
We had not received any claims billed with CPT codes 78431, 78432,
or 78433 prior to the proposed rule. Therefore, we proposed to continue
to assign these CPT codes to the same new technology APCs as they were
in CY 2020. The proposed CY 2021 payment rate for the codes can be
found in Addendum B to the CY 2021 OPPS/ASC proposed rule (which is
available via the internet on the CMS website).
Comment: Several commenters expressed their support for our
proposal to assign CPT code 78431 to APC 1522 (New Technology--Level 22
($2001-$2500)) with a payment rate of $2,250.50, and to assign CPT
codes 78432 and 78433 to APC 1523 (New Technology--Level 23 ($2501-
$3000)) with a payment rate of $2,750.50.
Response: We appreciate the support of the commenters for our
proposal.
We have not received any claims for these services prior to this
final rule. After our review of the public comments, we have decided to
implement our proposal without modification. Table 14 reports code
descriptors, status indicators, and APC assignments for these CPT
codes.
[[Page 85944]]
[GRAPHIC] [TIFF OMITTED] TR29DE20.026
g. Pathogen Test for Platelets/Rapid Bacterial Testing
For the July 2017 update, the HCPCS Workgroup established HCPCS
code Q9987 (Pathogen(s) test for platelets) effective July 1, 2017.
This new code and the OPPS APC assignment was announced in the July
2017 OPPS quarterly update CR (Transmittal 3783, Change Request 10122,
dated May 26, 2017). Because HCPCS code Q9987 represented a test to
identify bacterial or other pathogen contamination in blood platelets,
we assigned the code to a new technology APC, specifically, New
Technology APC 1493 (New Technology--Level 1C ($21-$30)) with a status
indicator ``S'' and a payment rate of $25.50. We note that temporary
HCPCS code Q9987 was subsequently deleted on December 31, 2017, and
replaced with permanent HCPCS code P9100 (Pathogen(s) test for
platelets) effective January 1, 2018. For the January 2018 update, we
continued to assign the new code to the same APC and status indicator
as its predecessor code. Specifically, we assigned HCPCS code P9100 to
New Technology APC 1493 and status indicator ``S''. For the CY 2019
update, we made no change to the APC or status indicator assignment for
P9100, however, for the CY 2020 update, we revised the APC assignment
from New Technology APC 1493 to 1494 (New Technology--Level 1D ($31-
$40) based on the latest claims data used to set the payment rates for
CY 2020. We discussed the revision in the CY 2020 OPPS/ASC final rule
(84 FR 61219) and indicated that the reassignment to APC 1494
appropriately reflected the cost of the service.
For the CY 2021 OPPS/ASC proposed rule, we stated that we believed
we had sufficient claims data to reassign the code from a New
Technology APC to a clinical APC, and noted that HCPCS code P9100 has
been assigned to a New Technology APC for over 3 years. As stated in
section III.D. (New Technology APCs), a service is paid under a New
Technology APC until sufficient claims data have been collected to
allow CMS to assign the procedure to a clinical APC group that is
appropriate in clinical and resource terms. We expect this to occur
within two to three years from the time a new HCPCS code becomes
effective. However, if we are able to collect sufficient claims data in
less than 2 years, we would consider reassigning the service to an
appropriate clinical APC. Since HCPCS code P9100 has been assigned to a
new technology APC since July 2017, we believe that we should reassign
the code to a clinical APC. Specifically, our claims data for the CY
2021 OPPS/ASC proposed rule showed a geometric mean cost of
approximately $30 for HCPCS code P9100 based on 70 single claims (out
of 1,835 total claims).
[[Page 85945]]
Based on resource cost and clinical homogeneity to the other services
assigned to APC 5732 (Level 2 Minor Procedures), we believed that HCPCS
code P9100 should be reassigned to clinical APC 5732, which had a
geometric mean cost of approximately $33.
As we have stated several times since the implementation of the
OPPS on August 1, 2000, we review, on an annual basis, the APC
assignments for all services and items paid under the OPPS based on our
analysis of the latest claims data. For the CY 2021 OPPS update, based
on claims submitted between January 1, 2019, and December 30, 2019, our
analysis of the latest claims data for the CY 2021 OPPS/ASC proposed
rule supports reassigning HCPCS code P9100 to APC 5732 based on its
clinical and resource homogeneity to the procedures and services in the
APC. Therefore, we proposed to reassign HCPCS code P9100 from New
Technology APC 1494 to clinical APC 5732 for CY 2021. The proposed CY
2021 payment rate for HCPCS code P9100 can be found in Addendum B to
the CY 2021 OPPS/ASC proposed rule with comment period. In addition, we
refer readers to Addendum D1 of the CY 2021 OPPS/ASC proposed rule with
comment period for the status indicator (SI) meanings for all codes
reported under the OPPS. Both Addendum B and D1 are available via the
internet on the CMS website.
Comment: Two commenters expressed their support for our proposal.
Response: We appreciate the support of the commenters.
After reviewing the public comments for this proposal, we have
decided to finalize our proposal without modification to reassign HCPCS
code P9100 from New Technology APC 1494 to clinical APC 5732 for CY
2021. The final rule data supports our decision. The data show a
geometric mean cost of approximately $31 for HCPCS code P9100 based on
75 single claims (out of 2,038 total claims), which is close to the
payment rate of around $33 for APC 5732. The final CY 2021 payment rate
for HCPCS code P9100 can be found in Addendum B to this CY 2021 OPPS/
ASC final rule with comment period. In addition, we refer readers to
Addendum D1 of this CY 2021 OPPS/ASC final rule with comment period for
the status indicator (SI) meanings for all codes reported under the
OPPS. Both Addendum B and D1 are available via the internet on the CMS
website.
h. V-Wave Medical Interatrial Shunt Procedure
A randomized, double-blinded, controlled IDE study is currently in
progress for the V-Wave interatrial shunt. The V-Wave interatrial shunt
is for patients with severe symptomatic heart failure and is designed
to regulate left atrial pressure in the heart. All participants who
passed initial screening for the study receive a right heart
catheterization procedure described by CPT code 93451 (Right heart
catheterization including measurement(s) of oxygen saturation and
cardiac output, when performed). Participants assigned to the
experimental group also receive the V-Wave interatrial shunt procedure
while participants assigned to the control group only receive right
heart catheterization. The developer of V-Wave was concerned that the
current coding of these services by Medicare would reveal to the study
participants whether they have received the interatrial shunt because
an additional procedure code, CPT code 93799 (Unlisted cardiovascular
service or procedure), would be included on the claims for participants
receiving the interatrial shunt. Therefore, we created a temporary
HCPCS code to describe the V-wave interatrial shunt procedure for both
the experimental group and the control group in the study.
Specifically, we established HCPCS code C9758 (Blinded procedure for
NYHA class III/IV heart failure; transcatheter implantation of
interatrial shunt or placebo control, including right heart
catheterization, trans-esophageal echocardiography (TEE)/intracardiac
echocardiography (ICE), and all imaging with or without guidance (for
example, ultrasound, fluoroscopy), performed in an approved
investigational device exemption (IDE) study) to describe the service,
and we assigned the service to New Technology APC 1589 (New
Technology--Level 38 ($10,001-$15,000)).
No claims have been reported for HCPCS code C9758. Therefore, we
proposed to continue to assign the service to New Technology APC 1589
for CY 2021. The proposed CY 2021 payment rate for V-Wave interatrial
shunt procedure can be found in Addendum B to the proposed rule (which
is available via the internet on the CMS website).
Comment: Three commenters including the developer of the V-Wave
interatrial shunt procedure and the developer of the Corvia Medical
interatrial shunt procedure requested that we delete HCPCS code C9758
because V-Wave has decided to no longer seek Medicare payment for its
interatrial shunt procedure trial. The commenters believe that deleting
HCPCS code C9758 will help prevent provider confusion with billing
procedures describing the implementation of interatrial shunts.
Response: We do not intend to delete HCPCS code C9758 and believe
that HCPCS code C9758 is sufficiently distinct from HCPCS code C9760
(Non-randomized, non-blinded procedure for nyha class ii, iii, iv heart
failure; transcatheter implantation of interatrial shunt or placebo
control, including right and left heart catheterization, transeptal
puncture, trans-esophageal echocardiography (tee)/intracardiac
echocardiography (ice), and all imaging with or without guidance (for
example, ultrasound, fluoroscopy), performed in an approved
investigational device exemption (ide) study) that providers will not
be confused about the appropriate service code to report.
Comment: Two commenters, including the developer of the V-Wave
interatrial shunt procedure and the developer of the Corvia Medical
interatrial shunt procedure, provided information about procedures that
had comparable non-device service costs similar to the interatrial
shunt procedures. One commenter suggested using the non-device cost of
CPT code 93580 (Percutaneous transcatheter closure of congenital
interatrial communication (that is, fontan fenestration, atrial septal
defect) with implant) to approximate non-device costs for this
procedure. The other commenter suggested that interatrial septal shunt
procedures and percutaneous intracardiac closure procedures (CPTs
93580-93591) assigned to APC 5194 (Level 4--Endovascular Procedures)
would describe the non-device costs of the interatrial shunt
procedures.
Response: Based on the suggestions of the commenters, we averaged
the non-device costs of the interatrial septal shunt procedures and
percutaneous intracardiac closure procedures to estimate the non-device
costs of the interatrial shunt procedures. Our estimate of the non-
device costs of both the V-Wave interatrial shunt and Corvia Medical
interatrial shunt procedures was around $6,500.
Comment: One commenter requested that we assign the V-Wave
interatrial shunt procedure to a New Technology APC that reflects the
cost of the procedure.
Response: We will assign the V-Wave interatrial shunt procedure to
an APC that reasonably reflects the cost of the
[[Page 85946]]
procedure both when the device is implanted and when a placebo
treatment occurs.
After reviewing the public comments and analyzing the cost of both
the V-Wave interatrial shunt procedure and the Corvia Medical
interatrial shunt procedure, we will finalize our proposal with
modifications. We believe that similar resources and device costs are
involved with the V-Wave interatrial shunt procedure and the Corvia
Medical interatrial shunt procedure. Therefore, the difference in the
payment for HCPCS codes C9758 and C9760 is based on how often the
interatrial shunt is implanted when each code is billed. An interatrial
shunt is implanted one-half of the time HCPCS code C9758 is billed.
Therefore, we will reassign HCPCS code C9758 to New Technology APC
1590, which reflects the cost of having surgery every time and
receiving the interatrial shunt one-half of the time when the procedure
is performed. Details about the HCPCS code and its APC assignment are
shown in Table 15. The final CY 2021 payment rate for the V-Wave
interatrial shunt procedure can be found in Addendum B to the final
rule.
[GRAPHIC] [TIFF OMITTED] TR29DE20.027
i. Corvia Medical Interatrial Shunt Procedure
Corvia Medical is currently conducting their pivotal trial for
their interatrial shunt procedure. The trial started in Quarter 1 of CY
2017 and is scheduled to continue through CY 2021. On July 1, 2020, we
established HCPCS code C9760 (Non-randomized, non-blinded procedure for
nyha class ii, iii, iv heart failure; transcatheter implantation of
interatrial shunt or placebo control, including right and left heart
catheterization, transeptal puncture, trans-esophageal echocardiography
(tee)/intracardiac echocardiography (ice), and all imaging with or
without guidance (for example, ultrasound, fluoroscopy), performed in
an approved investigational device exemption (ide) study) to facilitate
the implantation of the Corvia Medical interatrial shunt.
In the CY 2021 OPPS/ASC proposed rule, we proposed to assign HCPCS
code C9760 to New Technology APC 1589. The proposed CY 2021 payment
rate for Corvia Medical interatrial shunt procedure was found in
Addendum B to the proposed rule (which is available via the internet on
the CMS website).
Comment: Several commenters recommended revising the code
descriptor for HCPCS code C9760 since the current descriptor
inaccurately suggests that the code may include placebo control
subjects who would not receive a shunt implant. The commenters
specifically requested deleting the phrase ``or placebo control'' to
eliminate any confusion on how this code should be reported.
Response: We agree with the commenters and have revised the long
descriptor effective January 1, 2021 to read ``Non-randomized, non-
blinded procedure for NYHA Class II, III, IV heart failure;
transcatheter implantation of interatrial shunt, including right and
left heart catheterization, transeptal puncture, trans-esophageal
echocardiography (TEE)/intracardiac echocardiography (ICE), and all
imaging with or without guidance (for example, ultrasound,
fluoroscopy), performed in an approved investigational device exemption
(IDE) study.'' The revised long descriptor for HCPCS code C9760 can
also be found in the 2021 Alpha Numeric HCPCS File that is posted on
the CMS HCPCS website, specifically, at https://www.cms.gov/Medicare/Coding/HCPCSReleaseCodeSets/Alpha-Numeric-HCPCS.
Comment: Two commenters, including the developer of the Corvia
Medical interatrial shunt procedure and the developer of the V-Wave
interatrial shunt procedure, provided information about procedures that
had comparable non-device service costs similar to the interatrial
shunt procedures. One commenter suggested using the non-device cost of
CPT code 93580 (Percutaneous transcatheter closure of congenital
interatrial communication (that is, fontan fenestration, atrial septal
defect) with implant). The other commenter suggested that interatrial
septal shunt procedures and percutaneous intracardiac closure
procedures (CPTs 93580-93591) assigned to APC 5194 (Level 4--
Endovascular Procedures) would describe the non-device costs of the
interatrial shunt procedures.
Response: Based on the suggestions of the commenters, we averaged
the non-device costs of the interatrial septal shunt procedures and
percutaneous intracardiac closure procedures to estimate the non-device
costs of the interatrial shunt procedures. Our estimated cost of the
non-device costs of the both the Corvia Medical interatrial shunt and
V-Wave interatrial shunt procedures was around $6,500.
Comment: Multiple commenters, including the developer of the Corvia
Medical interatrial shunt procedure and the developer of the V-Wave
interatrial shunt procedure, requested a higher payment rate for the
procedure. Several commenters were concerned that the payment rate
established for HCPCS
[[Page 85947]]
code C9760 would discourage providers from participating in the
clinical trial, and the developer of the Corvia Medical interatrial
shunt procedure stated that they had to assume all costs for the trial
because of inadequate payment for the Corvia Medical interatrial shunt
procedure. The developer of the V-Wave interatrial shunt procedure
mentioned that HCPCS code C9760 is the service code they will use to
report interatrial shunt procedures for their continuing study.
Response: As mentioned earlier, we decided to estimate the non-
device costs of both the Corvia Medical interatrial shunt procedure and
the V-Wave interatrial shunt procedure. We also plan to combine the
non-device costs of the procedures with the costs of the interatrial
shunt device to create a new estimate of the payment rate for HCPCS
code C9760. HCPCS code C9760 can be used to report any non-randomized,
non-blinded study related to the implantation of interatrial shunts
where the device is implanted for every procedure reported.
After our review of the public comments, we intend to finalize our
proposal with modifications. We believe that similar resources and
device costs are involved with the Corvia Medical interatrial shunt
procedure and the V-Wave interatrial shunt procedure. Therefore, the
difference in the payment for HCPCS codes C9760 and C9758 is based on
how often the interatrial shunt is implanted when each code is billed.
The Corvia Medical interatrial shunt is implanted every time HCPCS code
C9760 is billed. Therefore, we will reassign HCPCS code C9760 to New
Technology APC 1592. We also will implement the commenters' suggestion
to modify the code descriptor for HCPCS code C9760 to remove the phrase
``or placebo control,'' from the descriptor. Details about the HCPCS
code and its APC assignment are shown in Table 16. The final CY 2021
payment rate for the Corvia Medical interatrial shunt procedure can be
found in Addendum B to the final rule.
[GRAPHIC] [TIFF OMITTED] TR29DE20.028
j. Supervised Visits for Esketamine Self-Administration (HCPCS Codes
G2082 and G2083 APCs 1508 and 1511)
On March 5, 2019, FDA approved Spravato\TM\ (esketamine) nasal
spray, used in conjunction with an oral antidepressant, for treatment
of depression in adults who have tried other antidepressant medicines
but have not benefited from them (treatment-resistant depression
(TRD)). Because of the risk of serious adverse outcomes resulting from
sedation and dissociation caused by Spravato administration, and the
potential for abuse and misuse of the product, it is only available
through a restricted distribution system under a Risk Evaluation and
Mitigation Strategy (REMS). A REMS is a drug safety program that FDA
can require for certain medications with serious safety concerns to
help ensure the benefits of the medication outweigh its risks.
A treatment session of esketamine consists of instructed nasal
self-administration by the patient, followed by a period of post-
administration observation of the patient under direct supervision of a
health care professional. Esketamine is a noncompetitive N-methyl D-
aspartate (NMDA) receptor antagonist. It is a nasal spray supplied as
an aqueous solution of esketamine hydrochloride in a vial with a nasal
spray device. This is the first FDA approval of esketamine for any use.
Each device delivers two sprays containing a total of 28 mg of
esketamine. Patients would require either two (2) devices (for a 56mg
dose) or three (3) devices (for an 84 mg dose) per treatment.
Because of the risk of serious adverse outcomes resulting from
sedation and dissociation caused by Spravato administration, and the
potential for abuse and misuse of the product, Spravato is only
available through a restricted distribution system under a REMS;
patients must be monitored by a health care provider for at least 2
hours after receiving their Spravato dose; the prescriber and patient
must both sign a Patient Enrollment Form; and the product will only be
administered in a certified medical office where the health care
provider can monitor the patient. Please refer to the CY 2020 PFS final
rule and interim final rule for more information about supervised
visits for esketamine self-administration (84 FR 63102 through 63105).
To facilitate prompt beneficiary access to the new, potentially
life-saving treatment for TRD using esketamine, we created two new
HCPCS G codes, G2082 and G2083, effective January 1, 2020. HCPCS code
G2082 is for an outpatient visit for the evaluation and management of
an established patient that requires the supervision of a physician or
other qualified health care professional and provision of up to 56 mg
of esketamine nasal self-administration and includes 2 hours post-
administration observation. HCPCS code G2082 was assigned to New
Technology APC 1508 (New
[[Page 85948]]
Technology--Level 8 ($601-$700)) with a payment rate of $650.50. HCPCS
code G2083 describes a similar service to HCPCS code G2082, but
involves the administration of more than 56 mg of esketamine. HCPCS
code G2083 was assigned to New Technology APC 1511 (New Technology--
Level 11 ($901-$1000)) with a payment rate of $950.50.
No Medicare OPPS claims had been reported for either HCPCS code
G2082 or G2083 prior to the CY 2021 OPPS/ASC proposed rule. Therefore,
we proposed to continue to assign HCPCS code G2082 to New Technology
APC 1508 and to assign HCPCS code G2083 to New Technology APC 1511. The
proposed CY 2021 payment rate for esketamine self-administration can be
found in Addendum B to proposed rule (which is available via the
internet on the CMS website).
Comment: Two commenters supported our proposal.
Response: We appreciate the support of the commenters.
We have not received any OPPS claims for this code prior to this
final rule. After reviewing the public comments for this proposal, we
have decided to implement our proposal without modification to assign
HCPCS code G2082 to New Technology APC 1508 and to assign HCPCS code
G2083 to New Technology APC 1511. Details about the HCPCS codes and
their APC assignments are shown in Table 17. The final CY 2021 payment
rate for esketamine self-administration can be found in Addendum B to
the proposed rule (which is available via the internet on the CMS
website).
[GRAPHIC] [TIFF OMITTED] TR29DE20.029
D. APC-Specific Policies
1. Administration of Lacrimal Ophthalmic Insert Into Lacrimal
Canaliculus (APC 5692)
HCPCS code J1096 (Dexamethasone, lacrimal ophthalmic insert, 0.1
mg) is a drug indicated ``for the treatment of ocular inflammation and
pain following ophthalmic surgery.''\4\ Stakeholders assert that this
drug is administered through CPT code 0356T (Insertion of drug-eluting
implant (including punctal dilation and implant removal when performed)
into lacrimal canaliculus, each). Stakeholders also state the drug is
inserted in a natural opening in the eyelid (called the punctum) and
that the drug is designed to deliver a tapered dose of dexamethasone to
the ocular surface for up to 30 days.
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\4\ 1 Dextenza. FDA Package Insert. https://www.accessdata.fda.gov/drugsatfda_docs/label/2019/208742s001lbl.pdf.
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HCPCS code J1096 is currently on pass-through status and assigned
to APC 9308 (Dexametha opth insert 0.1 mg) with status indicator ``G''.
Please see section V.A.5. of this final rule with comment period for
further information
[[Page 85949]]
regarding the pass-through status of J1096. CPT code 0356T is currently
assigned to status indicator ``Q1,'' indicating conditionally packaged
payment under the OPPS. Packaged payment applies if a code assigned
status indicator ``Q1'' is billed on the same claim as a HCPCS code
assigned status indicator ``S'', ``T'', or ``V''. Accordingly, based on
the OPPS assigned status indicator, CPT code 0356T is assigned to
payment indicator ``N1'' in the ASC setting, meaning a packaged
service/item.
We refer readers to Addendum D1 of this final rule for a list of
OPPS status indicators and their definitions, available via the
internet on the CMS website. We also refer readers to Addendum AA for
ASC payment indicator assignments and to Addendum DD1 for payment
indicator definitions, available via the internet on the CMS website.
CPT code 0356T is assigned to APC 5692 (Level 2 Drug
Administration). With regards to APCs 5691 (Level 1 Drug
Administration) and APC 5692 (Level 2 Drug Administration), and as
stated in the CY 2018 OPPS/ASC final rule with comment period, our
overarching goal is to make OPPS payments for all services paid under
the OPPS more consistent with those of a prospective payment system and
less like those of a per-service fee schedule. To achieve this goal, it
is important that we are consistent in our approach to packaging items
and services under the established packaging categories. Therefore, in
the CY 2018 OPPS/ASC final rule with comment period, after
consideration of the public comments we received, we finalized, without
modification, the proposed policy to conditionally package low-cost
drug administration services assigned to APC 5691 and APC 5692 (82 FR
52391 through 52393). Additionally, conditional packaging for Levels 1
and 2 Drug Administration services is consistent with the ancillary
packaging policy that was adopted in the 2015 OPPS/ASC Final Rule with
comment period (79 FR 66819 through 66822). Accordingly, in the CY 2021
OPPS/ASC Proposed Rule, we did not propose to change the OPPS status
indicator assignment and APC placement, or ASC payment indicator
assignment for CPT code 0356T.
Comment: Several commenters had concerns with continuing the same
APC placement of APC 5692 for CPT code 0356T for CY 2021. Commenters
generally advocated for separate payment for this CPT code through a
change in status indicator. A few commenters suggested alternative APC
placements, such as APC 5501 (Level 1 Extraocular, Repair, and Plastic
Eye Procedures), APC 5693 (Level 3 Drug Administration), or APC 1504
(New Technology--Level 4), whereas other commenters requested a larger
payment in general without a specific APC placement suggestion. Several
stakeholders commented that the clinical importance of providing HCPCS
code J1096 to patients is that it reduces ocular pain, inflammation,
and reduces the burden of topical eyedrop application.
Additionally, providers stated that they usually perform CPT code
0356T to administer HCPCS code J1096 after the conclusion of ophthalmic
surgeries. Most commonly, providers cited using CPT code 0356T to
administer HCPCS code J1096 after surgeries such as cataract, glaucoma,
and corneal surgeries. Commenters believe the procedure is a distinct
surgical procedure that requires additional operating room time and
resources. Commenters were concerned that the lack of increased or
separate payment may reduce access to HCPCS J1096, particularly in the
ASC setting.
Response: We thank commenters for their feedback. After careful
consideration of the statements from commenters, we continue to believe
that assignment of CPT code 0356T to APC 5692, with an OPPS status
indicator ``Q1'' and an associated ASC payment indicator of ``N1'', is
appropriate based on its clinical and resource use similarity to other
services assigned to that APC. Commenters have stated that CPT code
0356T is performed during ophthalmic surgeries such as cataract
surgeries. We do not find it appropriate to compare CPT code 0356T to
that of an independent procedure when performed during these other
ophthalmic surgeries. We continue to believe that conditionally
packaging the payment for CPT code 0356T into the payment for these
primary procedures is appropriate. This is consistent with our policy
to conditionally package low-cost drug administration services assigned
to APC 5691 (Level 1 Drug Administration) and APC 5692 (Level 2 Drug
Administration). We note the policy established in the CY 2018 OPPS to
conditionally package low-cost drug administration services assigned to
APC 5691 and APC 5692 (82 FR 52391 through 52393). Also, we note that
the conditional packaging of drug administration supports our
overarching goal to make payments for all services paid under the OPPS
and ASC payment system more consistent with those of a prospective
payment system and less like those of a per-service fee schedule. We
believe that packaging encourages efficiency and is an essential
component of a prospective payment system, and that packaging payments
for items and services that are typically integral, ancillary,
supportive, dependent, or adjunctive to a primary service is a
fundamental part of the OPPS.
After consideration of the public comments, we are finalizing our
proposed policy without modification to assign CPT code 0356T to APC
5692 (Level 2 Drug Administration) with OPPS status indicator ``Q1'' in
the CY 2021 OPPS. Based on those assignments, we are also finalizing an
ASC payment indicator for CPT code 0356T of ``N1'' under the CY 2021
ASC payment system.
2. Chimeric Antigen Receptor T-Cell (CAR T-Cell) Therapy (APCs 5694,
9035, 9194, and 9391)
Chimeric Antigen Receptor T-Cell (CAR T-cell) therapy is a cell-
based gene therapy in which T-cells are collected and genetically
engineered to express a chimeric antigen receptor that will bind to a
certain protein on a patient's cancerous cells. The CAR T-cells are
then administered to the patient to attack certain cancerous cells and
the individual is observed for potential serious side effects that
would require medical intervention. We refer readers to previous
discussions in the OPPS/ASC final rules with comment period for
background regarding the specific CAR T-cell products, in both the CY
2020 OPPS/ASC final rule with comment period (84 FR 61231 through
61234) and the CY 2019 OPPS/ASC final rule with comment period (83 FR
58904 through 58908). In addition, for discussion about CY 2021 OPPS
payment policies for separately paid drugs with pass-through status
expiring or continuing in CY 2021, please see sections V.A.4. and
V.A.5. of this final rule with comment period.
The AMA created four Category III CPT codes that are related to CAR
T-cell therapy, effective January 1, 2019. As discussed in the CY 2019
OPPS/ASC final rule with comment period (83 FR 58904 through 58908) and
the CY 2020 OPPS/ASC final rule with comment period (84 FR 61231
through 61234), we finalized our proposal to assign procedures
described by CPT codes 0537T, 0538T, and 0539T to status indicator
``B'' (Codes that are not recognized by OPPS when submitted on an
outpatient hospital Part B bill type (12x and 13x)) to indicate that
the services are not paid under the OPPS. The procedures described by
CPT codes 0537T, 0538T, and 0539T describe the various steps required
to collect and
[[Page 85950]]
prepare the genetically modified T-cells, and Medicare does not
generally pay separately for each step used to manufacture a drug or
biological. We also finalized that the procedures described by CPT code
0540T would be assigned status indicator ``S'' (Procedure or Service,
Not Discounted when Multiple) and APC 5694 (Level 4 Drug
Administration) for CY 2019 and CY 2020, and made no proposal to change
the assignment for CY 2021. Additionally, the National Uniform Billing
Committee (NUBC) established CAR T-cell-related revenue codes and a
value code to be reportable on Hospital Outpatient Department (HOPD)
claims effective for claims received on or after April 1, 2019.
We made no specific proposal related to the CAR T-cell preparation
codes, as described by CPT codes 0537T, 0538T, 0539T. As listed in
Addendum B of the CY 2021 OPPS/ASC proposed rule, we proposed to
continue to assign procedures described by these CPT codes, 0537T,
0538T, and 0539T, to status indicator ``B'' (Codes that are not
recognized by OPPS when submitted on an outpatient hospital Part B bill
type (12x and 13x)) to indicate that the services are not paid under
the OPPS. We proposed to continue to assign CPT code 0540T to status
indicator ``S'' (Procedure or Service, Not Discounted when Multiple)
and APC 5694 (Level IV Drug Administration).
Comment: Several commenters opposed our proposal to continue to
assign status indicator ``B'' to CPT codes 0537T, 0538T, and 0539T for
CY 2021. Commenters stated that a change in status indicator would be
appropriate, with a preference for assigning CPT codes 0537T, 0538T,
and 0539T to status indicator ``Q1''. Commenters believed that the
procedures these CPT codes describe did not represent the steps
required to manufacture the CAR T-cell product, as CMS has stated.
Generally, those advocating for a change in status indicator contend
this change is necessary to allow services furnished to the patient to
be eligible for payment and for hospitals to be paid appropriately for
the services they provide during each step of the CAR T-cell process.
Commenters asked CMS to release new cost centers and to revise the
instructions in MLN Matters Article SE19009 accordingly.
Response: We thank the commenters for their feedback. CMS does not
believe that separate or packaged payment under the OPPS is necessary
for the procedures described by CPT codes 0537T, 0538T, and 0539T for
CY 2021. The procedures described by CPT codes 0537T, 0538T, and 0539T
describe the various steps required to collect and prepare the
genetically modified T-cells and Medicare does not generally pay
separately for each step used to manufacture a drug or biological
product. Additionally, we note that CAR T-cell therapy is a unique
therapy approved as a biologic, with unique preparation procedures,
that cannot be directly compared to other therapies or existing CPT
codes. We note that the current HCPCS coding for the currently approved
CAR T-cell therapies include leukapheresis and dose preparation
procedures, as these services are included in the manufacturing of
these biologicals. Therefore, payment for these services is
incorporated into the drug codes. Please see Table 18 for HCPCS coding
for CAR T-cell therapies.
[GRAPHIC] [TIFF OMITTED] TR29DE20.030
We note that although there is no payment associated with CPT codes
0537T, 0538T, and 0539T for reasons stated previously, these codes can
still be reported to CMS for tracking purposes. We thank commenters for
their feedback related to cost centers and our guidance contained in
MLN Matters Article SE19009.\5\ We are not revising this document at
this time, but appreciate the feedback from stakeholders. Also, we
would like to note that HOPDs can bill Medicare for reasonable and
necessary services that are otherwise payable under the OPPS, and we
believe that the comments in reference to payment for services in
settings not payable under the OPPS are outside the scope of this
proposed rule. Accordingly, we are not revising the existing codes for
CAR T-cell therapies to remove leukapheresis and dose preparation
procedures, and we are not accepting the recommendations at this time
to revise the status indicators for procedures described by CPT codes
0537T, 0538T, and 0539T. We will continue to evaluate and monitor
payment for CAR T-cell therapies.
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\5\ https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/downloads/SE19009.pdf.
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In summary, after consideration of the public comments we received,
we are finalizing our proposal to assign status indicator ``B'' to CPT
codes 0537T, 0538T, and 0539T for CY 2021. Additionally, we are
continuing our policy from CY 2019 to assign status indicator ``S'' to
CPT code 0540T for CY 2021. Table 19 below shows the final SI
[[Page 85951]]
and APC assignments for HCPCS codes 0537T, 0538T, 0539T, and 0540T for
CY 2021. For more information on CY 2021 OPPS final status indicators,
APC assignments, and payment rates for HCPCS codes, including the CAR
T-cell drug codes, we refer readers to Addendum B to this final rule
with comment period. In addition, the status indicator definitions can
be found in Addendum D1 (OPPS Payment Status Indicators for CY 2021) to
this final rule with comment period. Both Addendum B and D1 are
available via the internet on the CMS website.
[GRAPHIC] [TIFF OMITTED] TR29DE20.031
3. Eustachian Tube Balloon Dilation Procedure (APC 5165)
For the CY 2021 update, the CPT Editorial Panel established CPT
codes 69705 and 69706 to describe the eustachian tube balloon dilation
(ETBD) surgical procedure effective January 1, 2021. Prior to CY 2021,
this surgical procedure was described by HCPCS code C9745.
In 2017, CMS received a new technology application for the
transnasal flexible balloon catheter eustachian tube dilation surgical
procedure, which is associated with the Acclarent Aera Eustachian Tube
Balloon Dilation System, and established a new code, specifically,
HCPCS code C9745. Based on the estimated cost for the bilateral
placement of the eustachian tube balloon dilation devices, we assigned
the code to APC 5165 (Level 5 ENT Procedures) with a payment rate of
$4,130.94 effective July 1, 2017. We announced the new code, interim SI
and APC assignments, and payment rate in the July 2017 quarterly update
to the OPPS (Transmittal 3783, Change Request 10122, dated May 26,
2017).
For the CY 2018 update, we made no change to the APC assignment and
continued to assign HCPCS code C9745 to APC 5165 with a payment rate of
$4,338.79. We note that OPPS payment rates for the CY 2018 update were
based on claims submitted between January 1, 2016 through December 30,
2016, that were processed on or before June 30, 2017. Because HCPCS
code C9745 was established on July 1, 2017, we had no claims data for
the procedure for use in CY 2018 ratesetting.
For the CY 2019 update, based on our analysis of the claims data,
we made no change to the payment assignment and continued to assign
HCPCS code C9745 to APC 5165. Specifically, our claims data showed a
geometric mean cost of approximately $4,385 for HCPCS code C9745 based
on 217 single claims (out of 218 total claims), which was consistent
with the geometric mean cost of about $4,462 for APC 5165.
Consequently, we retained HCPCS code C9745 in APC 5165.
Similarly, for CY 2020, we made no change to the APC assignment for
HCPCS code C9745, consistent with our claims data. Based on claims
submitted between January 1, 2018 through December 30, 2018, that were
processed on or before June 30, 2019, the geometric mean cost for HCPCS
code C9745 was approximately $4,547 based on 577 single claims (out of
582 total claims), which is in line with the geometric mean cost of
$4,746 for APC 5165. Therefore, we maintained HCPCS code C9745 in APC
5165.
For CY 2021, we proposed to delete HCPCS code C9745 and assign CPT
code 69705 to APC 5164 (Level 4 ENT Procedures) with a proposed OPPS
payment of $2,776.63 and assign CPT code 69706 to APC 5165 (Level 5 ENT
Procedures) with a proposed OPPS payment of $5,150.60. Because HCPCS
code C9745 was on the ASC Covered Surgical Procedures list, we also
proposed to assign CPT code 69705 to ASC payment indicator ``J8''
(device-intensive) with a proposed ASC payment of $1,564.17. Similarly,
we proposed to assign CPT code 69706 to ASC payment indicator ``J8''
(device-intensive) with a proposed ASC payment of $3,453.23. We note
that CPT codes 69705 and 69706 were listed as placeholder codes 697XX
and 697X1, respectively, in OPPS Addendum B and ASC Addendum AA to the
CY 2021 OPPS/ASC proposed rule.
Comment: Some commenters expressed concern with the proposed
assignment to APC 5164 for CPT code 69705 (unilateral procedure) and
stated that the proposed assignment will negatively affect the
reimbursement of the procedure in the ASC setting, and ultimately
decrease access to the procedure. They stated that the major portion of
the procedure cost is the device used in the procedure, and reported
the device cost is about $2,180, which is used for each procedure,
regardless of whether it is a unilateral or bilateral procedure. In
addition, they stated that in the CY 2021 Physician Fee Schedule (PFS)
proposed rule, the
[[Page 85952]]
estimate for the non-facility payment for CPT codes 69705 and 69706
includes the full cost of the device kit, specifically, $3,092.81 for
CPT code 69705 (unilateral) and $3,183.14 for CPT code 69706
(bilateral). To ensure fair reimbursement for unilateral procedures,
they recommended that CMS assign both codes to APC 5165. However, in
the event the recommendation is not accepted, they urged CMS to
reconsider the device-intensive calculation for CPT code 69705 to
reflect the cost of the device kit for unilateral procedures in the ASC
setting; otherwise, commenters contended the ASC payment will be
reduced below the actual cost of the device kit.
Response: Our medical advisors advised that the procedure described
by CPT code 69705, while performed in the hospital outpatient setting,
will primarily be performed in either the physician office or ASC
setting. To ensure that Medicare beneficiaries have access to the
procedure, we believe that it is appropriate to reassign CPT code 69705
(unilateral) to the same APC as CPT code 69706 (bilateral). That is, we
believe that reassigning CPT code 69705 to APC 5165 will better reflect
the device cost to perform this procedure either unilaterally or
bilaterally when furnished in either the hospital outpatient or the ASC
setting.
In summary, after consideration of the public comments, we are
finalizing our proposal, without modification, to assign CPT code 69706
to APC 5165. However, we are finalizing our proposal, with
modification, to assign CPT code 69705 to APC 5165 for CY 2021. We note
that we are deleting HCPCS code C9745 on December 31, 2020, since it
has been replaced with CPT codes 69705 and 69706 effective January 1,
2021. Table 20 lists the final SI and APC assignments for the two
codes. The final CY 2021 OPPS payment rate for the codes can be found
in Addendum B to this final rule with comment period. In addition, we
refer readers to Addendum D1 of this final rule with comment period for
the status indicator (SI) meanings for all codes reported under the
OPPS. Both Addendum B and D1 are available via the internet on the CMS
website.
[GRAPHIC] [TIFF OMITTED] TR29DE20.032
4. Eye-Movement Analysis Without Spatial Calibration (APC 5734)
For July 2020, the CPT Editorial Panel established a new CPT code
0615T, effective July 1, 2020, to describe eye-movement analysis
without spatial calibration that involves the use of the EyeBOX system
as an aid in the diagnosis of concussion, also known as mild traumatic
brain injury (mTBI). The EyeBOX is intended to measure and analyze eye
movements as an aid in the diagnosis of concussion within one week of
head injury in patients 5 through 67 years of age in conjunction with a
standard neurological assessment of concussion. A negative EyeBOX
classification may correspond to eye movement that is consistent with a
lack of concussion. A positive EyeBOX classification corresponds to eye
movement that may be present in both patients with or without a
concussion.
We included this new code in the July quarterly OPPS update CR
(Transmittal 10224, Change Request 11814, dated July 15, 2020).
Effective July 1, 2020, we assigned CPT code 0615T to APC 5734 (Level 4
Minor Procedures) with status indicator ``Q1'' (conditionally packaged)
and a CY 2020 OPPS payment rate of $109.03 as reflected in the Addendum
B to the July 2020 quarterly OPPS update.
As displayed in the Addendum B to the 2021 ASC/OPPS Proposed Rule,
we proposed to assign 0615T to APC 5734 with status indicator ``Q1''
and a proposed OPPS payment rate of $113.23 for CY 2021. We also
assigned this code to comment indicator ``NP'' in Addendum B to
indicate that this code is new effective July 1, 2020, and that public
comments would be accepted on its proposed status indicator assignment.
Comment: A commenter was concerned that what they believed was a
lack of adequate, separate payment would strongly discourage hospitals
from providing this important new technology to their patients. The
commenter urged CMS to: (1) Change the APC assignment of CPT code 0615T
to APC 5722 (Level 2 Diagnostic Tests and Related Services) with a
proposed OPPS payment rate of $269.85 and (2) change the status
indicator for the service to ``S'' to allow for a separate payment
under the OPPS.
The commenter asked that CMS assign CPT code 0615T to APC 5722 for
two reasons: (1) The current and proposed reimbursement rates for
services in APC 5734 are inadequate to pay hospitals appropriately for
the costs
[[Page 85953]]
of furnishing the EyeBOX test; and (2) the clinical characteristics and
resources associated with 0615T are more similar to codes in APC 5722
than services in APC 5734.
Response: We note that OPPS payment rates for the CY 2021 final
rule are based on claims submitted between January 1, 2019 through
December 31, 2019, that were processed on or before June 30, 2020.
Because HCPCS code 0615T was established on July 1, 2020, we did not
have claims data for CY 2021 OPPS ratesetting.
In terms of the resource similarity of CPT code 0615T to other eye-
related diagnostic tests that are assigned to APC 5722, such as CPT
code 92240 (Indocyanine-green angiography (includes multiframe imaging)
with interpretation and report, unilateral or bilateral) and CPT code
92242 (Fluorescein angiography and indocyanine-green angiography
(includes multiframe imaging) performed at the same patient encounter
with interpretation and report, unilateral or bilateral), the EyeBOX
test does not involve an injection. Therefore, we do not believe that
the resource costs for CPT code 0615T are comparable to other eye-
related diagnostic tests in APC 5722. Updated claims data for this
final rule with comment period indicate that the geometric mean cost of
APC 5722 is $257.61, while the geometric mean cost of APC 5734 is
$109.05. However, because there were no claims for CPT code 0615T in
the CY 2021 updated data set, we have decided not to make any changes
to the proposed CY 2021 APC assignment and to assign the code to the
APC with the lower geometric mean cost. Based on these findings, we
believe that maintaining assignment of APC 5734 for CPT code 0615T for
CY 2021 is appropriate.
In response to the comment related to status indicator ``Q1'', we
note that status indicator ``Q1'' listed in the OPPS Addendum D1 to
this 2021 OPPS/ASC final rule with comment period allows for up to
three potential payment assignments:
Packaged APC payment if billed on the same claim as a
HCPCS code assigned status indicator ``S'', ``T'', or ``V''; or
Composite APC payment if billed with specific combinations
of services based on OPPS composite-specific payment criteria. Payment
is packaged into a single payment for specific combinations of
services; or
In other circumstances, payment is made through a separate
APC payment.
Depending on the procedures submitted on the claim and whether the
procedure described by CPT code 0615T is performed with any other
services on the same day, the procedure described by CPT code 0615T may
be paid separately through an APC (in this case APC 5734) or receive
packaged payment when accompanying a more significant procedure that is
reported on the claim. Based on the nature of this procedure, which may
be performed by itself or with other procedures on the same claim, we
believe that the continued assignment of status indicator ``Q1'' is
appropriate for the procedure described by CPT code 0615T.
As we do every year, we will reevaluate the APC assignment for CPT
code 0615T for the next rulemaking cycle. We note that we review, on an
annual basis, the APC assignments for all services and items paid under
the OPPS.
After consideration of the public comments we received, we are
finalizing our proposal, without modification, to assign CPT code 0615T
to status indicator ``Q1'' and APC 5734 for CY 2021. The final CY 2021
payment rate for the CPT code can be found in Addendum B to this final
rule with comment period (which is available via the internet on the
CMS website).
5. Gynecologic Procedures and Services (APC 5416)
For CY 2021, we proposed to continue to assign CPT code 0404T
(Transcervical uterine fibroid(s) ablation with ultrasound guidance,
radiofrequency) to APC 5416 (Level 6 Gynecologic Procedures) with a
proposed payment of $6,929.92. CPT code 0404T describes the procedure
associated with the Sonata System, which is used for the treatment of
symptomatic uterine fibroids. We note that CPT code 0404T was effective
on January 1, 2016.
Comment: Several commenters stated that the proposed APC payment
rate is insufficient to compensate hospital outpatient departments for
the resources needed to perform the procedure. They indicated that the
combined cost of the single-use handpiece, capital equipment, supplies,
screening labs, anesthesia, medication, and facility and personnel
overhead are higher than the OPPS payment rate. The commenters asserted
that the proposed payment will significantly limit patient access to
the procedure because it does not cover the total cost of the surgery.
One commenter acknowledged that the proposed payment appropriately
reimburses for hospital outpatient costs, but believed the ASC proposed
payment of $2,763.68 significantly underpays for the procedure in the
ASC setting. The same commenter explained that CMS has no claims data
for the code because the procedure is rarely performed on Medicare
patients, and also due to the device's commercial availability.
Although the CPT code was effective January 2016, because of
manufacturing issues, the company was unable to submit their FDA
application until a couple of years later. The company eventually
received market approval from the FDA in August 2018 and the device was
commercially available in late summer/early Fall 2019. To ensure access
to the procedure, the commenters suggested reassigning CPT code 0404T
to either:
APC 5362 (Level 2 Laparoscopy and Related Services) with a
proposed payment rate of $9,041.94 because the procedure cost is
similar to these procedures:
[cir] CPT code 43210 (Esophagogastroduodenoscopy, flexible,
transoral; with esophagogastric fundoplasty, partial or complete,
includes duodenoscopy when performed);
[cir] CPT code 50593 (Ablation, renal tumor(s), unilateral,
percutaneous, cryotherapy);
[cir] CPT code 58546 (Laparoscopy, surgical, myomectomy, excision;
5 or more intramural myomas and/or intramural myomas with total weight
greater than 250 g); and
[cir] CPT code 58674 (Laparoscopy, surgical, ablation of uterine
fibroid(s) including intraoperative ultrasound guidance and monitoring,
radiofrequency), or
APC 5376 (Level 6 Urology and Related Services) with a
proposed payment of $8,395.62 because the procedure cost is similar to
these procedures:
[cir] CPT code 55873 (Cryosurgical ablation of the prostate
(includes ultrasonic guidance and monitoring); and
[cir] CPT code 0421T (Transurethral waterjet ablation of prostate,
including control of post-operative bleeding, including ultrasound
guidance, complete (vasectomy, meatotomy, cystourethroscopy, urethral
calibration and/or dilation, and internal urethrotomy are included when
performed)).
Response: For CY 2021, OPPS payments are developed based on claims
submitted between January 1, 2019 through December 31, 2019, and
processed through June 30, 2020. For this final rule with comment
period, we have no claims data for this code. As explained by a
commenter, CPT code 0404T is a procedure not commonly performed on
Medicare beneficiaries. In addition, we disagree with the commenters'
assessment that CPT code
[[Page 85954]]
0404T is similar to the codes they have referenced. CPT code 0404T is
not a urology, kidney, or esophagogastroduodenum-related procedure, nor
is it a laparoscopy procedure. We believe that the code is
appropriately placed in APC 5416 based on its clinical homogeneity and
resource costs to the other gynecology-related procedures in the APC.
We agree with the commenter who believed that the proposed OPPS payment
for the service is adequate to cover the cost of providing the
procedure in the hospital outpatient setting.
For a discussion on the ASC payment for CPT code 0404T, we refer
readers to the ASC payment section of this CY 2021 OPPS/ASC final rule
with comment period, specifically, section XIII. (Updates to the
Ambulatory Surgical Center (ASC) Payment System).
Comment: Some commenters suggested designating CPT code 0404T as
device-intensive under the OPPS so that facilities can be paid
appropriately for furnishing the procedure in the ASC setting. They
also recommended establishing an offset percentage that is higher than
the default 31 percent based on invoice pricing data provided to CMS by
the device manufacturer so that payment for the procedure in the ASC
setting includes the cost of the device.
Response: We refer readers to section IV. B. (Device-Intensive
Procedures) for the discussion related to the OPPS device offset for
the code. For a discussion of the ASC procedures designed as device
intensive, please see section XIII.C.1. of this final rule with comment
period.
In summary, after consideration of the public comments, we are
finalizing our proposal, without modification, and assigning CPT code
0404T to APC 5416 for CY 2021. The final CY 2021 OPPS payment rate for
the code can be found in Addendum B to this final rule with comment
period. In addition, we refer readers to Addendum D1 of this final rule
with comment period for the status indicator (SI) assignments for all
codes reported under the OPPS. Both Addendum B and D1 are available via
the internet on the CMS website.
6. Hemodialysis Arteriovenous Fistula (AVF) Procedures (APC 5194)
For CY 2019, based on two new technology applications received by
CMS for hemodialysis arteriovenous fistula creation, CMS established
two new HCPCS codes to describe the surgical procedure associated with
the two technologies since no specific CPT codes exist. Specifically,
CMS established HCPCS code C9754 for the Ellipsys System and C9755 for
the WavelinQ System effective January 1, 2019. The complete descriptors
for both codes are as follows:
C9754 (Creation of arteriovenous fistula, percutaneous;
direct, any site, including all imaging and radiologic supervision and
interpretation, when performed and secondary procedures to redirect
blood flow (e.g., transluminal balloon angioplasty, coil embolization,
when performed))
C9755 (Creation of arteriovenous fistula, percutaneous
using magnetic-guided arterial and venous catheters and radiofrequency
energy, including flow-directing procedures (e.g., vascular coil
embolization with radiologic supervision and interpretation, when
performed) and fistulogram(s), angiography, venography, and/or
ultrasound, with radiologic supervision and interpretation, when
performed)
Both HCPCS codes were assigned to APC 5193 (Level 3 Endovascular
Procedures) with a payment rate of $9,669.04 for CY 2019. For CY 2020,
as discussed in the CY 2020 OPPS/ASC final rule with comment period (84
FR 61246), we revised the assignment for both codes to APC 5194 (Level
4 Endovascular Procedures) with a payment rate of $15,939.97.
For the July 2020 update, we deleted HCPCS codes C9754 and C9755 on
June 30, 2020, and replaced them with G-codes effective July 1, 2020 to
enable physicians to report the procedures when performed in the
physician office setting. Specifically, we deleted HCPCS code C9754 on
June 30, 2020 because it was replaced with HCPCS code G2170 effective
July 1, 2020. Similarly, we deleted HCPCS code C9755 on June 30, 2020
because it was replaced with HCPCS code G2171 effective July 1, 2020.
Below are the complete descriptors for HCPCS codes G2170 and G2171:
G2170 (Percutaneous arteriovenous fistula creation (AVF),
direct, any site, by tissue approximation using thermal resistance
energy, and secondary procedures to redirect blood flow (e.g.,
transluminal balloon angioplasty, coil embolization) when performed,
and includes all imaging and radiologic guidance, supervision and
interpretation, when performed)
G2171 (Percutaneous arteriovenous fistula creation (AVF),
direct, any site, using magnetic-guided arterial and venous catheters
and radiofrequency energy, including flow-directing procedures (e.g.,
vascular coil embolization with radiologic supervision and
interpretation, when performed) and fistulogram(s), angiography,
enography, and/or ultrasound, with radiologic supervision and
interpretation, when performed)
We deleted the C-codes based on concerns from stakeholders that
physicians are reluctant to perform the Ellipsys procedure in the
physician office setting without a specific HCPCS code. With the
deletion of the C-codes, we crosswalked the APC assignment and payment
rate for the C-codes to the new G-codes. We note that C-codes are not
reportable on Medicare physician office claims, whereas G-codes are
reportable on physician office, hospital outpatient, and ambulatory
surgical center claims.
For CY 2021, we proposed to reassign HCPCS code G2170 (Ellipsys
System) from APC 5194 to APC 5193 (Level 3 Endovascular Procedures)
with a proposed payment rate of $10,222.32, based on the latest claims
data. Specifically, based on the predecessor HCPCS code C9754, our
claims data for the proposed rule showed a HCPCS geometric mean cost of
approximately $10,068 based on 57 single claims (out of 57 total
claims), which is comparable to the geometric mean cost of about $9,850
for APC 5193 rather than the geometric mean cost of approximately
$15,753 for APC 5194. In addition, we proposed to maintain the
assignment to APC 5194 for G2171 (WavelinQ System) because our claims
data for the proposed rule, based on predecessor HCPCS code C9755,
showed a geometric mean cost of about $13,519 based on 182 single
claims (out of 186 total claims), which is consistent with the
geometric mean cost of about $15,753 for APC 5194.
At the August 31, 2020 HOP Panel Meeting, a presenter requested
that we maintain the assignment for the WavelinQ procedure (HCPCS code
G2170) to APC 5194. The presenter stated that the number of single
claims is too small to support a reassignment to APC 5193. Based on the
discussion during the meeting, the HOP Panel recommended that CMS
maintain the assignment of HCPCS code G2170 in APC 5194 for CY 2021.
Comment: Most commenters opposed the reassignment to APC 5193 for
G2170 and suggested that we continue to assign the code to APC 5194
based on the HOP Panel recommendation at the August 31, 2020 meeting.
They argued that the number of single claims on which to base the
reassignment is too low, and recommended that CMS maintain the current
assignment to APC 5194 until more claims data can be gathered for
appropriate APC assignment. However, one commenter suggested that we
reassign HCPCS code G2170 to APC 5193 based on the 1-year
[[Page 85955]]
claims data, and stated that the HOP Panel recommendation to maintain
the assignment to APC 5194 is not supported by the hospital claims
data. This same commenter suggested that the 1-year hospital claims
data does support maintaining HCPCS code G2171 in APC 5194. One
commenter reported that reassigning the code to APC 5193 would be
insufficient to cover the cost of the procedure in the ASC setting.
According to the commenter, the proposed CY 2021 ASC payment for HCPCS
code G2170 is $5,887.63, which does not cover the cost of the $6,000
device used in the procedure.
Response: As noted above, HCPCS codes G2170 and G2171 are two
technologies used for hemodialysis arteriovenous fistula creation. We
note that these procedures are furnished to dialysis patients with
chronic kidney disease, which affects thousands of Medicare
beneficiaries. To ensure Medicare access to these dialysis-related
procedures in both the hospital outpatient and ASC settings, which is
in line with various HHS initiatives, including the HHS Initiative on
``Advancing American Kidney Health'', we believe that we should
maintain both codes in APC 5194 for CY 2021. In addition, maintaining
the assignment to APC 5194 for both codes is consistent with the HOP
Panel's recommendation at the August 31, 2020 meeting. Moreover, given
the low frequency of claims for HCPCS code G2170 (predecessor HCPCS
code C9754), we also reviewed the arithmetic mean and median costs for
the code, as we would do for New Technology APC services with fewer
than 100 claims. We noted that HCPCS code G2170 and HCPCS code G2171
(predecessor HCPCS code C9755) have very similar median costs, and
combined with the low claims data for HCPCS code G2170, the fact that
this is the first year of claims data available for these services, as
well as the public comments and the HOP Panel recommendation, we
believe that it would be inappropriate to assign these two services to
different APCs. As a result, we are using 1833(t)(2)(E) to assign HCPCS
code G2170 (predecessor HCPCS code C9754) to APC 5194 because its cost
is similar to HCPCS code G2171 and both procedures are performed for
ESRD patients that need dialysis. Therefore, we are using our equitable
adjustment authority under section 1833(t)(2)(E) of the Act, which
states that the Secretary shall establish, in a budget neutral manner,
other adjustments as determined to be necessary to ensure equitable
payments, to assign G2170 to APC 5194. We note that we review, on an
annual basis, the APC assignments for all services and items paid under
the OPPS, and continue to monitor the updated claims data for these
codes as they become available.
In summary, after consideration of the public comments, we are
finalizing our proposal with modification. Specifically, we are
finalizing our APC proposal to assign HCPCS code G2171 to APC 5194, and
assigning HCPCS code G2170 to APC 5194 for CY 2021 using our equitable
adjustment authority. The final CY 2021 OPPS payment rates for the
codes can be found in Addendum B to this final rule with comment
period. In addition, we refer readers to Addendum D1 of this final rule
with comment period for the status indicator (SI) meanings for all
codes reported under the OPPS. Both Addendum B and D1 are available via
the internet on the CMS website.
7. Health and Behavior Services (APC 5822)
For CY 2021, we proposed to revise the payment rate associated with
APC 5822 (Level 2 Health and Behavior Services) from $78.54 to $75.26
based on the latest OPPS claims data.
Comment: Some commenters expressed concern with the proposed
payment decrease for APC 5822. Several commenters noted that the APC
includes a number of needed behavioral health services. Those services
include group therapy as well as outpatient programs that are less
intensive than PHPs but are still important for those who may not need
a full day of treatment all week, but who still require substantial
support. The commenters noted that the proposed payment rate decrease
of $3.10 per group per patient equates to a reduction of approximately
$9.30 per patient per day and that group psychotherapy makes up well
over 95 percent of the services provided by programs under Hospital
Partial Hospitalization Services. The commenters urged CMS to reexamine
the data used in developing the payment for APC 5822. Other commenters
requested we reconsider the proposed 4.2 percent payment rate decrease
for APC 5822.
Response: The CY 2021 OPPS payment rates are based on claims
submitted January 1, 2019 through December 31, 2019, processed through
June 30, 2020. Based on our evaluation of the claims data for this
final rule with comment period, the geometric mean cost of APC 5822 is
approximately $72.94 based on 1,069,622 single claims (out of 1,085,044
total claims).
Based on our review, we have no reason to believe that the services
are miscoded. In addition, based on our analysis of the CY 2021 claims
data used for this final rule with comment period, we are unable to
determine whether facilities are misreporting the services. It is
generally not our policy to judge the accuracy of provider coding and
charging for purposes of ratesetting. We rely on providers to
accurately report the use of HCPCS codes in accordance with their code
descriptors and CPT and CMS instructions, and to report services on
claims and charges and costs for the services on their Medicare
hospital cost report appropriately. Also, we generally do not specify
the methodologies that providers use to set charges for this or any
other service. Furthermore, we state in Chapter 4 of the Medicare
Claims Processing Manual that it is extremely important that facilities
report all HCPCS codes consistent with their descriptors; CPT and/or
CMS instructions; and correct coding principles, and that all charges
for services they furnish, whether payment for the services is made
separately paid or is packaged, are reported to enable CMS to establish
future ratesetting for OPPS services. Therefore, we are finalizing our
proposal, without modification, for APC 5822.
8. High-Density Lipoprotein (HDL) Therapy (APC 5243)
For CY 2021, we proposed to continue to assign CPT code 0342T
(Therapeutic apheresis with selective hdl delipidation and plasma
reinfusion) to APC 5243 (Level 3 Blood Product Exchange and Related
Services) with a proposed payment of $4,074.81.
Comment: One commenter reported that their company expects FDA
Humanitarian Device Exemption approval in Q4 of 2020 for its ``PDS-2
System,'' an HDL Therapy system that is designed to reduce plaque in
coronary arteries and increase HDL levels in patients diagnosed with
homozygous familial hypercholesterolemia (HoFH). The commenter
indicated that the code associated with their device is CPT code 0342T.
The commenter stated that they intend to apply to CMS for a new
technology APC in early 2021. According to the commenter, the cost of
the therapy described by CPT code 0342T is $77,100. The commenter
suggested that the proposed payment of $4,074.81 for APC 5243 (Level 3
Blood Product Exchange and Related Services) and $37,470.54 for APC
5244 (Level 4 Blood Product Exchange and Related Services) does not
capture the cost of providing the therapy, and
[[Page 85956]]
consequently, the company intends to submit an application for a new
technology APC in 2021.
Response: We thank the commenter for making us aware of their
intent to submit a new technology APC application. Once we receive the
application, we will review it and make the appropriate determination.
9. Imaging With and Without Contrast (APCs 5523, 5524, 5571, 5572, and
5573)
a. Cardiac Computed Tomography (CT) (APC 5571)
For CY 2021, we proposed to continue to assign the following
cardiac CT exam codes to APC 5571 (Level 1 Imaging with Contrast) with
a proposed payment rate of $181.41.
75572 (Computed tomography, heart, with contrast material,
for evaluation of cardiac structure and morphology (including 3d image
postprocessing, assessment of cardiac function, and evaluation of
venous structures, if performed))
75573 (Computed tomography, heart, with contrast material,
for evaluation of cardiac structure and morphology in the setting of
congenital heart disease (including 3d image postprocessing, assessment
of lv cardiac function, rv structure and function and evaluation of
venous structures, if performed))
75574 (Computed tomographic angiography, heart, coronary
arteries and bypass grafts (when present), with contrast material,
including 3d image postprocessing (including evaluation of cardiac
structure and morphology, assessment of cardiac function, and
evaluation of venous structures, if performed))
We received many comments related to our proposed payment for the
cardiac CT codes. Below is a summary of the public comments and our
responses to the comments.
Comment: Many commenters opposed the assignment of CPT codes 75572,
75573, and 75574, which are the codes that describe cardiac CT exams,
to APC 5571. They stated that the proposed CY 2021 OPPS payment rate of
$181.41 for APC 5571 is inadequate to cover the total cost of providing
the service. They also indicated that the proposed payment will result
in decreased reimbursement for cardiac CT for the fourth consecutive
year. Commenters were particularly concerned with the proposed payment
for CPT code 75574, for which, according to the commenters, the payment
rate has decreased by 30 percent over the past 3 years. They reported
that the cardiac CT exam is a complex exam and more time-consuming to
perform and interpret than any other type of contrast CT scan. They
also believe that the resource costs required to perform cardiac CT
scans are similar to the tests that are assigned to APC 5573 rather
than APC 5571. They noted that the low payment for the test limits
patient access, and requested that CMS take action to increase
reimbursement to levels in line with the actual testing costs. The
commenters requested an APC reassignment for all three codes.
Specifically, the commenters suggested reassigning CPT codes 75572 and
75573 to APC 5572 and CPT code 75574 to APC 5573. Most of the
commenters reported that cardiac CT scans are more resource intensive
than other CT and x-ray scans and are similar to other cardiac stress
imaging modalities like nuclear stress testing; therefore, cardiac CT
scans should be reimbursed accordingly.
Another commenter reported that the test described by CPT code
75574 generally takes about four times longer to perform than a CT scan
of the thorax with contrast that is described by CPT code 71260
(Computed tomography, thorax; with contrast material(s)) and also
assigned to APC 5571. The commenters noted that based on clinical
indications and performance/interpretation, CPT code 75574 is very much
like a SPECT nuclear scan, which is described by CPT code 78452
(Myocardial perfusion imaging, tomographic (spect) (including
attenuation correction, qualitative or quantitative wall motion,
ejection fraction by first pass or gated technique, additional
quantification, when performed); multiple studies, at rest and/or
stress (exercise or pharmacologic) and/or redistribution and/or rest
reinjection) and assigned to APC 5593 (Level 3 Nuclear Medicine and
Related Services) with a proposed payment rate of $1,336.28, rather
than a CT scan of the thorax. The commenters further asserted that
cardiac CT scans prior to invasive angiography lead to lower
utilization of cardiac catheterization, PCI, and costs.
Response: Payments under the OPPS are based on our analysis of the
latest available claims and cost report data submitted to Medicare. We
have many years of claims data for CPT codes 75572, 75573, and 75574.
The AMA established specific CPT codes for cardiac CT services
beginning in 2006 when they were first described by Category III codes.
The Category III CPT codes were subsequently deleted on December 31,
2009, and replaced with Category I CPT codes 75572, 75573, and 75574,
which were effective on January 1, 2010. Because OPPS payments are
updated every year based on our analysis of the latest claims data, the
payment rates have varied each year based on that data.
For CY 2021, OPPS payments are based on claims submitted between
January 1, 2019 through December 31, 2019, that were processed on or
before June 30, 2020. Based on our evaluation of the claims data for
this final rule, the geometric mean costs for the cardiac CT scan codes
range between $157 and $196. Specifically, as shown in Table 21, our
analysis show a geometric mean cost of approximately $157 for CPT code
75572 based on 14,262 single claims, approximately $194 for CPT code
75573 based on 317 single claims, and approximately $196 for CPT code
75574 based on 32,556 single claims. Based on the geometric mean costs
for these codes, we do not believe that CPT codes 75572, 75573, and
75574 utilize similar resources as the exams assigned to APC 5572 or
APC 5573. The geometric mean costs for the tests placed in APC 5571
range between $157 and $196, while the tests in APC 5572 range between
$265 and $510, and for APC 5573, between $534 and $961.
In addition, our data shows that the resources associated with
cardiac CT exams are unlike those of single photon emission CT (SPECT)
nuclear scans (CPT code 78452). As listed in Table 21, our data shows
that SPECT nuclear scans are more often performed on Medicare patients
than cardiac CT exams. Specifically, CPT code 78452 shows a geometric
mean cost of approximately $1,288 based on 591,344 single claims
compared to 47,135 single claims for cardiac CT (CPT codes 75572,
75573, and 75574). Although the commenters have indicated that the
resource costs associated with cardiac CT exams are similar to SPECT
nuclear scans, our analysis of the latest OPPS claims data reveal
otherwise. Similarly, we found the same results for nuclear stress
tests (CPT codes 93350 and 93351). That is, that the estimated resource
costs to perform nuclear stress tests are higher than for cardiac CT.
As noted in Table 21, the geometric mean costs for nuclear stress test
range between $529 and $671 based on 92,670 single claims for CPT codes
93350 and 93351, while the geometric mean costs for the cardiac CT
codes range between $157 and $196.
[[Page 85957]]
[GRAPHIC] [TIFF OMITTED] TR29DE20.033
We believe our claims data accurately reflects the resources
associated with providing cardiac CT exams in the HOPD setting. Because
CPT codes 75572, 75573, and 5574 have been active for some time now, we
have no reason to believe that HOPDs have issues with coding or
reporting these exams correctly. We believe that HOPDs have had
sufficient time to learn how to code and report these services
accurately using the Category I CPT codes that were established in
2010.
Moreover, we believe that we have substantial claims data for the
cardiac CT services upon which to base the CY 2021 final OPPS payment
rates. As noted in Table 22, the total number of claims for these codes
has increased each year. The historical OPPS payments for cardiac CT
services does not appear to have affected Medicare beneficiaries'
access to these services. Given that these services have been paid
under the OPPS for many years, with payments based on the latest
hospital claims and Medicare cost report data, we believe we are
providing a stable and consistent payment methodology that
appropriately reflects the hospital resources required for cardiac CT.
[GRAPHIC] [TIFF OMITTED] TR29DE20.034
Further, reassigning CPT codes 75572 and 75573 from APC 5571 to APC
5572, and CPT code 75574 from APC 5571 to APC 5573 would potentially
significantly overpay for the exams. As noted in Table 23, which shows
the percent change for each code, reassigning the codes to APC 5572 and
APC 5573 would pay at a rate that is two and three times the estimated
cost of the service as reflected in the hospital outpatient claims
data, and we do not believe that overpaying for the exams is
appropriate. We note that we monitor our claims data every year to
assess the appropriateness of the APC assignments for all services
under the hospital OPPS.
[[Page 85958]]
[GRAPHIC] [TIFF OMITTED] TR29DE20.035
Every year, since the implementation of the OPPS on August 1, 2000,
we receive many requests from specialty associations, device
manufacturers, drug manufacturers, and consultants to increase the
payments for codes associated with specific drugs, devices, services,
and surgical procedures. Under the OPPS, one of our goals is to make
payments that are appropriate for the items and services that are
necessary for the treatment of Medicare beneficiaries. The OPPS, like
other Medicare payment systems, is budget neutral and increases are
generally limited to the annual payment update factor. As a budget
neutral payment system, the OPPS does not pay the full hospital costs
of services, however, we believe that our payment rates generally
reflect the costs that are associated with providing care to Medicare
beneficiaries. Furthermore, we believe that our payment rates are
adequate to ensure access to services.
Comment: Commenters stated that the current methodology for
determining OPPS payments disadvantages cardiac CT exams
disproportionately and requested that CMS exercise its authority to
create an exception to the current payment methodology for the three
cardiac CT codes. As an alternative to the current methodology for
establishing OPPS payment rates, the commenters suggested using the
general cardiology revenue code to set the payment rates for CPT codes
75572, 75573, and 75574. They stated that based on their study that
used claims data from CY 2021 OPPS proposed rulemaking, the use of a
general cardiology revenue code to set the payment rates matches the
actual cost of cardiac exams. Specifically, their results reveal a
geometric mean cost of about $400.55 for CPT code 75572, $479.74 for
CPT code 75573, and $505.89 for CPT code 75574. Based on their
analysis, the commenters contended that the geometric mean costs for
CPT codes 75572 and 75573 justify their assignment to APC 5572, and CPT
code 75574 to APC 5573.
Response: It is our standard ratesetting methodology to rely on
hospital cost and charge information as it is reported to us through
the claims and cost report data. We believe that the assignment to APC
5571 for the cardiac CT codes is fully consistent with our standard
ratesetting methodology, which provides appropriate incentives for
efficiency. The OPPS is a prospective payment system that relies on
hospital charges on the claims and cost report data from the hospitals
that furnish the services in order to determine relative costs for OPPS
ratesetting. We believe that the prospective payment rates for CPT
codes 75572, 75573, and 75574, calculated based on the costs of those
providers that furnished the services in CY 2019, provide appropriate
payment to the providers who will furnish the services in CY 2021. We
continue to believe that this standard ratesetting methodology
accurately provides payment for cardiac CT exams furnished to hospital
outpatients.
Comment: One commenter recommended that we decrease the payment for
CPT code 78452 because the commenter believes SPECT is an outdated test
for chest pain evaluation. The commenter also stated that the test is
overutilized with no evidence of improvement in patient outcomes.
Response: As stated above, we review, on an annual basis, the APC
assignments for all services and items paid under the OPPS based on our
analysis of the latest claims data. For CY 2021, OPPS payments are
based on claims data submitted between January 1, 2019 through December
30, 2019, that were processed on or before June 30, 2020. Based on our
analysis, and as shown in Table 21 above, the claims data for CPT code
78452 show a geometric mean cost of approximately $1,288 based on
591,344 single claims, which is consistent with the geometric mean cost
of about $1,272 for APC 5593 (Level 3 Nuclear Medicine and Related
Services). We believe that CPT code 78452 is appropriately assigned to
APC 5593. Therefore, based on the latest claims data, we have no basis
to reassign the SPECT exam CPT code 78452 to another APC with a lower
payment rate.
Comment: Some commenters recommended that CMS allow facilities to
submit charges for cardiac CT using revenue codes that they believe
would more accurately estimate costs. They added that CMS should
provide explicit permission via a line item to allow hospitals to
submit charges for cardiac
[[Page 85959]]
CT tests under the cardiology stress testing revenue/cost centers. They
noted that CMS guidance for all non-CT and MR CPT codes is for
hospitals to submit claims utilizing revenue codes that most accurately
reflect clinical and resource homogeneity. They believe that making an
exception to the current policy and allowing HOPDs to submit charges
for cardiac CT tests under the cardiology stress testing revenue/cost
centers would provide better data in the future that reflects actual
resource costs for cardiac CT.
Response: Hospital outpatient facilities make the final
determination for reporting the appropriate cost centers and revenue
codes. As stated in section 20.5 in Chapter 4 (Part B Hospital) of the
Medicare Claims Processing, CMS ``does not instruct hospitals on the
assignment of HCPCS codes to revenue codes for services provided under
OPPS since hospitals' assignment of cost vary. Where explicit
instructions are not provided, providers should report their charges
under the revenue code that will result in the charges being assigned
to the same cost center to which the cost of those services are
assigned in the cost report.'' Therefore, HOPDs must determine the most
appropriate cost center and revenue code for the cardiac CT exams.
In summary, after consideration of the public comments, we are
finalizing our proposal, without modification, to assign the cardiac CT
exam codes, specifically, CPT codes 75572, 75573, and 75574 to APC
5571. The final CY 2021 OPPS payment rates for the codes can be found
in Addendum B to this final rule with comment period. In addition, we
refer readers to Addendum D1 of this final rule with comment period for
the status indicator (SI) meanings for all codes reported under the
OPPS. Both Addendum B and D1 are available via the internet on the CMS
website.
b. Cardiac Magnetic Resonance (CMR) Imaging (APC 5523, 5524, 5572, and
5573)
For CY 2021, we proposed to continue to assign the following
cardiac magnetic resonance imaging (MRI) CPT codes to APC 5523, 5524,
5572, and 5573, respectively:
CPT code 75557 (Cardiac magnetic resonance imaging for
morphology and function without contrast material) to APC 5523 (Level 3
Imaging without Contrast) with a proposed payment of $235.05;
CPT code 75559 (Cardiac magnetic resonance imaging for
morphology and function without contrast material; with stress imaging)
to APC 5524 (Level 3 Imaging without Contrast) with a proposed payment
of $490.52;
CPT code 75561 (Cardiac magnetic resonance imaging for
morphology and function without contrast material(s), followed by
contrast material(s) and further sequences) to APC 5572 (Level 2
Imaging with Contrast) with a proposed payment of $375.33; and
CPT code 75563 (Cardiac magnetic resonance imaging for
morphology and function without contrast material(s), followed by
contrast material(s) and further sequences; with stress imaging) to APC
5573 (Level 3 Imaging with Contrast) with a proposed payment of
$722.74.
Comment: Some commenters expressed concern with the lack of payment
stability for cardiac MRI services, specifically, those described by
CPT codes 75557, 75559, 75561, and 75563. They indicated that the
payments for these codes have decreased in the last several years, and
prior to CY 2017, the codes were placed in appropriate APCs. Of
significant concern are the payment rates for CPT codes 75561 and
75563, which, according to the commenters, are grouped with services
that are not clinically similar. The commenters stated that CPT code
75561 is unlike CT of the abdomen or pelvis or MRI of the neck and
spine in APC 5572, and instead, the code should be placed in APC 5573
with comparable services. The commenters further added that CPT code
75563 is labor-intensive and should be assigned to APC 5593 (Level 3
Nuclear Medicine and Related Services).
Response: Payment changes from one year to the next are unavoidable
in a relative weight payment system that depends on updated hospital
charges and costs and in which reassignment of HCPCS codes from one APC
to another is required by law in cases of 2 times rule violations. The
statutory design of the OPPS and the evolution in the delivery of
outpatient hospital services include elements that are responsible for
some of the fluctuation in payment rates from year to year. The OPPS is
based on HCPCS coding for which there are hundreds of changes each
year. In addition, the entry of new technology into a budget neutral
payment system results in a shift of funds away from previously
existing services to provide payments for new services. These factors
are reflections of the changes in services in the outpatient
department, and shifts in payment mirror those changes.
Moreover, section 1833(t)(9)(A) of the Act requires the Secretary
to review, not less often than annually, and revise the APC groups, the
relative payment weights, and the wage and other adjustments to take
into account changes in medical practice, changes in technology, the
addition of new services, new cost data, and other relevant information
and factors. Consequently, we review, on an annual basis, the APC
assignments for all services and items paid under the OPPS based on our
analysis of the latest claims data. For CY 2021, OPPS payments are
based on claims data submitted between January 1, 2019 through December
30, 2019, that were processed on or before June 30, 2020. Based on our
analysis, and as shown in Table 24, the claims data for CPT code 75557
show a geometric mean cost of approximately $250 based on 1,941 single
claims, which is consistent with the geometric mean cost of about $224
for APC 5523 (Level 3 Imaging Without Contrast). Similarly, the
geometric mean cost for CPT code 75559 is approximately $403 based on
57 single claims, which is in line with the geometric mean cost of
about $470 for APC 5524. For CPT code 75561, the geometric mean cost is
approximately $426 based on 17,216 single claims, which is in line with
the geometric mean cost of approximately $359 for APC 5572. We note
that the geometric mean cost of approximately $426 for CPT code 75561
is within the range of the significant geometric mean cost for APC
5572, which is between approximately $265 (for CPT code 74174) and
about $510 (for CPT code 73525). For CPT code 75563, the geometric mean
cost is about $761 based on 2,370 single claims, which is close to the
geometric mean cost of approximately $697 for APC 5573. The geometric
cost of approximately $761 for CPT code 75563 is within the range of
the significant geometric mean cost for APC 5573, which is
approximately between $534 (for CPT code C8923) and about $961 (for
HCPCS code C8928). Based on the latest claims data, we believe that the
cardiac MRI codes are appropriately assigned to APCs 5523, 5524, 5572,
and 5573.
[[Page 85960]]
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In addition, based on the commenters' belief that the APC
assignments for the cardiac MRI codes were appropriately placed prior
to CY 2017 and not currently, we reviewed the OPPS payment rates from
CY 2016 through CY 2021. Based on our evaluation, we believe that the
payments for the cardiac MRI codes are appropriate. The OPPS, like
other Medicare payment systems, is a prospective payment system based
on averages. In some individual cases payment exceeds the average cost
and in other cases payment is less than the average cost. Based on our
review, we believe that the historical and current payment rates for
CPT codes 75557, 75559, 75561, and 75563, reflect the geometric mean
costs associated with the service that are consistent with providing
cardiac MRI to Medicare beneficiaries in cost efficient settings.
Comment: Some commenters expressed concern with the clinical
homogeneity in the Imaging APCs and requested more transparency. They
also questioned the criteria for assigning HCPCS codes to specific APCs
and as well as why the Imaging APCs were reduced from 17 to 7 APCs.
Response: Every year we publish an OPPS/ASC proposed rule that
informs the public of our proposed policies, which include payment
rates for specific HCPCS codes, for the upcoming year that will become
effective on January 1. The proposed rules are subject to a 60-day
public comment period, and comments received by the due dates are
addressed in the final rules. In the April 7, 2000 OPPS final rule, we
defined the term ``clinical homogeneity.'' As stated in the April 7,
2000 final rule, ``The definition of each APC group should be
`clinically meaningful,' that is, the procedures or services included
within the APC group relate generally to a common organ system or
etiology, have the same degree of extensiveness, and utilize the same
method of treatment, for example, surgical, endoscopic, etc. The
definition of clinical meaningfulness is, of course, dependent on the
goal of the classification system. For APCs, the definition of clinical
meaningfulness relates to the medical rationale for differences in
resource use. If, on the other hand, classifying patient prognosis were
the goal, the definition of patient characteristics that were
clinically meaningful might be different.'' (68 FR 18457).
In addition, we believe that the combined annual proposed and final
rules with their accompanying addenda and cost statistics files, as
well as the quarterly OPPS and ASC update change request documents that
are issued by CMS provide substantial transparency on APCs and,
overall, the OPPS payment system.
With regard to the reduction from 17 to 7 APCs for the Imaging
APCs, we discussed the issue in the CY 2017 OPPS/ASC final rule (81 FR
79628 through 79631) and stated that the change was based on
stakeholder recommendations. As a part of our CY 2016 (80 FR 70392
through 70397) and CY 2017 (81 FR 79628 through 79631) comprehensive
review of the structure of the imaging APCs and procedure code
assignments, we examined the APCs that contained imaging services. For
CY 2017, we proposed and updated the restructuring of the OPPS APC
groupings for imaging services to more appropriately reflect the costs
and clinical characteristics of the procedures within each APC grouping
in the context of the OPPS. We believe that the updated restructuring
and reconfiguration of the Imaging APCs appropriately reflect the
similar resource costs and clinical characteristics of the procedures
within each APC. We also believe that the current broader categories of
Imaging APCs are appropriate for ratesetting under the OPPS because
they support greater similarities in clinical characteristics and
resource use of procedures assigned to the APCs, while improving the
homogeneity of the APC structure.
In summary, after consideration of the public comments, we are
finalizing our proposal, without modification, to assign CPT code 75557
to APC 5523, CPT code 75559 to APC 5524, CPT code 75561 to APC 5572,
and CPT code 75563 to APC 5573. The final CY 2021 payment rates for the
codes can be found in Addendum B to this final rule with comment
period. In addition, we refer readers to Addendum D1 of this final rule
with comment period for the status indicator (SI) meanings for all
codes reported under the OPPS. Both Addendum B and D1 are available via
the internet on the CMS website.
10. IDx-DR: Artificial Intelligence System To Detect Diabetic
Retinopathy (APC 5733)
As stated in a press release issued by the FDA on April 11, 2018,
the IDx-DR is the ``first medical device to use artificial intelligence
(AI) to detect greater than a mild level of the eye disease diabetic
retinopathy in adults who have diabetes'' (https://www.fda.gov/news-events/press-announcements/fda-permits-marketing-artificial-intelligence-based-device-detect-certain-diabetes-related-eye).
Approved for marketing by the FDA in April 2018, the artificial
intelligence
[[Page 85961]]
algorithm provides a clinical decision without the need for a clinician
to also interpret the image. A provider uploads the digital images of
the patient's retinas to a cloud server on which the IDx-DR software is
installed, and once analysis is completed, the provider is given one of
the following two results:
More than mild diabetic retinopathy detected: Refer to an
eye care professional; or
negative for more than mild diabetic retinopathy; rescreen
in 12 months.
The test itself generally takes about 5 minutes to complete and
does not need to be performed by a clinician. The test associated with
the IDx-DR technology received a new CPT code effective January 1,
2021, specifically, CPT code 92229. With the establishment of the new
code, the CPT Editorial Panel also revised the descriptors associated
with existing CPT codes 92227 and 92228 to appropriately differentiate
them from the IDx-DR test. Below are the complete descriptors for CPT
codes 92227, 92228, and 92229 for CY 2021. We note that CPT code 92229
was listed as placeholder 9225X in Addendum B of the CY 2021 OPPS/ASC
proposed rule:
92227 (Imaging of retina for detection or monitoring of
disease; with remote clinical staff review and report, unilateral or
bilateral);
92228 (Imaging of retina for detection or monitoring of
disease; with remote physician or other qualified health care
professional interpretation and report, unilateral or bilateral); and
92229 (Imaging of retina for detection or monitoring of
disease; point-of-care automated analysis and report, unilateral or
bilateral).
As stated in the CY 2021 OPPS/ASC proposed rule (85 FR 48839),
based on our evaluation of the service, we believe that IDx-DR is a
diagnostic test that should be payable under the hospital OPPS, similar
to existing CPT codes 92227 and 92228, which are assigned to APC 5732
(Level 2 Minor Procedures) and status indicator ``Q1.'' Based on its
clinical similarity to CPT codes 92227 and 92228, we believe that the
IDx-DR test should also be assigned to APC 5732. Consequently, for CY
2021, we proposed to assign the new IDx-DR CPT code to APC 5732 with a
proposed payment rate of $33.16. We also proposed to assign the code to
status indicator ``Q1'' to indicate that the code is conditionally
packaged when performed with another service on the same day. Because
the IDx-DR test will most often be performed as part of a visit, we
believed that packaging the cost into the primary service is
appropriate. We note that under the OPPS, the HOPD E&M visit code
(G0463; CY 2021 OPPS proposed payment rate of $120.88) is paid
separately when not billed with a C-APC, and we believed that payment
would include the cost of providing the IDx-DR test. Generally, our
policy for tests with minimal costs is to package the cost into the
primary service.
Comment: Some commenters disagreed with the proposed payment amount
and requested a revision in the assignment from APC 5732 to APC 5734
(Level 4 Minor Procedures) with a proposed payment rate of $113.23 and
assignment to status indicator ``Q1''. The commenters reported that the
service described by new CPT code 92229, which was listed as
placeholder CPT code 9225X in Addendum B to the CY 2021 OPPS/ASC
proposed rule), is similar to the technical components described by
existing CPT code 92250 (Fundus photography with interpretation and
report), which was proposed for assignment to APC 5734 and status
indicator ``Q1''. They stated that providers are currently billing on
an interim basis under CPT code 92250 for the same service. The
commenters further disagreed with the comparison to CPT code 92227 and
92228, which are assigned to APC 5732 with a status indicator ``Q1''
and stated that the tests described by these codes involve human
readers while the service described by CPT code 92229 is artificial
(AI) intelligence-related. The commenters indicated that APC 5734,
which is the APC assigned to the predecessor CPT code 92250, is the
more appropriate assignment for new CPT code 92229 until sufficient
Medicare claims data can be collected by CMS to either retain that
assignment or reassign to another APC.
Response: We stated in the CY 2021 OPPS/ASC proposed rule with
comment period (85 FR 48839) that the CPT Editorial Panel revised the
descriptors associated with existing CPT codes 92227 and 92228 to
appropriately differentiate them from the IDx-DR test, which is
described by new CPT code 92229. We note that the descriptors for all
three codes involve tests that use imaging of the retina for detection
or monitoring of disease. Based on the revisions to CPT code 92227 and
92228 and placement of the new code, we believe that the IDx-DR test is
similar to CPT code 92227 and 92228. We do not believe that CPT code
92250, which the commenters reported to be the predecessor code, is
similar to the IDx-DR test; otherwise, the placement of the new IDx-DR
code would have been close to CPT code 92250. However, after further
review and consideration of the issue, we believe that CPT code 92229
should be assigned to APC 5733 (Level 3 Minor Procedures) rather than
APC 5732 (Level 2 Minor Procedures).
We note that under the OPPS, one of our goals is to make payments
that are appropriate for the services that are necessary for the
treatment of Medicare beneficiaries. The OPPS, like other Medicare
payment systems, is a prospective payment system. The payment rates
that are established reflect the geometric mean costs associated with
items and services assigned to an APC and we believe that our payment
rates generally reflect the costs that are associated with providing
care to Medicare beneficiaries in cost efficient settings. Moreover, we
strive to establish rates that are adequate to ensure access to
medically necessary services for Medicare beneficiaries.
For many emerging technologies there is a transitional period
during which utilization may be low, often because providers are first
learning about the techniques and their clinical utility. Quite often,
the requests for higher payment amounts are for new procedures in that
transitional phase. These requests, and their accompanying estimates
for expected Medicare beneficiary or total patient utilization, often
reflect very low rates of patient use, resulting in high per use costs
for which requesters believe Medicare should make full payment.
Medicare does not, and we believe should not, assume responsibility for
more than its share of the costs of procedures based on Medicare
beneficiary projected utilization and does not set its payment rates
based on initial projections of low utilization for services that
require expensive capital equipment.
We note that in a budget neutral environment, payments may not
fully cover hospitals' costs, including those for the purchase and
maintenance of capital equipment. We rely on hospitals to make their
decisions regarding the acquisition of high cost equipment with the
understanding that the Medicare program must be careful to establish
its initial payment rates for new services that lack hospital claims
data based on realistic utilization projections for all such services
delivered in cost-efficient hospital outpatient settings. As the OPPS
acquires claims data regarding hospital costs associated with new
procedures, we annually review the claims data and any available new
information regarding the clinical aspects of new procedures to confirm
that OPPS payments remain appropriate for procedures as they transition
into mainstream medical practice.
[[Page 85962]]
Comment: Several commenters requested a reassignment from proposed
APC 5732 to APC 5733 (Level 3 Minor Procedures) consistent with the APC
assignment for CPT codes 92285 (External ocular photography with
interpretation and report for documentation of medical progress (e.g.,
close-up photography, slit lamp photography, goniophotography, stereo-
photography) and 92134 (Scanning computerized ophthalmic diagnostic
imaging, posterior segment, with interpretation and report, unilateral
or bilateral; retina).
Response: The IDx-DR test generally takes about 5 minutes to
complete and does not need to be performed by a clinician. Based on our
evaluation of the service, we believe that IDx-DR is a diagnostic test
that should be payable under the hospital OPPS. We do not believe that
the services described by CPT code 92285 or 92134 are appropriate
comparisons for the IDx-DR test because these tests generally involve
physician work and require approximately 10 minutes to perform.
However, after further review and deliberation of the issue, we believe
that CPT code 92229 should be assigned to APC 5733 (Level 3 Minor
Procedures) rather than APC 5732 (Level 2 Minor Procedures).
Comment: Some commenters requested a change in the proposed status
indicator assignment for CPT code 92229 from ``Q1'' to ``S'' to ensure
that the test is separately reimbursed when provided with an outpatient
clinic visit or other service. The commenters indicated that assigning
the code to ``Q1'' will not support patient access in the outpatient
setting and will encourage less efficient care. They suggested that
HOPDs would likely schedule patients to receive only the IDx-DR test
during an outpatient visit, instead of performing the test during a
clinic visit, and could discourage hospitals from offering the test
altogether. They further suggested that diabetic patients receiving
diabetic care in the outpatient setting would likely be asked to make
separate appointments as a result of the status indicator ``Q1''
assignment.
Response: With regard to HOPDs potentially scheduling the IDx-DR
test on a separate day from the clinic visit to receive separate
payment, we have concerns about this kind of manipulation of patient
scheduling because such a practice could create an undue burden for
Medicare beneficiaries. We expect HOPDs to furnish services in the most
efficient way that meets the needs of the patient. After further review
and deliberation on the issue, we are revising the status indicator to
``S'' to ensure patient access to the test.
In summary, after consideration of the public comments, we are
finalizing our proposal, with modification. Specifically, we are
assigning CPT code 92229 to APC 5733 with status indicator ``S.'' The
final CY 2021 payment rate for the code can be found in Addendum B to
this final rule with comment period. In addition, we refer readers to
Addendum D1 of this final rule with comment period for the status
indicator (SI) meanings for all codes reported under the OPPS. Both
Addendum B and D1 are available via the internet on the CMS website.
11. Implantable Interstitial Glucose Sensor System (APC 5051 and 5054)
For CY 2021, we proposed to assign CPT code 0447T to APC 5051
(Level 1 Skin Procedures) with a proposed OPPS payment of $182.38. In
addition, we proposed to assign CPT codes 0446T and 0448T to APC 5053
(Level 3 Skin Procedures) with a proposed OPPS payment of $530.98. We
note that the long descriptors for these codes can be found in Table 25
below.
Comment: A commenter agreed with the proposed APC assignment for
CPT code 0447T to APC 5051 but opposed the proposed assignment for CPT
codes 0446T and 0448T to APC 5053. The commenter stated that the
payment for APC 5053 does not include the provision of the service
associated with the Eversense Implantable Continuous Glucose System
(CGS), which is a technology that provides real-time glucose
monitoring. Specifically, the payment for APC 5053 does not account for
providing the glucose sensor and wireless transmitter, as well as
implanting, removing, and replacing the glucose sensor. In contrast,
the commenter believed that CPT codes 0446T and 0448T include those
costs, referring to the discussion in the CY 2020 PFS final rule (84 FR
62627). The commenter added that assignment to APC 5053 is
inappropriate based on clinical homogeneity and resource cost, and
suggested reassigning CPT codes 0446T and 0448T to either APC 5054
(Level 4 Skin Procedures) with a proposed OPPS payment of $1,733.06 or
New Technology APC 1523 (New Technology--Level 23 ($2501-$3000)) with a
proposed OPPS payment of $2,750.50.
Response: Although CPT codes 0446T, 0447T, and 0448T were effective
January 1, 2017, the Eversense CGM technology was only recently
approved for marketing by the FDA on June 6, 2019. For CY 2021, OPPS
payments are developed based on claims submitted between January 1,
2019 through December 31, 2019, and processed through June 30, 2020.
For this final rule with comment period, we have no claims data for CPT
codes 0446T, 0447T, or 0448T for OPPS ratesetting purposes. However,
based on our review of the issue, and feedback from our medical
advisors, as well as the expected device costs associated with CPT
codes 0446T and 0448T as discussed in the CY 2021 PFS proposed rule (85
FR 50174), we believe that these codes should be reassigned to APC 5054
(Level 4 Skin Procedures) rather than New Technology APC 1523 (New
Technology--Level 23 ($2501-$3000)). Because we have neither claims
data nor specific HOPD costs, including the cost to perform each exam
(other than the supply cost discussed in the CY 2021 PFS proposed
rule), we believe that APC 5054 is the most appropriate assignment at
this time for CPT codes 0446T and 0448T.
Therefore, after consideration of the public comment, we are
finalizing our proposal, with modification. Specifically, we are
finalizing our proposal for CPT code 0447T and assigning the code to
APC 5051, however, we are reassigning CPT codes 0446T and 0448T to APC
5054. Table 25 list the long descriptors and final SI and APC
assignments for the codes. The final CY 2021 payment rate for the codes
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the status indicator (SI) meanings for all codes
reported under the OPPS. Both Addendum B and D1 are available via the
internet on the CMS website.
[[Page 85963]]
[GRAPHIC] [TIFF OMITTED] TR29DE20.037
12. Intervertebral Disc Allogeneic Cellular and/or Tissue-Based Product
Percutaneous Injection (APC 5115)
In the CY 2021 OPPS/ASC Proposed Rule, we proposed to assign the
procedures described by CPT codes 0627T (Percutaneous injection of
allogeneic cellular and/or tissue-based product, intervertebral disc,
unilateral or bilateral injection, with fluoroscopic guidance, lumbar;
first level) and 0629T (Percutaneous injection of allogeneic cellular
and/or tissue-based product, intervertebral disc, unilateral or
bilateral injection, with CT guidance, lumbar; first level) to status
indicator ``T'', APC 5443 (Level 3 Nerve Injections) with a proposed
OPPS payment rate of $836.26 based on the estimated costs of these
procedures.
We proposed to assign the procedures described by CPT codes 0628T
(Percutaneous injection of allogeneic cellular and/or tissue-based
product, intervertebral disc, unilateral or bilateral injection, with
fluoroscopic guidance, lumbar; each additional level (List separately
in addition to code for primary procedure) and 0630T (Percutaneous
injection of allogeneic cellular and/or tissue-based product,
intervertebral disc, unilateral or bilateral injection, with CT
guidance, lumbar; each additional level (List separately in addition to
code for primary procedure) to status indicator ``N'' to indicate that
they are packaged under OPPS since they are add-on codes. These codes
were listed as 0X32T, 0X33T, 0X34T, and 0X37T (the 5-digit CMS
placeholder codes) in Addendum B with the short descriptor and also in
Addendum O with the long descriptor, to the CY 2021 OPPS/ASC proposed
rule.
We also proposed to assign these codes to comment indicator ``NP''
in Addendum B to indicate that the codes are new for CY 2021 and that
public comments would be accepted on the proposed status indicator
assignment. We note that these codes will be effective January 1, 2021.
Comment: Some commenters disagreed with the assignment of codes
0627T and 0629T to APC 5443 based on what the commenters believed was a
lack of clinical and resource coherence with other procedures in this
APC. They stated that CPT codes 0627T and 0629T involve percutaneous
placement of an allogeneic cellular and/or tissue-based biologics to
supplement and support deteriorating vertebral discs in patients
suffering from degenerative disc disease. They believe that these
procedures are not comparable to a simple nerve injection.
One commenter explained that the cost of these procedures is
significantly higher than the proposed Level 3 Nerve Injection APC
payment, which is $836.26. The cost of the VIA Disc Matrix Kit used for
these procedures is $8,000 per kit. Therefore, they believed that a
higher APC payment level more appropriately covers both the cost of the
device and the non-device costs of the procedure.
Another commenter noted that the non-device costs of procedures
0627T and 0629T are most appropriately crosswalked to CPT code 22514
(Percutaneous vertebral augmentation, including cavity creation
(fracture reduction and bone biopsy included when performed) using
mechanical device (e.g. kyphoplasty), 1 vertebral body, unilateral or
bilateral cannulation, inclusive of all imaging guidance; lumbar) that
is assigned to APC 5114 (Level 4 Musculoskeletal Procedures) with the
payment rate of $6,368.58.
A medical device company recently submitted a new technology APC
application to CMS for VIA[supreg] Disc Allograft Supplementation
described by codes 0627T and 0629T and requested that CMS assign CPT
codes 0627T and 0629 to APC 1575 (New Technology APC Level 38 ($10,001-
$15,000)) for CY 2021 based on total estimated non-device-related cost
of APC 5114 ($4,524) plus the device-related costs ($8,000) or $12,524
which is closest to APC 1575 with a CY 2021 proposed payment rate of
$12,500.50.
The same device company recommended, because 0628T and 0630T are
add-on codes used in conjunction with their primary procedural codes
0627T and 0629T, that CMS uses the device-related cost for each
additional VIA Disc mixing system kit of $8,000 plus an incremental
thirty minute non-device cost to capture the additional operative time
and costs in performing a separate intervertebral disc injection.
The commenter requested that CMS assign CPT codes 0628T and 0630T
to APC 1571 (New Technology APC Level 34 ($8001-$8500)) for CY 2021
since the total estimated cost of these codes is closest to APC 1571
with a CY 2021 proposed payment rate of $8,250.50.
[[Page 85964]]
Response: Based on our review of the application and input from our
clinical advisors, we agree that the codes would be appropriately
placed in an alternative APC that might better reflect their resource
costs. Our updated claims data for this final rule with comment period
shows that the geometric mean cost of APC 5115 is about $11,996.45,
which is more similar to the device and procedure costs associated with
these codes. Therefore, we are assigning CPT codes 0627T and 0629T to
comprehensive APC 5115 (Level 5 Musculoskeletal Procedures) with status
indicator ``J1'' for the CY 2021 OPPS.
CPT codes 0628T and 0630T would be assigned to status indicator
``N'' under OPPS for CY 2021 because the cost of an add-on code is
packaged into the primary procedure under OPPS packaging policy, as
discussed in the CY 2014 OPPS/ASC final rule (78 FR 74942).
In summary, after consideration of the public comments and our
analysis of updated claims data for this final rule and other
additional information, we are finalizing our proposal related to codes
0627T and 0629T with modification. Specifically, we are revising the
APC assignment for CPT codes 0627T and 0629T to APC 5115 and revising
their status indicator to ``J1'' for the CY 2021 OPPS. For CPT codes
0628T and 0630T, we are finalizing our proposal without modification
and maintaining the assignment of status indicator ``N'' to these
codes.
The final CY 2021 OPPS payment rate for CPT codes 0627T and 0629T
and final status indicator assignment for 0628T and 0630T can be found
in Addendum B to this final rule with comment period. In addition, we
refer readers to Addendum D1 of this final rule with comment period for
the status indicator (SI) meanings for all codes reported under the
OPPS. Both Addendum B and D1 are available via the internet on the CMS
website.
The final CY 2021 APC and SI assignments for 0627T through 0630T
can be found in Table 26.
[GRAPHIC] [TIFF OMITTED] TR29DE20.038
13. Intraocular Procedures (APCs 5491 Through 5495)
In prior years, CPT code 0308T (Insertion of ocular telescope
prosthesis including removal of crystalline lens or intraocular lens
prosthesis) was assigned to the APC 5495 (Level 5 Intraocular
Procedures) based on its estimated costs. In addition, its relative
payment weight has been based on its median cost under our payment
policy for low-volume device-intensive procedures because the APC
contained a low volume of claims. The low volume device-intensive
procedures payment policy was discussed in more detail in section
III.C.2. of the proposed rule.
In the CY 2019 OPPS, we assigned procedure code CPT code 0308T to
the APC 5494 (Level 4 Intraocular Procedures) (83 FR 58917 through
58918). We made this change based on the similarity of the estimated
cost for the single claim of $12,939.75 to that of the APC
($11,427.14). However, this created a discrepancy in payments between
the OPPS setting and the ASC setting in which the ASC payments would be
significantly lower than the OPPS payments for the same service because
of the difference in estimated cost for the encounter determined under
a comprehensive methodology within the OPPS and the estimated cost
determined under the payment methodology for device intensive services
within the ASC payment system.
In CY 2020 OPPS/ASC rulemaking, we reestablished APC 5495 (Level 5
Intraocular Procedures) because we believed that the procedure
described by CPT code 0308T would be most appropriately placed in the
APC based on its estimated cost (84 FR 61249 through 61250). Assignment
of the procedure to the Level 5 Intraocular Procedures APC was
consistent with its historical placement and would also address the
large discrepancy in payment for the procedure between the OPPS and the
ASC payment system. We note that we also implemented a policy where the
payment for a service when performed in an ASC (84 FR 61399 through
61400), would be no higher than the OPPS payment rate for the
[[Page 85965]]
service when performed in the hospital outpatient setting.
In reviewing the claims data available for CY 2021 ratesetting,
there was a single claim containing the code 0308T that was unable to
be used for the ratesetting process. In addition, this code and its APC
have historically had relatively low claims volume for ratesetting
purposes. While there were no claims usable for ratesetting in the CY
2021 OPPS proposed data under our standard process, we still needed to
determine a payment weight for the APC. We believed that the most
recently available data that we used to set payment for this service in
the CY 2020 OPPS final rule was an appropriate proxy for both the
procedure's estimated cost and its relative payment weight. We note
that the proposed policy to use prior year claims data in ratesetting
is similar to the application of a geometric mean cost floor to the
Partial Hospitalization APCs, as initially established in the CY 2020
OPPS/ASC final rule (84 FR 61339 through 61347). Therefore, we believed
it was appropriate to propose to use the median cost of $20,229.78 for
CPT 0308T, calculated from claims data used in the CY 2020 OPPS final
rule with comment period, to establish the payment weight for the CY
2021 OPPS for CPT code 0308T. We will continue to monitor the claims
available for the procedure for ratesetting purposes.
To summarize, for CY 2021, we proposed to assign 0308T a payment
weight based on the most recently available data, from the CY 2020 OPPS
final rule, and therefore proposed to assign CPT code 0308T to APC 5495
(Level 5 Intraocular Procedures). Under the proposal, the proposed CY
2021 OPPS payment rate for the service would be established based on
the median cost, as discussed in section V.A.5. of the proposed rule,
because it is a device intensive procedure assigned to an APC with
fewer than 100 total annual claims within the APC. Therefore, the
proposed APC assignment for CPT code 0308T would be based on the CY
2020 OPPS final rule median cost of $20,229.78.
Comment: We received one comment supporting our proposal to
continue to assign the CPT code 0308T to APC 5495 (Level 5 Intraocular
Procedures) and use the CY 2020 median cost as a proxy for use in
developing the CY 2021 OPPS payment rate.
Response: We appreciate the commenter's support. While the updated
final rule claims data includes two claims containing the code 0308T,
those claims are unusable for OPPS ratesetting purposes. Therefore, we
are finalizing our proposed policy to assign CPT code 0308T to APC 5495
and use the CY 2020 median cost in determining a CY 2021 OPPS payment
rate.
After consideration of the public comment we received, we are
finalizing our proposal to continue to assign CPT code 0308T to APC
5495 (Level 5 Intraocular Procedures) for the CY 2021 OPPS and, as a
device intensive procedure assigned to an APC with fewer than 100 total
claims, to establish the CY 2021 OPPS payment rate for the service
using its CY 2020 median cost. Therefore, the CY 2021 OPPS payment rate
for CPT 0308T will be based on the CY 2020 OPPS final rule median cost
of $20,229.78.
14. Irreversible Electroporation Ablation of Tumors (NanoKnife[supreg]
System) (APC 5362)
Electroporation is a technique in which an electrical field is
applied to cells in order to increase the permeability of the cell
membranes through the formation of nanoscale defects in the lipid
bilayer. The result is creation of nanopores in the cell membrane and
disruption of intra-cellular homeostasis, ultimately causing cell
death. After the NanoKnife[supreg] System delivers a sufficient number
of high voltage pulses; the cells surrounded by the electrodes will be
irreversibly damaged. This mechanism, which causes permanent cell
damage, is referred to as Irreversible Electroporation (IRE). The
NanoKnife[supreg] System with six outputs for the treatment of Stage
III pancreatic cancer received FDA Breakthrough Device designation on
January 18, 2018 and approval of an FDA investigational device
exemption (IDE G180278) on March 28, 2019.
The CPT Editorial Panel established two new codes; specifically CPT
codes 0600T and 0601T, to describe NanoKnife[supreg] System procedures
effective July 1, 2020. The manufacturer also submitted a new
technology application requesting new technology APC assignments for
CPT codes 0600T and 0601T. Based on our review of the new technology
APC application for the NanoKnife[supreg] System, we provided temporary
APC and status indicators assignments for 0600T and 0601T. The
temporary APC and SI assignments were publicly released in the July
2020 quarterly update to the OPPS (Transmittal 10224, Change Request
11814, and dated July 15, 2020). In addition, in the CY 2021 OPPS/ASC
proposed rule with comment period, we proposed to assign the codes to
APC 5361 (Level 1 Laparoscopy and Related Procedures) with a payment
rate of $5,148.34, and status indicator `J1'' (Hospital Part B services
paid through a comprehensive APC) based on clinical and resource
similarities between 0600T, 0601T and other procedures in the same APC.
We also proposed to assign these codes to comment indicator (CI) ``NP''
in Addendum B to the proposed rule to indicate that the codes are new
for CY 2020 and that public comments would be accepted on their
proposed APC assignments.
Comment: We received one comment from the applicant on the proposed
assignment to APC 5361 (Level 1 Laparoscopy and Related Procedures).
According to the applicant, new Category III CPT codes 0600T and 0601T
should not be assigned to APC 5361 because the clinical characteristics
and resource costs associated with the procedures are significantly
different from existing procedures assigned to that APC. The applicant
noted that under the IPPS, the NanoKnife[supreg] System was estimated
to have a technology added cost of approximately $11,086, and that the
procedures for which the system would apply generally were not
significantly different in the inpatient and outpatient settings. They
believe that the codes would be more appropriately placed in New
Technology APC 1576 (New Technology--Level 39 ($15,001-$20,000)) with a
payment rate of $17,500.50, based on the estimated costs and complexity
of the procedures.
Response: We thank the applicant for their comment and the
additional information they have provided regarding the procedures and
in particular their estimated costs. While we recognize that there are
differences between the various ablation modalities, we believe that
the APC levels 5361 and 5362 for ``Laparoscopy and Related Services''
appropriately describe the resource costs and clinical characteristics
of these procedures. However, we agree with the commenter that an
alternative APC might better reflect the resource costs of the
procedures. Therefore, we are revising the CY 2021 APC assignments for
these codes. Specifically, we are assigning CPT codes 0600T and 0601T
to APC 5362 (Level 2 Laparoscopy and Related Procedures) with a status
indicator of ``J1'' in the CY 2021 OPPS.
After consideration of the public comment for the new irreversible
electroporation codes, and based on our evaluation of the new
technology application which provided the estimated costs for the
services and described the components and characteristics of the new
codes, we are finalizing our proposal with
[[Page 85966]]
modification, and reassigning CPT codes 0600T and 0601T to the final CY
2021 OPPS APC 5362 (Level 2 Laparoscopy and Related Services). Table 27
lists the four Category III CPT codes for the NanoKnife[supreg] System
and their APC and SI assignments for CY 2021. The final CY 2021 OPPS
payment rate for the codes can be found in Addendum B to this final
rule with comment period (which is available via the internet on the
CMS website).
[GRAPHIC] [TIFF OMITTED] TR29DE20.039
15. Medical Physics Dose Evaluation (APC 5611)
For CY 2021, we proposed to assign CPT code 76145 (Medical physics
dose evaluation for radiation exposure that exceeds institutional
review threshold, including report (medical physicist/dosimetrist)) in
APC 5611 (Level 1 Therapeutic Radiation Treatment Preparation) with a
proposed payment rate of $129.86. We note this is a new code that will
be effective on January 1, 2021. Because the code is new, we requested
public comments on the APC assignment for CY 2021. We also note that
CPT code 76145 was listed as placeholder code 7615X in Addendum B and
Addendum O of the CY 2021 OPPS/ASC proposed rule.
Comment: Several commenters disagreed with the assignment to APC
5611 and requested a reassignment to APC 5724 (Level 4 Diagnostic Tests
and Related Services) with a proposed payment rate of $936.70. The
commenters indicated that CPT code 76145 is not a radiation oncology
code, rather, it is a service that will be performed in interventional
radiology or interventional cardiology. The commenters stated that the
resource consumption in APC 5724 more closely aligns with the resources
used to perform CPT code 76145. One commenter explained that CPT code
76145 is used to describe the medical physicist's work in performing a
patient-specific peak organ dose calculation subsequent to an
interventional radiology or interventional cardiology procedure. The
same commenter expressed concern that the new code will be included on
the Deficit Reduction Act (DRA) cap designation list.
Response: Section 5102(b) of the Deficit Reduction Act of 2005
(DRA) added section 1848(b)(4) to the statute to place a payment cap on
the technical component (TC) of certain diagnostic imaging procedures
and the TC portions of the global diagnostic imaging services at the
amount paid under the OPPS. To implement this provision, the physician
fee schedule (PFS) amount is compared to the OPPS payment amount and
the lower amount is used for payment under the PFS. However, we note
that the OPPS cap is a policy that applies to the PFS payment and is
not applicable under the OPPS; and the list of services that are
subject to the OPPS cap is published as part of the annual PFS final
rules. In addition, based on our review of the service associated with
CPT code 76145 and input from our medical advisors, we believe that APC
code 5611 is the most appropriate assignment for the code. The code is
new for CY 2021 and therefore we have no claims data available for OPPS
ratesetting. However, once we have claims data, we will review the APC
assignment and determine whether a change is necessary. We note that we
review, on an annual basis, the APC assignments for all items and
services paid under the OPPS.
In summary, after consideration of the public comments, we are
finalizing our proposal, without modification, and assigning CPT code
76145 to APC 5611 for CY 2021. The final CY 2021 payment rate for the
code can be found in Addendum B to this final rule with comment period.
In addition, we refer readers to Addendum D1 of this final rule with
comment period for the status indicator (SI) meanings for all codes
reported under the OPPS. Both Addendum B and D1 are available via the
internet on the CMS website.
16. Musculoskeletal Procedures (APCs 5111 Through 5116)
Prior to CY 2016, OPPS payment for musculoskeletal procedures was
primarily divided according to anatomy and the type of musculoskeletal
procedure. As part of the CY 2016 reorganization to better structure
the OPPS payments towards prospective payment packages, we consolidated
those individual APCs so that they became a general Musculoskeletal APC
series (80 FR 70397 through 70398).
In the CY 2018 OPPS/ASC final rule with comment period (82 FR
59300), we continued to apply a six-level structure for the
Musculoskeletal APCs because doing so provided an appropriate
distinction for resource costs at each level and provided clinical
homogeneity. However, we indicated that we would continue to review the
structure of these APCs to determine whether additional granularity
would be necessary.
In the CY 2019 OPPS proposed rule (83 FR 37096), we recognized that
commenters had previously expressed concerns regarding the granularity
of the current APC levels and, therefore, requested comment on the
establishment of additional levels. Specifically, we solicited comments
on the creation of a new APC level between the current Level 5 and
Level 6 within
[[Page 85967]]
the Musculoskeletal APC series. While some commenters suggested APC
reconfigurations and requests for change to APC assignments, many
commenters requested that we maintain the current six-level structure
and continue to monitor the claims data as they become available.
Therefore, in the CY 2019 OPPS/ASC final rule with comment period, we
maintained the six-level APC structure for the Musculoskeletal
Procedures APCs (83 FR 58920 through 58921).
Based on the claims data available for the CY 2021 OPPS/ASC
proposed rule, we stated that we continued to believe that the six-
level APC structure for the Musculoskeletal Procedures APC series is
appropriate. Therefore, we proposed to maintain the APC structure for
the CY 2021 OPPS update.
In the CY 2020 OPPS/ASC final rule, we discussed issues related to
the APC assignment of CPT code 22869 (Insertion of interlaminar/
interspinous process stabilization/distraction device, without open
decompression or fusion, including image guidance when performed,
lumbar; single level) to APC 5115 (84 FR 61253 through 61254).
Specifically, commenters believed that the code was inappropriately
assigned to APC 5115 due to one hospital inaccurately reporting its
costs and charges. While we recognized the concerns that the commenters
described, we noted that it is generally not our policy to judge the
accuracy of hospital coding and charging for purposes of ratesetting.
For the proposed CY 2021 OPPS, the geometric mean cost of CPT code
22869 increased slightly relative to the prior year, from $11,023.45 to
$12,788.56. However, the proposed geometric mean costs of the Level 5
and Level 6 Musculoskeletal Procedures APCs were $12,102.02 and
$15,975.08, respectively, and so, based on the data that was available,
we continued to believe that it is appropriate to assign CPT code 22869
to APC 5115 (Level 5 Musculoskeletal Procedures APC).
For the CY 2021 OPPS, we also proposed to eliminate the Inpatient
Only (IPO) list over a three-year transition and to assign codes
removed from the IPO list to clinical APCs. Many of the codes proposed
to be removed from the IPO list are musculoskeletal procedures that we
proposed to assign to APCs in the Musculoskeletal Procedures APC
series, and so there may be effects on the geometric means as the
limited claims data for those codes is included in OPPS ratesetting.
For a more detailed discussion of the proposal to remove certain codes
from the IPO list, please see section IX.B. of the CY 2021 OPPS/ASC
proposed rule.
Table 28 displays the final CY 2021 Musculoskeletal Procedures APC
series' structure and APC geometric mean costs.
[GRAPHIC] [TIFF OMITTED] TR29DE20.040
Comment: One commenter recommended that CMS create a seventh
Musculoskeletal APC level above APC 5116 to account for complex
procedures that were proposed to be removed from the IPO list. Another
commenter requested that CMS consider the development of an additional
Musculoskeletal APC between current APCs 5114 and 5115.
Response: We appreciate the commenters' recommendation. We
understand that the addition of codes removed from the IPO list may
affect the geometric means of the Musculoskeletal Procedures APCs and
we will continue to monitor the claims data as they become available.
We also appreciate the goal of developing APC levels that appropriately
reflect resource costs. At this time, we believe the six-level
structure for the Musculoskeletal APCs continues to be appropriate.
However, we will take these comments into consideration for future
rulemaking
Comment: We received one comment recommending that CMS reassign CPT
codes 28297 (Correction, hallux valgus (bunionectomy), with
sesamoidectomy, when performed; with first metatarsal and medial
cuneiform joint arthrodesis, any method) and 28740 (Arthrodesis,
midtarsal or tarsometatarsal, single joint) to APC 5115 (Level 5
Musculoskeletal Procedures) to resolve any 2 times rule violations.
Response: We appreciate the commenter's recommendation regarding
the APC assignment of CPT 28297 and 28740. CPT codes 28297 and 28740
are currently assigned to APC 5114 (Level 4 Musculoskeletal
Procedures). Our review did not find that APC 5114 violates the 2 times
rule. We also note that for purposes of identifying significant
procedure codes for examination under the 2 times rule, we only
consider procedure codes that have more than 1,000 single major claims
or procedure codes that both have more than 99 single major claims and
[[Page 85968]]
contribute at least 2 percent of the single major claims used to
establish the APC cost to be significant (75 FR 71832). Neither of
these codes met this requirement and therefore were not considered
significant procedure codes for 2 times rule purposes. Therefore, we
are finalizing our proposal to continue to assign CPT codes 28297 and
28740 to APC 5114 in the CY 2021 OPPS.
Comment: Commenters supported our proposal to continue to assign
CPT code 22869 to APC 5115 (Level 5 Musculoskeletal Procedures). One
commenter requested that CMS continue to monitor the geometric mean
cost for CPT code 22869 and reestablish the code with assignment to APC
5116 (Level 6 Musculoskeletal Procedures) when appropriate.
Response: We appreciate commenters' support. We will continue to
review the most recent data and update the APC assignment for CPT code
22869 as necessary.
Comment: One commenter requested that we assign CPT code 23473
(Revision of total shoulder arthroplasty, including allograft when
performed; humeral or glenoid component) from APC 5115 to APC 5116,
based on their belief that the claims data was inaccurate and that the
time required to perform the procedure was not reflected in the
resource costs of the proposed APC placement.
Response: We note that CPT code 23473 has been established for some
time, with an effective date of January 1, 2013 and that it was the
initially established with a status indicator of ``T'' in the CY 2013
OPPS. Therefore, some of the issues related to codes transitioning off
the IPO list do not necessarily apply in this case and the actual data
for the claims are more appropriate in ratesetting than alternative
proxies. In the updated final rule claims data available for
ratesetting, the estimated geometric mean cost of CPT 23473 is
approximately $10,634 based on 287 claims, which is within the range of
the significant procedure costs of APC 5115 from approximately $9,644
to $12,902. As a result, we believe that the code is appropriately
placed in APC 5115.
Comment: For the CY 2020 OPPS/ASC final rule, HCPCS code C9757
(Laminotomy (hemilaminectomy), with decompression of nerve root(s),
including partial facetectomy, foraminotomy and excision of herniated
intervertebral disc, and repair of annular defect with implantation of
bone anchored annular closure device, including annular defect
measurement, alignment and sizing assessment, and image guidance; 1
interspace, lumbar) was assigned to comment indicator ``NI'' in the
OPPS Addendum B to indicate that the code was new and that we would be
accepting comments on the interim APC assignment. A commenter supported
the assignment to APC 5115 (Level 5 Musculoskeletal Procedures) with a
CY 2020 payment rate of $11,900.71.
Response: As we stated in the CY 2020 OPPS/ASC final rule, we
accepted comments on the interim OPPS payment assignment for new codes
effective January 1, 2020 that are assigned to comment indicator ``NI''
in the OPPS Addendum B (84 FR 61207). We further stated that the
comments would be addressed, and if applicable, the APC assignment
would be finalized in the CY 2021 OPPS/ASC final rule comment period.
We appreciate the feedback. We note that for CY 2021, we are finalizing
the assignment to APC 5115 (Level 5 Musculoskeletal Procedures) for
HCPCS code C9757. The final payment rate for the code can be found in
Addendum B to this final rule with comment period. In addition, the
status indicator definitions can be found in Addendum D1 to this final
rule with comment period. Both Addendum B and Addendum D1 are available
via the internet on the CMS website.
After consideration of the comments, we are finalizing our proposal
to maintain the six-level Musculoskeletal Procedures APC structure. We
are also finalizing the proposed assignment of CPT codes 28297 and
28740 to APC 5114, and the proposed assignment of CPT codes 22869 and
23473 to APC 5115 for the CY 2021 OPPS.
17. Neurostimulator and Related Procedures (APCs 5461 Through 5465)
In the CY 2015 OPPS/ASC final rule with comment period (79 FR 66807
through 66808), we finalized a restructuring of what were previously
several neurostimulator procedure-related APCs into a four-level
series. Since CY 2015, the four-level APC structure for the series has
remained unchanged. In addition to that restructuring, in the CY 2015
OPPS/ASC final rule, we also made the Level 2 through 4 APCs
comprehensive APCs (79 FR 66807 through 66808). Later, in the CY 2020
OPPS final rule, we also established the Level 1 Neurostimulator and
Related Procedure APC (APC 5461) as a comprehensive APC (84 FR 61162
through 61166).
In reviewing the claims data available for the CY 2021 OPPS
proposed rule, we believed that it was appropriate to create an
additional Neurostimulator and Related Procedures level, between the
current Level 2 and 3 APCs. Creating this APC allows for a smoother
distribution of the costs between the different levels based on their
resource costs and clinical characteristics. Therefore, for the CY 2021
OPPS, we proposed to establish a five-level APC structure for the
Neurostimulator and Related Procedures series. We noted that in
addition to creating the new level, we also proposed to assign CPT code
0398T (Magnetic resonance image guided high intensity focused
ultrasound (mrgfus), stereotactic ablation lesion, intracranial for
movement disorder including stereotactic navigation and frame placement
when performed) to the new Level 3 APC, as discussed in further detail
in section III.C.3.A of the CY 2021 OPPS/ASC proposed rule with comment
period.
Comment: Multiple commenters requested that we add a Level 6
Neurostimulator and Related Procedures APC. The commenters are
concerned that the payment rate for the current Level 4 APC and the
proposed Level 5 APC is dominated by CPT code 63685 (Insertion or
replacement of spinal neurostimulator pulse generator or receiver,
direct or inductive coupling) which has a geometric mean of $29,123.02.
The commenter indicated this means that higher cost neurostimulator
services that have relatively low utilization are substantially
underpaid. The commenters believe the lack of payment for these
services is discouraging their use, and they want a Level 6 APC to
establish a payment rate that more closely reflects the cost of these
expensive, low utilization services.
Response: We appreciate the concerns of the commenters, but we
reiterate that the OPPS is a prospective payment system. We group
procedures with similar clinical characteristics and resource costs
into APCs and establish a payment rate that reflects the geometric mean
of all services in the group even though the cost of each service
within the APC may be higher or lower than the APC's geometric mean. As
a result, in the OPPS any individual procedure may potentially be
overpaid or underpaid because the payment rate is based on the
geometric mean of the entire group of services in the APC. However, the
impact of these payment differences should be mitigated when
distributed across a large number of APCs. If we were to establish a
Level 6 APC for Neurostimulators and Related Procedures based on the
commenters' request, we would find the payment rate for the APC would
be closer to some of the services assigned to that APC but
[[Page 85969]]
other services would continue to receive payment that is substantially
lower than those services' geometric mean cost. In the end, the only
way to ensure each service receives payment equivalent to the cost of
the service would be to establish separate APCs for each service the
commenters believe is underpaid. That solution would be contrary to
payment principles of the OPPS, which is based on prospective payment.
Therefore, we believe it is appropriate to maintain the same five level
structure as proposed in the CY 2021 OPPS.
Comment: Most commenters supported our proposal to create an
additional Neurostimulator and Related Procedures level, between the
current Level 2 and 3 APCs, which is described as the Level 3
Neurostimulator and Related Procedures APC in our proposal.
Response: We appreciate the support of the commenters for our
proposal.
Comment: One commenter noted that our proposal to establish an
additional APC level would lead to a decrease in payment for services
described by CPT codes 63650 (Percutaneous implantation of
neurostimulator electrode array, epidural), 63685 (Insertion or
replacement of spinal neurostimulator pulse generator or receiver,
direct or inductive coupling), and 63688 (Revision or removal of
implanted spinal neurostimulator pulse generator or receiver).
Response: We did not find that there would be a substantial
decrease in the payment for the procedures described by CPT codes
63650, 63685, and 63688 due to our proposal. Based on a review of our
claims data, we found only a modest payment decrease for CPT code 63650
and modest payment increases for CPT codes 63685 and 63688.
In addition, for CY 2021, we proposed to continue to assign CPT
code 0587T to APC 5442 (Level 2 Nerve Injections) with a proposed
payment of $644.55. We also proposed to continue to assign CPT code
0588T to APC 5441 (Level 1 Nerve Injections) with a proposed payment of
$267.50. We note that because both codes were effective on January 1,
2020, we have no claims data available for OPPS ratesetting, as the CY
2021 OPPS payment rates are based on claims submitted between January
1, 2019 through December 31, 2019, and processed through June 30, 2020.
The long descriptors for both codes can be found in Table 29 below.
Comment: A commenter explained that in May 2019 the AMA CPT
Editorial Panel approved four (4) Category III CPT codes to describe
the surgical procedures associated with the PROTECT PNS
Neurostimulation System, specifically, CPT codes 0587T, 0588T, 0589T,
and 0590T. The PROTECT PNS device is used for the treatment of
overactive bladder (OAB) symptoms. The commenter added that on October
19, 2016, CMS approved Medicare coverage for the Category B IDE study
associated with the PROTECT PNS device. In addition, the commenter also
stated that CMS incorrectly assigned CPT codes 0587T and 0588T to
inappropriate APC assignments.
For CPT code 0587T, the commenter clarified that CPT code 0587T is
not an injection; rather, the code describes an implantation or
replacement of an integrated single device neurostimulation system,
similar to the procedures assigned to the Neurostimulator and Related
Procedures (APCs 5461 through 5465) family. The commenter recommended
reassigning CPT code 0587T to one of these APCs to adequately capture
the correct clinical characteristics and resource costs of the
technology similar to other neurostimulation devices in APCs 5461
through 5465. The commenter specifically recommended the reassignment
to APC 5464 (Level 4 Neurostimulator and Related Procedures) with a
proposed payment rate of $20,789.82, since the procedure is very
similar to CPT code 64590 (Insertion or replacement of peripheral or
gastric neurostimulator pulse generator or receiver, direct or
inductive coupling), which is assigned to APC 5464. According to the
commenter, the cost of the PROTECT implantable device and transmitter
kit that is used in the procedure is about $15,820. Based on the
commenter's estimated cost of approximately $20,032, which includes the
non-device cost of $2,737 and the PROTECT device cost of $15,820, the
appropriate assignment for the code until OPPS claims are available is
APC 5464.
For CPT code 0588T, the commenter explained that the code is not an
injection procedure, rather, the code describes the surgical removal of
the device. The commenter suggested reassigning the code to APC 5461
(Level 1 Neurostimulator and Related Procedures) with a proposed
payment of $3,498.13 because it is comparable to CPT code 64595
(Revision or removal of peripheral or gastric neurostimulator pulse
generator or receiver) based on clinical similarity and resource costs.
Response: We do not agree that CPT code 0587T is comparable to CPT
code 64590. Based on our review of the clinical characteristics of the
procedure and input from our medical advisors, we believe CPT code
0587T is more similar to the procedures assigned to APC 5462 (Level 2
Neurostimulator and Related Procedures). However, we agree that CPT
code 0588T is similar to the procedures in APC 5461, and are therefore
assigning the code to APC 5461 in the CY 2021 OPPS.
In summary, after consideration of the public comment, we are
finalizing our proposal with modification, and reassigning CPT code
0587T to APC 5462 and CPT code 0588T to APC 5461. Table 29 below list
the four Category III CPT codes for the PROTECT PNS System and their
APC and SI assignments for CY 2021. The final CY 2021 OPPS payment
rates for the codes can be found in Addendum B of this final rule with
comment period. In addition, we refer readers to Addendum D1 of this
final rule with comment period for the status indicator meanings for
all codes reported under the OPPS for CY 2021. Both Addendum B and
Addendum D1 are available via the internet on the CMS website.
BILLING CODE 4120-01-P
[[Page 85970]]
[GRAPHIC] [TIFF OMITTED] TR29DE20.041
Comment: Two commenters supported our proposal to change the APC
assignment for CPT code 0398T (Magnetic resonance image guided high
intensity focused ultrasound (mrgfus), stereotactic ablation lesion,
intracranial for movement disorder including stereotactic navigation
and frame placement when performed) to the proposed new Level 3
Neurostimulator and Related Procedures APC.
Response: We appreciate the support of the commenters for our
proposal.
After consideration of the public comments we received, we are
finalizing our proposal, without modification, to establish a five-
level APC structure for the Neurostimulator and Related Procedures
series. In addition to creating this new level, we also finalizing our
proposal to assign CPT 0398T (Magnetic resonance image guided high
intensity focused ultrasound (mrgfus), stereotactic ablation lesion,
intracranial for movement disorder including stereotactic navigation
and frame placement when performed) to this new Level 3 APC. Table 30
displays the proposed and final CY 2021 Neurostimulator and Related
Procedures APC series' structure and APC geometric mean costs.
[[Page 85971]]
[GRAPHIC] [TIFF OMITTED] TR29DE20.043
BILLING CODE 4120-01-C
18. Noncontact Real-Time Fluorescence Wound Imaging/MolecuLight (APC
5722)
For the July 2020 update, the CPT Editorial Panel established two
new codes, specifically, CPT codes 0598T and 0599T, to report
noncontact real-time fluorescence wound imaging for bacterial presence
in chronic and acute wounds. The codes and their long descriptors were
listed in Table 7 (New HCPCS Codes Effective July 1, 2020) of the CY
2021 OPPS/ASC final rule with comment period (85 FR 48815 through
48823). We note that CMS recently received a new technology application
for the MolecuLight i: X procedure, which is described by CPT codes
0598T and 0599T. In determining the appropriate payment for CPT code
0598T, we considered whether there should be separate or conditionally
packaged payment for the procedure since the use of the MolecuLight
imaging device will most often involve another procedure or service
during the same session (for example, debridement of the wound,
laboratory service, or another skin-related procedure). In addition, we
considered whether the code should be placed in either the Diagnostic
Procedures or Minor Procedures APC group. Based on our review of the
application and input from our physicians, we assigned CPT code 0598T
to APC 5722 (Level 2 Diagnostic Tests and Related Services) and status
indicator ``T'' with a payment rate of $253.10 effective July 1, 2020.
In addition, because CPT code 0599T is an add-on code, we assigned the
code to status indicator ``N'' to indicate that the payment is included
in the primary procedure. We note that the new technology application
indicated a higher projected cost involving care in an operating room
(OR), however, based on our review of the MolecuLight service, we
removed OR-associated costs because it was not clear to us that the
test would routinely be performed in the OR setting. However, in the CY
2021 OPPS/ASC proposed rule we solicited public comments from hospital-
based providers that have used MolecuLight on the appropriate OPPS
payment, particularly with respect to the cost of providing the service
in the hospital outpatient setting.
For CY 2021, we proposed to continue to assign CPT code 0598T to
APC 5722 (Level 2 Diagnostic Tests and Related Services) with a
proposed payment rate of $269.85. We proposed to maintain a status
indicator of ``N'' for CPT code 0599T, which is an add-on code, to
indicate that the payment is included in the primary procedure. The
long descriptors and proposed SI and APC assignments for both codes can
be found in Table 31 below.
Comment: Some commenters agreed with the APC assignment to APC 5722
for CPT code 0598T, however, they had concerns with the packaged status
indicator assignment for CPT code 0599T, and suggested assigning the
code to a different APC and revising the status indicator from ``N''
(packaged) to ``S'' (Procedure or Service, Not Discounted When
Multiple). One commenter indicated that the payment is insufficient to
cover the cost of the procedure and contended that the low
reimbursement will dissuade hospitals from offering the service. The
commenter reported that the procedure requires the use of a Dark Drape
technology and also requires significant time because the second ulcer
and subsequent ulcers typically involve different anatomical locations.
Another commenter reported that hospital outpatient charges for CPT
code 0598T are between $850 and $2,500 for the first wound and between
$850 and $1,850 for subsequent anatomic sites. The same commenter
suggested that OPPS payment is inadequate, especially in cases that
involve additional wounds in different anatomic sites such as the
sacrum, abdomen, toe, or leg, all of which require additional resource
costs. Consequently, the commenter requested a revision in the APC
assignment for both codes. Specifically, the commenter recommended
reassigning CPT code 0598T from APC 5722 to APC 5723 (Level 3
Diagnostic Tests and Related Services) with a proposed payment of
$497.96, and to assign CPT code 0599T to APC 5722 with a proposed
payment of $269.85. In addition, the commenter recommended assigning
both codes status indicator ``S''.
Response: With regard to CPT code 0598T, based on our evaluation of
the new technology application submitted to CMS as well as input from
our physicians, we believe that we should maintain the assignment to
APC 5722 for CY 2021. In addition, because CPT code 0599T is an add-on
code, we are maintaining its status indicator assignment of ``N''
(packaged). As specified in section Sec. 419.2(b)(18), add-on codes
are generally packaged under
[[Page 85972]]
the hospital OPPS. As explained in the CY 2014 OPPS/ASC final rule with
comment period (78 FR 74942 through 74945), we finalized a policy to
unconditionally package procedures described by add-on codes.
Procedures described by add-on codes represent an extension or
continuation of a primary procedure, which means that they are
typically supportive, dependent, or adjunctive to a primary service.
The primary code defines the purpose and typical scope of the patient
encounter and the add-on code describes incremental work, when the
extent of the procedure encompasses a range rather than a single
defined endpoint applicable to all patients. Given the dependent nature
and adjunctive characteristics of procedures described by add-on codes
and in light of longstanding OPPS packaging principles, we finalized a
policy to unconditionally package add-on codes with the primary
procedure.
In summary, after consideration of the public comments, we are
finalizing our proposal, without modification, to assign CPT code 0598T
to APC 5722 with status indicator ``T'' and to assign CPT code 0599T
status indicator ``N'' for CY 2021. The final CY 2021 payment rate for
CPT code 0598T can be found in Addendum B to this final rule with
comment period. In addition, we refer readers to Addendum D1 of this
final rule with comment period for the status indicator (SI) meanings
for all codes reported under the OPPS. Both Addendum B and D1 are
available via the internet on the CMS website.
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19. Nuclear Medicine Services: Single-Photon Emission Computed
Tomography (SPECT) Studies (APC 5593)
For CY 2021, we proposed to reassign CPT code 78803
(Radiopharmaceutical localization of tumor, inflammatory process or
distribution of radiopharmaceutical agent(s) (includes vascular flow
and blood pool imaging, when performed); tomographic (spect), single
area (e.g., head, neck, chest, pelvis), single day imaging) from APC
5593 (Level 3 Nuclear Medicine and Related Services) with a payment
rate of $1,272.19 to APC 5592 (Level 2 Nuclear Medicine and Related
Services) with a proposed payment rate of $501.45.
Comment: Several commenters objected to the reassignment of CPT
code 78803 to APC 5592 and requested that we not finalize our proposal
but rather maintain the current placement in APC 5593. They stated that
the significant payment decrease would limit patient access, affect
patient care, and restrict hospitals from offering the test. One
commenter reported that the Medicare payment for CPT code 78803 is
insufficient, and as a result, many hospitals refuse to offer the
service. This same commenter reported that lowering the payment for the
test may force some hospitals that currently offer the test to stop
providing it altogether. The commenter added that many patients travel
hours to access a SPECT scan exam and lowering the payment for the test
would not improve patient care. Some commenters reminded us that for CY
2020, CPT code 78803 replaced seven codes that were deleted on December
31, 2019. Most commenters stated that the more appropriate placement
for CPT code 78803 is APC 5593, based on resource use and clinical
similarity to the other procedures in the APC.
Response: We discussed the issue related to the seven deleted codes
in the CY 2020 OPPS/ASC final rule (84 FR 61257 through 61258) and
noted that based on the geometric mean costs for CPT code 78803 and the
deleted codes, we believe it was necessary for us to maintain the APC
assignment for CPT code 78803 in APC 5593. Because the CY 2021 OPPS
payments are based on claims submitted between January 1, 2019 through
December 31, 2019, and processed through June 30, 2020, we again
reviewed the claims data for the deleted codes to determine the
appropriate placement for CPT code 78803. As listed in Table 32, the
range of geometric mean costs for CPT code 78803 and the seven deleted
codes is between $408 and $1,508. Similar to our CY 2020 findings, we
note that several of the deleted codes were assigned to APC 5593, and
based on our review of these codes, we believe it would be appropriate
to maintain assignment of CPT code 78803 to APC 5593 for CY 2021.
[[Page 85973]]
[GRAPHIC] [TIFF OMITTED] TR29DE20.045
Comment: One commenter agreed with the proposal to maintain the
four levels of nuclear medicine APCs for CY 2021 but requested that CMS
consider establishing additional APCs as needed to ensure that the
nuclear medicine APCs do not violate the 2-times rule when the cost of
packaged diagnostic radiopharmaceuticals drugs are included.
Response: We appreciate the feedback and will consider in future
rulemaking whether establishing additional nuclear medicine APCs would
be appropriate.
In summary, after consideration of the public comments, and after
our analysis of the updated claims data for this final rule with
comment period, we are finalizing a modification to our proposal.
Specifically, we are revising the APC assignment for CPT code 78803 to
APC 5593 for CY 2021. The final CY 2021 payment rate for the code can
be found in Addendum B to this final rule with comment period (which is
available via the internet on the CMS website).
As we do every year, we will reevaluate the APC assignment for CPT
code 78803 for the next rulemaking cycle. We note that we review, on an
annual basis, the APC assignments for all services and items paid under
the OPPS.
20. Pathogen Test for Platelets/Rapid Bacterial Testing (APC 5732)
For the July 2017 update, the HCPCS Workgroup established HCPCS
code Q9987 (Pathogen(s) test for platelets) effective July 1, 2017.
This new code and the OPPS APC assignment were announced in the July
2017 OPPS quarterly update CR (Transmittal 3783, Change Request 10122,
dated May 26, 2017). Because HCPCS code Q9987 represented a test to
identify bacterial or other pathogen contamination in blood platelets,
we assigned the code to a new technology APC, specifically, New
Technology APC 1493 (New Technology--Level 1C ($21-$30)) with a status
indicator ``S'' and a payment rate of $25.50. We note that temporary
HCPCS code Q9987 was subsequently deleted on December 31, 2017, and
replaced with permanent HCPCS code P9100 (Pathogen(s) test for
platelets) effective January 1, 2018. For the January 2018 update, we
continued to assign the new code to the same APC and status indicator
as its predecessor code. Specifically, we assigned HCPCS code P9100 to
New Technology APC 1493 and status indicator ``S''. For the CY 2019
update, we made no change to the APC or status indicator assignment for
P9100, however, for the CY 2020 update, we revised the APC assignment
from New Technology APC 1493 to 1494 (New Technology--Level 1D ($31-
$40)) based on the latest claims data used to set the payment rates for
CY 2020. We discussed the revision in the CY 2020 OPPS/ASC final rule
(84 FR 61219) and indicated that the reassignment to APC 1494
appropriately reflected the cost of the service.
For the CY 2021 proposed rule, we believed that we had sufficient
claims data to reassign the code from a New Technology APC to a
clinical APC, and noted that HCPCS code P9100 had been assigned to a
New Technology APC for over 3 years. As stated in section III.D. (New
Technology APCs), a service is paid under a New Technology APC until
sufficient claims data have been collected to allow CMS to assign the
procedure to a clinical APC group that is appropriate in clinical and
resource terms. We expect this to occur within two to three years from
the time a new HCPCS code becomes effective. However, if we are able to
collect sufficient claims data in less than 2 years, we would consider
reassigning the service to an appropriate clinical APC. Since HCPCS
code P9100 has been assigned to a new technology APC since July 2017,
we believed that we should reassign the code to a clinical APC.
Specifically, our claims data for the proposed rule showed a geometric
mean cost of approximately $30 for HCPCS code P9100 based on 70 single
claims (out of 1,835 total claims). Based on resource cost and clinical
homogeneity to the other services assigned to APC 5732 (Level 2 Minor
Procedures), we believed that HCPCS code P9100 should be reassigned to
clinical APC 5732, which had a geometric mean cost of approximately
$33.
As we have stated several times since the implementation of the
OPPS on August 1, 2000, we review, on an annual basis, the APC
assignments for all services and items paid under the OPPS based on our
analysis of the latest claims data. For the CY 2021 OPPS update, based
on claims submitted between January 1, 2019, and December
[[Page 85974]]
30, 2019, our analysis of the latest claims data for the proposed rule
supported reassigning HCPCS code P9100 to APC 5732 based on its
clinical and resource similarity to the procedures and services in the
APC. Therefore, we proposed to reassign HCPCS code P9100 from New
Technology APC 1494 to clinical APC 5732 for CY 2021.
Comment: A commenter supported our proposal to revise the APC
assignment for HCPCS code P9100 to APC 5732.
Response: We appreciate the support for our proposal. Based on our
review of the updated claims data for this final rule with comment
period, which is based on claims submitted between January 1, 2019, and
December 30, 2019, and processed through June 30, 2020, we continue to
believe that reassigning HCPCS code P9100 to APC 5732 is appropriate.
Specifically, our claims data show a geometric mean cost of
approximately $30.86 for HCPCS P9100 based on 75 single claims (out of
2,038 total claims), which is consistent with the geometric mean cost
of about $32.97 for APC 5732.
In summary, after consideration of the public comment, and after
our analysis of the updated claims data for this final rule with
comment period, we are finalizing our proposal, without modification,
to assign HCPCS code P9100 to APC 5732 for CY 2021. The final CY 2021
payment rate for the code can be found in Addendum B to this final rule
with comment period. In addition, we refer readers to Addendum D1 of
this final rule with comment period for the status indicator (SI)
meanings for all codes reported under the OPPS. Both Addendum B and D1
are available via the internet on the CMS website.
21. Payment for Radioisotopes Derived From Non-Highly Enriched Uranium
(Non-HEU) Sources (APC 1442)
Radioisotopes are widely used in modern medical imaging,
particularly for cardiac imaging and predominantly for the Medicare
population. Some of the Technetium-99 (Tc-99m), the radioisotope used
in the majority of such diagnostic imaging services, is produced in
legacy reactors outside of the United States using highly enriched
uranium (HEU).
The United States would like to eliminate domestic reliance on
these reactors, and is promoting the conversion of all medical
radioisotope production to non-HEU sources. Alternative methods for
producing Tc-99m without HEU are technologically and economically
viable, and conversion to such production has begun. We expect that
this change in the supply source for the radioisotope used for modern
medical imaging will introduce new costs into the payment system that
are not accounted for in the historical claims data.
Therefore, beginning in CY 2013, we finalized a policy to provide
an additional payment of $10 for the marginal cost for radioisotopes
produced by non-HEU sources (77 FR 68323). Under this policy, hospitals
report HCPCS code Q9969 (Tc-99m from non-highly enriched uranium
source, full cost recovery add-on per study dose) once per dose along
with any diagnostic scan or scans furnished using Tc-99m as long as the
Tc-99m doses used can be certified by the hospital to be at least 95
percent derived from non-HEU sources (77 FR 68321).
Comment: One commenter requested that we increase the payment rate
for HCPCS add-on code Q9969 from $10. The commenter noted that we have
not increased the payment rate for Q9969 since the code was established
in CY 2013. The commenter suggested increasing the payment for Q9969 by
the annual market basket increase for CY 2021 along with a one-time
increase to reflect prior increases to the market basket between CY
2013 and CY 2021. Alternatively, the commenter suggested the payment
rate could be increased by the change in the drug cost threshold
packaging amount between CY 2013 and CY 2021.
Response: We appreciate the information we received from the
commenter supporting an increase to the payment rate of $10 for HCPCS
code Q9969. As discussed in the CY 2013 OPPS/ASC final rule with
comment period, we did not finalize a policy to use the usual OPPS
methodologies to update the non-HEU add-on payment (77 FR 68317). The
purpose of the additional payment is limited to mitigating any adverse
impact of transitioning to non-HEU sources and we believe the add-on is
appropriate at this time.
Comment: Multiple commenters supported the current payment amount
for HCPCS code Q9969 and they requested that we finalize our proposed
payment rate for the add-on.
Response: We appreciate the support of the commenters for the
proposed payment rate for HCPCS code Q9969.
After consideration of the public comments we received, we are
finalizing our proposal, without modification, to continue the policy
of providing an additional $10 payment for radioisotopes produced by
non-HEU sources for CY 2021 and subsequent years as represented by
HCPCS code Q9969.
22. Percutaneous Transcatheter Ultrasound Nerve Ablation
The Therapeutic Intra-Vascular Ultrasound System
(TIVUSTM) is a high intensity, non-focused, ultrasound
catheter system, which enables remote, localized, controlled and
repeatable thermal modulation of nerves adjacent to arterial vessel
wall for performing therapeutic pulmonary artery sympathetic
denervation and is used for the treatment of pulmonary arterial
hypertension (PAH). In 2020, the TIVUSTM system was approved
by FDA for a Category B (Nonexperimental/investigational)
Investigational Device Exemption (IDE) for the device to be used in a
clinical study. The study sponsors have also requested Medicare
coverage of the Category B IDE study to allow for coverage of the
TIVUSTM system and the routine care items and services in
the clinical trial. To date, CMS has not established approval of
Medicare coverage for the Category B IDE study for the
TIVUSTM system.
The TIVUSTM system is used with CPT code 0632T
(Percutaneous transcatheter ultrasound ablation, nerves innervating the
pulmonary arteries, including right heart catheterization, radiological
supervision and interpretation and pulmonary artery angiography), which
will become effective January 1, 2021. In the CY 2021 OPPS/ASC proposed
rule, CPT code 0632T was assigned status indicator ``E1'', which
describes items, codes, and services not covered by any Medicare
outpatient benefit category, statutorily excluded by Medicare, or not
reasonable and necessary. These items, codes, and services are not paid
by Medicare when submitted on outpatient claims.
Comment: One commenter, the manufacturer of the TIVUSTM
system, requested that, in anticipation of approval of Medicare
coverage for the Category B IDE study for the TIVUSTM
system, CMS assign CPT code 0632T status indicator ``J1'', which
describes services paid through a comprehensive APC (C-APC) instead of
status indicator ``E1'' for CY 2021. The commenter also requested that
CMS assign CPT code 0632T to C-APC 5213 (Level 3 Electrophysiologic
Procedures) for CY 2021, stating that the procedure is similar in
clinical characteristics and resource costs to CPT code 93656
(Comprehensive electrophysiologic evaluation including transseptal
catheterizations, insertion and repositioning of multiple electrode
catheters with induction or attempted induction of an arrhythmia
including
[[Page 85975]]
left or right atrial pacing/recording, when necessary, right
ventricular pacing/recording when necessary, and his bundle recording
when necessary with intracardiac catheter ablation of atrial
fibrillation by pulmonary vein isolation), which is assigned to C-APC
5213 for CY 2021.
Response: For approved Category B IDE studies, CMS allows for
coverage of the Category B device and the routine care items and
services in the clinical trial. To date, coverage for the Category B
IDE clinical study for the TIVUSTM system has not been
approved by CMS. We do not believe that it is appropriate to assign a
payable status indicator under the OPPS to CPT code 0632T prior to the
approval of the Category B IDE study. Therefore, for CY 2021, we are
finalizing the assignment of status indicator ``E1'' to CPT code 0632T.
23. Peripheral Intravascular Lithotripsy (IVL) Procedure (APCs 5192,
5193, and 5194)
The IVL system has three components: A proprietary IVL Catheter, an
IVL Generator, and an IVL Connector Cable. It is a lithotripsy-enhanced
balloon catheter used to dilate lesions, including calcified lesions,
in the peripheral vasculature, including the iliac, femoral, ilio-
femoral, popliteal, infra-popliteal, and renal arteries. The IVL
catheter has integrated lithotripsy emitters and is designed to enhance
percutaneous transluminal angioplasty by enabling delivery of the
calcium disrupting capability of lithotripsy prior to full balloon
dilatation at low pressures. The application of lithotripsy mechanical
pulse waves alters the structure of an occlusive vascular deposit
(stenosis) prior to low-pressure balloon dilation of the stenosis and
facilitates the passage of blood and is used for the treatment of
peripheral artery disease (PAD).
In 2019, FDA cleared 510(k) submission based on a determination of
substantial equivalence to a legally marketed predicate device. The
manufacturer also submitted a new technology application requesting new
technology APC assignment for IVL procedures. Based on our review of
the New Technology APC application for this service and the service's
clinical similarity to existing APCs in the OPPS, we created four new
HCPCS codes for these services and assigned these codes to existing
clinical APCs. Specifically, CMS proposed to add HCPCS code C9764
(Revascularization, endovascular, open or percutaneous, any vessel(s);
with intravascular lithotripsy, includes angioplasty within the same
vessel(s), when performed), C9765 (Revascularization, endovascular,
open or percutaneous, any vessel(s); with intravascular lithotripsy,
and transluminal stent placement(s), includes angioplasty within the
same vessel(s), when performed) C9766 (Revascularization, endovascular,
open or percutaneous, any vessel(s); with intravascular lithotripsy and
atherectomy, includes angioplasty within the same vessel(s), when
performed), and C9767 (Revascularization, endovascular, open or
percutaneous, any vessel(s); with intravascular lithotripsy and
transluminal stent placement(s), and atherectomy, includes angioplasty
within the same vessel(s), when performed), effective July 1, 2020. We
assigned code C9764 to APC 5192 (Level 2 Endovascular Procedures) with
a payment rate of $4,953.91; C9765 and C9766 to APC 5193 (Level 3
Endovascular Procedures) with a payment rate of $9,908.48; and C9767 to
APC 5194 (Level 4 Endovascular Procedures) with a payment rate of
$15,939.97 for CY 2020. In the CY 2021 OPPS/ASC proposed rule, we
proposed to maintain these APC assignments for these codes in CY 2021.
At the August 31, 2020 HOP Panel Meeting, a presenter requested
that we reassign IVL procedure C9764 to APC 5193 and procedures C9765
and C9766 to APC 5194. The presenter indicated that the APC payment
associated with HCPCS code(s) C9764, C9765 and C9766 is inadequate to
cover the cost of the procedures. According to the presenter, the
proposed CY 2021 geometric mean cost for the procedures range from
$6,619.26 to $22,305.36, not including the additional cost of the IVL
catheter. The presenter reported that the cost of one catheter is
$2,800 but each procedure requires an average of 1.2 catheters,
bringing the total cost of catheters to $3,360 per procedure. The
presenter stated that the payment rate for the IVL procedures on tibial
and peroneal vessels was lower than the payment rate for similar
procedures without IVL. The presenter believed that hospitals will
limit access to IVL, reducing patient access, because payment for the
procedure is inadequate. They argued that limiting IVL access to
patients suffering from critical limb ischemia in tibial and peroneal
arteries could lead to higher complications associated with current
treatment modalities. They believe that traditional treatments are
associated with higher risk of distal embolization, perforation and
possible amputation. Based on the information presented at the meeting,
the HOP Panel recommended CMS reassign HCPCS code C9764 to APC 5193 and
HCPCS codes C9765 and C9766 to APC 5194, as long as the cost of the IVL
device is within 10 percent of other devices currently available.
However, we are unable to identify devices that are similar to IVL and
therefore cannot complete the data analysis recommended by the HOP
Panel.
Comment: Several commenters disagreed with CMS' proposed APC
assignments for the peripheral intravascular lithotripsy service
described by HCPCS codes C9764, C9765 and C9766. They reported that,
based on the resource cost of the service described by HCPCS code
C9764, APC 5192 does not provide adequate reimbursement for the
service, and recommended reassignment to APC 5193 (Level 3 Endovascular
Procedures) with a proposed payment rate of $10,222.32. Similarly, for
HCPCS codes C9765 and C9766, the commenters indicated that APC 5193
would not adequately cover the resource costs associated with these
procedures, and recommended their reassignment to APC 5194 (Level 4
Endovascular Procedures) with a proposed payment rate of $16,348.66.
Response: APC assignment for a code is based on similarity to other
codes within an APC in terms of clinical homogeneity and resource
costs. As specified in 42 CFR 419.31(a)(1), CMS classifies outpatient
services and procedures that are comparable clinically and in terms of
resource use into APC groups. As we stated in the CY 2012 OPPS/ASC
final rule (76 FR 74224), the OPPS is a prospective payment system that
provides payment for groups of services that share clinical and
resource use characteristics. For all new codes, our policy has been to
assign the service or procedure to an APC informed by a variety of
sources, including but not limited to, review of the clinical
similarity of the service to existing procedures; advice from CMS
medical advisors; information from interested specialty societies; and
review of all other information available to us, including information
provided to us by the public, whether through meetings with
stakeholders or additional information that is mailed or otherwise
communicated to us.
Based on the comments we received, the HOP Panel recommendation,
information provided in the new technology application, and advice from
our medical advisors, we believe we should add new HCPCS codes to
describe tibial and peroneal IVL procedures, for a total of eight IVL
procedure codes, and revise the long
[[Page 85976]]
descriptors for HCPCS codes C9764, C9765, C9766, and C9767 by deleting
the words ``any vessel(s)'' and replacing with ``lower extremity
artery(ies), except tibial/peroneal'' effective January 1, 2021. We
agree with commenters that the resources associated with tibial and
peroneal IVL procedures are higher than iliac, femoral and popliteal
procedures. Therefore, we are creating new HCPCS codes C9772, C9773,
C9774, and C9775 to describe tibial and peroneal procedures and
assigning these codes to APCs as listed in the Table 33 below.
In summary, after consideration of public comments, we are
finalizing our proposal with modification, to provide new HCPCS codes
C9772, C9773, C9774 and C9775 and assign these codes to APCs listed in
Table 33. Table 33 also lists revised long descriptors for HCPCS codes
C9764, C9765, C9766, and C9767, and final SI and APC assignments for
all eight codes. The final CY 2021 payment rate for these codes can be
found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the status indicator (SI) meanings for all codes
reported under the OPPS. Both Addendum B and D1 are available via the
internet on the CMS website.
BILLING CODE 4120-01-P
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[[Page 85977]]
BILLING CODE 4120-01-C
24. Remote Physiological Monitoring (APC 5741)
a. Initial Remote Monitoring of Physiologic Parameters (APC 5741)
For the CY 2019 update, the CPT Editorial Panel established a new
code, specifically, CPT code 99454, to describe initial remote
monitoring of physiological parameters effective January 1, 2019. In
the CY 2019 update, we assigned this code to APC 5741 (Level 1
Electronic Analysis of Devices) with status indicator ``Q1''
(conditionally packaged) and a payment rate of $37.16 effective January
1, 2019, based on the clinical and resource similarity with CPT code
93270 (External patient and, when performed, auto activated
electrocardiographic rhythm derived event recording with symptom-
related memory loop with remote download capability up to 30 days, 24-
hour attended monitoring; recording (includes connection, recording,
and disconnection)). The new code appeared in the OPPS Addendum B of
the CY 2019 OPPS/ASC final rule.
For CY 2020 OPPS/ASC final rule, we maintained the assignment of
CPT code 99454 to APC 5741 with a payment rate of $36.25. We note that
we had no claims data for CPT code 99454 for the CY 2020 final rule
since the code was established on January 1, 2019. For the CY 2021
OPPS/ASC proposed rule, we proposed to maintain the assignment of CPT
code 99454 to APC 5741 with the proposed payment rate of $37.76.
Comment: One commenter was concerned that the current reimbursement
rate is too low, which the commenter believes discourages providers
from using much-needed equipment and services. The commenter stated
that CMS must ensure that life-saving RPM technology would be available
to Medicare beneficiaries by updating the status indicator and
increasing reimbursement rate for CPT code 99454. The commenter
requested: (1) A change in the status indicator for CPT code 99454 from
``Q1'' to ``S,'' so that it will be paid when used in conjunction with
other services; and (2) reassignment of CPT code 99454 from APC 5741
(Level 1 Electronic Analysis of Devices) to APC 5742 (Level 2
Electronic Analysis of Devices).
Response: As we have stated every year since the implementation of
the OPPS on August 1, 2000, we review, on an annual basis, the APC
assignments for all services and items paid under the OPPS based on our
analysis of the latest claims data. For CY 2021, based on claims
submitted between January 1, 2019 through December 31, 2019, that were
processed on or before June 30, 2020, our analysis of the latest claims
data for this final rule with comment period supports continuing to
assign CPT code 99454 to APC 5741. Specifically, our claims data shows
a geometric mean cost of approximately $28.06 for CPT 99454 based on
185 single claims (out of 275 total claims), which is comparable to the
geometric mean cost of about $36.19 for APC 5741, rather than the
geometric mean cost of approximately $97.72 for APC 5742.
We proposed to assign code 99454 to status indicator ``Q1'' for CY
2021 to indicate that the payment for CPT code 99454 is packaged when
the code is billed on the same claim as a HCPCS code assigned to OPPS
status indicator ``S'', ``T'', or ``V'', but is paid separately when it
is the only major service on the claim. Because the service described
by CPT code 99454 will most often be performed as part of another
significant procedure, we believe that packaging the cost associated
with CPT code 99454 into the primary service is appropriate. Therefore,
assignment of status indicator ``Q1'' to CPT 99454 is appropriate.
In summary, after consideration of the public comments and after
evaluation of our claims data for this final rule with comment period,
we are finalizing our proposal, without modification, for CPT code
99454. The final CY 2021 payment rate for the CPT code 99454 can be
found in Addendum B to this final rule with comment period (which is
available via the internet on the CMS website).
As we do every year, we will reevaluate the APC assignment for CPT
code 99454 for the next rulemaking cycle. We remind hospitals that we
review, on an annual basis, the APC assignments for all services and
items paid under the OPPS based on the latest claims data.
b. Remote Physiological Monitoring Services, Virtual Check-In, E-
Visits, Telephone E/M, and Medication Management Services
For CY 2021, we proposed to continue to assign CPT code 99091
(Collection and interpretation of physiologic data (e.g., ecg, blood
pressure, glucose monitoring) digitally stored and/or transmitted by
the patient and/or caregiver to the physician or other qualified health
care professional, qualified by education, training, licensure/
regulation (when applicable) requiring a minimum of 30 minutes of time,
each 30 days) to status indicator ``N'' (packaged) to indicate that the
payment for the service is included in the primary service reported
with the code. We also proposed to continue to assign CPT codes 99457
(Remote physiologic monitoring treatment management services, clinical
staff/physician/other qualified health care professional time in a
calendar month requiring interactive communication with the patient/
caregiver during the month; first 20 minutes) and 99458 (Remote
physiologic monitoring treatment management services, clinical staff/
physician/other qualified health care professional time in a calendar
month requiring interactive communication with the patient/caregiver
during the month; each additional 20 minutes (list separately in
addition to code for primary procedure)) to status indicator ``B'' (not
recognized under OPPS) to indicate that the codes are not paid under
the hospital OPPS but may be paid under a different Medicare payment
system other than the OPPS. However, if the services described by
either CPT code 99457 or 99458 are performed in the hospital outpatient
facility, the facility should report an alternate code. These codes are
listed in Table 34 along with the descriptors and status indicator
assignments. In addition, the definitions for all the OPPS status
indicators can be found in Addendum D1.
We note that for CY 2020, we revised the status indicator for CPT
code 99457 from ``M'' (Items and Services Not Billable to the MAC. Not
paid under OPPS) to ``B,'' and for CPT code 99458, which is an add-on
code, from ``N'' (packaged) to ``B'' effective March 1, 2020. We made
the changes to enable Critical Access Hospitals (CAHs) to bill under
CAH's Method II for these waiver services so that claims with these
codes would process appropriately in the Integrated Outpatient Code
Editor (IOCE). We announced the revisions in the July 2020 OPPS
Quarterly Update CR (Transmittal 10224, Change Request 11814, dated
July 15, 2020).
At the August 31, 2020 HOP Panel Meeting, a presenter requested
that we revise the status indicators for these codes. Specifically, the
presenter suggested that CPT codes 99091 and 99457 should be treated
similar to HCPCS G0463 (Hospital outpatient clinic visit for assessment
and management of a patient), which is assigned to status indicator
``V'' (Clinic or Emergency Department Visit) and APC 5012 (Clinic
Visits and Related Services) which has a CY 2021 proposed payment rate
of $120.88. Based on the discussion at the Panel Meeting, the HOP Panel
recommended that the status indicator for CPT codes 99091 and 99457 be
revised to ``V'' and the status indicator for CPT code 99458 be revised
[[Page 85978]]
to ``N''. We note that we are not accepting the Panel's recommendation
because we believe that we need further review to determine whether
these type of services (i.e., remote physiologic monitoring) should be
paid separately under the OPPS. We appreciate the HOP Panel's
recommendations on the status indicator revisions for CPT codes 99091,
99457, and 99458, and will consider them in future rulemaking.
Comment: For CPT code 99091, one commenter disagreed with the
status indicator assignment of ``N,'' and stated the code should not be
packaged because the service may be the only OPPS service furnished
during a month for a registered hospital outpatient. The commenter
recommended assigning the code to either status indicator ``V'' or
treating it similar to CPT code 99454 (Remote monitoring of physiologic
parameter(s) (e.g., weight, blood pressure, pulse oximetry, respiratory
flow rate), initial; device(s) supply with daily recording(s) or
programmed alert(s) transmission, each 30 days), which has a payable
status indicator of ``Q1'' (STV-Packaged Codes) and assigned to APC
5741 (Level 1 Electronic Analysis of Devices) with a CY 2021 proposed
payment of $37.76.
Response: Although we are sensitive to the concern raised by the
commenter, we do not believe that revising the status indicator for CPT
code 99091 would be appropriate at this time. We believe we need
further review of this code, along with all the remote physiological
monitoring (PRM) service codes, to determine whether these types of
services should be separately payable under the OPPS. Therefore, for CY
2021, we are finalizing our proposal, without modification and will
continue to assign CPT code 99091 to status indicator ``N,'' and
consider the suggestion to revise the status indicator in future
rulemaking. The final CY 2021 status indicator for CPT code 99091 can
also be found in Table 34 below.
Comment: For CPT code 99457, several commenters suggested
reassigning the code to status indicator ``V,'' similar to CPT code
99453 (Remote monitoring of physiologic parameter(s) (e.g., weight,
blood pressure, pulse oximetry, respiratory flow rate), initial; set-up
and patient education on use of equipment), which has a payable status
indicator of ``V'' and assigned to APC 5012 with a CY 2021 proposed
payment of $120.88. The commenters stated that in the CY 2020 Physician
Fee Schedule (PFS), CMS clarified that ``CPT codes 99457 and 99458 can
be furnished by clinical staff under the general supervision of the
physician or NPP.'' Based on this statement, the commenters believe
that CPT code 99457 should be paid separately under the OPPS. The
commenters reported that because the code is currently assigned to
status indicator ``B,'' hospital outpatient facilities do not receive
any reimbursement when the service is provided by clinical staff in a
hospital outpatient setting. One commenter stated that the status
indicator should be revised to ``V'' to support the service being
provided to Medicare beneficiaries under the order of a physician.
Response: We appreciate the commenters' suggestions, however, we
believe we need further evaluation of this code, along with the rest of
the RPM service codes, to determine whether this type of service should
be separately payable under the OPPS. Therefore, for CY 2021, we are
finalizing our proposal, without modification, to assign CPT code 99457
to status indicator ``B.'' We will consider the commenters' suggestion
to revise the status indicator for future rulemaking. The final CY 2021
status indicator for CPT code 99457 can also be found in Table 34
below. Also, as noted above, we revised the status indicator for CPT
code 99457 from ``M'' to ``B'' effective March 1, 2020, to enable
Critical Access Hospitals (CAHs) to bill under CAH's Method II for
these waiver services so that claims with this code would process
appropriately in the Integrated Outpatient Code Editor (IOCE). We
announced the revisions in the July 2020 OPPS Quarterly Update CR
(Transmittal 10224, Change Request 11814, dated July 15, 2020).
Comment: For CPT code 99458, the commenters suggested the
reassignment to status indicator ``N'' because this is an add-on code.
Response: As noted above, similar to CPT code 99457, we revised the
status indicator for CPT code 99458 to ``B'' effective March 1, 2020,
to enable Critical Access Hospitals (CAHs) to bill under CAH's Method
II for the service so that claims with this code would process
appropriately in the Integrated Outpatient Code Editor (IOCE). We
announced the revisions in the July 2020 OPPS Quarterly Update CR
(Transmittal 10224, Change Request 11814, dated July 15, 2020). We
appreciate the commenters' suggestions, however, we believe we need
further evaluation of this code, along with the rest of the RPM service
codes, to determine whether this type of service should be separately
payable under the OPPS. Therefore, for CY 2021, we are finalizing our
proposal, without modification, to assign CPT code 99458 to status
indicator ``B,'' and we will consider the suggestion to revise the
status indicator in future rulemaking. The final CY 2021 status
indicator for CPT code 99458 can be found in Table 34 below.
Comment: One commenter indicated that CMS is currently paying
separately for certain RPM services and have assigned the codes to
separately payable status indicator ``V,'' ``S,'' or ``Q1,'' however,
some other RPM codes are assigned to non-payable status indicators such
as ``B'' and ``M''. The commenter added that the status indicator
assignments for the RPM codes are inconsistent and confusing to
providers. The same commenter suggested that CMS recognize each
distinct RPM CPT code that require hospital resources and assign the
codes consistently to payable status indicators. The commenter
recommended reassigning CPT codes 93264, 93268, 93297, 93298 from
status indicator ``M'' to ``S'' and assigning the code to either APC
5741 (Level 1 Electronic Analysis of Devices) with a proposed CY 2021
payment rate of $37.76, APC 5742 (Level 2 Electronic Analysis of
Devices) with a proposed CY 2021 payment rate of $101.76, or APC 5743
(Level 3 Electronic Analysis of Devices) with a proposed CY 2021
payment rate of $272.91. The commenter stated that CPT codes 93264,
93268, 93297, 93298 should be covered and payable, similar to CPT code
93296 (Interrogation device evaluation(s) (remote), up to 90 days;
single, dual, or multiple lead pacemaker system, leadless pacemaker
system, or implantable defibrillator system, remote data
acquisition(s), receipt of transmissions and technician review,
technical support and distribution of results), which is assigned to
APC 5741 with a proposed CY 2021 payment rate of $37.76. The same
commenter suggested reassigning CPT code 99474 from status indicator
``B'' to ``V'' and assigning it to APC 5012, similar to CPT code 99453
(Remote monitoring of physiologic parameter(s) (e.g., weight, blood
pressure, pulse oximetry, respiratory flow rate), initial; set-up and
patient education on use of equipment).
Response: We appreciate the commenter's suggestions, however, we
believe that we need further evaluation of the codes to determine
whether all RPM CPT codes should be paid separately under the OPPS.
Therefore, for CY 2021, we are finalizing our proposal, without
modification, to assign CPT codes 93264, 93268, 93297, and 93298 to
status indicator ``M,'' and consider the suggestions to revise the
status indicator and assign appropriate APCs to the codes in future
rulemaking. Similarly, we are finalizing our
[[Page 85979]]
proposal, without modification, to assign CPT code 99474 to status
indicator B'' for CY 2021. The final status indicators for CPT codes
93264, 93268, 93297, 93298, and 99474 can be found in Table 34 below.
Commenter: One commenter suggested revising the status indicator
for 19 CPT codes that describe virtual check-ins, e-visits, and
telephone evaluation and management services from non-payable to
separately payable under the OPPS. The 19 codes, along with the
proposed status indicator assignments and descriptors, can be found in
Table 34 below. The commenter explained that when clinicians furnish
virtual check-ins, e-visits, and telephone E/M services to hospital
outpatients, hospital resources are used to support the clinician. The
commenter stated that while the codes are separately payable under the
PFS, the hospital resources are not paid separately under the OPPS. The
commenter believes that under 42 CFR 419.22, virtual or remote services
are not excluded from OPPS and, therefore, the facility expense should
be paid separately under the OPPS.
Response: We appreciate the commenter's suggestions, however, we
believe that we need further evaluation of the 19 codes to determine
whether the services should be paid separately under the OPPS.
Therefore, for CY 2021, we are finalizing our proposal, without
modification, to assign the codes to either status indicator ``A'' or
``B'' for the 19 codes listed in Table 34 as virtual check-in, e-visit,
and telephone E/M services.
Comment: One commenter suggested revising the status indicator for
two medication therapy management (MTM) codes from ``E1'' to ``B,'' and
indicated that the codes should be assigned to the same status
indicator as genetic counseling code CPT 96040 (Medical genetics and
genetic counseling services, each 30 minutes face-to-face with patient/
family), which is assigned to status indicator ``B'' under the OPPS.
Specifically, the commenter recommended reassigning CPT codes 99605
(Medication therapy management service(s) provided by a pharmacist,
individual, face-to-face with patient, with assessment and intervention
if provided; initial 15 minutes, new patient) and 99606 (Medication
therapy management service(s) provided by a pharmacist, individual,
face-to-face with patient, with assessment and intervention if
provided; initial 15 minutes, established patient) from ``E1'' to
``B.'' The commenter explained that the CY 2021 PFS proposed rule
clarified that genetic counseling and pharmacist services can be
considered ``incident to'' a professional service in the office
setting. Specifically, the commenter noted that the 2021 PFS proposed
rule (85 FR 50146) states ``Medication management is covered under both
Medicare Part B and Part D. We are reiterating the clarification we
provided in the May 1st COVID-19 IFC (85 FR 27550 through 27629), that
pharmacists fall within the regulatory definition of auxiliary
personnel under our regulations at Sec. 410.26. As such, pharmacists
may provide services incident to the services, and under the
appropriate level of supervision, of the billing physician or NPP, if
payment for the services is not made under the Medicare Part D
benefit.'' In light of the statements, the commenter believes that when
MTM services are furnished in the HOPD setting, the hospital outpatient
facility is reporting for the pharmacists' services, which the
commenter believes meet the definition of outpatient services at 42 CFR
410.27 and the definition of OPPS services at 42 CFR 419.21.
Consequently, the commenter believes that MTM services should be paid
separately under the OPPS.
Response: We appreciate the commenter's suggestions, however, we
believe that we need further evaluation of the two MTM codes to
determine whether the services should be paid separately under the
OPPS. We note that policies discussed in the PFS proposed rules
typically do not apply to OPPS policies; however, we will review the
issue. Therefore, for CY 2021, we are finalizing our proposal, without
modification, to assign the codes to status indicator ``E1'' for the 2
MTM codes listed in Table 34.
Comment: One commenter suggested that CMS treat all telehealth and
communication technology-based services (CTBS) consistently with OPPS
payable status indicators and ambulatory payment classification (APC)
assignments. The commenter explained that these issues were discussed
in the 2021 PFS proposed rule.
Response: We appreciate the commenter's suggestion, however, we
believe that we need further evaluation of the issue to determine
whether all the codes that describe telehealth and communication
technology-based services (CTBS) should be paid separately under the
OPPS. In addition, we made no proposals regarding these issues in the
CY 2021 OPPS/ASC proposed rule. As stated above, the proposed policies
discussed in the PFS proposed rules typically do not apply to OPPS
policies because they are two different Medicare payment systems.
However, we will review the issue for potential future rulemaking.
In summary, after consideration of the public comments, we are
finalizing our proposal, without modification, for the 29 codes listed
in Table 34 for CY 2021. In addition, we refer readers to Addendum D1
of this final rule with comment period for the status indicator (SI)
meanings for all codes reported under the OPPS. Both Addendum B and D1
are available via the internet on the CMS website.
BILLING CODE 4120-01-P
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[GRAPHIC] [TIFF OMITTED] TR29DE20.047
[[Page 85981]]
[GRAPHIC] [TIFF OMITTED] TR29DE20.048
[[Page 85982]]
[GRAPHIC] [TIFF OMITTED] TR29DE20.049
BILLING CODE 4120-01-C
25. Review of Electrocorticograms From an Implanted Brain
Neurostimulator (APC 5741)
For CY 2021, we proposed to continue to assign CPT code 95836
(Electrocorticogram from an implanted brain neurostimulator pulse
generator/transmitter, including recording, with interpretation and
written report, up to 30 days) to APC 5741 (Level 1 Electronic Analysis
of Devices) with a proposed payment of $37.76.
Comment: A commenter urged CMS to reassign CPT code 95836 from APC
5741 to APC 5742 (Level 2 Electronic Analysis of Devices) with a
proposed payment rate of $101.76, and stated that the payment for APC
5741 does not adequately reflect the resources used by HOPDs in
performing this procedure.
Response: Based on our analysis of the hospital outpatient claims
data for this final rule, we disagree that the resource cost to perform
the service is inappropriate. Our evaluation of the latest claims data
show a geometric mean cost of about $14 based on 21 single claims (out
of 213 total claims). We believe that reassigning the code to APC 5742,
whose geometric mean cost is approximately $98, would significantly
overpay for the service. Additionally, we believe that the payment for
CPT code 95836 is sufficient to cover the hospital cost of performing
the service.
In summary, after consideration of the public comment, we are
finalizing our proposal, without modification, to continue to assign
CPT code 95836 to APC 5741 for CY 2021. The final CY 2021 payment rate
for the code can be found in Addendum B to this final rule with comment
period. In addition, we refer readers to Addendum D1 of this final rule
with comment period for the status indicator (SI) meanings for all
codes reported under the OPPS. Both Addendum B and D1 are available via
the internet on the CMS website.
As we do every year, we will reevaluate the APC assignment for CPT
code 95836 in the next rulemaking cycle. We remind hospitals that we
review, on an annual basis, the APC assignments for all services and
items paid under the OPPS based on the latest claims data available to
us.
26. Therapeutic Apheresis
The LIXELLE[supreg] [beta]2-microglobulin Apheresis Column is
indicated for use in the treatment of dialysis-related amyloidosis
(DRA), a disease that affects people with end-stage renal disease
(ESRD) who have been receiving dialysis for five or more years. The
LIXELLE[supreg] device is used in an apheresis procedure that
selectively removes [beta]2-microglobulin (``[beta]2m'') from the
circulating blood of patients with DRA. LIXELLE[supreg] is used
pursuant to a physician prescription in conjunction with hemodialysis
and is intended to be used at each hemodialysis session (i.e.,
frequency of treatment is expected to be three times per week).
In March 2015, FDA approved LIXELLE[supreg] as a Class III
Humanitarian Use Device (HUD) with an approved Humanitarian Device
Exemption (HDE). FDA regulations require the manufacturer to conduct a
post-approval study (PAS) to evaluate the safety of the LIXELLE[supreg]
Apheresis procedure in U.S. patients on chronic hemodialysis with
clinically-diagnosed DRA, and assess the probable benefit of
LIXELLE[supreg] Apheresis to increase the [beta]2m reduction rate in
these patients in successive dialysis sessions (compared to dialysis
without LIXELLE[supreg]). Currently, there is no payment under the OPPS
for the apheresis procedure used with the LIXELLE[supreg] device.
Comment: One commenter, the manufacturer of the LIXELLE[supreg]
device,
[[Page 85983]]
requested that CMS provide payment for the apheresis procedure used
with the device under the OPPS. The commenter stated that the
LIXELLE[supreg] apheresis procedure may be administered in either a
dialysis facility or the hospital outpatient department and that the
HOPD was the more clinically appropriate setting. Specifically, the
commenter requested that CMS provide payment through the OPPS via one
of three potential pathways: (1) Allow payment for the apheresis
procedure used with the LIXELLE[supreg] device through CPT code 36516
(Therapeutic apheresis with extracorporeal immunoadsorption, selective
adsorption or selective filtration and plasma reinfusion), which was
proposed to be assigned to APC 5243 (Level 3 Blood Product Exchange and
Related Services) for CY 2021, and require the use of a modifier or
add-on code when the LIXELLE[supreg] apheresis procedure is billed to
reduce the payment for the procedure to the payment rate for APC 5242
(Level 2 Blood Product Exchange and Related Services); (2) allow
payment for the dialysis performed as part of LIXELLE[supreg] apheresis
procedure through HCPCS code G0257 (Unscheduled or emergency dialysis
treatment for an ESRD patient in a hospital outpatient department that
is not certified as an ESRD facility), which is assigned to APC 5401
(Dialysis) for CY 2021, and require the use of a modifier or add-on
code to provide additional payment beyond that provided by APC 5401; or
(3) create a HCPCS C code or G code for the LIXELLE[supreg] apheresis
procedure and assign the code to APC 5242 (Level 2 Blood Product
Exchange and Related Services). Finally, the commenter also noted that
they have been unable to complete the FDA-required post-approval study
as a condition of the HDE, due to difficulty in securing patient
enrollment because of lack of CMS payment for the LIXELLE[supreg]
apheresis procedure.
Response: We appreciate these comments and understand the various
issues related to coverage and payment for the LIXELLE[supreg]
apheresis procedure. We will consider these comments for future
rulemaking.
27. Tympanostomy Using an Automated Tube Delivery System (APC 5163)
As displayed in Addendum B to the CY 2021 OPPS/ASC proposed rule,
we proposed to assign CPT code 0583T (Tympanostomy (requiring insertion
of ventilating tube), using an automated tube delivery system,
iontophoresis local anesthesia) to status indicator (SI) ``E1'' to
indicate that the code is not payable by Medicare when submitted on
outpatient claims (any outpatient bill type) because the services
associated with these codes are either not covered by any Medicare
outpatient benefit category, are statutorily excluded from Medicare
payment, or are not reasonable and necessary.
Comment: Some commenters reported that the device associated with
CPT code 0583T received FDA approval in November 2019 and requested
separate payment for the code. They specifically requested assignment
to APC 5164 (Level 4 ENT Procedures), with a proposed payment of
$2,776.63, and also requested assignment to either status indicator
``S'' (Procedure or Service, Not Discounted When Multiple) or ``T''
(Procedure or Service, Multiple Procedure Reduction Applies). They
reported that assignment to APC 5164 would match the resources
furnished when providing this service. The manufacturer for the device
associated with the code explained that while the surgical procedure
described by CPT code 0583T is primarily performed on children, the
device is approved for all ages above 6 months. The manufacturer also
indicated that the procedure will be extremely important for the
Medicaid population and Medicaid programs who often refer to Medicare
to establish coverage and payment. One commenter reported that the
total cost for the complete procedure is approximately $2,776, while
the device manufacturer reported a cost of about $1,400 for the device.
Response: Based on our review of the procedure and input from our
medical advisors, we believe that the surgical procedure described by
CPT code 0583T is most similar, in terms of clinical homogeneity and
resource cost, to CPT code 69436 (Tympanostomy (requiring insertion of
ventilating tube), local or topical anesthesia), which is assigned to
APC 5163 (Level 3 ENT Procedures) with a proposed payment of about
$1,395. Both procedures (as described by CPT codes 0583T and 69436)
require ventilating tubes that require anesthesia. Therefore, we
believe that the most appropriate APC assignment for CPT code 0583T is
APC 5163, which is associated with status indicator ``J1'' (Hospital
Part B services paid through a comprehensive APC).
In summary, after consideration of the public comments, we are
finalizing our proposal with modification, and assigning CPT code 0583T
to APC 5163 with a status indicator of ``J1'' for CY 2021. The final CY
2021 payment rate for the code can be found in Addendum B to this final
rule with comment period. In addition, we refer readers to Addendum D1
of this final rule with comment period for the status indicator (SI)
meanings for all codes reported under the OPPS. Both Addendum B and D1
are available via the internet on the CMS website.
28. Unlisted Dental Procedure (APC 5161)
For CY 2021, we proposed to continue to assign CPT code 41899
(Unlisted procedure, dentoalveolar structures) to APC 5161 (Level 1 ENT
Procedures) with a payment rate of $213.59.
Comment: Two dental specialty societies expressed concern with the
payment rate for CPT code 41899. They explained that this is the only
CPT code available for dental surgery and its low reimbursement is
insufficient to cover the facility costs. The commenters added that the
low payment rate has resulted in many dentists, especially pediatric
dentists, experiencing difficulty in obtaining operating room (OR) time
to perform surgical procedures under general anesthesia. They stated
that the problem has been exacerbated by the COVID-19 pandemic, with
further limited access to ORs to address patient dental needs.
Response: CPT code 41899 is designated as an unlisted code. Some
HCPCS codes are used to report items, services, and procedures that do
not define the exact item, service, or surgical procedure furnished.
They are commonly called ``unlisted'' codes. The code descriptors often
contain phrases such as: ``unlisted procedure,'' ``not otherwise
classified,'' or ``not otherwise specified.'' The unlisted codes
typically fall within a clinical or procedural category, but they lack
the specificity needed to describe the resources used. Until a more
specific HCPCS code is established, as an interim, the unlisted code
provides a way for providers to report items, services, and procedures
furnished. In general, unlisted codes are reported when no other
specific CPT or Level II HCPCS code accurately describes the item,
procedure, or service. Because of the lack of specificity, unlisted
codes are assigned to the lowest level, clinically appropriate APC
group under the OPPS. The assignment of the unlisted codes to the
lowest level APC in the clinical category specified in the code
provides a reasonable means for interim payment until such time as
there is a code that specifically describes what is being paid. It also
encourages the creation of codes where appropriate and protects against
overpayment of services that are not clearly identified on the claim.
As a reminder, unlisted codes are not used in establishing the percent
of claims contributing to the APC, nor are their
[[Page 85984]]
costs used in the calculation of the APC geometric mean (80 FR 70321),
because, by the code's definition, we do not know what service or
combination of services is reflected in the claims billed with the
unlisted code. Currently, we have five levels of ENT Procedure APCs,
Levels 1 through 5, with Level 1 assigned to the lowest paying of the
five APCs. Because the code is designated as an unlisted code, we
believe that CPT 41899 code is appropriately assigned to APC 5161,
which is the lowest level ENT APC.
In addition, because unlisted codes are non-specific, HOPDs are
reminded that Medicare Administrative Contractors (MACs) may have
additional documentation requirements for how the codes should be
reported to receive payment. Refer to section 180.3 (Unlisted Service
or Procedure) in Chapter 4 (Part B Hospital) of the Medicare Claims
Processing Manual for information on how MACs review claims with
unlisted codes.
We note that AMA establishes new CPT codes, depending on the code
type, quarterly and annually. Interested parties that desire more
specific codes for unlisted codes should consult the AMA. Information
on CPT codes and the process for requesting new codes can be found on
the AMA website: https://www.ama-assn.org/about/cpt-editorial-panel/cpt-code-process.
In summary, after consideration of the public comments, we are
finalizing our proposal, without modification, to assign CPT code 41899
to APC 5161 for CY 2021. The final CY 2021 payment rate for the code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the status indicator (SI) meanings for all codes
reported under the OPPS. Both Addendum B and D1 are available via the
internet on the CMS website.
29. Urology and Related Services (APCs 5371 Through 5378)
We received comments on the CY 2020 OPPS/ASC proposed rule
suggesting we revise the APC assignments for the services assigned to
the Urology & Related Services APCs. The commenter specifically noted
that a reorganization for APCs 5374 through 5376 would be appropriate,
but added that there were other adjustments across services within the
Urology APCs that could improve the structure of these APCs. In
response to this comment, we stated in the CY 2020 OPPS/ASC final rule
with comment period that we would consider revisions to the urology
APCs in future rulemaking.
Currently, for CY 2020, there are seven levels of APCs for urology
services. We reviewed the geometric mean cost for APCs 5371 through
5377 and, after our analysis of the claims data for the CY 2021 OPPS/
ASC proposed rule, we believed that a modification to the urology APCs
would be appropriate.
For the CY 2021 OPPS/ASC proposed rule, we evaluated the claims
data and noted the large difference in geometric mean cost between APC
5376 (level 6) and APC 5377 (level 7) has continued to grow. This
difference in the geometric mean cost from APC 5376 to APC 5377 would
have been about $9,700, with the geometric mean cost for APC 5377 at
approximately 220 percent of the geometric mean cost of APC 5376. Based
on the proposed rule claims data, which showed an unusually large
difference between the geometric mean costs of the Level 6 Urology APC
and the Level 7 Urology APC on both a dollar and percentage basis, we
believed that creating an additional APC in the urology and related
series would provide an appropriate structure, distinguishing between
clinical and cost similarity for the procedures in the different
levels. Therefore, for CY 2021, we proposed to establish an additional
level for the urology and related services APCs, specifically, APC 5378
(Level 8 Urology and Related Services) and to re-organize the current
APCs 5376 (Level 6 Urology and Related Services) and 5377 (Level 7
Urology and Related Services). We believed this re-organization would
address the lack of an appropriate level for procedures with geometric
mean costs that fall between current APC 5376 and current APC 5377.
As we stated in the proposed rule (85 FR 48842), the proposed
reorganization would reassign CPT 53440 (Male sling procedure) and CPT
0548T (Transperineal periurethral balloon continence device; bilateral
placement, including cystoscopy and fluoroscopy) from the current APC
5376 to APC 5377.
In addition, the proposed revision would reassign the following
services from APC 5377 to APC 5378:
CPT 54416 (Removal and replacement of non-inflatable
(semi-rigid) or inflatable (self-contained) penile prosthesis at the
same operative session).
CPT 53444 (Insert tandem cuff).
CPT 54410 (Removal and replacement of all component(s) of
a multi-component, inflatable penile prosthesis at the same operative
session).
CPT 54411 (Removal and replacement of all components of a
multi-component inflatable penile prosthesis through an infected field
at the same operative session, including irrigation and debridement of
infected tissue).
CPT 54401 (Insertion of penile prosthesis; inflatable
(self-contained)).
CPT 54405 (Insertion of multi-component, inflatable penile
prosthesis, including placement of pump, cylinders, and reservoir).
CPT 53447 (Removal and replacement of inflatable urethral/
bladder neck sphincter including pump, reservoir, and cuff at the same
operative session).
CPT 53445 (Insertion of inflatable urethral/bladder neck
sphincter, including placement of pump, reservoir, and cuff).
As further stated in the proposed rule, the proposed APC
reassignment for these 10 codes results in geometric mean costs for
Levels 6, 7, and 8 of the Urology APCs that we believe more
appropriately align with the geometric mean costs for services in these
APCs than the current structure. Specifically, as listed in Table 19 of
the proposed rule, and reprinted below, the geometric mean cost of
$8,089.78 for APC 5376, $11,275.15 for APC 5377, and $18,015.54 for APC
5378 reduces the unusually large gaps on both a dollar and percentage
basis in geometric mean costs between each APC level.
[[Page 85985]]
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We received many comments on our proposal. Below are the comments
and our responses.
Comment: Several commenters supported our proposal to establish an
additional Urology and Related Services APC, specifically, APC 5378
(Level 8 Urology and Related Services), and re-organize the current
APCs 5376 (Level 6 Urology and Related Services) and 5377 (Level 7
Urology and Related Services). These commenters agreed that the
addition of APC 5378 within the Urology APCs would better align
procedures based on their resource cost and clinical homogeneity.
Response: We appreciate the commenters' support for our proposal to
establish new APC 5378 and to re-organize the procedures in the Urology
APCs. We note that each year, under the OPPS, we revise and make
changes to the APC groupings based on the latest hospital outpatient
claims data to appropriately place procedures and services in APCs
based on clinical characteristics and resource similarity. We note that
based on our review of the claims data for the final rule, we are also
finalizing our proposal without modification to reassign CPT codes
53440 and 0548T to APC 5377. Similarly, we are finalizing our proposal
without modification to reassign CPT codes 54416, 53444, 54410, 54411,
54401, 54405, 53447, and 53445 to APC 5378.
Comment: A commenter supported the continued assignment of HCPCS
code C9739 (Cystourethroscopy, with insertion of transprostatic
implant; 1 to 3 implants) to APC 5375 and HCPCS C9740
(Cystourethroscopy, with insertion of transprostatic implant; 4 or more
implants) to APC 5376.
Response: We appreciate the commenter's support for our APC
assignments, which are based on our review of the latest claims data.
We are finalizing our proposal and assigning these codes to the
proposed APCs in this final rule.
Comment: Several commenters also recommended additional changes
within APCs 5371 to APC 5376. Specifically, for APCs 5371 and 5372, the
commenters recommended the following reassignments from APC 5371 to APC
5372:
CPT 51720 (Bladder instillation of anticarcinogenic agent
(including retention time);
CPT 43763 (lacement of gastrostomy tube, percutaneous,
includes removal, when performed, without imaging or endoscopic
guidance; requiring revision of gastrostomy tract);
51725 Simple cystometrogram (cmg) (e.g., spinal
manometer);
51726 Complex cystometrogram (i.e., calibrated electronic
equipment); and
51040 Cystostomy, cystotomy with drainage.
Also, the commenters suggested the reassignment of the following
codes from APC 5373 to APC 5374:
52287 Cystourethroscopy, with injection(s) for
chemodenervation of the bladder
52276 Cystourethroscopy with direct vision internal
urethrotomy
54840 Excision of spermatocele, with or without
epididymectomy
53854 Transurethral destruction of prostate tissue; by
radiofrequency generated water vapor thermotherapy
In addition, the commenters recommended reassigning the following
codes from APC 5375 to APC 5376:
53420 Urethroplasty, 2-stage reconstruction or repair of
prostatic or membranous urethra; first stage;
C9747 Ablation of prostate, transrectal, high intensity
focused ultrasound (hifu), including imaging guidance;
53410 Urethroplasty, 1-stage reconstruction of male
anterior urethra;
50553 Renal endoscopy through established nephrostomy or
pyelostomy, with or without irrigation, instillation, or
ureteropyelography, exclusive of radiologic service; with ureteral
catheterization, with or without dilation of ureter;
54111 Excision of penile plaque (peyronie disease); with
graft to 5 cm in length;
55875 Transperineal placement of needles or catheters into
prostate for interstitial radioelement application, with or without
cystoscopy;
54660 Insertion of testicular prosthesis (separate
procedure);
50576 Renal endoscopy through nephrotomy or pyelotomy,
with or without irrigation, instillation, or ureteropyelography,
exclusive of radiologic service; with fulguration and/or incision, with
or without biopsy; and
0549T Transperineal periurethral balloon continence
device; unilateral placement, including cystoscopy and fluoroscopy;
Further, the commenters suggested revising the assignment for these
codes from APC 5376 to APC 5377:
[[Page 85986]]
55873 Cryosurgical ablation of the prostate (includes
ultrasonic guidance and monitoring);
50081 Percutaneous nephrostolithotomy or
pyelostolithotomy, with or without dilation, endoscopy, lithotripsy,
stenting, or basket extraction; over 2 cm; and
50562 Renal endoscopy through established nephrostomy or
pyelostomy, with or without irrigation, instillation, or
ureteropyelography, exclusive of radiologic service; with resection of
tumor.
Response: Based on our review of the claims data for the final
rule, we do not believe that reassigning these 21 urology procedures to
the suggested APCs is appropriate. Our review of the claims data for
this CY 2021 OPPS/ASC final rule with comment period show that the
procedures are appropriately placed in the proposed APCs based on
clinical homogeneity and resource costs. Consequently, we are
finalizing our proposal without modification for the 21 urology
procedures discussed above.
In summary, after consideration of the public comments, and after
our analysis of the updated claims data for this final rule with
comment period, we are finalizing our proposal, without modification,
to reorganize the Urology and Related Services APCs. The final CY 2021
payment rate for the codes for all the codes discussed above can be
found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the status indicator (SI) meanings for all codes
reported under the OPPS. Both Addendum B and D1 are available via the
internet on the CMS website.
a. High-Intensity Focused Ultrasound of the Prostate (HIFU) Procedure
(APC 5375)
In 2017, CMS received a new technology application for the prostate
HIFU procedure and established a new code, specifically, HCPCS code
C9747 (Ablation of prostate, transrectal, high intensity focused
ultrasound (hifu), including imaging guidance). Based on the estimated
cost provided in the new technology application, we assigned the new
code to APC 5376 (Level 6 Urology and Related Services) with a payment
rate of $7,452.66 effective July 1, 2017. We announced the SI and APC
assignment in the July 2017 OPPS quarterly update CR (Transmittal 3783,
Change Request 10122, dated May 26, 2017).
For the CY 2018 update, we maintained the assignment of HCPCS code
C9747 to APC 5376 with a payment rate of $7,596.26. We note that the
payment rates for the CY 2018 OPPS update were based on claims
submitted between January 1, 2016 through December 30, 2016, that were
processed on or before June 30, 2017. Since HCPCS code C9747 was
established on July 1, 2017, we had no claims data for the procedure
for use in ratesetting for CY 2018.
However, for the CY 2019 update, based on the latest claims data
for the final rule, we revised the APC assignment for HCPCS code C9747
from APC 5376 to APC 5375 with a payment rate of $4,020.54. We note
that the payment rates for CY 2019 were based on claims submitted
between January 1, 2017 through December 30, 2017, that were processed
on or before June 30, 2018. Our claims data showed a geometric mean
cost of approximately $5,000 for HCPCS code C9747 based on 64 single
claims (out of 64 total claims), which was significantly lower than the
geometric mean cost of about $7,717 for APC 5376. We believed that the
geometric mean cost for HCPCS code C9747 was more comparable to the
geometric mean cost of approximately $4,055 for APC 5375. Consequently,
we reassigned the code from APC 5376 to APC 5375 (Level 5 Urology and
Related Services) for CY 2019 and C9747 remained in APC 5376 for CY
2020.
For CY 2021, we proposed to continue to assign HCPCS code C9747 to
APC 5375 with a proposed payment rate $4,487.87. In addition, we noted
that HCPCS C9747 will be replaced with CPT 55880 beginning January
2021.
Comment: Many commenters stated that the APC 5375 payment rate does
not cover the hospital facility cost for this procedure, and thus,
discourages hospitals from providing this procedure for Medicare
patients. Some commenters argued that HIFU is a device-intensive
procedure, believed that the average cost of the HIFU procedure is
closer to the APC 5376 proposed payment rate of $8,395.87, and
requested a reassignment to enable Medicare beneficiaries to receive
the treatment. They projected that maintaining the assignment in APC
5375 will deter HOPD facilities from offering the HIFU treatment to
Medicare beneficiaries because the payment is insufficient to cover the
cost of the procedure. Several commenters recommended we assign this
procedure to APC 5376 because they believe the service is clinically
similar and comparable in terms of resources to cryoablation of the
prostate, which is described by CPT code 55873 (Cryosurgical ablation
of the prostate (includes ultrasonic guidance and monitoring) and
assigned to APC 5376 (Level 6 Urology and Related Services), with a
proposed payment rate of $8,395.62.
Response: As we have stated every year since the implementation of
the OPPS on August 1, 2000, we review, on an annual basis, the APC
assignments for all services and items (including devices) paid under
the OPPS based on our analysis of the latest claims data. For CY 2021,
based on claims submitted between January 1, 2019 through December 30,
2019, that were processed on or before June 30, 2020, our analysis of
the latest claims data for this final rule supports maintaining HCPCS
code C9747 in APC 5375. Specifically, our claims data shows a geometric
mean cost of approximately $5,744 for HCPCS code C9747 based on 279
single claims, which is more comparable to the geometric mean cost of
about $4,300 for APC 5375, rather than the geometric mean cost of
approximately $8,045 for APC 5376. Furthermore, the claims data do not
indicate that HCPCS code C9747 meets the device-intensive threshold of
30 percent. Therefore, we are not designating HCPCS code C9747 as a
device-intensive procedure.
With regard to the issue of similarity to CPT code 55873, while we
agree both procedures are intended to treat prostate cancer, we
disagree that the resource costs associated with the prostate HIFU
procedure are necessarily similar to those of cryoablation of the
prostate. Specifically, our claims data for cryoablation of the
prostate shows a geometric mean cost of about $8,423 based on 1,226
single claims. The geometric mean cost for CPT code 55873 is reasonably
consistent with APC 5376, which has a geometric mean cost of
approximately $8,045.
In summary, after careful consideration of the public comments and
after our analysis of the updated claims data for this final rule with
comment period, we are maintaining the APC assignment for HCPCS code
C9747 in APC 5375. We note that for the CY 2021 update, the CPT
Editorial Panel established CPT code 55880 (Ablation of malignant
prostate tissue, transrectal, with high intensity--focused ultrasound
(HIFU), including ultrasound guidance) to describe HIFU effective
January 1, 2021. Therefore, we are deleting HCPCS code C9747 on
December 31, 2020 because it will be replaced with CPT code 55880. The
final CY 2021 payment rate for CPT code 55880 can be found in Addendum
B to this final rule with comment period. In addition, we refer readers
to Addendum D1 of this final rule with comment period for the status
indicator (SI) meanings for all codes
[[Page 85987]]
reported under the OPPS. Both Addendum B and D1 are available via the
internet on the CMS website.
b. Optilume Procedure--Optilume Drug Coated Balloon Catheter System
(APC 5375)
For the July 2020 update, the CPT Editorial Panel established a new
code, specifically, Category III CPT code 0619T (Cystourethroscopy with
transurethral anterior prostate commissurotomy and drug delivery,
including transrectal ultrasound and fluoroscopy, when performed), to
describe the surgical procedure associated with the Optilume Drug
Coated Balloon Catheter System used to treat benign prostate
hyperplasia (BPH). We announced the APC assignment for CPT code 0619T
in the July 2020 OPPS quarterly update CR (Transmittal 10207, Change
Request 11814, dated July 2, 2020).
Specifically, we assigned CPT code 0619T to APC 5375 (Level 5
Urology and Related Services) with a payment rate of approximately
$4,232 effective July 1, 2020 and also assigned the code a status
indicator of ``J1'' (Hospital Part B services paid through a
comprehensive APC). Based on input from our medical advisors and the
nature of the procedure, we believed that the procedure described by
CPT code 0619T was similar, based on clinical homogeneity and resource
cost, to CPT code 52601 (Transurethral electrosurgical resection of
prostate, including control of postoperative bleeding, complete
(vasectomy, meatotomy, cystourethroscopy, urethral calibration and/or
dilation, and internal urethrotomy are included)).
Comment: A commenter asserted that CPT code 0619T should be
reassigned to APC 5376 (Level 6 Urology and Related Services). The
commenter reported that the CPT code 0619T is more clinically similar
to HCPCS C9740 (Cystourethroscopy, with insertion of transprostatic
implant; 4 or more implants) in terms of clinical characteristics,
physician work/intraoperative intensity, and resource costs including
both non-device related and device related costs. Furthermore, the
commenter also indicated that CPT code 0619T has additional non-device
costs, including transrectal ultrasound, fluoroscopy and use of a
rectal steeper device. The commenter stated that CPT code 0619T has
similar resource cost to HCPCS code C9740 in terms of its device and
non-device cost.
Response: We appreciate the commenter's input on this subject and
we understand that this is a new procedure without a predecessor code.
Based on our evaluation, we do not agree that CPT code 0619T is similar
to HCPCS code C9740. Based on the nature of the procedure and input
from our medical advisors, we believe CPT code 0619T is more comparable
to HCPCS code C9739 (Cystourethroscopy, with insertion of
transprostatic implant; 1 to 3 implants), and CPT 52601 (Transurethral
electrosurgical resection of prostate, including control of
postoperative bleeding, complete (vasectomy, meatotomy,
cystourethroscopy, urethral calibration and/or dilation, and internal
urethrotomy are included)), which are both currently assigned to APC
5375 (Level 5 Urology and Related Services). We believe the assignment
of CPT code 0619T to APC 5375 and its device-offset of 31 percent is
appropriate until CMS receives more cost data to support a reassignment
to another APC or a different device offset adjustment.
In summary, after consideration of the comment, we are finalizing
our proposal without modification to continue to assign CPT code 0619T
to APC 5375 for CY 2021. The final CY 2021 payment rate for this code
can be found in Addendum B to this final rule with comment period. In
addition, we refer readers to Addendum D1 of this final rule with
comment period for the status indicator (SI) meanings for all codes
reported under the OPPS. Both Addendum B and D1 are available via the
internet on the CMS website.
30. Venous Mechanical Thrombectomy (APC 5193)
For CY 2020, CPT code 37187 (Percutaneous transluminal mechanical
thrombectomy, vein(s), including intraprocedural pharmacological
thrombolytic injections and fluoroscopic guidance) is assigned to APC
5192 (Level 2 Endovascular Procedures) with a payment of $4,953.91. For
CY 2021, we proposed to reassign CPT code 37187 from APC 5192 to APC
5193 (Level 3 Endovascular Procedures) with a proposed payment of
$10,222.32.
Comment: A commenter approved of our proposal to reassign CPT code
37187 to APC 5193 and requested that CMS finalize the proposal. The
commenter noted that the geometric mean cost of CPT code 37187 is well
aligned with APC 5193, and stated that the cost of the venous
mechanical thrombectomy procedure is comparable to other clinically
similar procedures within the APC.
Response: We appreciate the support for our proposal to reassign
CPT code 37187 from APC 5192 to APC 5193. The claims data for the final
rule, which is based on claims submitted between January 1, 2019,
through December 31, 2019, processed through June 30, 2020, show that
the geometric mean cost for CPT code 37187 is approximately $10,385,
which is within the range of procedures of significant volume within
APC 5193. Procedures with significant volume in APC 5193 range between
$7,278 for CPT code 36905 and $13,492 for CPT code 37225. We believe
that reassigning CPT code 37187 is appropriate based on its clinical
homogeneity and similarity in resource costs to the other thrombectomy
procedures (e.g., 36905, 37225) assigned to APC 5193.
In summary, after consideration of the public comment, we are
finalizing our proposal to assign CPT code 37187 to APC 5193 for CY
2021. The final CY 2021 payment rate for this code can be found in
Addendum B to this final rule with comment period. In addition, we
refer readers to Addendum D1 of this final rule with comment period for
the status indicator (SI) meanings for all codes reported under the
OPPS. Both Addendum B and D1 are available via the internet on the CMS
website.
IV. OPPS Payment for Devices
A. Pass-Through Payment for Devices
1. Beginning Eligibility Date for Device Pass-Through Status and
Quarterly Expiration of Device Pass-Through Payments
a. Background
The intent of transitional device pass-through payment, as
implemented at 42 CFR 419.66, is to facilitate access for beneficiaries
to the advantages of new and truly innovative devices by allowing for
adequate payment for these new devices while the necessary cost data is
collected to incorporate the costs for these devices into the procedure
APC rate (66 FR 55861). Under section 1833(t)(6)(B)(iii) of the Act,
the period for which a device category eligible for transitional pass-
through payments under the OPPS can be in effect is at least 2 years
but not more than 3 years. Prior to CY 2017, our regulation at 42 CFR
419.66(g) provided that this pass-through payment eligibility period
began on the date CMS established a particular transitional pass-
through category of devices, and we based the pass-through status
expiration date for a device category on the date on which pass-through
payment was effective for the category. In the CY 2017 OPPS/ASC final
rule with comment period (81 FR 79654), in accordance with section
1833(t)(6)(B)(iii)(II) of the Act, we amended Sec. 419.66(g) to
provide that the
[[Page 85988]]
pass-through eligibility period for a device category begins on the
first date on which pass-through payment is made under the OPPS for any
medical device described by such category.
In addition, prior to CY 2017, our policy was to propose and
finalize the dates for expiration of pass-through status for device
categories as part of the OPPS annual update. This means that device
pass-through status would expire at the end of a calendar year when at
least 2 years of pass-through payments had been made, regardless of the
quarter in which the device was approved. In the CY 2017 OPPS/ASC final
rule with comment period (81 FR 79655), we changed our policy to allow
for quarterly expiration of pass-through payment status for devices,
beginning with pass-through devices approved in CY 2017 and subsequent
calendar years, to afford a pass-through payment period that is as
close to a full 3 years as possible for all pass-through payment
devices.
We refer readers to the CY 2017 OPPS/ASC final rule with comment
period (81 FR 79648 through 79661) for a full discussion of the current
device pass-through payment policy.
We also have an established policy to package the costs of the
devices that are no longer eligible for pass-through payments into the
costs of the procedures with which the devices are reported in the
claims data used to set the payment rates (67 FR 66763).
b. Expiration of Transitional Pass-Through Payments for Certain Devices
As stated earlier, section 1833(t)(6)(B)(iii) of the Act requires
that, under the OPPS, a category of devices be eligible for
transitional pass-through payments for at least 2 years, but not more
than 3 years. There currently are 7 device categories eligible for
pass-through payment: C1823-Generator, neurostimulator (implantable),
nonrechargeable, with transvenous sensing and stimulation leads);
C1824-Generator, cardiac contractility modulation (implantable); C1982-
Catheter, pressure-generating, one-way valve, intermittently occlusive;
C1839-Iris prosthesis; C1734-Orthopedic/device/drug matrix for opposing
bone-to-bone or soft tissue-to bone (implantable); C2596-Probe, image-
guided, robotic, waterjet ablation; and C1748-Endoscope, single-use
(that is disposable), Upper GI, imaging/illumination device
(insertable).
The pass-through payment status of the device category for HCPCS
code C1823 will end on December 31, 2021; the pass-through payment
status of the device category for HCPCS code C1748 will end on June 30,
2023; and the pass-through payment status of the device categories for
HCPCS codes C1824, C1982, C1839, C1734, and C2596 will end on December
31, 2022. Table 35 shows the expiration of transitional pass-through
payments for these devices. All of these HCPCS codes will have pass-
through payment status and will continue to receive pass-through
payments in CY 2021.
[GRAPHIC] [TIFF OMITTED] TR29DE20.051
[[Page 85989]]
2. New Device Pass-Through Applications
a. Background
Section 1833(t)(6) of the Act provides for pass-through payments
for devices, and section 1833(t)(6)(B) of the Act requires CMS to use
categories in determining the eligibility of devices for pass-through
payments. As part of implementing the statute through regulations, we
have continued to believe that it is important for hospitals to receive
pass-through payments for devices that offer substantial clinical
improvement in the treatment of Medicare beneficiaries to facilitate
access by beneficiaries to the advantages of the new technology.
Conversely, we have noted that the need for additional payments for
devices that offer little or no clinical improvement over previously
existing devices is less apparent. In such cases, these devices can
still be used by hospitals, and hospitals will be paid for them through
appropriate APC payment. Moreover, a goal is to target pass-through
payments for those devices where cost considerations might be most
likely to interfere with patient access (66 FR 55852; 67 FR 66782; and
70 FR 68629). We note that, as discussed in section IV.A.4. of this CY
2021 OPPS/ASC proposed rule, we created an alternative pathway in the
CY 2020 OPPS/ASC final rule that granted fast-track device pass-through
payment under the OPPS for devices approved under the FDA Breakthrough
Device Program for OPPS device pass-through payment applications
received on or after January 1, 2020. We refer readers to section
IV.A.4. of this CY 2021 OPPS/ASC proposed rule for a complete
discussion of this pathway.
As specified in regulations at 42 CFR 419.66(b)(1) through (3), to
be eligible for transitional pass-through payment under the OPPS, a
device must meet the following criteria:
If required by FDA, the device must have received FDA
marketing authorization (except for a device that has received an FDA
investigational device exemption (IDE) and has been classified as a
Category B device by the FDA), or meet another appropriate FDA
exemption; and the pass-through payment application must be submitted
within 3 years from the date of the initial FDA marketing
authorization, if required, unless there is a documented, verifiable
delay in U.S. market availability after FDA marketing authorization is
granted, in which case CMS will consider the pass-through payment
application if it is submitted within 3 years from the date of market
availability;
The device is determined to be reasonable and necessary
for the diagnosis or treatment of an illness or injury or to improve
the functioning of a malformed body part, as required by section
1862(a)(1)(A) of the Act; and
The device is an integral part of the service furnished,
is used for one patient only, comes in contact with human tissue, and
is surgically implanted or inserted (either permanently or
temporarily), or applied in or on a wound or other skin lesion.
In addition, according to Sec. 419.66(b)(4), a device is not
eligible to be considered for device pass-through payment if it is any
of the following: (1) Equipment, an instrument, apparatus, implement,
or item of this type for which depreciation and financing expenses are
recovered as depreciation assets as defined in Chapter 1 of the
Medicare Provider Reimbursement Manual (CMS Pub. 15-1); or (2) a
material or supply furnished incident to a service (for example, a
suture, customized surgical kit, or clip, other than a radiological
site marker).
Separately, we use the following criteria, as set forth under Sec.
419.66(c), to determine whether a new category of pass-through payment
devices should be established. The device to be included in the new
category must--
Not be appropriately described by an existing category or
by any category previously in effect established for transitional pass-
through payments, and was not being paid for as an outpatient service
as of December 31, 1996;
Have an average cost that is not ``insignificant''
relative to the payment amount for the procedure or service with which
the device is associated as determined under Sec. 419.66(d) by
demonstrating: (1) The estimated average reasonable cost of devices in
the category exceeds 25 percent of the applicable APC payment amount
for the service related to the category of devices; (2) the estimated
average reasonable cost of the devices in the category exceeds the cost
of the device-related portion of the APC payment amount for the related
service by at least 25 percent; and (3) the difference between the
estimated average reasonable cost of the devices in the category and
the portion of the APC payment amount for the device exceeds 10 percent
of the APC payment amount for the related service (with the exception
of brachytherapy and temperature-monitored cryoablation, which are
exempt from the cost requirements as specified at Sec. 419.66(c)(3)
and (e)); and
Demonstrate a substantial clinical improvement, that is,
substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part compared to
the benefits of a device or devices in a previously established
category or other available treatment.
Beginning in CY 2016, we changed our device pass-through evaluation
and determination process. Device pass-through applications are still
submitted to CMS through the quarterly subregulatory process, but the
applications will be subject to notice-and-comment rulemaking in the
next applicable OPPS annual rulemaking cycle. Under this process, all
applications that are preliminarily approved upon quarterly review will
automatically be included in the next applicable OPPS annual rulemaking
cycle, while submitters of applications that are not approved upon
quarterly review will have the option of being included in the next
applicable OPPS annual rulemaking cycle or withdrawing their
application from consideration. Under this notice-and-comment process,
applicants may submit new evidence, such as clinical trial results
published in a peer-reviewed journal or other materials for
consideration during the public comment process for the proposed rule.
This process allows those applications that we are able to determine
meet all of the criteria for device pass-through payment under the
quarterly review process to receive timely pass-through payment status,
while still allowing for a transparent, public review process for all
applications (80 FR 70417 through 70418).
In the CY 2020 annual rulemaking process, we finalized an
alternative pathway for devices that are granted a Breakthrough Device
designation (84 FR 61295) and receive Food and Drug Administration
(FDA) marketing authorization. Under this alternative pathway, devices
that are granted a FDA Breakthrough Device designation are not
evaluated in terms of the current substantial clinical improvement
criterion at Sec. 419.66(c)(2) for the purposes of determining device
pass-through payment status, but do need to meet the other requirements
for pass-through payment status in our regulation at Sec. 419.66.
Devices that are part of the Breakthrough Devices Program, have
received FDA marketing authorization, and meet the other criteria in
regulation can be approved through the quarterly process and announced
through that process (81 FR 79655). Proposals regarding these devices
and whether pass-through
[[Page 85990]]
payment status should continue to apply are included in the next
applicable OPPS rulemaking cycle. This process promotes timely pass-
through payment status for innovative devices, while also recognizing
that such devices may not have a sufficient evidence base to
demonstrate substantial clinical improvement at the time of FDA
marketing authorization.
More details on the requirements for device pass-through payment
applications are included on the CMS website in the application form
itself at: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-
Payment/HospitalOutpatientPPS/passthrough_payment.html, in the
``Downloads'' section. In addition, CMS is amenable to meeting with
applicants or potential applicants to discuss research trial design in
advance of any device pass-through application or to discuss
application criteria, including the substantial clinical improvement
criterion.
Comment: Some commenters requested that CMS waive the criteria for
establishing new device categories specified at Sec. 419.66(c)(1),
which states that a device to be included in the category is not
appropriately described by any of the existing categories or by any
category previously in effect, and was not being paid for as an
outpatient service as of December 31, 1996, for devices that are
granted a FDA Breakthrough Device designation. The commenters stated
that these devices should automatically be considered not to be
described by any of the existing (either currently active or expired)
categories established for transitional device pass-through payments
because the FDA Breakthrough Device designation implies that the device
is a first of kind. These commenters noted that under the IPPS New
Technology Add-on Payment (NTAP), devices granted a Breakthrough Device
designation that have received FDA marketing authorization are
considered new and not substantially similar to an existing technology
for purposes of the NTAP.
Response: We continue to believe that it is necessary to evaluate
whether a device that has been granted a FDA Breakthrough Device
designation is already described by any of the current device pass-
through categories or by any category previously in effect to ensure
that no device is described by more than one category. We also remind
stakeholders that the criteria for establishing a new device category
described in the regulation at 42 CFR 419.66(c)(1) are unique to the
OPPS device pass-through policy.
b. Applications Received for Device Pass-Through Payment for CY 2021
We received five complete applications by the March 1, 2020
quarterly deadline, which was the last quarterly deadline for
applications to be received in time to be included in the CY 2021 OPPS/
ASC proposed rule. We received one of the applications in the second
quarter of 2019, two of the applications in the fourth quarter of 2019,
and two of the applications in the first quarter of 2020. Two of the
applications were approved for device pass-through payment during the
quarterly review process: CUSTOMFLEX[supreg] ARTIFICIALIRIS and
EXALTTM Model D Single-Use Duodenoscope. CUSTOMFLEX[supreg]
ARTIFICIALIRIS received fast-track approval under the alternative
pathway effective January 1, 2020. EXALTTM Model D Single-
Use Duodenoscope received fast-track approval under the alternative
pathway effective July 1, 2020. As previously stated, all applications
that are preliminarily approved upon quarterly review will
automatically be included in the next applicable OPPS annual rulemaking
cycle. Therefore, CUSTOMFLEX[supreg] ARTIFICIALIRIS and
EXALTTM Model D Single-Use Duodenoscope are discussed below
in section IV.2.b.1.
Applications received for the later deadlines for the remaining
2020 quarters (June 1, September 1, and December 1), if any, will be
presented in the CY 2022 OPPS/ASC proposed rule. We note that the
quarterly application process and requirements have not changed in
light of the addition of rulemaking review. Detailed instructions on
submission of a quarterly device pass-through payment application are
included on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Downloads/catapp.pdf.
A discussion of the applications received by the March 1, 2020
deadline is presented below.
1. Alternative Pathway Device Pass-Through Applications
We received three device pass-through applications by the March
2020 quarterly application deadline for devices that have received
Breakthrough Device designation from FDA and FDA marketing
authorization, and therefore are eligible to apply under the
alternative pathway. As stated above in section IV.2.a of this final
rule with comment, under this alternative pathway, devices that are
granted a FDA Breakthrough Device designation are not evaluated in
terms of the substantial clinical improvement criterion at Sec.
419.66(c)(2)(i) for purposes of determining device pass-through payment
status, but will need to meet the other requirements for pass-through
payment status in our regulation at Sec. 419.66.
(1) CUSTOMFLEX[supreg] ARTIFICIALIRIS
VEO Ophthalmics submitted an application for a new device category
for transitional pass-through payment status for the CUSTOMFLEX[supreg]
ARTIFICIALIRIS by the June 2019 quarterly deadline. The
CUSTOMFLEX[supreg] ARTIFICIALIRIS device is described as a foldable
iris prosthesis that is custom-made for each individual patient who
requires one. The applicant stated that the CUSTOMFLEX[supreg]
ARTIFICIALIRIS comes in two models-With Fiber or Fiber Free. The two
models are identical in every respect except that the With Fiber model
has a polyester meshwork layer embedded in it to provide adequate tear
strength to withstand suturing.
The applicant provided that the CUSTOMFLEX[supreg] ARTIFICIALIRIS
is intended to serve as an artificial iris prosthesis, inserted at the
time of cataract surgery or during a subsequent stand-alone procedure.
The CUSTOMFLEX[supreg] ARTIFICIALIRIS is indicated for use in children
and adults for the treatment of full or partial aniridia resulting from
congenital aniridia, acquired defects, or other conditions associated
with full or partial aniridia. The conditions that the
CUSTOMFLEX[supreg] ARTIFICIALIRIS treats are rare; congenital aniridia
is present in approximately 1.8 in 100,000 live births (1 in 40,000 to
1 in 100,000),6-2 congenital IridoCorneal Endothelial
Syndrome (ICE) syndrome is even less common (incidence not available).
Iris defects such as iatrogenic iridodialysis as a complication of
cataract surgery has variable prevalence, ranging from 0-0.84 percent
of surgeries,3-8 and may
[[Page 85991]]
occur in approximately 0.2 percent of blunt orbital trauma.\9\ Although
rare, these conditions are cosmetically and functionally limiting. The
applicant provided that in addition to a noticeably absent or irregular
iris/pupil, affected patients frequently experience photophobia (light
sensitivity) and glare as well as symptoms such as dry
eye.10 11
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\6\ Berlin HS, Ritch R. The treatment of glaucoma secondary to
aniridia. Mt Sinai J Med. 1981;48:11.
\2\ Nelson LB, Spaeth GL, Nowinski TS, et al. Aniridia. A
review. Surv Ophthalmol. 1984; 28:621-642.
\3\ Greenberg PB, Tseng VL, Wu WC, et.al. Prevalence and
predictors of ocular complications associated with cataract surgery
in United States veterans. Ophthalmology. 2011 Mar;118(3):507-14.
\4\ Jaycock P, Johnston RL, Taylor H, et al., UK EPR User Group.
The Cataract National Dataset electronic multi-centre audit of
55,567 operations: Updating benchmark standards of care in the
United Kingdom and internationally. Eye (Lond). 2009;23:38-49.
\5\ Lum F, Schein O, Schachat AP, et al. Initial two years of
experience with the AAO National Eyecare Outcomes Network (NEON)
cataract surgery database. Ophthalmology. 2000;107:691-697.
\6\ Steinberg EP, Tielsch JM, Schein OD, et.al. National study
of cataract surgery outcomes: Variation in 4-month postoperative
outcomes as reflected in multiple outcomes measures Ophthalmology.
1994;101:1131-1140.
\7\ Schein OD, Steinberg EP, Javitt JC, et al. Variation in
cataract surgery practice and clinical outcomes. Ophthalmology.
1994;101:1142-1152.
\8\ Powe NR, Schein OD, Gieser SC, et al. Cataract Patient
Outcome Research Team Synthesis of the literature on visual acuity
and complications following cataract extraction with intraocular
lens implantation. Arch Ophthalmol, 1994;112:239-252.
\9\ Kreidl KO, Kim DY, Mansour SE. Prevalence of significant
intraocular sequelae in blunt orbital trauma. Am J Emerg Med. 2003
Nov;21(7):525-8.
\10\ Weissbart SB, Ayres BD. Management of aniridia and iris
defects: An update on iris prosthesis options. Curr Opin Ophthalmol.
2016 May;27(3):244-9.
\11\ Lee HJ, Colby KA. A review of the clinical and genetic
aspects of aniridia. Semin Ophthalmol. 2013 Sep-Nov;28(5-6):306-12.
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According to the applicant, currently available treatments for
symptomatic glare, photophobia, and cosmesis are limited, and an FDA-
approved, commercially available iris prosthesis fills a needed gap.
Alternatives include tinted spectacles or contact lenses, iris
reconstruction (for example, pupilloplasty or iridodialysis repair),
and corneal tattooing.\10\ Among these, tinted spectacles can provide
some symptomatic relief, but the applicant stated that they do not
address the underlying problem and cannot be used in all settings. Iris
reconstruction requires that sufficient iris tissue be present. Tinted
contact lenses and corneal tattooing are cosmetically not ideal and
have an associated risk of corneal infection (corneal ulcer and
infectious keratitis). According to the applicant, in addition, corneal
tattooing has a risk of surface toxicity, anterior segment
inflammation, and/or corneal epithelial defect. The only other
artificial iris devices in the U.S. were previously available under FDA
compassionate use exemption (Morcher 50F, 96F; Ophtec 311 aniridia
lens).\10\ However, these devices are no longer available following FDA
approval of the CUSTOMFLEX[supreg] ARTIFICIALIRIS.
With respect to the newness criterion at Sec. 419.66(b)(1), the
FDA designated the CUSTOMFLEX[supreg] ARTIFICIALIRIS as a Breakthrough
Device on December 21, 2017, and approved the premarket approval
application (PMA) for CUSTOMFLEX[supreg] ARTIFICIALIRIS (P170039) on
May 30, 2018 for use in the treatment of full or partial aniridia
resulting from congenital or acquired defects. The applicant provided
that there was a roughly 3-month market delay after receipt of PMA
approval while final labeling in its printed form was submitted to FDA
and FDA completed its review and approval process. The applicant notes
that commercial availability of the device commenced on September 12,
2018 after it received FDA approval for the final labeling. We received
the application for a new device category for transitional pass-through
payment status for the CUSTOMFLEX[supreg] ARTIFICIALIRIS on May 31,
2019, which is within 3 years of the date of the initial FDA marketing
authorization. We solicited public comment on whether the
CUSTOMFLEX[supreg] ARTIFICIALIRIS meets the newness criterion.
Comment: Commenters claimed that the CUSTOMFLEX[supreg]
ARTIFICIALIRIS meets the newness criterion as described at Sec.
419.66(b)(1).
Response: After consideration of the public comments and our review
of the application, we agree that the CUSTOMFLEX[supreg] ARTIFICIALIRIS
meets the newness criterion as described at Sec. 419.66(b)(1).
With respect to the eligibility criterion at Sec. 419.66(b)(3),
the applicant stated that the device is implanted via injection through
a 2.75-4 mm clear corneal incision. Depending on the site of
implantation (capsular bag, ciliary sulcus, sutured to sclera), the
device is cut (trephined) to the correct diameter. The device can also
be sutured to an intraocular lens if an intraocular lens is also
implanted at the time of surgery. The applicant further provided that
the CUSTOMFLEX[supreg] ARTIFICIALIRIS is integral to the service
provided, is used for one patient only, comes in contact with human
tissue, and is surgically implanted. The applicant also claimed that
the CUSTOMFLEX[supreg] ARTIFICIALIRIS meets the device eligibility
requirements of Sec. 419.66(b)(4) because it is not an instrument,
apparatus, implement, or item for which depreciation and financing
expenses are recovered, and it is not a supply or material furnished
incident to a service. We solicited public comment on whether the
CUSTOMFLEX[supreg] ARTIFICIALIRIS meets the eligibility criteria at
Sec. 419.66(b).
Comment: Commenters believed that the CUSTOMFLEX[supreg]
ARTIFICIALIRIS meets the eligibility criteria as described at Sec.
419.66(b).
Response: After consideration of the public comments we received
and our review of the application, we agree that the CUSTOMFLEX[supreg]
ARTIFICIALIRIS meets the eligibility criteria as described at Sec.
419.66(b).
The criteria for establishing new device categories are specified
at Sec. 419.66(c). The first criterion, at Sec. 419.66(c)(1),
provides that CMS determines that a device to be included in the
category is not appropriately described by any of the existing
categories or by any category previously in effect, and was not being
paid for as an outpatient service as of December 31, 1996. Upon review,
it did not appear that there were any other existing pass-through
payment categories that might apply to the CUSTOMFLEX[supreg]
ARTIFICIALIRIS and we solicited public comments on this issue.
Comment: Commenters claimed that the CUSTOMFLEX[supreg]
ARTIFICIALIRIS meets the criterion for establishing new device
categories specified at Sec. 419.66(c)(1).
Response: After consideration of the public comments we received,
we have determined that there are no existing pass-through categories
that appropriately describe the CUSTOMFLEX[supreg] ARTIFICIALIRIS and
we have determined the CUSTOMFLEX[supreg] ARTIFICIALIRIS meets the
criterion for establishing new device categories specified at Sec.
419.66(c)(1).
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines either of the following: (i)
That a device to be included in the category has demonstrated that it
will substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part compared to
the benefits of a device or devices in a previously established
category or other available treatment; or (ii) for devices for which
pass-through status will begin on or after January 1, 2020, as an
alternative to the substantial clinical improvement criterion, the
device is part of the FDA's Breakthrough Devices Program and has
received FDA marketing authorization. As stated in section IV.2.a
above, devices that apply under the alternative pathway for devices
that have a Breakthrough Device designation with a FDA marketing
authorization are not subject to evaluation for substantial clinical
improvement (84 FR 61295). The CUSTOMFLEX[supreg] ARTIFICIALIRIS was
designated as a Breakthrough Device by FDA on December 21, 2017.
We did not receive comments on whether the CUSTOMFLEX[supreg]
ARTIFICIALIRIS meets the second criterion for establishing a device
category at Sec. 419.66(c)(2)(i). Based on its Breakthrough Device
designation, we
[[Page 85992]]
have determined that CUSTOMFLEX[supreg] ARTIFICIALIRIS meets this
criterion.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. The applicant stated that the
CUSTOMFLEX[supreg] ARTIFICIALIRIS would be reported with CPT code
66999--Unlisted procedure, anterior segment of eye, which was assigned
to APC 5491 (Level 1 Intraocular Procedures) for Calendar Year (CY)
2020. To meet the cost criterion for device pass-through payment
status, a device must pass all three tests of the cost criterion for at
least one APC. For our calculations, we used APC 5491, which had a CY
2019 payment rate of $1,917. Beginning in CY 2017, we calculated the
device offset amount at the HCPCS/CPT code level instead of the APC
level (81 FR 79657). CPT code 66999 had a device offset amount of
$149.80 at the time the application was received. According to the
applicant, the cost of the CUSTOMFLEX[supreg] ARTIFICIALIRIS is $7,700,
for both the Fiber Free and with Fiber models.
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $7,700 for the CUSTOMFLEX[supreg]
ARTIFICIALIRIS is 402 percent of the applicable APC payment amount for
the service related to the category of devices of $1,917 (($7,700/
$1,917) x 100 = 402 percent). Therefore, we stated in the CY 2021 OPPS/
ASC proposed rule that we believe the CUSTOMFLEX[supreg] ARTIFICIALIRIS
meets the first cost significance requirement.
The second cost significance requirement, at Sec. 419.66(d)(2),
provides that the estimated average reasonable cost of the devices in
the category must exceed the cost of the device-related portion of the
APC payment amount for the related service by at least 25 percent,
which means that the device cost needs to be at least 125 percent of
the offset amount (the device-related portion of the APC found on the
offset list). The estimated average reasonable cost of $7,700 for the
CUSTOMFLEX[supreg] ARTIFICIALIRIS is 5,140 percent of the cost of the
device-related portion of the APC payment amount for the related
service of $150 (($7,700/$150) x 100 = 5,140 percent). Therefore, we
stated in the CY 2021 OPPS/ASC proposed rule that we believe that the
CUSTOMFLEX[supreg] ARTIFICIALIRIS meets the second cost significance
requirement.
The third cost significance requirement, at Sec. 419.66(d)(3),
provides that the difference between the estimated average reasonable
cost of the devices in the category and the portion of the APC payment
amount for the device must exceed 10 percent of the APC payment amount
for the related service. The difference between the estimated average
reasonable cost of $7,700 for the CUSTOMFLEX[supreg] ARTIFICIALIRIS and
the portion of the APC payment amount for the device of $1,917 is 394
percent of the APC payment amount for the related service of $150
(($7,700 - $150)/$1,917) x 100 = 394 percent). Therefore, we stated in
the CY 2021 OPPS/ASC proposed rule that we believe that the
CUSTOMFLEX[supreg] ARTIFICIALIRIS meets the third cost significance
requirement.
We solicited public comment on whether the CUSTOMFLEX[supreg]
ARTIFICIALIRIS meets the device pass-through payment criteria discussed
in this section, including the cost criterion.
Comment: We received comments indicating that the
CUSTOMFLEX[supreg] ARTIFICIALIRIS meets the device pass-through payment
criteria, including the cost criterion.
Response: After considering the public comments received and our
review of the application, we have determined that the
CUSTOMFLEX[supreg] ARTIFICIALIRIS meets the device pass-through payment
criteria, including the cost criterion.
As stated above, we received the application for the
CUSTOMFLEX[supreg] ARTIFICIALIRIS application by the June 1, 2019
quarterly deadline and preliminarily approved it for transitional pass-
through payment under the alternative pathway for CY 2020, effective
January 1, 2020. We solicited public comment on whether the
CUSTOMFLEX[supreg] ARTIFICIALIRIS should continue to receive
transitional pass-through payment under the alternative pathway for
devices that have FDA's Breakthrough Device designation and marketing
authorization.
Comment: Commenters stated that CUSTOMFLEX[supreg] ARTIFICIALIRIS
should continue to receive transitional pass-through payment.
Response: After consideration of the public comments we received
and our review of the device pass-through application, we have
determined that the CUSTOMFLEX[supreg] ARTIFICIALIRIS meets the
requirements for device pass-through payment status described at Sec.
419.66. As stated previously, devices that are granted a FDA
Breakthrough Device designation are not evaluated in terms of the
current substantial clinical improvement criterion at Sec.
419.66(c)(2)(i) for purposes of determining device pass-through payment
status, but must meet the other criteria for device pass-through
status, which we believe CUSTOMFLEX[supreg] ARTIFICIALIRIS does.
Therefore, we are finalizing approval for device pass-through payment
status for CUSTOMFLEX[supreg] ARTIFICIALIRIS under the alternative
pathway for devices that have a FDA Breakthrough Device designation and
are FDA market authorized. For CY 2021, we will continue the device
pass-through payment status for CUSTOMFLEX[supreg] ARTIFICIALIRIS.
(2) EXALTTM Model D Single-Use Duodenoscope
Boston Scientific Corporation submitted an application before the
March 2020 quarterly deadline for a new device category for
transitional pass-through payment status for the EXALTTM
Model D Single-Use Duodenoscope. The EXALTTM Model D Single-
Use Duodenoscope is described as a sterile, single-use, flexible
duodenoscope used to examine the duodenum and perform endoscopic
retrograde cholangiopancreatography (ERCP) procedures by facilitating
access to the pancreaticobiliary system. The applicant stated that it
has designed the technology of the EXALTTM Model D Single-
Use Duodenoscope to eliminate the risk of nosocomial infections due to
improper reprocessing of a reusable duodenoscope. As stated above, the
EXALTTM Model D Single-Use Duodenoscope is used during ERCP
procedures that are performed to examine bile and pancreatic ducts.
According to the applicant, the EXALTTM Model D Single-Use
Duodenoscope enables passage and manipulation of accessory devices in
the pancreaticobiliary system for diagnostic and therapeutic purposes,
as necessary. During the ERCP procedure, the physician inserts the
duodenoscope through the patient's mouth, passes the duodenoscope
through the esophagus and stomach and enters into the first part of the
small intestine (duodenum). The applicant stated that during ERCP a
cannula is passed through the duodenoscope via a working channel and
used to cannulate a small opening on the duodenal wall. Once that step
is complete, the physician injects contrast while x-rays are taken to
study the bile and/or pancreatic ducts. If the physician
[[Page 85993]]
identifies an area that warrants further investigation, accessory
devices can be inserted through the working channel of the scope and
into the pancreaticobiliary system for diagnosis or treatment.
According to the applicant, after the conclusion of the procedure, the
single-use EXALTTM Model D Single-Use Duodenoscope device
has no further medical use and is fully disposable.
With respect to the newness criterion at Sec. 419.66(b)(1), the
FDA designated the EXALTTM Model D Single-Use Duodenoscope
as a Breakthrough Device on November 19, 2019, and approved the
premarket approval application (K193202) for EXALTTM Model D
Single-Use Duodenoscope on December 13, 2019. We received the
application for a new device category for transitional pass-through
payment status for the EXALTTM Model D Single-Use
Duodenoscope on January 17, 2020, which is within 3 years of the date
of the initial FDA premarket approval. We solicited public comment on
whether the EXALTTM Model D Single-Use Duodenoscope meets
the newness criterion.
Comment: The manufacturer of EXALTTM Model D Single-Use
Duodenoscope believes the device meets the eligibility criteria for
device pass-through payment under the regulation at Sec. 419.66, which
includes the newness criterion, based on FDA Breakthrough Device
designation it received on December 13, 2019 and the 510(k) premarket
approval it received on November 19, 2019.
Response: We appreciate the commenter's input. After consideration
of the public comment we received and based on the fact that the
EXALTTM Model D Single-Use Duodenoscope application was
received January 17, 2020, within 3 years of FDA premarket approval,
which was on November 19, 2019, and FDA Breakthrough Device designation
on December 13, 2019, we believe that the EXALTTM Model D
Single-Use Duodenoscope meets the newness criterion.
With regard to the eligibility criterion at Sec. 419.66(b)(3),
according to the applicant, the EXALTTM Model D Single-Use
Duodenoscope is integral to the ERCP service provided, is used for one
patient only, and is surgically inserted as it is inserted through the
patient's mouth, down the esophagus, into the stomach, and then into
the first part of the small intestine. The applicant also stated that
the EXALTTM Model D Single-Use Duodenoscope meets the device
eligibility requirements of Sec. 419.66(b)(4) because it is not an
instrument, apparatus, implement, or item for which depreciation and
financing expenses are recovered, and it is not a supply or material
furnished incident to a service.
Comment: The manufacturer of EXALTTM Model D Single-Use
Duodenoscope believed that the EXALTTM Model D Single-Use
Duodenoscope met the eligibility criteria at Sec. 419.66(b). They
maintained that the EXALTTM Model D Single-Use Duodenoscope
meets the criterion at Sec. 419.66(b)(3) because it is integral to the
ERCP service provided, is used for one patient only, and is surgically
inserted through the patient's mouth, down the esophagus, into the
stomach, and then into the first part of the small intestine. The
commenter believes the device meets eligibility requirements at Sec.
419.66(b)(4) because it is not an instrument, apparatus, implement, or
item for which depreciation and financing expenses are recovered, and
it is not a supply or material furnished incident to a service.
Response: We appreciate the commenter's feedback. Based on the
information we have received from the commenter and our review of the
application, we have determined that EXALTTM Model D Single-
Use Duodenoscope meets the eligibility criteria at Sec. 419.66(b)(3)
and (b)(4) because, as previously discussed, the device is integral to
the service furnished, is used for one patient only, and is inserted
through the patient's mouth, down the esophagus, into the stomach, and
finally into the first part of the small intestine. It also is not an
instrument, apparatus, implement, or item for which depreciation and
financing expenses are recovered, and it is not a supply or material
furnished incident to a service.
The criteria for establishing new device categories are specified
at Sec. 419.66(c). The first criterion, at Sec. 419.66(c)(1),
provides that CMS determines that a device to be included in the
category is not appropriately described by any of the existing
categories or by any category previously in effect, and was not being
paid for as an outpatient service as of December 31, 1996. With respect
to the existence of a previous pass-through device category that
describes EXALTTM Model D Single-Use Duodenoscope, the
applicant suggested a category descriptor of ``Duodenoscope, single-
use.'' The applicant also provided an existing device category ``C1749,
Endoscope, retrograde imaging/illumination colonoscope device
(implantable),'' for pass-through payment for another endoscope and
explained why they believe the category descriptor is not applicable to
EXALTTM Model D Single-Use Duodenoscope. The applicant
stated that HCPCS C1749 does not appropriately describe the EXALT Model
D, as C1749 is intended to describe endoscopic imaging devices that are
inserted through a colonoscope and into the colon. The applicant argued
that EXALT Model D is the first and only single-use duodenoscope
through which devices can be passed, and it is utilized in ERCP
procedures. The applicant further stated that the scope that is the
subject of this request provides access to a different part of the
anatomy, specifically, the pancreaticobiliary system and facilitates
access for diagnostic and therapeutic purposes, as opposed to the
devices described by C1749, which are endoscopic imaging devices that
are inserted through a colonoscope and into the colon, providing access
to a different part of the anatomy. Upon review, we agreed with the
applicant that it does not appear that there are any other existing
pass-through payment categories that might apply and we solicited
public comment on this issue.
Comment: Several commenters stated they did not believe there is an
existing pass-through payment category that describes the
EXALTTM Model D Single-Use Duodenoscope. They commented that
the existing device category that CMS identified does not adequately
describe critical aspects of the device. The commenters also noted that
existing category, C1749 Endoscope, retrograde imaging/illumination
colonoscope device (implantable), does not appropriately describe
single-use endoscopes that provide access to a different part of the
anatomy, specifically the upper gastrointestinal (GI) tract.
Response: We appreciate the commenters' input. After consideration
of the public comments we received, we agree there is no existing pass-
through payment category that appropriately describes the
EXALTTM Model D Single-Use Duodenoscope because it is a
single use endoscope with internal channel that provides access to the
duodenum and the hepatopancreatic duct. Based on this information, we
have determined that the EXALTTM Model D Single-Use
Duodenoscope meets the eligibility criterion at Sec. 419.66(c)(1).
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines either of the following: (i)
That a device to be included in the category has demonstrated that it
will substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part
[[Page 85994]]
compared to the benefits of a device or devices in a previously
established category or other available treatment; or (ii) for devices
for which pass-through status will begin on or after January 1, 2020,
as an alternative to the substantial clinical improvement criterion,
the device is part of the FDA's Breakthrough Devices Program and has
received FDA marketing authorization. As previously discussed in
section IV.2.a above, we finalized the alternative pathway for devices
that are granted a Breakthrough Device designation and receive FDA
marketing authorization in the CY 2020 OPPS/ASC final rule (84 FR
61295). The EXALTTM Model D Single-Use Duodenoscope has a
Breakthrough Device designation and marketing authorization from the
FDA and therefore is not evaluated based on substantial clinical
improvement.
We did not receive comments on whether EXALTTM Model D
Single-Use Duodenoscope meets the second criterion for establishing a
device category at Sec. 419.66(c)(2). We have determined that the
EXALTTM Model D Single-Use Duodenoscope meets this
criterion.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. The applicant stated that the
EXALTTM Model D Single-Use Duodenoscope would be reported
with CPT code 43274 which is associated with APC 5331 (Complex GI
Procedures). To meet the cost criterion for device pass-through payment
status, a device must pass all three tests of the cost criterion for at
least one APC. We used APC 5331 for our calculations, which had a CY
2020 payment rate of $4,780.30 at the time the application was
received. Beginning in CY 2017, we calculate the device offset amount
at the HCPCS/CPT code level instead of the APC level (81 FR 79657). CPT
code 43274 had a device offset amount of $1,287.81 at the time the
application was received. According to the applicant, the cost of the
EXALTTM Model D Single-Use Duodenoscope is $2,930.
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $2,930 for the EXALTTM Model D
Single-Use Duodenoscope is 61 percent of the applicable APC payment
amount for the service related to the category of devices of $4,780.30
($2,930/$4,780.30 x 100 = 61.3 percent). Therefore, we believe the
EXALTTM Model D Single-Use Duodenoscope meets the first cost
significance requirement.
The second cost significance requirement, at Sec. 419.66(d)(2),
provides that the estimated average reasonable cost of the devices in
the category must exceed the cost of the device-related portion of the
APC payment amount for the related service by at least 25 percent,
which means that the device cost needs to be at least 125 percent of
the offset amount (the device-related portion of the APC found on the
offset list). The estimated average reasonable cost of $2,930 for the
EXALTTM Model D Single-Use Duodenoscope is 228 percent of
the cost of the device-related portion of the APC payment amount for
the related service of $1,287.81 ($2,930/$1,287.81) x 100 = 227.5
percent. Therefore, we believe that the EXALTTM Model D
Single-Use Duodenoscope meets the second cost significance requirement.
The third cost significance requirement, at Sec. 419.66(d)(3),
provides that the difference between the estimated average reasonable
cost of the devices in the category and the portion of the APC payment
amount for the device must exceed 10 percent of the APC payment amount
for the related service. The difference between the estimated average
reasonable cost of $2,930 for the EXALTTM Model D Single-Use
Duodenoscope and the portion of the APC payment amount for the device
of $1,287.81 is 34 percent of the APC payment amount for the related
service of $4,780.30 (($2,930-$1,287.81)/$4,780.30) x 100 = 34.4
percent). Therefore, we believe that the EXALTTM Model D
Single-Use Duodenoscope meets the third cost significance requirement.
We solicited public comment on whether the EXALTTM Model D
Single-Use Duodenoscope meets the device pass-through payment criteria
discussed in this section, including the cost criterion.
As specified above, the EXALTTM Model D Single-Use
Duodenoscope application was preliminarily approved for transitional
pass-through payment under the alternative pathway effective July 1,
2020. We solicited public comment on whether the EXALTTM
Model D Single-Use Duodenoscope should continue to receive transitional
pass-through payment under the alternative pathway for devices that
have a FDA Breakthrough Device designation and are FDA market
authorized.
Comment: Several commenters, including the manufacturer of the
EXALTTM Model D Single-Use Duodenoscope, believed that the
device meets the cost criterion for device pass-through payment status.
Some commenters recommended we not apply a device offset amount for
EXALTTM Model D Single-Use Duodenoscope because they
believed that single-use duodenscopes are not replacing devices that
are packaged into the APC payment rate and thus, should not be subject
to the device offset.
Response: We appreciate the commenters input. Section
1833(t)(6)(D)(ii) of the Act requires that the amount of payment for a
pass-through device be the amount by which a hospital's charges,
adjusted to cost, exceeds the portion of the otherwise applicable APC
payment amount that the Secretary determines is associated with the
device. The portion of the APC payment amount that we determine is
associated with the cost of the pass-through device is referred to as
the device offset. The device offset is used to reduce the otherwise
applicable APC payment amount for the applicable pass-through device.
After further review, we agree with the commenters. We have
determined that the costs associated with the EXALTTM Model
D Single-Use Duodenoscope are not already reflected in the device
portions of APCs 5303 (Level 3 Upper GI Procedures) or 5331 (Complex GI
Procedures) because there were no single-use duodenoscopes on the
market previously so no operating cost data associated with such
devices could be included historical OPPS claims data. Therefore, we
are not applying a device offset for the EXALTTM Model D
Single-Use Duodenoscope.
After consideration of the public comments we received, we believe
that EXALTTM Model D Single-Use Duodenoscope meets the cost
criterion for device pass-through payment status.
For CY 2021, we will continue the device pass-through payment
status for EXALTTM Model D Single-Use Duodenoscope. As
stated previously, devices that are designated as Breakthrough Devices
by the FDA are not evaluated in terms of the current substantial
clinical improvement criterion at Sec. 419.66(c)(2)(i) for purposes of
determining device pass-through payment status, but must meet the other
criteria for device pass-through status, which we believe
EXALTTM Model D Single-Use Duodenoscope does. Therefore, we
are finalizing approval for
[[Page 85995]]
device pass-through payment status for EXALTTM Model D
Single-Use Duodenoscope under the alternative pathway for devices that
have FDA Breakthrough Device designation and FDA market authorization
beginning CY 2021.
(3) BAROSTIM NEOTM System
CVRx, Inc. submitted an application for the BAROSTIM
NEOTM System by the December 2019 quarterly deadline. The
applicant provided that the BAROSTIM NEOTM is indicated for
the treatment of symptoms of patients with advanced heart failure. The
applicant asserted that the BAROSTIM therapy triggers the body's main
cardiovascular reflex to regulate blood pressure and address the
underlying causes of the progression of heart failure. According to the
applicant, increased sympathetic and decreased parasympathetic activity
contribute to heart failure (HF) symptoms and disease progression.
Barostim's mechanism of action is stimulating the carotid baroreceptor
which results in centrally mediated reduction of sympathetic and
increase in parasympathetic activity. A single 2 mm coated electrode
with a 7 mm silicone backer is sutured to the carotid artery to
activate the baroreceptors. It is connected to an implantable pulse
generator in the chest which provides control of baroreflex activation
energy. The BAROSTIM NEOTM System uses CVRx patented
BAROSTIM THERAPYTM technology to trigger the body's own
natural systems (baroreflex) by electrically activating the carotid
baroreceptors, the body's natural cardiovascular regulation sensors.
According to the applicant, in conditions such as hypertension and
heart failure, it is believed the baroreceptors, the body's natural
sensors, are not functioning properly and are not sending sufficient
signals to the brain. This results in the brain sending signals to
other parts of the body (heart, blood vessels, kidneys) to constrict
the blood vessels, retain water and salt by the kidneys and increase
stress-related hormones. The applicant provided that when the
baroreceptors are activated by the BAROSTIM NEOTM system,
signals are sent through neural pathways to the brain. In response, the
brain works to counteract this stimulation by sending signals to other
parts of the body (heart, blood vessels, and kidneys) that relax the
blood vessels and inhibit the production of stress-related hormones.
These changes act to reduce cardiac after-load and enable the heart to
increase blood output, while maintaining or reducing its workload.
Parameters are programmed into the Implantable Pulse Generator (IPG)
using telemetry via a wireless external programming system. The
applicant stated that the BAROSTIM NEOTM System is fully
programmable to adjust the therapy to each patient's needs.
With respect to the newness criterion at Sec. 419.66(b)(1), the
FDA designated the BAROSTIM NEOTM System as a Breakthrough
Device and approved the premarket approval application (P180050) on
August 16, 2019 based on the improvement of symptoms of heart failure--
quality of life, six-minute hall walk, and functional status--for
patients who remain symptomatic despite treatment with guideline-
directed medical therapy, are New York Heart Association (NYHA) Class
III or Class II (who had a recent history of Class III), have a left
ventricular ejection fraction TM on November 27, 2019, which is within
3 years of the date of the initial FDA premarketing approval. We
solicited public comment on whether the BAROSTIM NEOTM meets
the newness criterion.
Comment: The manufacturer stated that BAROSTIM NEOTM
meets the newness criterion as described by Sec. 419.66(b) because the
FDA designated the BAROSTIM NEOTM System as a Breakthrough
Device and approved the premarket application (P180050) on August 16,
2019 based on the improvement of symptoms of heart failure--quality of
life, six-minute hall walk, and functional status--for patients who
remain symptomatic despite treatment.
Response: We appreciate the commenter's input. After consideration
of the public comments we received and because the BAROSTIM
NEOTM application was received November 27, 2019 and
received FDA premarketing approval on August 16, 2019 which is within 3
years, we agree that the BAROSTIM NEOTM meets the newness
criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
according to the applicant, the use of BAROSTIM NEOTM is
integral to the service of providing baroreflex therapy, is used for
one patient only, comes in contact with human skin and is surgically
implanted or inserted. The applicant also claimed the BAROSTIM
NEOTM meets the device eligibility requirements of Sec.
419.66(b)(4) because it is not an instrument, apparatus, implement, or
item for which depreciation and financing expenses are recovered, and
it is not a supply or material furnished incident to a service. We
solicited public comments on whether the BAROSTIM NEOTM
meets the eligibility criteria at Sec. 419.66(b).
Comment: The manufacturer of BAROSTIM NEOTM felt that
their device met the eligibility criteria at Sec. 419.66(b) because it
is used for one patient only, comes in contact with human skin and is
surgically implanted or inserted. The applicant claimed the BAROSTIM
NEOTM meets the device eligibility requirements of Sec.
419.66(b)(4) because it is not an instrument, apparatus, implement, or
item for which depreciation and financing expenses are recovered, and
it is not a supply or material furnished incident to a service.
Response: Based on the information we have received and our review
of the application, we agree with the commenter that the device is used
for one patient only, comes in contact with human skin and is
surgically implanted or inserted. We also agree with the commenter that
BAROSTIM NEOTM meets the device eligibility requirements of
Sec. 419.66(b)(4) because it is not an instrument, apparatus,
implement, or item for which depreciation and financing expenses are
recovered, and it is not a supply or material furnished incident to a
service. Based on this assessment we have determined that BAROSTIM
NEOTM meets the eligibility criterion at Sec. 419.66(b)(3)
and (4).
The criteria for establishing new device categories are specified
at Sec. 419.66(c). The first criterion, at Sec. 419.66(c)(1),
provides that CMS determines that a device to be included in the
category is not appropriately described by any existing categories or
by any category previously in effect, and was not being paid for as an
outpatient service as of December 31, 1996. With respect to the
existence of a previous pass-through device category that described
BAROSTIM NEOTM, the applicant suggested a category
descriptor of ``Generator, neurostimulator (implantable), non-
rechargeable with carotid sinus stimulation lead.'' The applicant also
provided a list of current and expired device categories for pass-
through payment for other neurostimulation systems and their rationale
for why they believed the category descriptors are not applicable to
BAROSTIM NEOTM.
The applicant stated that BAROSTIM NEOTM is not
described by existing device category C1767, Generator, neurostimulator
(implantable), non-
[[Page 85996]]
rechargeable. The applicant stated that similar to the traditional
spinal cord stimulation (SCS) systems included in this category, the
BAROSTIM NEOTM System is not rechargeable; however, it is
the only system that works to deliver CVRx's proprietary baroreflex
activation therapy (BAT). The applicant provided that BAT uses afferent
signaling to the brain by stimulating the carotid artery to reduce the
sympathetic signal and increase the parasympathetic signal. The
applicant stated that this unique therapy works to rebalance the
autonomic input to the heart to improve heart failure symptoms.
Additionally, the applicant stated that traditional devices provide
pain relief by disrupting the pain signals traveling between the spinal
cord's nervous system and the brain, but the BAROSTIM NEO System uses
the generator to stimulate the baroreceptors in the carotid artery to
treat the symptoms of patients with advanced heart failure. The
applicant stated that the BAROSTIM NEO generator is unique in its
capability to drive electricity up to 20 mA/100 Hz with sufficient
battery capacity to provide the required therapy through the BAROSTIM
NEOTM carotid sinus lead. The applicant described that the
BAROSTIM NEOTM carotid sinus lead is sutured to the carotid
wall, where the baroreceptors (stretch fibers) are located. Electrical
current radiating from the carotid sinus lead activates the
baroreceptors. When activated, the baroreceptors send afferent signals
through the Carotid Sinus Nerve to the brain. The brain interprets
these afferent signals and reacts by reducing the sympathetic tone and
increasing the parasympathetic tone. The applicant stated that the
BAROSTIM NEOTM System is the only device currently approved
by FDA that leverages this mechanism of action to treat the symptoms of
patients with advanced heart failure.
The applicant stated that BAROSTIM NEOTM is not
described by existing device category C1823, Generator, neurostimulator
(implantable), non-rechargeable, with transvenous sensing and
stimulation leads. They contended that existing device category C1823
is exclusively used to describe a complete system comprised of a
generator implanted in the chest, a stimulation lead attached to the
phrenic nerve and a sensing lead to control the function of the
diaphragm for the treatment of moderate to severe central sleep apnea.
The applicant also stated that the BAROSTIM NEOTM System
utilizes a single stimulation lead positioned on the carotid artery to
stimulate baroreceptors. The stimulation of the baroreceptors creates
afferent nerve traffic through the Carotid Sinus Nerve, and results in
the activation of the baroreflex. The applicant again stated that the
BAROSTIM NEOTM System is the only device currently approved
by FDA that leverages this mechanism of action to improve quality of
life and functional status in heart failure.
The applicant also provided that BAROSTIM NEOTM is not
described by existing device category C1778, Lead, neurostimulator
(implantable). The applicant stated that leads used in traditional
neurostimulation are implanted on nerves (for example, spinal cord,
peripheral nerves). The applicant contended that in contrast, the
BAROSTIM NEO carotid sinus lead is sutured onto the carotid artery and
is the only lead that is designed to be secured on an arterial wall to
stimulate sensors located inside the arterial wall (baroreceptors). The
applicant provided that stimulation is delivered to the arterial wall,
where the baroreceptors (stretch fibers) are located. The applicant
stated that the BAROSTIM NEOTM generator is uniquely
designed to send electric current via the BAROSTIM NEOTM
carotid sinus lead and that the BAROSTIM NEOTM carotid sinus
lead is uniquely designed to only interface with the BAROSTIM NEO
generator. Again, the applicant provided that the BAROSTIM
NEOTM System is the only device currently approved by FDA
that leverages this mechanism of action to treat the symptoms of
patients with advanced heart failure.
We stated in the CY 2021 OPPS/ASC proposed rule that we were
concerned that the BAROSTIM NEOTM System may be
appropriately described by existing pass-through payment categories.
For example, we believed that the BAROSTIM NEOTM System may
be appropriately described by C1767 as the BAROSTIM NEOTM
device consists of a generator, a neurostimulator, and a lead. We
solicited public comment on this issue.
Comment: The manufacturer of the device stated that it does not
believe there is an existing pass-through payment category that
describes the BAROSTIM NEOTM System, commenting that the
existing device categories that CMS identified do not adequately
describe critical aspects of the device. The manufacturer noted that
existing categories, such as C1767, Generator, neurostimulator
(implantable), non-rechargeable, C1823, Generator, neurostimulator
(implantable), non-rechargeable, with transvenous sensing and
stimulation leads, and C1778, Lead, neurostimulator (implantable), do
not appropriately describe systems that activate special receptors in
the carotid artery known as baroreceptors, which are in a different
anatomical location than nerves. The manufacturer stated that
baroreceptors are sensory cells that respond to mechanical pressure.
They have ion channels that open to allow ions to pass through when
they are stretched. Baroreceptors are mechanosensitive ion channels,
which according to the manufacturer, are functionally very different
from the voltage gate ion channels of nerves. In addition, the
manufacturer continued, BAROSTIM NEO stimulates baroreceptors deep
within the arterial wall of the carotid sinus, as opposed to direct
activation of the carotid sinus nerve. The manufacturer explained that
the carotid sinus nerve contains afferent nerve fibers leading from
baroreceptors, but also contains afferent nerve fibers leading from the
chemoreceptors, which can cause unwanted side effects. The manufacturer
stated that BAROSTIM NEOTM uses electricity to activate the
baroreceptors and stimulate the baroreflex and does not directly
stimulate neurons and therefore, is not appropriately described by
existing categories.
Response: We appreciate the commenter's input. After consideration
of the public comments we received, we agree that there is no existing
pass-through payment category that appropriately describes BAROSTIM
NEOTM because it is an implantable generator with surgically
placed lead providing selective stimulation of carotid sinus
baroreceptors and activation of baroreflex, which then stimulates the
autonomic nervous system. Based on this information, we have determined
that BAROSTIM NEOTM meets the eligibility criterion at Sec.
419.66(c)(1).
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines either of the following: (i)
That a device to be included in the category has demonstrated that it
will substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part compared to
the benefits of a device or devices in a previously established
category or other available treatment; or (ii) for devices for which
pass-through status will begin on or after January 1, 2020, as an
alternative to the substantial clinical improvement criterion, the
device has received FDA marketing authorization and is part of the
FDA's Breakthrough Devices Program. As stated in section IV.2.a above,
devices
[[Page 85997]]
that apply under the alternative pathway for devices with FDA
premarketing approval and a Breakthrough Device designation are not
subject to evaluation for substantial clinical improvement (84 FR
61295). The BAROSTIM NEOTM System has Breakthrough Device
designation and FDA premarketing approval, and therefore is not
evaluated based on substantial clinical improvement.
We did not receive comments on whether BAROSTIM NEOTM
meets the second criterion for establishing a device category at Sec.
419.66(c)(2). We have determined that the BAROSTIM NEOTM
meets this criterion.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. The applicant stated that the BAROSTIM
NEOTM would be reported with CPT code 0266T, which they
consider to be a total system code. CPT code 0266T is assigned to APC
5464 (Level 4 Neurostimulator and Related Procedures). To meet the cost
criterion for device pass-through payment status, a device must pass
all three tests of the cost criterion for at least one APC. For our
calculations, we used APC 5464, which has a CY 2020 payment rate of
$29,115.50. Beginning in CY 2017, we calculated the device offset
amount at the HCPCS/CPT code level instead of the APC level (81 FR
79657). CPT code 0266T had a device offset amount of $24,253 at the
time the application was received. According to the applicant, the cost
of the BAROSTIM NEOTM is $35,000.
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $35,000 for the BAROSTIM NEOTM is
120 percent of the applicable APC payment amount for the service
related to the category of devices of $29,116 (($35,000/29,116) x 100 =
120.2 percent). Therefore, we believe the BAROSTIM NEOTM
meets the first cost significance requirement.
The second cost significance requirement, at Sec. 419.66(d)(2),
provides that the estimated average reasonable cost of the devices in
the category must exceed the cost of the device-related portion of the
APC payment amount for the related service by at least 25 percent,
which means that the device cost needs to be at least 125 percent of
the offset amount (the device-related portion of the APC found on the
offset list). The estimated average reasonable cost of $35,000 for the
BAROSTIM NEOTM is 144 percent of the cost of the device-
related portion of the APC payment amount for the related service of
$24,253 (($35,000/$24,253) x 100 = 144.3 percent). Therefore, we
believe that the BAROSTIM NEOTM meets the second cost
significance requirement.
The third cost significance requirement, at Sec. 419.66(d)(3),
provides that the difference between the estimated average reasonable
cost of the devices in the category and the portion of the APC payment
amount for the device must exceed 10 percent of the APC payment amount
for the related service. The difference between the estimated average
reasonable cost of $35,000 for BAROSTIM NEOTM and the
portion of the APC payment amount for the device of $24,253 is 37
percent of the APC payment amount for the related service of $29,116
(($35,000-$24,253)/$29,116) x 100 = 36.9 percent). Therefore, we
believe that the BAROSTIM NEOTM System meets the third cost
significance requirement.
We solicited public comment on whether the BAROSTIM
NEOTM System meets the device pass-through payment criteria
discussed in this section, including the cost criterion.
Comment: The manufacturer of the BAROSTIM NEOTM System
believed that the device meets the cost criterion for device pass-
through payment status.
Response: We appreciate the manufacturer's input. After
consideration of the public comments we received and our cost threshold
calculations, we agree that BAROSTIM NEOTM meets the cost
criterion for device pass-through payment status.
After consideration of the public comments we received and our
review of the device pass-through application, we have determined that
the BAROSTIM NEOTM qualifies for device pass-through
payment. As stated previously, devices that receive FDA Breakthrough
Device designation are not evaluated in terms of the current
substantial clinical improvement criterion at Sec. 419.66(c)(2)(i) for
purposes of determining device pass-through payment status, but must
meet the other criteria for device pass-through status, which we
believe BAROSTIM NEOTM does. Therefore, we are finalizing
approval for device pass-through payment status beginning CY 2021 for
BAROSTIM NEOTM under the alternative pathway for devices
that receive FDA Breakthrough Device designation and FDA premarket
approval. Please refer to section IV.B.1.b of this final rule with
comment for more information on the device offset for BAROSTIM
NEOTM device.
2. Traditional Device Pass-Through Applications
(1) Hemospray[supreg] Endoscopic Hemostat
Cook Medical submitted an application for a new device category for
transitional pass-through payment status for the Hemospray[supreg]
Endoscopic Hemostat (Hemospray) for CY 2021. Hemospray[supreg]
Endoscopic Hemostat is a prescription use device consisting of a
hemostatic agent and a delivery system. The hemostatic agent is an
inert, bentonite powder, naturally sourced from aluminum phyllosilicate
clay, developed for endoscopic hemostasis. According to the applicant,
Hemospray[supreg] is indicated by the FDA for hemostasis of nonvariceal
gastrointestinal bleeding. Using an endoscope to access the
gastrointestinal tract, the Hemospray delivery system is passed through
the accessory channel of the endoscope and positioned just above the
bleeding site without making contact with the GI tract wall. The
Hemospray[supreg] powder is propelled through the application catheter,
either a 7 or 10 French polyethylene catheter, by release of
CO2 from the cartridge located in the device handle and
sprayed onto the bleeding site. Bentonite can absorb five to ten times
its weight in water and swell up to 15 times its dry volume. Bentonite
rapidly absorbs water and becomes cohesive to itself and adhesive to
tissue, forming a physical barrier to aqueous fluid (for example,
blood). Hemospray[supreg] is not absorbed by the body and does not
require removal as it passes through the GI tract within 72 hours.
Hemospray[supreg] is single-use and disposable.
With respect to the newness criterion at Sec. 419.66(b)(1), the
FDA granted a de novo request classifying the Hemospray[supreg]
Endoscopic Hemostat (Hemospray[supreg]) as a Class II device under
section 513(f)(2) of the Federal Food, Drug, and Cosmetic Act on May 7,
2018. We received the application for a new device category for
transitional pass-through payment status for the Hemospray[supreg]
Endoscopic Hemostat on December 2, 2019, which is within 3 years of the
date of the initial FDA marketing authorization. We solicited public
comments on whether Hemospray[supreg] meets the newness criterion.
Comment: The manufacturer of Hemospray[supreg] believed this device
meets
[[Page 85998]]
the newness eligibility criteria for device pass-through payment under
the regulation at Sec. 419.66(b)(1) since Hemospray[supreg] was
granted de novo marketing authorization and classified as a Class II
device on May 7, 2018.
Response: We appreciate the commenter's input. After consideration
of the public comments we received and based on the fact that the
Hemospray[supreg] application was received on May 7, 2018, within 3
years of FDA approval, we agree that the Hemospray[supreg] System meets
the newness criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
according to the applicant, Hemospray[supreg] is integral to the
service provided, is used for one patient only, comes in contact with
human skin, and is applied in or on a wound or other skin lesion. The
applicant also claimed that Hemospray[supreg] meets the device
eligibility requirements of Sec. 419.66(b)(4) because it is not an
instrument, apparatus, implement, or item for which depreciation and
financing expenses are recovered, and it is not a supply or material
furnished incident to a service. We solicited public comments on
whether Hemospray[supreg] meets the eligibility criteria at Sec.
419.66(b).
Comment: Three commenters, including the manufacturer of
Hemospray[supreg], believed that the Hemospray[supreg] meets the
eligibility criteria at Sec. 419.66(b)(3) stating that
Hemospray[supreg] is a prescription single use device consisting of a
hemostatic agent and a delivery system that is integral to the service
provided.
Response: We appreciate the commenters' input. Based on the public
comments we have received and our review of the application, we have
determined that Hemospray[supreg] meets the eligibility criterion at
Sec. 419.66(b)(3) and (4).
The criteria for establishing new device categories are specified
at Sec. 419.66(c). The first criterion, at Sec. 419.66(c)(1),
provides that CMS determines that a device to be included in the
category is not appropriately described by any of the existing
categories or by any category previously in effect, and was not being
paid for as an outpatient service as of December 31, 1996. We stated in
the CY 2021 OPPS/ASC proposed rule that we have not identified an
existing pass-through payment category that describes
Hemospray[supreg]. We solicited public comment on whether
Hemospray[supreg] meets the device category criterion.
Comment: Two commenters, including the manufacturer of the
Hemospray[supreg], indicated that there is not an existing pass-through
payment category that describes the device.
Response: We appreciate the commenters' input. After consideration
of the public comments we received, we continue to believe that there
is not an existing pass-through payment category that describes
Hemospray[supreg], and therefore, Hemospray[supreg] meets the device
category eligibility criterion at Sec. 419.66(c)(1).
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines either of the following: (i)
That a device to be included in the category has demonstrated that it
will substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part compared to
the benefits of a device or devices in a previously established
category or other available treatment; or (ii) for devices for which
pass-through status will begin on or after January 1, 2020, as an
alternative to the substantial clinical improvement criterion, the
device is part of the FDA's Breakthrough Devices Program and has
received FDA marketing authorization. The applicant stated that
Hemospray[supreg] represents a substantial clinical improvement over
existing technologies. With respect to this criterion, the applicant
submitted studies that examined the impact of Hemospray[supreg] on
endoscopic hemostasis outcomes, rebleeding occurrence, and mortality.
According to the applicant, Hemospray[supreg] is a topically
applied mineral powder that offers a novel primary treatment option for
endoscopic bleeding management, serves as an option for patients who
fail conventional endoscopic treatments, and serves as an alternative
to interventional radiology hemostasis (IRH) and surgery. Broadly, the
applicant outlined two treatment areas in which it stated
Hemospray[supreg] would provide a substantial clinical improvement: (1)
As a primary treatment or a rescue treatment after the failure of a
conventional method, and (2) in use for the treatment of malignant
lesions. The applicant provided seven articles specifically for the
purpose of addressing the substantial clinical improvement criterion.
The first article provided by the applicant was a prospective,
single-armed, multicenter Phase 2 safety and efficacy study performed
in France.\7\ From March 2013 to January 2015, 64 endoscopists in 20
centers enrolled 202 patients in the study in which Hemospray[supreg]
was used as either a first line treatment (46.5 percent) or salvage
therapy (53.5 percent) following unsuccessful treatment with another
method. The indication for Hemospray[supreg] as a first-line therapy or
salvage therapy was at the discretion of the endoscopist. Of the 202
patients, the mean age was 68.9, 69.3 percent were male, and all
patients were classified into four primary etiologic groups: Ulcers
(37.1 percent), malignant lesions (30.2 percent), post-endoscopic
bleeding (17.3 percent), and other (15.3 percent). Patients were
further classified by the American Society of Anesthesiologist (ASA)
physical status scores with 4.5 percent as a normal healthy patient,
24.3 percent as a patient with mild systemic disease, 46 percent as a
patient with severe systemic disease, 22.8 percent as a patient with
severe systemic disease that is a constant threat to life, and 2.5
percent as a moribund patient who is not expected to survive without an
operation.8 9 Immediate hemostasis was achieved in 96.5
percent across all patients; among treatment subtypes, immediate
hemostasis was achieved in 96.8 percent of first-line treated patients
and 96.3 percent of salvage therapy patients. At day 30, the overall
rebleeding was 33.5 percent of 185 patients with cumulative incidences
of 41.4 percent for ulcers, 37.7 percent for malignant lesions, 17.6
percent for post-endoscopic bleedings, and 25 percent for others. When
Hemospray[supreg] was used as a first-line treatment, rebleeding at day
30 occurred in 26.5 percent (22/83) of overall lesions, 30.8 percent of
ulcers, 33.3 percent of malignant lesions, 13.6 percent of post-
endoscopic bleedings, and 22.2 percent of other. When Hemospray[supreg]
was used as a salvage therapy, rebleeding at day 30 occurred in 39.2
percent (40/102) of overall lesions, 43.9 percent of ulcers, 50.0
percent of malignant lesions, 25.0 percent of post-endoscopic
bleedings, and 26.3 percent for others. According to the article, the
favorable hemostatic results seen from Hemospray[supreg] are due to its
threefold mechanism of action: Formation of a mechanical barrier;
concentration of clotting factors at the bleeding site; and enhancement
of clot formation.\10\ No severe adverse events
[[Page 85999]]
were noted, however the authors note the potential for pain exists due
to the use of carbon dioxide. Lastly, the authors stated that while
Hemospray[supreg] was found to reduce the need for radiological
embolization and surgery as salvage therapies, it was not found to be
better than other hemostatic methods in terms of preventing rebleeding
of ulcers.
---------------------------------------------------------------------------
\7\ Haddara S, Jacques J, Lecleire S et al. A novel hemostatic
powder for upper gastrointestinal bleeding: A multicenter study (the
GRAPHE registry). Endoscopy 2016; 48: 1084-95.
\8\ Ibid.
\9\ ASA House of Delegates/Executive Committee. (2014, October
15). ASA Physical Status Classification System. Retrieved from
American Society of Anesthesiologists: https://www.asahq.org/standards-and-guidelines/asa-physical-status-classification-system.
\10\ Haddara S, Jacques J, Lecleire S et al. A novel hemostatic
powder for upper gastrointestinal bleeding: A multicenter study (the
GRAPHE registry). Endoscopy 2016; 48: 1084-95.
---------------------------------------------------------------------------
The applicant provided a second article consisting of an abstract
from another systematic review article.\11\ The abstract purports to
cover a review of prospective, retrospective, and randomized control
trials evaluating Hemospray[supreg] as a rescue therapy. Eighty-five
articles were initially identified and 23 were selected for review. Of
those, 5 studies were selected which met the inclusion criteria of the
analysis. The median age of patients was 69; 68 percent were male. The
abstract concludes that when used as a rescue therapy after the failure
of conventional endoscopic modalities in nonvariceal gastrointestinal
bleeding, Hemospray[supreg] seems to have significantly higher rates of
immediate hemostasis.
---------------------------------------------------------------------------
\11\ Moole, V., Chatterjee, T., Saca, D., Uppu, A., Poosala, A.,
& Duvvuri, A. A Systematic review and meta-analysis: Analyzing the
efficacy of hemostatic nanopowder (TC-325) as rescue therapy in
patients with nonvariceal upper gastrointestinal bleeding.
Gastroenterology 2019; 156(6), S-741
---------------------------------------------------------------------------
A third article provided by the applicant described a single-arm
retrospective analytical study of 261 enrolled patients conducted at 21
hospitals in Spain.\12\ The mean age was 67 years old, 69 percent of
patients were male, and the overall technical success, defined as
correct assembled and delivery of Hemospray[supreg] to a bleeding
lesion, was 97.7 percent (95.1 percent-99.2 percent). The most common
causes of bleeding in patients were peptic ulcer (28 percent),
malignancy (18.4 percent), therapeutic endoscopy-related (17.6
percent), and surgical anastomosis (8.8 percent). Overall, 93.5 percent
(89.5 percent to 96 percent) of procedures achieved hemostasis.
Recurrent bleeding, defined as (1) a new episode of bleeding symptoms,
(2) a decrease in hemoglobin of >2 g/dL within 48 hours of an index
endoscopy or >3g/dL in 24 hours, or (3) direct visualization of active
bleeding at the previously treated lesion on repeat endoscopy, had a
cumulative incidence at 3 and 30 days of 16.1 percent (11.9 percent-21
percent) and 22.9 percent (17.8 percent-28.3 percent) respectively. The
overall risk of Hemospray[supreg] failure at 3 and 30 days was 21.1
percent (16.4 percent-26.2 percent) and 27.4 percent (22.1 percent-32.9
percent) respectively with no statistically significant differences
(p=0.07) between causes at 30 days (for example, peptic ulcer,
malignancy, anastomosis, therapeutic endoscopy-related, and other
causes). With the use of multivariate analysis, spurting bleeding vs.
nonspurting bleeding (subdistribution hazard ratio [sHR] 1.97 (1.24-
3.13)), hypotension vs. normotensive (sHR 2.14 (1.22-3.75)), and the
use of vasoactive drugs (sHR 1.80 (1.10-2.95)) were independently
associated with Hemospray[supreg] failure. The overall 30-day survival
was 81.9 percent (76.5 percent-86.1 percent) with 46 patients dying
during follow-up and 22 experiencing bleeding related deaths; twenty
patients (7.6 percent) with intraprocedural hemostasis died before day
30. The authors indicated the majority of Hemospray[supreg] failures
occurred within the first 3 days and the rate of immediate hemostasis
was similar to literature reports of intraprocedural success rates of
over 90 percent. The authors stated that the hemostatic powder of
Hemospray[supreg] is eliminated from the GI tract as early as 24 hours
after use, which could explain the wide ranging recurrent bleeding
percentage. The authors reported that importantly, adverse events are
rare, but cases of abdominal distension, visceral perforation,
transient biliary obstruction, and splenic infarct have been reported;
one patient involved in this study experienced an esophageal
perforation without a definitive causal relationship.
---------------------------------------------------------------------------
\12\ Rodriguez de Santiago E, Burgos-Santamaria D, Perez-Carazo
L, et al. Hemostatic spray TC-325 for GI bleeding in a nationwide
study: Survival analysis and predictors of failure via competing
risks analysis. Gastrointest Endosc 2019; 90(4), 581-590.
---------------------------------------------------------------------------
A fourth article provided by the applicant described a single-arm
multicenter prospective registry involving 314 patients in Europe which
collected data on days 0, 1, 3, 7, 14, and 30 after endotherapy with
Hemospray[supreg].\13\ The outcomes of interest in this study were
immediate endoscopic hemostasis (observed cessation of bleeding within
5 minutes post Hemospray[supreg] application) with secondary outcomes
of rebleeding immediately following treatment and during follow-up, 7
and 30 day all-cause mortality, and adverse events. The sample was 74
percent male with a median age of 71 with the most common pathologies
of peptic ulcer (53 percent), malignancy (16 percent), post-endoscopic
bleeding (16 percent), bleeding from severe inflammation (11 percent),
esophageal variceal bleeding (2.5 percent), and cases with no obvious
cause (1.6 percent). The median baseline Blatchford score (BS) and RS
were 11 and 7 respectively. The BS ranges from 0 to 23 with higher
scores indicating increasing risk for required endoscopic intervention
and is based upon the blood urea nitrogen, hemoglobin, systolic blood
pressure, pulse, presence of melena, syncope, hepatic disease, and/or
cardiac failure.\14\ The RS ranges from 0 to 11 with higher scores
indicating worse potential outcomes and is based upon age, presence of
shock, comorbidity, diagnosis, and endoscopic stigmata of recent
hemorrhage.\15\ Immediate hemostasis was achieved in 89.5 percent of
patients following the use of Hemospray[supreg]; only the BS was found
to have a positive correlation with treatment failure in multivariate
analysis (OR 1.21 (1.10-1.34)). Rebleeding occurred in 10.3 percent of
patients who achieved immediate hemostasis again with only the BS
having a positive correlation with rebleeding (OR: 1.13 (1.03-1.25)).
At 30 days, the all-cause mortality was 20.1 percent; 78 percent of
these patients had achieved immediate endoscopic hemostasis and had a
cause of death resulting from the progression of other comorbidities. A
subgroup analysis of treatment type (monotherapy, combination therapy,
and rescue therapy groups) was performed showing no statistically
significant difference in immediate hemostasis across groups (92.4
percent, 88.7 percent, and 85.5 percent respectively). Higher all-cause
mortality rates at 30 days were highest in the monotherapy group (25.4
percent, p=0.04) as compared to all other groups. According to the
authors, in comparison to major recent studies, they were able to show
lower rebleeding rates overall and in all subgroups despite the high-
risk population.\16\ The authors further note limitations in that the
inclusion of patients was nonconsecutive and at the discretion of the
endoscopist at the time of the endoscopy, which allows for the
potential introduction of selection bias,
[[Page 86000]]
which may have affected these study results.
---------------------------------------------------------------------------
\13\ Alzoubaidi D, Hussein M, Rusu R, et al. Outcomes from an
international multicenter registry of patients with acute
gastrointestinal bleeding undergoing endoscopic treatment with
Hemospray. Digestive Endoscopy 2019.
\14\ Saltzman, J. (2019, October). Approach to acute upper
gastrointestinal bleeding in adults. (M. Feldman, Editor) Retrieved
from UpToDate: https://www.uptodate.com/contents/approach-to-acute-upper-gastrointestinal-bleeding-in-adults.
\15\ Ibid.
\16\ Alzoubaidi D, Hussein M, Rusu R, et al. Outcomes from an
international multicenter registry of patients with acute
gastrointestinal bleeding undergoing endoscopic treatment with
Hemospray. Digestive Endoscopy 2019.
---------------------------------------------------------------------------
The fourth article also described the utility of Hemospray[supreg]
in the treatment of malignant lesions. According to the applicant,
malignant lesions pose a significant clinical challenge as successful
hemostasis rates are as low as 40 percent with high recurrent bleeding
over 50 percent within 1 month following standard
treatments.17 18 The applicant added that bleeding from
tumors is often diffuse and consists of friable mucosa decreasing the
utility of traditional treatments (for example, ligation, cautery).
From the fourth article, the applicant noted that 50 patients were
treated for malignant bleeding with an overall immediate hemostasis in
94 percent of patients.\19\ Of the 50 patients, 33 were treated with
Hemospray[supreg] alone, 11 were treated with Hemospray[supreg] as the
final treatment, and 4 were treated with Hemospray[supreg] as a rescue
therapy of which 100 percent, 84.6 percent and 75 percent experienced
immediate hemostasis respectively.\20\ Similarly, from the first
discussed article, the applicant noted that among malignant bleeding
patients, 95.1 percent achieved immediate hemostasis with lower
rebleeding rates at 8 days when Hemospray[supreg] was used as a primary
treatment compared to when used as a rescue therapy (17.1 percent vs.
46.7 percent respectively).\21\ The applicant concluded that
Hemospray[supreg] may provide an advantage as a primary treatment to
patients with malignant bleeding.
---------------------------------------------------------------------------
\17\ Kim YI, Choi IJ, Cho SJ, et al. Outcome of endoscopic
therapy for cancer bleeding in patients with unresectable gastric
cancer. J Gastroenterol Hepatol 2013;28:1489-95.
\18\ Roberts SE, Button LA, Williams JG. Prognosis following
upper gastrointestinal bleeding. PLoS One 2012;7:e49507.
\19\ Alzoubaidi D, Hussein M, Rusu R, et al. Outcomes from an
international multicenter registry of patients with acute
gastrointestinal bleeding undergoing endoscopic treatment with
Hemospray. Digestive Endoscopy 2019.
\20\ Alzoubaidi D, Hussein M, Rusu R, et al. Outcomes from an
international multicenter registry of patients with acute
gastrointestinal bleeding undergoing endoscopic treatment with
Hemospray. Digestive Endoscopy 2019.
\21\ Haddara S, Jacques J, Lecleire S et al. A novel hemostatic
powder for upper gastrointestinal bleeding: A multicenter study (the
GRAPHE registry). Endoscopy 2016; 48: 1084-95.
---------------------------------------------------------------------------
The applicant provided a fifth article, which consisted of a
journal pre-proof article detailing a 1:1 randomized control trial of
20 patients treated with Hemospray[supreg] versus the standard of care
(for example, thermal and injection therapies) in the treatment of
malignant gastrointestinal bleeding.\22\ The goals of this pilot study
were to determine the feasibility of a definitive trial. The primary
outcome of the study was immediate hemostasis (absence of bleeding
after 3 minutes) with secondary outcomes of recurrent bleeding at days
1, 3, 30, 90, and 180 and adverse events at days 1, 30, and 180. The
mean age of patients was 67.2, 75 percent were male, and on average
patients presented with 2.9 1.7 comorbidities. All
patients had active bleeding at endoscopy and the majority of patients
had an ASA score of 2 (45 percent) or 3 (40 percent). Immediate
hemostasis was achieved in 90 percent of Hemospray[supreg] patients and
40 percent of standard of care patients (5 injection alone, 3 thermal,
1 injection with clips, and 1 unknown). Of those patients in the
control group, 83.3 percent crossed over to the Hemospray[supreg]
treatment. One patient died while being treated with Hemospray[supreg]
from exsanguination; post-mortem examination demonstrated that bleeding
was caused by rupture of a malignant inferior mesenteric artery
aneurysm. Overall, 86.7 percent of patients treated with
Hemospray[supreg] initially or as crossover treatment achieved
hemostasis. Recurrent bleeding was lower in the Hemospray[supreg] group
(20 percent) as compared to the control group (60 percent) at 180 days.
Forty percent of the treated group received blood transfusions as
compared to 70 percent of the control group. The overall length of stay
was 14.6 days among treated patients as compared to 9.4 in the control
group. Mortality at 180 days was 80 percent in both the treated and
control groups. The authors noted the potential for operator bias in
the use of Hemospray[supreg] prior to switching to another method when
persistent bleeding exists. Lastly, the authors noted that while they
did not occur during this study, there are concerns around the risks of
perforation, obstruction, and systemic embolization with the use of
Hemospray[supreg].
---------------------------------------------------------------------------
\22\ Chen Y-I, Wyse J, Lu Y, Martel M, Barkun AN, TC-325
hemostatic powder versus current standard of care in managing
malignant GI bleeding: A pilot randomized clinical trial.
Gastrointestinal Endoscopy (2019), doi: https://doi.org/10.1016/j.gie.2019.08.005.
---------------------------------------------------------------------------
A sixth article provided by the applicant was a case-controlled
study with 10 patients with active upper gastrointestinal bleeding from
tumor compared with 10 conventional therapy patients selected as
historical controls, matched by type of tumor.\23\ The study evaluated
efficacy for tumor-related bleeding and compared Hemospray[supreg] to
conventional therapies, specifically examining 14-day rebleeding rates,
lengths of hospital stay (LOS), and mortality rate at 30-day follow up.
Historical controls were selected from patient medical records from
2010 to 2014. Among the patients who received Hemospray[supreg], the
14-day rebleeding rate (10 percent vs. 30 percent; P=0.60) and the 30-
day mortality rates (10 percent vs. 30 percent, P=0.7) were three times
lower compared to the control group; neither rate was statistically
significant. There was no difference in LOS between the
Hemospray[supreg] and conventional therapy patients.
---------------------------------------------------------------------------
\23\ Pittayanon, R., Prueksapanich, P., & Rerknimitr, R. (2016).
The efficacy of Hemospray in patients with upper gastrointestinal
bleeding from tumor. Endoscopy international open, 4(09), E933-E936.
---------------------------------------------------------------------------
A seventh article provided by the applicant described a single-arm
multicenter retrospective study from 2011 to 2016 involving 88 patients
who bled as a result of either a primary GI tumor or metastases to the
GI tract.\24\ In this study the authors define immediate hemostasis as
no further bleeding at least one minute after treatment with
Hemospray[supreg], and recurrent bleeding was suspected if one of seven
criteria were met: (1) Hematemesis or bloody nasogastric tube >6 hours
after endoscopy; (2) melena after normalization of stool color; (3)
hematochezia after normalization of stool color or melena; (4)
development of tachycardia or hypotension after >1 hour of vital sign
stability without other cause; (5) decrease in hemoglobin level greater
than or equal to 3 hours apart; (6) tachycardia or hypotension that
does not resolve within 8 hours after index endoscopy; or (7)
persistent decreasing hemoglobin of >3 g/dL in 24 hours associated with
melena or hematochezia). The sample for this study consisted of 88
patients (with a mean age of 65 years old and 70.5 percent male) of
which 33.3 percent possessed no co-morbid illness, and 25 percent were
on current antiplatelet/anticoagulant medication. The mean BS was 8.7
plus or minus 3.7 with a range from 0 to 18. Overall, 72.7 percent of
patients had a stage 4 adenocarcinoma, squamous cell carcinoma, or
lymphoma. Immediate hemostasis was achieved in 97.7 percent of
patients. Recurrent bleeding occurred in 13 of 86 (15 percent) and 1 of
53 (1.9 percent) at 3 and 30 days, respectively. A total of 25 patients
(28.4 percent) died during the 30-day follow up period. Overall, 27.3
percent of patients re-bled within 30 days after treatment of which
half were within 3 days. Using multivariate analysis, the authors found
patients
[[Page 86001]]
with good performance status, no end-stage cancer, or receiving any
combination of definitive hemostasis treatment modalities had
significantly greater survival. The authors acknowledged the recurrent
bleeding rate post Hemospray[supreg] treatment at 30 days of 38 percent
is comparable with that seen in sole conventional hemostatic techniques
and state this implies that Hemospray[supreg] does not differ from
conventional techniques and remains unsatisfactory.
---------------------------------------------------------------------------
\24\ Pittayanon R, Rerknimitr R, Barkun A. Prognostic factors
affecting outcomes in patients with malignant GI bleeding treated
with a novel endoscopically delivered hemostatic powder.
Gastrointest Endosc 2018; 87:991-1002.
---------------------------------------------------------------------------
Ultimately, the applicant concluded nonvariceal gastrointestinal
bleeding is associated with significant morbidity and mortality in
older patients with multiple co-morbid conditions. Inability to achieve
hemostasis and early rebleeding are associated with increased cost and
greater resource utilization. According to the applicant, patients with
bleeding from malignant lesions have few options that can provide
immediate hemostasis without further disrupting fragile mucosal tissue
and worsening the active bleed. The applicant stated Hemospray[supreg]
is an effective agent that provides immediate hemostasis in patients
with GI bleeding as part of multimodality treatment, as well as when
used as rescue therapy in patients who have failed more conventional
endoscopic modalities. Furthermore, the applicant stated that in
patients with malignant bleeding in the GI tract, Hemospray[supreg]
provides a high rate of immediate hemostasis and fewer recurrent
bleeding episodes, which, in combination with definitive cancer
treatment, may lead to improvements in long term survival. Lastly, the
applicant stated Hemospray[supreg] is an important new technology that
permits immediate and long-term hemostasis in GI bleeding cases where
standard of care treatment with clip ligation or cautery are not
effective.
In the CY 2021 OPPS/ASC proposed rule, we noted that the majority
of studies provided lacked a comparator when assessing the
effectiveness of Hemospray[supreg]. Three of the articles provided were
systematic reviews of the literature. While we found these articles
helpful in establishing a background for the use of Hemospray[supreg],
we were concerned that they may not provide strong evidence of
substantial clinical improvement. Four studies appeared to be single-
armed studies assessing the efficacy of Hemospray[supreg] in the
patient setting. In all of these articles, comparisons were made
between Hemospray[supreg] and standard of care treatments; however,
without the ability to control for factors such as study design,
patient characteristics, etc., it is difficult to determine if any
differences seen resulted from Hemospray[supreg] or confounding
variables. Furthermore, within the retrospective and prospective
studies lacking a control subset, some level of selection bias appeared
to potentially be introduced in that providers may have been allowed to
select the manner and order in which patients were treated, thereby
potentially influencing outcomes seen in these studies.
Additionally, one randomized control trial provided by the
applicant appeared to be in the process of peer-review and was not yet
published. Furthermore, this article was written as a feasibility study
for a potentially larger randomized control trial and contained a
sample of only 20 patients. This small sample size left us concerned
that the results were not representative of the larger Medicare
population. Lastly, as described, we were concerned the control group
could receive one of multiple treatments which lacked a clear
designation methodology beyond physician choice. For instance, 50
percent of the control patients received injection therapy alone, which
according to the literature provided by the applicant is not an
acceptable treatment for endoscopic bleeding. Accordingly, it was not
clear whether performance seen in the treated group as compared to the
control group was due to Hemospray[supreg] itself or due to confounding
factors.
Third, we stated in the CY 2021 OPPS/ASC proposed rule that we were
concerned with the samples chosen in many of the studies presented.
Firstly, the Medicare population is approximately 54 percent female and
46 percent male.\25\ Many of the samples provided by the applicant were
overwhelmingly male. Secondly, many of the studies provided were
performed in Europe and other settings outside of the U.S. We were
therefore concerned that the samples chosen within the literature
provided may not represent the Medicare population.
---------------------------------------------------------------------------
\25\ https://www.cms.gov/files/document/2018-mdcr-enroll-ab-5.pdf.
---------------------------------------------------------------------------
Lastly, we were concerned about the potential for adverse events
resulting from Hemospray[supreg]. It was unclear from the literature
provided by the applicant what the likelihood of these events is and
whether or not an evaluation for the safety of Hemospray[supreg] was
performed. About one-third of the articles submitted specifically
addressed adverse events with Hemospray[supreg]. However, the
evaluation of adverse events was limited and most of the patients in
the studies died of disease progression. A few of the provided articles
mentioned the potential for severe adverse reactions (for example,
abdominal distension, visceral perforation, biliary obstruction,
splenic infarct). Specifically, one article \26\ recorded adverse
events related to Hemospray[supreg], including abdominal distention and
esophageal perforation.
---------------------------------------------------------------------------
\26\ Rodriguez de Santiago E, Burgos-Santamaria D, Perez-Carazo
L, et al. Hemostatic spray TC-325 for GI bleeding in a nationwide
study: Survival analysis and predictors of failure via competing
risks analysis. Gastrointest Endosc 2019; 90(4), 581-590.
---------------------------------------------------------------------------
According to information submitted by the applicant, Cook Medical
had voluntarily recalled Hemospray[supreg] Endoscopic Hemostat due to
complaints received that the handle and/or activation knob on the
device in some cases had cracked or broken when the device was
activated and in some cases had caused the carbon dioxide cartridge to
exit the handle. The applicant stated that Cook Medical had received
one report of a superficial laceration to the user's hand that had
required basic first aid; however, there were no reports of laceration,
infection, or permanent impairment of a body structure to users or to
patients due to the carbon dioxide cartridge exiting the handle. The
applicant stated that Cook Medical had initiated an investigation and
would determine the appropriate corrective action(s) to prevent
recurrence of this issue. According to the applicant, although the
recall did restrict availability of the device, they wished to continue
their application as they believed the use of Hemospray[supreg]
significantly improves clinical outcomes for certain patient
populations compared to currently available treatments.
Based upon the evidence presented, we solicited public comments on
whether the Hemospray[supreg] Endoscopic Hemostat meets the substantial
clinical improvement criterion.
Comment: The manufacturer responded to several statements regarding
Hemospray[supreg] and substantial clinical improvement in the CY 2021
OPPS/ASC proposed rule, and asserted that Hemospray[supreg] meets the
substantial clinical improvement criterion. The manufacturer agreed the
data presented is primarily from single arm and retrospective studies
and may suffer from selection bias. However, the manufacturer suggested
that CMS should consider that Hemospray[supreg] is commonly used when
the conventional standard of care, such as injection plus clips or
cautery, is inadequate to treat patients undergoing an urgent catheter-
based embolization or surgery. The manufacturer stated that the
selection
[[Page 86002]]
bias is toward patients with the highest risk of morbidity or mortality
and the high rate of successful treatment for those patients with
Hemospray[supreg] represents substantial clinical improvement. They
cited several studies that found that, after all other conventional
treatments failed, there was overall treatment success in cases where
Hemospray[supreg] was used.
In response to CMS' concerns about the unpublished randomized
controlled trial presented, the manufacturer stated that the study has
been published with no changes and noted that, despite the small sample
size, they believe the results are representative of the general
population with malignant gastrointestinal bleeding and consistent with
other published retrospective studies.
The manufacturer stated that the research and studies for
Hemospray[supreg] are largely international because Hemospray[supreg]
was commercially available outside the U.S. for 5 to 7 years before the
FDA awarded the product de Novo 510(k) status. They believed that this
data is representative of the U.S. population, as the treatment
strategy and patient outcomes are similar. The manufacturer
acknowledged that study populations are predominantly male but noted
that 60 percent of patients undergoing endoscopic control of bleeding
are male, according to the 2016 Healthcare Cost and Utilization
Project. The manufacturer mentioned that the mean age of study
populations varied from 67-71 years, which is representative of the
Medicare population.
Regarding the potential for adverse events, the manufacturer stated
that FDA has determined the product is safe and effective for its
intended use, has an acceptable risk/benefit ratio, and cleared
Hemospray[supreg] to return to the market as of July 2020 after the
issue was addressed. The manufacturer also mentioned that they
understand the potential risks associated with Hemospray[supreg] and
have clearly labeled the product, conducted physician training,
diligently monitor reported complaints or complications, and will take
appropriate steps to correct any future issues that arise.
Response: We appreciate the manufacturer's response to our
questions regarding Hemospray[supreg]. After reviewing the information
provided in the public comment, we agree with the applicant's
statements that any potential bias introduced was toward the patients
with the highest risk of negative outcomes and that this potential bias
is no longer a concern. Regarding the applicant's comment on study
samples, we agree with the applicant that these samples are adequately
representative of the Medicare population. We also appreciate the
comment response regarding the potential for adverse events and the
update on the status of the Hemospray[supreg] voluntary recall. We will
continue to monitor available data for Hemospray[supreg] in regard to
any potential risk of adverse events.
As we noted in the FY 2021 IPPS final rule (85 FR 58672), while we
acknowledge some of the data limitations, we believe that
Hemospray[supreg] represents a substantial clinical improvement for the
treatment of gastrointestinal bleeding for the following reasons. We
believe that, given the results from the RCT trials and the single-
armed studies, Hemospray[supreg] provides a treatment benefit for those
with bleeding from gastrointestinal malignancies. We also see the
clinical importance of Hemospray as an alternative to invasive
treatments traditionally used as salvage therapy. Lastly, we note that
Hemospray[supreg] provides treatment for bleeding, without requiring
tissue trauma or precise targeting.
After consideration of the public comments we received, we have
determined that Hemospray[supreg] meets the substantial clinical
improvement criterion.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. The applicant stated that Hemospray[supreg]
would be reported with HCPCS codes 43227, 43255, 44366, 44378, 44391,
45334, and 45382. To meet the cost criterion for device pass-through
payment status, a device must pass all three tests of the cost
criterion for at least one APC. For our calculations in the CY 2021
OPPS/ASC proposed rule, we used APC 5312, which had a CY 2020 payment
rate of $1,004.10 at the time the application was received. Beginning
in CY 2017, we calculate the device offset amount at the HCPCS/CPT code
level instead of the APC level (81 FR 79657). HCPCS code 45382 had a
device offset amount of $33.54 at the time the application was
received. According to the applicant, the cost of the Hemospray[supreg]
Endoscopic Hemostat is $2,500.
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $2,500 for Hemospray[supreg] was 249 percent
of the applicable APC payment amount for the service related to the
category of devices of $1004.10 (($2,500/$1,004.10) x 100 = 249
percent). Therefore, we stated in the CY 2021 OPPS/ASC proposed rule
that we believe Hemospray[supreg] meets the first cost significance
requirement.
The second cost significance requirement, at Sec. 419.66(d)(2),
provides that the estimated average reasonable cost of the devices in
the category must exceed the cost of the device-related portion of the
APC payment amount for the related service by at least 25 percent,
which means that the device cost needs to be at least 125 percent of
the offset amount (the device-related portion of the APC found on the
offset list). The estimated average reasonable cost of $2,500 for
Hemospray[supreg] was 7,454 percent of the cost of the device-related
portion of the APC payment amount for the related service of $33.54
(($2,500/$33.54) x 100 = 7,453.8 percent). Therefore, we stated in the
CY 2021 OPPS/ASC proposed rule that we believe that Hemospray[supreg]
meets the second cost significance requirement.
The third cost significance requirement, at Sec. 419.66(d)(3),
provides that the difference between the estimated average reasonable
cost of the devices in the category and the portion of the APC payment
amount for the device must exceed 10 percent of the APC payment amount
for the related service. The difference between the estimated average
reasonable cost of $2,500 for Hemospray[supreg] and the portion of the
APC payment amount for the device of $33.54 was 246 percent of the APC
payment amount for the related service of $1004.10 t ((($2,500-$33.54)/
$1004.10) x 100 = 245.6 percent). Therefore, we stated in the CY 2021
OPPS/ASC proposed rule that we believe that Hemospray[supreg] meets the
third cost significance requirement.
We solicited public comment on whether the Hemospray[supreg]
Endoscopic Hemostat meets the device pass-through payment criteria
discussed in this section, including the cost criterion for device
pass-through payment status.
Comment: Three commenters, including the manufacturer of the
Hemospray[supreg], believe that the device meets the cost criterion for
device pass-through payment status.
Response: We appreciate the manufacturer's input. After
consideration of the public comments we received and consideration of
the
[[Page 86003]]
cost criterion, we have determined that Hemospray[supreg] meets the
cost criterion for device pass-through payment status.
After consideration of the public comments we received, we are
approving the Hemospray[supreg] for device pass-through payment status
beginning in CY 2021.
(2) The SpineJack[supreg] Expansion Kit
Stryker, Inc., submitted an application for a new device category
for transitional pass-through payment status for the SpineJack[supreg]
Expansion Kit (hereinafter referred to as the SpineJack[supreg] system)
by the March 2020 quarterly deadline. The applicant described the
SpineJack[supreg] system as an implantable fracture reduction system,
which is indicated for use in the reduction of painful osteoporotic
vertebral compression fractures (VCFs) and is intended to be used in
combination with Stryker VertaPlex and VertaPlex High Viscosity (HV)
bone cement.
The applicant described the SpineJack[supreg] system as including
two cylindrical implants constructed from Titanium-6-Aluminum-4-
Vanadium (Ti6Al4V) with availability in three sizes: 4.2 mm (12.5 mm
expanded), 5.0 mm (17 mm expanded) and 5.8 mm (20 mm expanded). The
applicant explained implant size selection is based upon the internal
cortical diameter of the pedicle. According to the SpineJack[supreg]
system Instructions for Use, the use of two implants is recommended to
treat a fractured VB. According to the applicant, multiple VBs can also
be treated in the same operative procedure as required. Additionally,
the applicant explained that titanium alloy allows for plastic
deformation when it encounters the hard cortical bone of the endplate
yet still provides the lift force required to restore midline VB height
in the fractured vertebra. The applicant stated that the
SpineJack[supreg] system notably contains a self-locking security
mechanism that restricts further expansion of the device when extreme
load forces are concentrated on the implant. As a result, the applicant
stated that this feature significantly reduces the risk of vertebral
endplate breakage while it further allows functional recovery of the
injured disc.\27\
---------------------------------------------------------------------------
\27\ Vanni D et al. ``Third-generation percutaneous vertebral
augmentation systems.'' Journal of Spine Surgery. 2016, vol 2(1),
pp. 13-20.
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The applicant stated that the implants are then progressively
expanded though actuation of an implant tube that pulls the two ends of
the implant towards each other in situ to mechanically restore VB
height. The applicant explained that the mechanical working system of
the implant allows for progressive and controlled reduction of the
vertebral fracture.\28\ The applicant stated that when expanded, each
SpineJack[supreg] implant exerts a lifting pressure on the fracture
through a mechanism that may be likened to the action of a scissor car
jack, and that the longitudinal compression on the implant causes it to
open in a craniocaudal direction. The applicant explained that the
implant is locked into the desired expanded position as determined and
controlled by the treating physician.\29\
---------------------------------------------------------------------------
\28\ Vanni D., et al., ``Third-generation percutaneous vertebral
augmentation systems,'' J. Spine Surg., 2016, vol. 2(1) pp. 13-20.
\29\ Noriega D. et al., ``Clinical Performance and Safety of 108
SpineJack Implantations: 1-Year Results of a Prospective Multicentre
Single-Arm Registry Study,'' BioMed Res. Int., 2015, vol. 173872.
---------------------------------------------------------------------------
The applicant further explained that the expansion of the
SpineJack[supreg] implants creates a preferential direction of flow for
the bone cement, and once the desired expansion has been obtained,
polymethylmethacrylate (PMMA) bone cement is deployed from the center
of the implant into the VB. The applicant stated that when two implants
are symmetrically positioned in the VB, this allows for a more
homogenous spread of PMMA bone cement. The applicant stated that the
interdigitation of bone cement creates a broad supporting ring under
the endplate, which is essential to confer stability to the VB.
According to the applicant, osteoporosis is one of the most common
bone diseases worldwide that disproportionately affects aging
individuals. The applicant explained that in 2010, approximately 54
million Americans aged 50 years or older had osteoporosis or low bone
mass,\30\ which resulted in more than 2 million osteoporotic fragility
fractures in that year alone.\31\ The applicant stated it has been
estimated that more than 700,000 VCFs occur each year in the United
States (U.S.),\32\ and of these VCFs, about 70,000 result in hospital
admissions with an average length of stay of 8 days per patient.\33\
Furthermore, the applicant noted that in the first year after a painful
vertebral fracture, patients have been found to require primary care
services at a rate 14 times greater than the general population.\34\
The applicant explained that medical costs attributed to VCFs in the
U.S. exceeded $1 billion in 2005 and are predicted to surpass $1.6
billion by 2025.\35\
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\30\ National Osteoporosis Foundation. (2019). What is
osteoporosis and what causes it? Available from: https://www.nof.org/patients/what-is-osteoporosis/.
\31\ King A and Fiorentino D. ``Medicare payment cuts for
osteoporosis testing reduced use despite tests' benefit in reducing
fractures.'' Health Affairs (Millwood), 2011, vol. 30(12), pp. 2362-
2370.
\32\ Riggs B and Melton L. ``The worldwide problem of
osteoporosis: Insights afforded by epidemiology.'' Bone, 1995, vol.
17(Suppl 5), pp. 505-511.
\33\ Siemionow K and Lieberman I. ``Vertebral augmentation in
osteoporotic and osteolytic fractures: Current Opinion in Supportive
and Palliative Care.'' 2009, vol. 3(3), pp. 219-225.
\34\ Wong C and McGirt M. ``Vertebral compression fractures: A
review of current management and multimodal therapy.'' Journal of
Multidisciplinary Healthcare, 2013, vol 6, pp. 205-214.
\35\ Burge R et al. ``Incidence and economic burden of
osteoporosis-related fractures in the United States: 2005-2025.''
Journal of Bone and Mineral Research. 2007, vol 22(3), pp. 465-475.
---------------------------------------------------------------------------
The applicant explained that osteoporotic VCFs occur when the
vertebral body (VB) of the spine collapses and can result in chronic
disabling pain, excessive kyphosis, loss of functional capability,
decreased physical activity, and reduced quality of life. The applicant
stated that as the spinal deformity progresses, it reduces the volume
of the thoracic and abdominal cavities, which may lead to crowding of
internal organs. The applicant noted that the crowding of internal
organs may cause impaired pulmonary function, abdominal protuberance,
early satiety and weight loss. The applicant indicated that other
complications may include bloating, distention, constipation, bowel
obstruction, and respiratory disturbances such as pneumonia,
atelectasis, reduced forced vital capacity and reduced forced
expiratory volume in 1 second.
The applicant explained that the SpineJack[supreg] implants provide
symmetric, broad load support for osteoporotic vertebral collapse,
which is based upon precise placement of bilateral ``struts'' that are
encased in PMMA bone cement, whereas BKP and vertebroplasty (VP) do not
provide structural support via an implanted device. The applicant
explained that the inflatable balloon tamps utilized in BKP are not
made from titanium and are not a permanent implant. According to the
applicant, the balloon tamps are constructed from thermoplastic
polyurethane, which have limited load bearing capacity. The applicant
noted that although the balloon tamps are expanded within the VB to
create a cavity for bone cement, they do not remain in place and are
removed before the procedure is completed. The applicant explained that
partial lift to the VB is obtained during inflation, resulting in
kyphotic deformity
[[Page 86004]]
correction and partial gains in anterior VB height restoration, but
inflatable balloon tamps are deflated prior to removal so some of the
VB height restoration obtained is lost upon removal of the bone tamps.
According to the applicant, BKP utilizes the placement of PMMA bone
cement to stabilize the fracture and does not include an implant that
remains within the VB to maintain fracture reduction and midline VB
height restoration.
The applicant stated that if VB collapse is >50 percent of the
initial height, segmental instability will ensue. As a result, the
applicant explained that adjacent levels of the VB must support the
additional load and this increased strain on the adjacent levels may
lead to additional VCFs. Furthermore, the applicant summarized that
VCFs also lead to significant increases in morbidity and mortality risk
among elderly patients, as evidenced by a 2015 study by Edidin et al.,
in which researchers investigated the morbidity and mortality of
patients with a newly diagnosed VCF (n = 1,038,956) between 2005 to
2009 in the U.S. Medicare population. For the osteoporotic VCF
subgroup, the adjusted 4-year mortality was 70 percent higher in the
conservatively managed group than in the balloon kyphoplasty procedures
(BKP)-treated group, and 17 percent lower in the BKP group than in the
vertebroplasty (VP) group. According to the applicant, when evaluating
treatment options for osteoporotic VCFs, one of the main goals of
treatment is to restore the load bearing bone fracture to its normal
height and stabilize the mechanics of the spine by transferring the
adjacent level pressure loads across the entire fractured vertebra and
in this way, the intraspinal disc pressure is restored and the risk of
adjacent level fractures (ALFs) is reduced.
The applicant explained that treatment of osteoporotic VCFs in
older adults most often begins with conservative care, which includes
bed rest, back bracing, physical therapy and/or analgesic medications
for pain control. According to the applicant, for those patients that
do not respond to conservative treatment and continue to have
inadequate pain relief or pain that substantially impacts quality of
life, vertebral augmentation (VA) procedures may be indicated. The
applicant explained that VP and BKP are two minimally invasive
percutaneous VA procedures that are most often used in the treatment of
osteoporotic VCFs, and another VA treatment option includes the use of
a spiral coiled implant made from polyetheretherketone (PEEK), which is
part of the Kiva[supreg] system.
According to the applicant, among the treatment options available,
BKP is the most commonly performed procedure and the current gold
standard of care for VA treatment. The applicant stated that it is
estimated that approximately 73 percent of all vertebral augmentation
procedures performed in the U.S. between 2005 and 2010 were BKP.\36\
According to the applicant, the utilization of the Kiva[supreg] system
is relatively low in the U.S. and volume information was not available
in current market research data.\37\
---------------------------------------------------------------------------
\36\ Goz V et al. ``Vertebroplasty and kyphoplasty: National
outcomes and trends in utilization from 2005 through 2010.'' The
Spine Journal. 2015, vol. 15(5), pp. 959-965.
\37\ Lin M. ``Minimally invasive vertebral compression fracture
treatments. Medtech 360, Market Insights, Millennium Research Group.
2019.
---------------------------------------------------------------------------
The applicant stated that VA treatment with VP may alleviate pain,
but it cannot restore VB height or correct spinal deformity. The
applicant stated that BKP attempts to restore VB height, but the
temporary correction obtained cannot be sustained over the long term.
The applicant stated that the Kiva[supreg] implant attempts to
mechanically restore VB height, but it has not demonstrated superiority
to BKP for this clinical outcome.\38\
---------------------------------------------------------------------------
\38\ Ibid.
---------------------------------------------------------------------------
The applicant provided additional detail comparing the construction
and mechanism of action for other VA treatments, provided below.
According to the applicant the Kiva[supreg] system is constructed of a
nitinol coil and PEEK-OPTIMA sheath, with sizes including a 4-loop
implant (12 mm expanded) and a 5-loop implant (15 mm expanded), and
unlike the SpineJack[supreg] system, is not made of titanium and does
not include a locking scissor jack design. The applicant stated that
the specific mechanism of action for the Kiva[supreg] system is
different from the SpineJack[supreg] system. The applicant explained
that during the procedure that involves implanting the Kiva[supreg]
system, nitinol coils are inserted into the VB to form a cylindrical
columnar cavity. The applicant stated that the PEEK-OPTIMA is then
placed over the nitinol coil. The applicant explained that the nitinol
coil is removed from the VB and the PEEK material is filled with PMMA
bone cement. The applicant stated that the deployment of 5 coils
equates to a maximum height of 15 mm. The applicant stated that the
lifting direction of the Kiva implant is caudate and unidirectional.
According to the applicant, in the KAST (Kiva Safety and Effectiveness
Trial) pivotal study, it was reported that osteoporotic VCF patients
treated with the Kiva[supreg] system had an average of 2.6 coils
deployed.\39\ Additionally, in a biomechanical comparison conducted for
the Kiva[supreg] system and BKP using a loading cycle of 200-500
Newtons in osteoporotic human cadaver spine segments filled with bone
cement, there were no statistically significant differences observed
between the two procedures for VB height restoration, stiffness at high
or low loads, or displacement under compression.\40\
---------------------------------------------------------------------------
\39\ Tutton S et al. KAST Study: The Kiva system as a vertebral
augmentation treatment--a safety and effectiveness trial: A
randomized, noninferiority trial comparing the Kiva system with
balloon kyphoplasty in treatment of osteoporotic vertebral
compression fractures. Spine. 2015; 40(12):865-875.
\40\ Wilson D et al. An ex vivo biomechanical comparison of a
novel vertebral compression fracture treatment system to
kyphoplasty. Clinical Biomechanics. 2012; 27(4):346-353.
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The applicant summarized the differences and similarities of the
SpineJack[supreg], BKP, and PEEK coiled implant as follows: (1) With
respect to construction, SpineJack[supreg] is made of Titanium-6-
Aluminum-4-Vanadium compared to thermoplastic polyurethanes for BKP and
nitinol and PEEK for the PEEK coiled implant; (2) with respect to
mechanism of action, the SpineJack[supreg] uses a locking scissor jack
encapsulated in PMMA bone cement compared to hydrodynamic cavity
creation and PMMA cavity filler for BKP and coil cavity creation and
PEEK implant filled with PMMA bone cement for the PEEK coiled implant;
(3) with respect to plastic deformation, SpineJack[supreg] and BKP
allow for plastic deformation while the PEEK coiled implant does not;
(4) with respect to craniocaudal expansion, SpineJack[supreg] allows
for craniocaudal expansion, whereas BKP and the PEEK coiled implant do
not; (5) with respect to bilateral load support, SpineJack[supreg]
provides bilateral load support whereas BKP and the PEEK coiled implant
do not; and (6) with respect to lift pressure of >500 N,
SpineJack[supreg] provides lift pressure of >500 N whereas BKP and the
PEEK coiled implant do not. The applicant summarized that the
SpineJack[supreg] system is uniquely constructed and utilizes a
different mechanism of action than BKP, which is the gold standard of
treatment for osteoporotic VCFs, and that the construction and
mechanism of action of the SpineJack[supreg] system is further
differentiated when compared with the PEEK coiled implant.
With respect to the newness criterion, the SpineJack[supreg]
Expansion Kit received FDA 510(k) clearance on August 30, 2018, based
on a determination of substantial equivalence to a legally
[[Page 86005]]
marketed predicate device. The applicant explained that although the
SpineJack[supreg] Expansion Kit received FDA 510(k) clearance on August
30, 2018, due to the time required to prepare for supply and
distribution channels, it was not available on the U.S. market until
October 2018. As we discussed previously, the SpineJack[supreg]
Expansion Kit is indicated for use in the reduction of painful
osteoporotic VCFs and is intended to be used in combination with
Stryker VertaPlex and VertaPlex High Viscosity (HV) bone cements. We
received the application for a new device category for transitional
pass-through payment status for the SpineJack[supreg] Expansion Kit on
February 4, 2020, which is within 3 years of the date of the initial
FDA marketing authorization. We solicited public comments on whether
the SpineJack[supreg] Expansion Kit meets the newness criterion.
Comment: The applicant reaffirmed that the SpineJack[supreg] system
meets the newness criteria as it received FDA 510(k) clearance on
August 30, 2018 and was commercially available in the United States on
October 11, 2018.
Response: We appreciate the commenter's input. After consideration
of the public comments we received and based on the fact that the
SpineJack[supreg] Expansion Kit application was received within 3 years
of FDA approval, we have determined that the SpineJack[supreg]
Expansion Kit meets the newness criterion.
With respect to the eligibility criterion at Sec. 419.66(b)(3),
according to the applicant, the use of the SpineJack[supreg] Expansion
Kit is integral to the service of reducing painful osteoporotic
vertebral compression fractures (VCFs), is used for one patient only,
comes in contact with human skin, and is surgically implanted or
inserted into the patient. Specifically, the applicant explained that
the SpineJack[supreg] system is designed to be implanted into a
collapsed vertebral body (VB) via a percutaneous transpedicular
approach under fluoroscopic guidance. According to the applicant, the
implants remain within the VB with the delivered bone cement. The
applicant also claimed the SpineJack[supreg] Expansion Kit meets the
device eligibility requirements of Sec. 419.66(b)(4) because it is not
an instrument, apparatus, implement, or item for which depreciation and
financing expenses are recovered, and it is not a supply or material
furnished incident to a service. We solicited public comments on
whether the SpineJack[supreg] Expansion Kit meets the eligibility
criteria at Sec. 419.66(b).
Comment: The applicant stated that the SpineJack[supreg] system
meets each of the device eligibility requirements at Sec. 419.66(b)(3)
for transitional pass-through payment under the OPPS as it is integral
to a service provided, and is not an instrument, apparatus, implement,
or item for which depreciation and financing expenses are recovered nor
is it a material or supply furnished incident to a service.
Response: We appreciate the comment's input. Based on the
information we have received and our review of the application, we have
determined that the SpineJack[supreg] system meets the eligibility
criteria at Sec. 419.66(b)(3) and (4).
The criteria for establishing new device categories are specified
at Sec. 419.66(c). The first criterion, at Sec. 419.66(c)(1),
provides that CMS determines that a device to be included in the
category is not appropriately described by any of the existing
categories or by any category previously in effect, and was not being
paid for as an outpatient service as of December 31, 1996. The
applicant describes the SpineJack[supreg] Expansion Kit as an
implantable fracture reduction system used to treat vertebral
compression fractures (VCFs). The applicant reported that it does not
believe that the SpineJack[supreg] Expansion Kit is described by an
existing category and requested category descriptor ``Vertebral body
height restoration device, scissor jack (implantable).'' We identified
one existing pass-through payment categories that may be applicable to
SpineJack[supreg] Expansion Kit. The SpineJack[supreg] Expansion Kit
may be described by HCPCS code C1821 (interspinous process distraction
device (implantable)). We solicited public comments on this issue.
Comment: In response to CMS' comment about whether
SpineJack[supreg] is described by an existing category, the applicant
stated that the SpineJack[supreg] system and implantable interspinous
process distraction devices are vastly different medical devices that
are distinguished by several attributes. According to the applicant,
where the SpineJack[supreg] system involves the insertion of two
bilateral expandable titanium implants into the vertebral body within
the anterior portion of the spinal column, the interspinous spacer uses
a single non-expandable device that is implanted between the spinous
processes of two adjacent veterbral bodies in the posterior portion of
the spinal column. The applicant further noted that the
SpineJack[supreg] system differs from interspinous spacers in terms of
the FDA submission type, the intended use, the mechanism of action, and
whether bone cement is used as a method of fixation. The applicant
reaffirmed their belief that the SpineJack[supreg] system meets the
requirement at Sec. 419.66(c)(1) that the device is not appropriately
described by any of the existing categories or by any category
previously in effect.
Response: We appreciate the additional information provided by the
applicant. After consideration of the public comments we received, we
believe there is no existing pass-through device category that
appropriately describes the SpineJack[supreg] system, due to the many
differences which exist between the predicate device and HCPCS code
C1821--interspinous process distraction device (implantable). Based on
this information, we believe that the SpineJack[supreg] system meets
the eligibility criterion at Sec. 419.66(c)(1).
The second criterion for establishing a device category, at Sec.
419.66(c)(2), provides that CMS determines either of the following: (i)
That a device to be included in the category has demonstrated that it
will substantially improve the diagnosis or treatment of an illness or
injury or improve the functioning of a malformed body part compared to
the benefits of a device or devices in a previously established
category or other available treatment; or (ii) for devices for which
pass-through status will begin on or after January 1, 2020, as an
alternative to the substantial clinical improvement criterion, the
device is part of the FDA's Breakthrough Devices Program and has
received FDA marketing authorization. With respect to the substantial
clinical improvement criterion, the applicant submitted 8 studies and
19 other references to support assertions that the treatment of
osteoporotic vertebral compression fracture (VCF) patients with the
SpineJack[supreg] system represents a substantial clinical improvement
over existing technologies because clinical research supports that it
reduces future interventions, hospitalizations, and physician visits
through a decrease in adjacent level fractures (ALFs), which the
applicant stated are clinically significant adverse events associated
with osteoporotic VCF. The applicant also stated that treatment with
the SpineJack[supreg] system greatly reduces pain scores and pain
medication use when compared to BKP, which the applicant stated is the
current gold standard in vertebral augmentation (VA) treatment.
The applicant explained that the SpineJack[supreg] system has been
available for the treatment of patients with osteoporotic VCFs for over
10 years in Europe. The applicant explained that, as
[[Page 86006]]
a result, the SpineJack[supreg] implant has been extensively studied,
and claims from smaller studies are supported by the results from a
recent, larger prospective, randomized study known as the SAKOS
(SpineJack[supreg] versus Kyphoplasty in Osteoporotic Patients) study.
The applicant cited the SAKOS study \41\ in support of multiple
substantial clinical improvement claims: Reduction in adjacent level
fractures, superiority in mid-vertebral body height restoration, and
pain relief. The applicant explained that the SAKOS study was the
pivotal trial conducted in support of the FDA 510(k) clearance for the
SpineJack[supreg] system and that the intent of the study was to
compare the safety and effectiveness of the SpineJack[supreg] system
with the KyphX Xpander Inflatable Bone Tamp (BKP) for treatment of
patients with painful osteoporotic VCFs in order to establish a non-
inferiority finding for use of the SpineJack[supreg] system versus
balloon kyphoplasty procedure (BKP).
---------------------------------------------------------------------------
\41\ Noriega, D., et al., ``A prospective, international,
randomized, noninferiority study comparing an implantable titanium
vertebral augmentation device versus balloon kyphoplasty in the
reduction of vertebral compression fractures (SAKOS study),'' The
Spine Journal, 2019, vol. 19(11), pp. 1782-1795.
---------------------------------------------------------------------------
The SAKOS study is a prospective, international, randomized, non-
inferiority study comparing a titanium implantable vertebral
augmentation device (TIVAD), the SpineJack[supreg] system, versus BKP
in the reduction of vertebral compression fractures with a 12-month
follow-up. The primary endpoint was a 12-month responder rate based on
a composite of three components: (1) Reduction in VCF fracture-related
pain at 12 months from baseline by >20 mm as measured by a 100-mm
Visual Analog Scale (VAS) measure; (2) maintenance or functional
improvement of the Oswestry Disability Index (ODI) score at 12 months
from baseline; and (3) absence of device-related adverse events or
symptomatic cement extravasation requiring surgical reintervention or
retreatment at the index level. If the primary composite endpoint was
successful, a fourth component (absence of ALF) was added to the three
primary components for further analysis. If the analysis of this
additional composite endpoint was successful, then midline target
height restoration at 6 and 12 months was assessed. According to the
applicant, freedom from ALFs and midline VB height restoration were two
additional superiority measures that were tested. According to the
SAKOS study, secondary clinical outcomes included changes from baseline
in back pain intensity, ODI score, EuroQol 5-domain (EQ-5D) index score
(to evaluate quality of life), EQ-VAS score, ambulatory status,
analgesic consumption, and length of hospital stay. Radiographic
endpoints included restoration of vertebral body height (mm), and Cobb
angle at each follow-up visit. Adverse events (AEs) were recorded
throughout the study period. The applicant explained that researchers
did not blind the treating physicians or patients, so each group was
aware of the treatment allocation prior to the procedure; however, the
three independent radiologists that performed the radiographic reviews
were blinded to the personal data of the patients, study timepoints,
and results of the study.
The SAKOS study recruited patients from 13 hospitals across 5
European countries and randomized 152 patients with osteoporotic
vertebral compression fractures (OVCFs) (1:1) to either
SpineJack[supreg] or BKP procedures. Specifically, patients were
considered eligible for inclusion if they met a number of criteria,
including: (1) At least 50 years of age; (2) had radiographic evidence
of one or two painful VCF between T7 and L4, aged less than 3 months,
due to osteoporosis; (3) fracture(s) that showed loss of height in the
anterior, middle, or posterior third of the VB >=15 percent but =50 mm at 6 weeks after
initiation of fracture care or a VAS pain score of >=70 percent mm at 2
weeks after initiation of fracture care. Eleven of the originally
recruited patients were subsequently excluded from surgery (9
randomized to SpineJack[supreg] and 2 to BKP). A total of 141 patients
underwent surgery, and 126 patients completed the 12-month follow-up
period (61 TIVAD and 65 BKP). The applicant contended that despite the
SAKOS study being completed outside the U.S., results are applicable to
the Medicare patient population, noting that 82 percent (116 of 141) of
the patients in the SAKOS trial that received treatment
(SpineJack[supreg] system or BKP) were age 65 or older. The applicant
explained further that the FDA evaluated the applicability of the SAKOS
clinical data to the U.S. population and FDA concluded that although
the SAKOS study was performed in Europe, the final study demographics
were very similar to what has been reported in the literature for U.S.-
based studies of BKP. The applicant also explained that FDA determined
that the data was acceptable for the SpineJack[supreg] system 510(k)
clearance, including two clinical superiority claims versus BKP.
The SAKOS study reported that analysis on the intent to treat
population using the observed case method resulted in a 12-month
responder rate of 89.8 percent and 87.3 percent, for SpineJack[supreg]
and BKP respectively (p=0.0016). The additional composite endpoint
analyzed in observed cases resulted in a higher responder rate for
SpineJack[supreg] compared to BKP at both 6 months (88.1 percent vs.
60.9 percent; p
2.61 mm vs 0.31 2.22 mm; p=0.0246) and at 12 months (1.31
2.58 mm vs. 0.10 2.23 mm; p=0.0035), with
similar results in the per protocol (PP) population.
Also, according to the SAKOS study, decrease in pain intensity
versus baseline was more pronounced in the SpineJack[supreg] group
compared to the BKP group at 1 month (p=0.029) and 6 months (p=0.021).
At 12 months, the difference in pain intensity was no longer
statistically significant between the groups, and pain intensity at 5
days post-surgery was not statistically different between the groups.
The SAKOS study publication also reported that at each timepoint, the
percentage of patients with reduction in pain intensity >20 mm was >=90
percent in the SpineJack[supreg] group and >=80 percent in the BKP
group, with a statistically significant difference in favor of
SpineJack[supreg] at 1-month post-procedure (93.8 percent vs 81.4
percent; p=0.03). The study also reported: (1) No statistically
significant difference in disability (ODI score) between groups during
the follow-up period, although there was a numerically greater
improvement in the SpineJack[supreg] group at most time points; (2) at
each time point, the percentage of patients with maintenance or
improvement in functional capacity was at or close to 100 percent; and
(3) in both groups, a clear and progressive improvement in quality of
life was observed throughout the 1-year follow-up period without any
statistically significant between-group differences.
In the SAKOS study, both groups had similar proportions of VCFs
with cement extravasation outside the treated VB (47.3 percent for
TIVAD, 41.0 percent for BKP; p=0.436). No symptoms of cement leakage
were reported. The SAKOS study also reported that the BKP group had a
rate
[[Page 86007]]
of adjacent fractures more than double the SpineJack[supreg] group
(27.3 percent vs. 12.9 percent; p=0.043). The SAKOS study also reported
that the BKP group had a rate of non-adjacent subsequent thoracic
fractures nearly 3 times higher than the SpineJack[supreg] group (21.9
percent vs. 7.4 percent) (a p-value was not reported for this result).
The most common AEs reported over the study period were back pain (11.8
percent with SpineJack[supreg], 9.6 percent with BKP), new lumbar
vertebral fractures (11.8 percent with SpineJack[supreg], 12.3 percent
with BKP), and new thoracic vertebral fractures (7.4 percent with
SpineJack[supreg], 21.9 percent with BKP). The most frequent SAEs were
lumbar vertebral fractures (8.8 percent with SpineJack[supreg]; 6.8
percent with BKP) and thoracic vertebral fractures (5.9 percent with
SpineJack[supreg], 9.6 percent with BKP). We also note that the length
of hospital stay (in days) for osteoporotic VCF patients treated in the
SAKOS trial was 3.8 3.6 days for the SpineJack[supreg]
group and 3.3 2.4 days for the BKP group (p=0.926,
Wilcoxon test).
The applicant also submitted additional studies, which are
described in more detail in this section, related to the applicant's
specific assertions regarding substantial clinical improvement.
As stated previously, the applicant stated that the
SpineJack[supreg] system represents a substantial clinical improvement
over existing technologies because it will reduce future interventions,
hospitalizations, and physician visits through a decrease in ALFs. The
applicant explained that ALFs are considered clinically significant
adverse events associated with osteoporotic VCFs, citing studies by
Lindsay et al.\42\ and Ross et al.\43\ The applicant explained that
these studies reported, respectively, that having one or more VCFs
(irrespective of bone density) led to a 5-fold increase in the
patient's risk of developing another vertebral fracture, and the
presence of two or more VCFs at baseline increased the risk of ALF by
12-fold. The applicant stated that analysis of the additional composite
endpoint in the SAKOS study demonstrated statistical superiority of the
SpineJack[supreg] system over BKP (p 2.61 mm vs 0.31 2.22 mm;
p=0.0246) and 12 months (1.31 2.58 mm vs. 0.10 2.23 mm; p=0.0035) post-procedure. The applicant noted that
similar results were also observed in the PP population (134 patients
in the intent-to-treat population without any major protocol
deviations).
---------------------------------------------------------------------------
\44\ Lin J et al. Better height restoration, greater kyphosis
correction, and fewer refractures of cemented vertebrae by using an
intravertebral reduction device: A 1-year follow-up study. World
Neurosurgery. 2016; 90:391-396.
\45\ Tzermiadianos M., et al., ``Altered disc pressure profile
after an osteoporotic vertebral fracture is a risk factor for
adjacent vertebral body fracture,'' European Spine Journal, 2008,
vol. 17(11), pp. 1522-1530.
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The applicant also provided two prospective studies, a
retrospective study, and two cadaveric studies in support of its
assertions regarding superior VB height restoration. The applicant
stated that in a prospective comparative study by Noriega D., et
al.,\46\ VB height restoration outcomes utilizing the SpineJack[supreg]
system were durable out to 3 years. This study was a safety and
clinical performance pilot that randomized 30 patients with painful
osteoporotic vertebral compression fractures to SpineJack[supreg]
(n=15) or BKP (n=15).\47\ Twenty-eight patients completed the 3-year
study (14 in each group). The clinical endpoints of analgesic
consumption, back pain intensity, ODI, and quality of life were
recorded preoperatively and through 36-months post-surgery.\48\ Spine
X-rays were also taken 48 hours prior to the procedure and at 5 days,
6, 12, and 36 months post-surgery.\49\ The applicant explained that
over the 3-year follow-up period, VB height restoration and kyphosis
correction was better compared to BKP, specifically that VB height
restoration and kyphotic correction was still evident at 36 months with
a greater mean correction of anterior VB height (10 13
percent vs 2 8 percent for BKP, p=0.007) and midline VB
height (10 11 percent vs 3 7 percent for BKP,
p=0.034), while there was a larger correction of the VB angle (-
4.97[deg] 5.06[deg] vs 0.42[deg] 3.43[deg];
p=0.003) for the SpineJack[supreg] group. The applicant stated that
this study shows superiority with regards to VB height restoration.
---------------------------------------------------------------------------
\46\ Noriega D., et al., ``Long-term safety and clinical
performance of kyphoplasty and SpineJack procedures in the treatment
of osteoporotic vertebral compression fractures: a pilot,
monocentric, investigator-initiated study,'' Osteoporosis
International, 2019, vol. 30, pp. 637-645.
\47\ Ibid.
\48\ Ibid.
\49\ Ibid.
---------------------------------------------------------------------------
The applicant stated that Arabmotlagh M., et al., also supported
superiority with regard to VB height restoration. Arabmotlagh M., et
al. reported an observational case series (with no comparison group) of
SpineJack[supreg]. They enrolled 42 patients with osteoporotic
vertebral compression fracture of the thoracolumbar, who were
considered for kyphoplasty, 31 of whom completed the clinical and
radiological evaluations up to 12 months after the procedure.\50\
According to materials provided by the applicant, the purpose of the
study was to evaluate the efficacy of kyphoplasty with the
SpineJack[supreg] system to correct the kyphotic deformity and to
analyze parameters affecting the restoration and maintenance of spinal
alignment. The
[[Page 86008]]
applicant explained that the mean VB height calculated prior to
fracture was 2.8 cm (standard deviation (SD) of 0.47), which decreased
to 1.5 cm (SD of 0.59) after the fracture. According to the applicant,
following the procedure performed with the SpineJack[supreg] device,
the VB height significantly increased to 1.9 cm (SD of 0.64; p20 mm was >=90 percent in the
SpineJack[supreg] system group and >=80 percent in the BKP group, with
a statistically significant difference in favor of the
SpineJack[supreg] system at 1 month post-procedure (93.8 percent vs.
81.5 percent; p=0.030). The applicant also noted that although
continued pain score improvements were seen out to 1 year for patients
treated with the SpineJack[supreg] system, the difference between the
treatment groups did not meet statistical significance (p=0.061). The
applicant also explained that in the SAKOS study, at 5 days after
surgery, there were significantly fewer patients taking central
analgesic agent medications in the SpineJack[supreg] implant-treated
group as compared to those in the BKP-treated group (SJ 7.4 percent vs.
BKP 21.9 percent, p=0.015). According to the applicant, central
analgesic agents included medications such as non-steroidal anti-
inflammatory drugs (NSAIDS), salicylates, or opioid analgesics.
The applicant also cited a prospective consecutive observational
study by Noriega D., et al. for statistically significant pain relief
immediately after surgery and at both 6 and 12 months. Noriega D., et
al. was a European multicenter, single-arm registry study that aimed to
confirm the safety and clinical performance of the SpineJack[supreg]
system for the treatment of vertebral compression fractures of
traumatic origin (no comparison procedure).\57\ The study enrolled 103
patients (median age: 61.6 years) with 108 VCFs due to trauma (n=81),
or traumatic VCF with associated osteoporosis (n=22) who had a
SpineJack[supreg] procedure. Twenty-three patients withdrew from the
study before
[[Page 86009]]
the 12-month visit. The study reported a significant improvement in
back pain at 48 hours after SpineJack[supreg] procedure, with the mean
VAS pain score decreasing from 6.6 2.6 cm at baseline to
1.4 1.3 cm (mean change: -5.2 2.7 cm;
pclinicaltrials.gov comparing SpineJack[supreg] system to
conservative orthopedic management consisting of brace and pain
medication in acute stable traumatic vertebral fractures in subjects
aged 18 to 60 years old. The clinicaltrials.gov entry indicated that
findings should be forthcoming in 2020. Additionally, we noted that the
recent systematic reviews of the management of vertebral compression
fracture (Buchbinder et al. for Cochrane (2018), Ebeling et al. (2019)
for the American Society for Bone and Mineral Research (ASBMR)), did
not support vertebral augmentation procedures due to lack of evidence
compared to conservative medical management.\60\ The ASBMR recommended
more rigorous study of treatment options including ``larger sample
sizes, inclusion of a placebo control and more data on serious AEs
(adverse events).''
---------------------------------------------------------------------------
\60\ Buchbinder R., Johnston R.V., Rischin K.J., Homik J., Jones
C.A., Golmohammadi K., Kallmes D.F., ``Percutaneous vertebroplasty
for osteoporotic vertebral compression fracture,'' Cochrane Database
Syst Rev. 2018 Apr 4 and Nov 6. PMID: 29618171; Ebeling P.R.,
Akesson K., Bauer D.C., Buchbinder R., Eastell R., Fink H.A.,
Giangregorio L., Guanabens N., Kado D., Kallmes D., Katzman W.,
Rodriguez A., Wermers R., Wilson H.A., Bouxsein M.L., ``The Efficacy
and Safety of Vertebral Augmentation: A Second ASBMR Task Force
Report.'' J Bone Miner Res., 2019, vol. 34(1), pp. 3-21.
---------------------------------------------------------------------------
We solicited public comment on whether the SpineJack[supreg] system
meets the substantial clinical improvement criterion.
Comment: Many commenters expressed their support for approval of
the SpineJack[supreg] system for device pass-through status. Many of
these commenters shared their academic knowledge of and first-hand
clinical experience with vertebral augmentation procedures, including
claims of familiarity and expertise with the use of the Kiva[supreg]
system, BKP and the SpineJack[supreg] system. According to many of
these commenters, the SpineJack[supreg] system provides a significant
benefit beyond that which is achieved by other vertebral augmentation
technology. Many commenters also indicated that the price compared to
the reimbursement rate has been an impediment to use of the
SpineJack[supreg] system in some cases. Finally, several of these
commenters expressed their belief that the SpineJack[supreg] system may
reduce costs to hospitals and the U.S. health system overall by
preventing the onset of additional adjacent fractures in patients.
The applicant and multiple commenters disagreed with CMS' concern
that recent systematic reviews of the management of vertebral
compression fracture do not support vertebral augmentation procedures
according to the ASBMR, which also suggested more rigorous study of
treatment options. The applicant stated that the latest clinical
evidence and a policy statement from the International Society for the
Advancement of Spine Surgery (ISASS) provide robust support for the use
of vertebral augmentation (VA) over non-surgical management (NSM) in
the treatment of osteoporotic vertebral compression fractures. Another
commenter disagreed with CMS' interpretation of the ASBMR report and
emphasized that the study found kyphoplasty was associated with
significantly more reduction in pain, more reduction in RMDQ scale, and
improvement in quality of life as compared to nonsurgical management;
the commenter concluded that it is not accurate to group kyphoplasty
with vertebroplasty data.
The applicant referenced a systematic review and meta-analysis of
25 prospective studies, which found that patients treated with balloon
kyphoplasty and vertebroplasty had greater pain reduction that those
treated with non-surgical management. Further, the applicant stated
that the most compelling evidence for the use of vertebral augmentation
in the treatment of osteoporotic VCF patients comes from the recently
published Local Coverage Determination (LCD) on Percutaneous Vertebral
Augmentation (PVA) for Osteoporotic Vertebral Compression Fracture by
the seven regional MACs, which currently appear in either a proposed or
final state.
The applicant and commenters also responded to CMS' concern that
the
[[Page 86010]]
SAKOS trial results do not appear to be corroborated in any other
randomized controlled study. Commenters stated it is unfair of CMS to
require results from multiple randomized control trials (RCTs) because
these studies take a large amount of time and resources to conduct,
which is at odds with the characteristics inherent in applicants for
device pass-through payment status given the newness criterion
requiring FDA approval within three years of application. The applicant
stated that multiple RCTs are often not conducted to corroborate level
one evidence that has been published in journals. They added that there
are a minimum of 16 journal articles that highlight the clinical
benefit that the SpineJack[supreg] system provides to patients.
In response to CMS' concern that SpineJack[supreg] was not compared
to the PEEK coiled implant, the applicant and multiple commenters
stated that the PEEK coiled system has not demonstrated clinical
superiority to BKP, which is the gold standard treatment for
osteoporotic VCFs. Commenters added that the PEEK coiled implants are
not widely used in the United States because of the very limited scope
of use, the high price, and the difficulty of use as compared to other
procedures.
In response to CMS' concern that the SpineJack[supreg] system was
not compared to conservative medical therapy, many commenters and the
applicant stated that this comparison would be inappropriate primarily
because of the large body of research showing improvements for patients
who receive treatment for VCFs with VA as opposed to NSM. One commenter
stated that there is a subset of patients who suffer compression
fractures for which no vertebral augmentation is advised but these
patients would not currently receive balloon kyphoplasty nor would they
likely receive treatment with the SpineJack[supreg] system. The
applicant stated that there is clinical evidence showing improved
outcomes for patients with VCFs treated with BKP as compared to NSM.
The applicant concluded that based upon the body of evidence available,
the use of NSM as a comparator treatment to the SpineJack[supreg]
system for a new clinical study would not be in the best interest of
osteoporotic VCF patients, primarily due to the increased risk of
morbidity and mortality that has been reported in this patient
population, particularly among the elderly. Lastly the applicant stated
that the SpineJack[supreg] system is not indicated for use in the
treatment of traumatic vertebral fractures in the United States.
In regard to CMS' statement that a study by Lin et al. did not
compare the SpineJack[supreg] system to BKP, the applicant agreed and
added that the publication provides further support of the claim for
superior mid-vertebral body height restoration with the
SpineJack[supreg] system as compared to other treatment options such as
vertebroplasty, which the applicant asserted continue to be widely
performed in Medicare patients.
In regard to CMS' statement that findings from the Arabmotlagh M.
et al. study did not report results for midline VB height, the
applicant stated that the publication shows that it is possible to
achieve anterior VB height restoration with the SpineJack[supreg]
system in addition to midline VB height restoration demonstrated in the
SAKOS trial.
In response to CMS' assertion that the Noriega et al. article did
not report results for six months and does not include results of mean
improvement as stated by the applicant, the applicant stated that they
would like to correct an error in their application attachment for the
2015 Noriega et al. publication. The data presented in their
application reflects findings from another citation \61\ in which the
overall improvements in visual analog scale back pain scores were
statistically significant at multiple time points.
---------------------------------------------------------------------------
\61\ Noriega D et al. Long-term safety and clinical performance
of kyphoplasty and SpineJack procedures in the treatment of
osteoporotic vertebral compression fractures: A pilot, monocentric,
investigator-initiated study. Osteoporosis International. 2019;
30:637-645.
---------------------------------------------------------------------------
Lastly, the applicant supplied minor corrections regarding the
SAKOS study results. Specifically the applicant stated that for the
midline VB height restoration reported at 12 months post-procedure for
the SpineJack[supreg] system compared to BKP in the SAKOS trial, an
error in the standard deviation value for the BKP data is reported in
the CY 2021 OPPS/ASC proposed rule. The applicant stated that this
value should be revised to 2.34 mm rather than the 2.23 mm reported
previously.
One commenter, a manufacturer of BKP implants, criticized the
evidence the applicant submitted to support its position that the
SpineJack[supreg] system meets the substantial clinical improvement
criterion. The commenter emphasized that although the applicant cited
the SAKOS study as the basis for concluding that the SpineJack[supreg]
system meets the substantial clinical improvement criterion, the SAKOS
study compared the SpineJack[supreg] system to older BKP technology
(KyphX), rather than to the most current BKP technology available at
the time of the study (Xpander II and Express II). According to the
commenter, these newer generation balloons have been available since
2011, generate lift force in excess of 1200 Newtons, and are the only
BKP products indicated for the cement resistance technique, whereby one
bone tamp is left in place during cement injection and curing to
maximize height restoration in a collapsed vertebral body. The
commenter stated that BKP does offer craniocaudal expansion while
creating a void for safer cement fill. Furthermore, with respect to
bilateral load support, according to the commenter, BKP has been
offered since 1998 as a bilateral procedure option to maximize lift
potential and reduce stress exerted on endplates. The commenter went on
to explain that BKP provides bilateral symmetric load support to
fractured endplates by providing a larger surface area when restoring
height. The commenter suggested that if the SAKOS study had compared
the SpineJack[supreg] system to these second-generation BKP implants,
then the SpineJack[supreg] system might not have demonstrated superior
performance on secondary outcome measures.
The commenter also offered several additional criticisms of the
SAKOS study. The commenter pointed out that the SAKOS study design did
not involve an even distribution of the spine levels treated across
study arms, and that it is possible that a difference in the levels
treated could have contributed to the reduction of ALFs in the
SpineJack[supreg] system group. The commenter asserted that the
vertebral levels T11-L1 are commonly known for higher number of
fractures, and that these spinal segments had 14 more levels treated
with BKP than with the SpineJack[supreg] system in the SAKOS study.
According to the commenter, further analysis would be needed to
determine if the location of fractures had an effect on the occurrence
of ALFs between the two study arms in SAKOS. The commenter also pointed
out that it was unclear whether there was any difference in the two
treatment groups' bone density metrics, as this was not disclosed in
the SAKOS study.
The commenter went on to emphasize that the clinical comparison in
the SAKOS study demonstrated the SpineJack[supreg] system was non-
inferior to BKP at the time of the primary endpoint (12 months);
however, there was no significant difference between groups in pain
intensity visual analog scale (VAS) score at the final time point, and
no difference in Oswestry Disability Index (ODI) or the EQ-5D health
status questionnaire at any time point during the study. The commenter
acknowledged that SAKOS
[[Page 86011]]
demonstrated superiority for the SpineJack[supreg] system for mid-
vertebral height restoration, but emphasized that measures of anterior
height, posterior height, and cobb angle showed no difference across
the study arms, within the secondary endpoints. The commenter also
observed that the SAKOS study showed a similar number of adverse events
between study arms, with the SpineJack[supreg] system population seeing
a higher percentage of serious adverse events.
Finally, the commenter disputed the applicant's assertion that
vertebral augmentation treatment with vertebroplasty may alleviate
pain, but cannot restore vertebral body height or correct spinal
deformity. The commenter likewise disputed the applicant's assertion
that BKP attempts to restore vertebral body height, but the temporary
correction obtained cannot be sustained over the long-term. In
countering the applicant's assertions, the commenter referenced three
published articles with empirical evidence regarding the impact of BKP
on kyphotic angle and VB height restoration.62 63 64 Lastly
the commenter stated that any mortality benefits have only been studies
for BKP and vertebroplasty and not for SpineJack[supreg]. According to
the commenter, it is therefore not appropriate to use this information
to demonstrate the mortality benefits from using the SpineJack[supreg]
technology.
---------------------------------------------------------------------------
\62\ Van Meirhaeghe JV, et al. 2013; 38(12): 971-983.
\63\ Dohm M, et al. 2014. (24 Months), Am J Neuroradiol.
2014;35:2227-2236.
\64\ Bozkurt M, et al. 2014. Asian Spine J. 2014; 8(1):27-34.
---------------------------------------------------------------------------
Response: We appreciate all the comments we received related to the
SpineJack[supreg] system, and we have taken them into consideration in
making our determination, including the applicant's submission of
additional information to address the concerns presented in the CY 2021
OPPS/ASC proposed rule and the comments expressing concerns with the
design and results of the SAKOS study.
After consideration of the public comments received, we believe
that commenters have addressed our concerns regarding whether the
SpineJack[supreg] system meets the substantial clinical improvement
criterion and that the SpineJack[supreg] system represents a
substantial clinical improvement over existing technologies based on
the data received from commenters. The data provided from the
commenters with clinical experience with vertebral augmentation
procedures and the SpineJack[supreg] system, which included improved
pain, VB height restoration and ALF outcomes for patients with
osteoporotic VCFs when compared with existing treatments, demonstrates
substantial clinical improvement.
The third criterion for establishing a device category, at Sec.
419.66(c)(3), requires us to determine that the cost of the device is
not insignificant, as described in Sec. 419.66(d). Section 419.66(d)
includes three cost significance criteria that must each be met. The
applicant provided the following information in support of the cost
significance requirements. The applicant stated that the
SpineJack[supreg] system would be reported with CPT code 22513, which
is assigned to APC 5114 (Level 4 Musculoskeletal Procedures). To meet
the cost criterion for device pass-through payment status, a device
must pass all three tests of the cost criterion for at least one APC.
For our calculations, we used APC 5114, which has a CY 2019 payment
rate of $5,891.95. Beginning in CY 2017, we calculated the device
offset amount at the HCPCS/CPT code level instead of the APC level (81
FR 79657). CPT code 22513 had a device offset amount of $1,127 at the
time the application was received. According to the applicant, the cost
of the SpineJack[supreg] system is $5,623.
Section 419.66(d)(1), the first cost significance requirement,
provides that the estimated average reasonable cost of devices in the
category must exceed 25 percent of the applicable APC payment amount
for the service related to the category of devices. The estimated
average reasonable cost of $5,622.64 for the SpineJack[supreg] system
is 94 percent of the applicable APC payment amount for the service
related to the category of devices of SpineJack[supreg] system
(($5,622.64/$5,981.28) x 100 = 94 percent). Therefore, we believe the
SpineJack[supreg] system meets the first cost significance requirement.
The second cost significance requirement, at Sec. 419.66(d)(2),
provides that the estimated average reasonable cost of the devices in
the category must exceed the cost of the device-related portion of the
APC payment amount for the related service by at least 25 percent,
which means that the device cost needs to be at least 125 percent of
the offset amount (the device-related portion of the APC found on the
offset list). The estimated average reasonable cost of $5,622.64 for
the SpineJack[supreg] system is 499 percent of the cost of the device-
related portion of the APC payment amount for the related service of
$1,126.87(($5,622.64/$1,126.87) x 100 = 499 percent). Therefore, we
believe that the SpineJack[supreg] system meets the second cost
significance requirement.
The third cost significance requirement, at Sec. 419.66(d)(3),
provides that the difference between the estimated average reasonable
cost of the devices in the category and the portion of the APC payment
amount for the device must exceed 10 percent of the APC payment amount
for the related service. The difference between the estimated average
reasonable cost of $5,622.64 for the SpineJack[supreg] system and the
portion of the APC payment amount for the device of $1,126.87 is 75
percent of the APC payment amount for the related service of $5,987.28
(($5,622.64-$1,126.87)/$5,981.28) = 75.2 percent). Therefore, we
believe that the SpineJack[supreg] Expansion Kit meets the third cost
significance requirement.
We solicited public comment on whether the SpineJack[supreg]
Expansion Kit meets the device pass-through payment criteria discussed
in this section, including the cost criterion.
Comment: The applicant agreed with CMS' conclusion that the
SpineJack[supreg] system meets all three of the cost significance
requirements for establishing a device pass-through category as
described in Sec. 419.66(d).
Response: We appreciate the applicant's input.
After consideration of the public comments we received, we have
determined that the SpineJack[supreg] Expansion Kit qualifies for
device pass-through payment status and we are approving the application
for device pass-through payment status for the SpineJack[supreg]
Expansion Kit beginning in CY 2021.
3. Technical Clarification to the Alternative Pathway to the OPPS
Device Pass-Through Substantial Clinical Improvement Criterion for
Certain Transformative New Devices
As described previously, in the CY 2020 annual rulemaking process,
we finalized an alternative pathway for devices that receive Food and
Drug Administration (FDA) marketing authorization and are granted a
Breakthrough Device designation (84 FR 61295 through 61297). Under this
alternative pathway, devices that are granted an FDA Breakthrough
Device designation are not evaluated in terms of the current
substantial clinical improvement criterion at Sec. 419.66(c)(2) for
purposes of determining device pass-through payment status, but will
need to meet the other requirements for pass-through payment status in
our regulation at Sec. 419.66. Similarly, in the FY 2020 IPPS/LTCH PPS
final rule, we finalized an alternative pathway for new
[[Page 86012]]
technology add-on payments for certain transformative new devices.
Under the existing regulations at Sec. 412.87(c), to be eligible for
approval for IPPS new technology add-on payments under this alternative
pathway, the device must be part of the FDA's Breakthrough Devices
Program and have received FDA marketing authorization.
We have received questions from the public regarding CMS's intent
with respect to the ``marketing authorization'' required for purposes
of approval under the alternative pathway for certain transformative
new devices at Sec. 412.87(c). Some of the public appear to assert
that so long as a technology has received marketing authorization for
any indication, even if that indication differs from the indication for
which the technology was designated by FDA as part of the Breakthrough
Devices Program, the technology would meet the marketing authorization
requirement at Sec. 412.87(c). Because of this potential confusion, we
clarified in the FY 2021 IPPS/LTCH PPS proposed rule that an applicant
cannot combine a marketing authorization for an indication that differs
from the technology's indication under the Breakthrough Device Program,
and for which the applicant is seeking to qualify for the new
technology add-on payment, for purposes of approval under the
alternative pathway for certain transformative devices (85 FR 32692).
We clarified in the CY 2021 OPPS/ASC proposed rule that the same
policy applies for purposes of the OPPS alternative pathway policy.
Specifically, we clarified that under the OPPS, in order to be eligible
for the alternative pathway, the device must receive marketing
authorization for the indication covered by the Breakthrough Devices
Program designation and we are making a conforming change to the
regulations at Sec. 419.66(c)(2). We also noted that the transitional
pass-through payment application for the device must be received within
2 to 3 years of the initial FDA marketing authorization (or a
verifiable market delay) for the device for the indication covered by
the Breakthrough Devices Program designation.
In summary, in the CY 2021 OPPS/ASC proposed rule, we proposed to
amend the regulations in Sec. 419.66(c)(2)(ii) to state that ``A new
medical device is part of the FDA's Breakthrough Devices Program and
has received marketing authorization for the indication covered by the
Breakthrough Device designation.''
We did not receive any comments regarding the technical
clarification outlined in the CY 2021 OPPS/ASC proposed rule that in
order to be eligible for the alternative pathway to the OPPS device
pass-through substantial clinical improvement criterion, the device
must receive marketing authorization for the indication covered by the
Breakthrough Devices Program designation. Therefore we are finalizing
our proposal to amend the regulations in Sec. 419.66(c)(2)(ii) to
provide that ``a new medical device is part of the FDA's Breakthrough
Devices Program and has received marketing authorization for the
indication covered by the Breakthrough Device designation.''
4. Comment Solicitation on Continuing To Provide Separate Payment in
CYs 2022 and Future Years for Devices With OPPS Device Pass-Through
Payment Status During the COVID-19 Public Health Emergency (PHE)
In the CY 2021 OPPS/ASC proposed rule, we solicited comments on
whether we should adjust future payments for devices currently eligible
to receive transitional pass-through payments that may have been
impacted by the PHE, and if so, how we should implement that adjustment
and for how long the adjustment should apply. On January 31, 2020, HHS
Secretary Azar determined that a PHE exists retroactive to January 27,
2020 \65\ under section 319 of the Public Health Service Act (42 U.S.C.
247d) in response to COVID-19, and on April 21, 2020 Secretary Azar
renewed, effective April 26, 2020 and again effective July 25, 2020,