CMS to Repay Hospitals for 2019 Reductions, More Litigation to Follow.


In a partial welcome sign for hospitals, the Centers for Medicare & Medicaid Services (“CMS”) recently announced the following regarding site-neutral payment policy:

  • CMS will repay hospitals for certain 2019 off-campus clinic visits (G0463):  2019 clinic visits provided in excepted (grandfathered) off-campus hospital outpatient departments (“HOPDs”) and paid at the reduced rate, will now be reprocessed automatically and paid at the full Outpatient Prospective Payment System (“OPPS”) rate.
  • However, CMS will continue the off-campus site-neutral clinic visit rate for 2020:  2020 site-neutral reimbursement will be implemented as per the 2020 OPPS Final Rule; clinic visits performed at grandfathered off-campus HOPDs will be paid 40% of the OPPS rate (this is being challenged in a lawsuit filed January 13, 2020).

As part of the 2019 OPPS Final Rule, CMS extended site neutral reimbursement to clinic visits performed at grandfathered HOPDs.  Effective January 1, 2019, clinic visits at these locations were paid 70% of the OPPS rate.  On September 17, 2019, a federal judge vacated the CMS site neutral payment rule for these clinic visits (see previous article).  On December 12, 2019, CMS filed a notice of appeal with the court.

In the meantime, to comply with the court’s order, 2019 clinic visits paid at the reduced rate will be automatically reprocessed with no provider action required.  Specifically, in the December 19, 2019 MLN Connects, CMS stated:

“CMS installed a revised Hospital Outpatient Prospective Payment System (OPPS) Pricer to update the rates being applied to claim lines.  The revised Pricer went into production on November 4, 2019, and applies to claims with a line item date of service of January 1, 2019, and after.  Starting January 1, 2020, and over the next few months, the Medicare Administrative Contactors will automatically reprocess 2019 claims paid at the reduced rate; no provider action needed.”

Advis recommends closely monitoring financial information to ensure 2019 claims are appropriately reprocessed.

As set out in the 2020 OPPS Final Rule, despite the reprocessing of 2019 claims, CMS intends to proceed with the implementation of full site-neutral reimbursement for 2020 clinic visits.  Therefore, 2020 clinic visits performed at grandfathered off-campus HOPDs will be paid at 40% of the OPPS rate.  On January 13, 2020, several hospital groups filed a lawsuit challenging the 2020 site-neutral implementation.

For any questions related to the site-neutral litigation, claims reprocessing, or any other healthcare or operational matters, please contact Advis at (708) 478-7030.