Final Rule on HOPPS Shows Few Improvements for Radiology and Radiation Oncology
The Centers for Medicare and Medicaid Services (CMS) has published its final decision on how hospital outpatient payments will be set for 2005. Medicare continues to move forward with its goal to purely rely on its hospital cost and charge information. Most of the ACR's comments on Medicare's Proposed Rule focused on many important radiology and radiation oncology procedures that are subject to huge cuts as a result of implementation of hospital data that appear to be flawed. The ACR's concern is that hospitals will identify these services as loss leaders and will make decisions not to provide them, resulting in less access for patients and thus lowering quality patient care. Many of these services include computed tomography angiography, intensity modulated radiation therapy, radiation physics consults, PET, and PET/CT.
The ACR is concerned with CMS' current method of collecting cost/charge ratios from hospitals and how they are applied to hospital charges in order to come up with costs to calculate ambulatory payment category (APC) weights. There appears to be an imbalance in how these charges were set and cost/charge ratios were applied pre-HOPPS/APCs versus the current system. The ACR believes that this flaw is affecting many of the new technologies, which are under-reimbursed by as much as a third of their average payment level. Following is a summary of the ACR's comments and Medicare's reply.
Radiation Physics Consultation
The ACR strongly opposed CMS' proposal to move 77370 (special medical radiation physics consultation) from APC 0305 (Level II therapeutic radiation treatment preparation) to APC 0304 (Level I therapeutic radiation treatment preparation). However, Medicare has decided to move this code under the rationale that the calculation of its APC was based on calculating 33,070 single procedure claims; it believes the cost of this procedure is adequately reflected at $134.22 for 2005, a 33% cut from the 2004 rate of $200.60.
Intensity Modulated Radiation Therapy
The ACR continues to comment that intensity modulated radiation therapy (IMRT) (code 77418) should not have been moved out of the new technology APC for 2004, causing a 28% cut in reimbursement. It should have remained in the new technology APC like IMRT planning (77370), which was developed by CPT® at the same time. However, CMS continues to disagree because it calculated the payment weight using 246,045 single procedural claims to come up with a payment rate of $307.78 for CY 2005.
PET and PET/CT
There are a number of PET procedures that are currently classified under the new technology APC 1516, which are due to be moved to regular APCs. Medicare offered 3 options for public comment: 1) remain in APC 1516; 2) move to regular APC; or 3) calculate PET APC at a blended rate of what is being paid in APC 1516 at a rate of $1,450.00 and what would be calculated from the hospital claims data for a regular APC. Medicare has 55,838 claims to use for calculating a PET payment rate but is cautious to not let the rate change be too dramatic; therefore, Medicare chose to implement option 3. The 50/50 blended payment rate for CY 2005 is $1,150.00.
There were new PET and PET/CT codes up for consideration and incorporation into the hospital outpayment prospective system for 2005. CMS has decided to not recognize these new codes and thus not place them in new technology APCs for 2005 payment. For PET, CMS states in the rule that it believes "the existing G-codes for PET scans adequately serve the purpose of tracking utilization of PET scans for various indications and will continue to recognize the existing G-codes for PET."
With respect to PET/CT, Medicare believes "existing codes for billing a PET scan along with an appropriate CT scan preserve the scope of coverage intent of the PET G-codes as well as allow for the continued tracking of the utilization of PET scans for various indications." Medicare plans to use billing guidance through program instructions and provider education articles for hospitals to provide guidance on how to appropriately bill for both a PET and CT scans in the near future.
Proton Beam Therapy
Several commenters, including the ACR, asked that the proton beam delivery codes (77523 and 77525) remain in the new technology APC 1511 at $950.00 for 2005. However, CMS will move the proton therapy codes from the new technology APCs to regular APC assignments. The payment rate for these two delivery codes will be $850.00 for CY 2005.
Computed Tomography Angiography
The ACR pointed out that computed tomography angiography (CTA) is not valued appropriately in the APCs and should be valued much higher than its counterpart CT study. The ACR requested that CMS consider combining the data from CT and 3D (76375) in order to calculate the weights for the CTA APCs. CMS replied its intent is to rely on the hospital cost data if at all possible and it wants to rely on it 100% by 2007. Therefore, CMS has denied all requests to calculate these APCs differently and will continue with its current method. CMS did acknowledge many claims may be flawed where hospitals are not structuring their charges appropriately; however, it says hospitals must manage their charge structures in a manner that accurately and best reflects the services provided. This same type of ruling was made for computerized reconstruction CT of the aorta used for preoperative planning and evaluation post vascular surgery and kyphoplasty.
Mammography Services
As a result of proposed legislation by the ACR that was appended to the Medicare Modernization Act both screening and diagnostic mammography will be paid at the Medicare Physician Fee Schedule rate for 2005. These efforts increased the payment rate for unilateral and bilateral diagnostic mammography under HOPPS from $35.46 in 2004 to $41.82 and $51.53 respectively for 2005. Although this produced a limited increase it did raise the relativity of diagnostic mammography above screening so that it now shows the more extensive study is paid at a higher rate.
Complex Interstitial Radiation Application
The ACR is pleased CMS will apply increased payment rates for interstitial brachytherapy. CMS has reviewed the claims for interstitial brachytherapy (code 7778), found errors in cost reporting, and has set an unadjusted payment rate of $1,248.93 for 2005. This is a significant increase from the 2004 rate at $589.72.
Transitional Pass-Through Payments for Drugs, Biologicals, and Radiopharmaceuticals
As a result of the MMA, CMS will continue to pay separately for all drugs, biologicals, and radiopharmaceuticals when the costs exceed $50.00 in 2005. This is a recent positive change given that Medicare's threshold for separate payment of these items was $150.00 for 2003.
CMS discusses the classification and payment for 3 radiopharmaceutical products, including Rubidium Rb-82, Ammonia N-13, and FDG for PET. It points to the legislation that states radiopharmaceuticals are classified as a "specified covered outpatient drug" and their payment is dependent on their classification as a single-source, multiple-source, or noninnovator multiple-source product.
CMS classified FDG as an innovator multiple-source drug and has assigned it to HCPCS code C1775 for CY 2005. This means that, according to legislation, it must be paid at a rate no higher than 68% of the average wholesale price (AWP) for the drug. Rubidium Rb-82 is being classified as a sole-source product. The HCPCS code is Q3000 and will be paid at 83% of AWP or $153.39 per dose. CMS does reference the ACR's comments that Rubidium and Ammonia should not be crosswalked in price because the resources used to make them are very different. CMS classified Ammonia N-13 as a "specified covered outpatient drug"; however, it cannot determine the AWP in order to set the price. Therefore, CMS is going to use median hospital claims data for this product, which calculated to a price of $109.86 per dose for CY 2005.
CMS also classified and set prices for Zevalin and Bexxar for 2005. These are radiopharmaceuticals used for mono- clonal antibody radiotherapy. These meet the definition of a sole-source drug and therefore cannot be paid less than 83% of AWP or more than 95% of AWP.
Required Use of C-Codes for Devices and Payment for Brachytherapy Services
The ACR continues to support mandatory requirements for C-codes for brachytherapy devices and other important devices to be reported separately from the procedure. The benefits of this extra coding are not only for payment for the devices but also to improve collection of accurate cost data for all elements of radiology and radiation oncology procedures. CMS required hospitals to include device category C-codes on claims when such devices are used in conjunction with procedures, effective January 1, 2005. In the rule, CMS specifies it will continue to pay for brachytherapy sources separately on a "per source" basis using the existing C-codes and descriptors. APC 0313, brachytherapy, payment rate, was adjusted to reflect the unpackaging of the brachytherapy source.
CMS also implemented the two new brachytherapy codes for brachytherapy source, high activity, Iodine-125, and Paladium-103, per source.
Conversion Factor
The conversion factor for the hospital outpatient payments is $56.98 for CY 2005.
Any ACR member who has questions or comments on the HOPPS Final Rule can call the Economics Department at (800) 227-5463, ext 4043.