I have to admit I cracked a smile when I heard about the proposal to do away with so-called provider-based billing. I always found that term kind of humorous, since it’s actually hospital and provider billing rather than billing for the provider’s services. It’s always felt like a cash grab by hospitals, who snapped up physician practices and added facility fees without so much as changing a light bulb in the doctor’s office. Physicians who became hospital employees during this time often didn’t realize what they were getting into, only to begin to hear from angry patients who didn’t understand why they were receiving two bills for physician services that previously cost less.
It’s being referred to as “site neutrality,” which although accurate, doesn’t sound very sexy. Payment for a given service would be the same regardless of whether it’s delivered in a physician office or a clinic that’s considered an outpatient department of a hospital. Leveling this charge playing field has been discussed for the last several years; endorsed by Congress and the Medicare Payment Advisory Committee; and was been supported by previous administrations, although loopholes have allowed hospitals continue to take advantage of their cash cow by exempting existing outpatient departments from rate cuts.
Including hospital facility charges for basic outpatient visits serves to drive up costs for Medicare as well as patients. Hospital organizations try to justify the charges by explaining that they need to charge more in different ways to make up for shortfalls due to Medicaid cuts as well as money spent on charity care and to finance all the services that are on standby for patients.
The Hospital Outpatient Prospective Payment System rule released this week aims to end this grandfathering for certain services, including routine physician visits. This would result in hundreds of millions of dollars of savings for Medicare, and by extension, should save patients about $150 million through reduced co-payments. The proposal doesn’t touch most of the procedures where hospitals make a great deal of money, however.
It’s not surprising that hospitals are pushing back and litigation may follow. I enjoyed the Twitter thread that followed Farzad Mostashari’s post about it, with various health IT personalities weighing in on his thoughts. The rule also addresses some drug payment issues and promotes movement of services from inpatient facilities to outpatient settings. The hospital lobby is powerful and it’s not clear whether the rule will stay in its current form.
Of the physicians I’ve chatted with since the rule came out, many are ambivalent about the change. Most are employed physicians who didn’t see any increase in their compensation when their employers started charging facility fees, but they did have patient complaints and some lost patients to independent competitors who didn’t charge facility fees. They’re just happy they won’t have to deal with the negative aspects.
Some of the older physicians appreciated that it might help prolong the solvency of Medicare, allowing them to actually take advantage of it as patients. A few of the surgical subspecialists (who were almost universally independent) had no idea what provider-based billing even was, so that they didn’t have an opinion on site neutrality.
They did have an opinion, however, about the movement of services to outpatient facilities since several of them are involved with ambulatory surgery centers. Under the rule, there will be additional procedures payable at surgery centers along with language to ensure payment parity for ASC procedures using high-cost devices. The goal is to help ASCs be competitive, so it’s not surprising that the surgeons’ ears perked up.
I’ve been following along with the CMS campaign for “Patients Over Paperwork” and just saw the July newsletter. This edition was mostly focused on how CMS is trying to address burden in the context of skilled nursing facilities. There were several comments from stakeholders that were included and I appreciated their candor. One example: “Unfortunately, health care has evolved into this: head in a bed, payer, and a pulse – and that’s it. I think everybody has lost sight of the actual … care of the patient. Nobody really looks at that any more.” That sentiment is true at far too many places of service, not just nursing facilities. We’re violating the basics of what we learned in medical school, treating “the numbers” instead of the patients in front of us. We’re checking boxes and following rules and not truly getting to know our patients or how best to help them.
There were a couple of bright spots in the newsletter, although reading through the lines, they were a little bit tardy. One such bright spot was about simplifying documentation, although the example given was a bit of a slap and a kiss at the same time. CMS apparently updated certain payment rules for podiatrists, orthotists, and prosthetists. Now it is “allowing payment for therapeutic shoe inserts made with current technology.” You got it, folks – CMS required providers to take an actual impression of the patient’s foot for them to be paid rather than using the digital image technology that many foot specialists have been using for years. Why this took so long is baffling, and it makes my arches ache just thinking about it since I had my own orthotics created from a digital scan several years ago. I had no idea Medicare still required patients to step on pieces of foam in a cardboard box that was then mailed off to the lab. I’m sure there are mail carriers across the country that will be glad to not have to pick up the boxes at the practice’s front desk.
I hadn’t seen the newsletter previously, so I’ll have to keep an out for it moving forward. This is only the sixth issue, so I don’t feel too bad about having missed it. There is so much to keep in with in my inbox – a steady stream of government announcements, payer updates, drug recalls, and more. Then, there are the fun things such as reader mail, rumors, and industry gossip. And of course, there are the messages for my actual day job, which pays the bills but isn’t as fun as the former.
What’s your favorite part of your inbox? Leave a comment or email me.
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