CMS Issues CY 2024 Proposed Rules for Medicare Hospital Outpatient Prospective Payment System (HOPPS) and Ambulatory Surgery Center (ASC)

On July 17, 2023, the Centers for Medicare and Medicaid Services (CMS) issued the proposed rule for the Medicare Hospital Outpatient Prospective Payment System (HOPPS) and Ambulatory Surgery Center (ASC) Prospective Payment System. These proposed rules cover outpatient hospital and ASC services furnished to beneficiaries on or after January 1, 2024. Highlights are described below.

For Outpatient Hospital:

  • CMS proposed a Conversion Factor of $87.488 for hospitals that meet the hospital outpatient quality (OQR) reporting program requirements; and a CF of $85.782 for hospitals that fail to meet the hospital OQR requirements.
  • CMS proposed payment rates increased by 2.8 percent for hospitals that meet the hospital OQR reporting program requirements; and a continuation of 2.0 percent reduction in payment for hospitals that fail to meet the hospital OQR requirements.
  • CMS proposed to continue the 5 percent cap wage index reduction. This means the wage index for FY 2024 would not be less than 95 percent of the finalized wage index for FY 2023 and would continue for subsequent years where the wage index for a given year would not be less than 95 percent of final wage index for the prior year.
  • CMS proposed to continue a 7.1% adjustment factor to payments to certain rural sole community hospitals; and proposed a budget neutrality factor for the rural adjustment at 1.0000.
  • CMS proposed to continue to reimburse drugs and biologicals purchased under the 340B program at the default rate of ASP plus 6 percent; utilizing only the “TB” modifier to identify 340B acquired drugs and biologicals; and the “TB” modifier descriptor (Drug or biological acquired with 340B drug pricing program discount, reported for informational purposes for select entities) would be changed effective January 1, 2024, to no longer include “…for select entities”, as all entities would report this modifier after this date.
  • No proposed changes to the Ambulatory Payment Classification (APC) payment policy or packaging policy, including continuation of special payment policy and methodology for the HOPPS complexity-adjusted comprehensive ambulatory payment classifications (C-APCs).
  • CMS proposed to continue to use code G0463 for the standardized code on which to base the relative payment weights, which means a continuation of a payment rate of 40% of the HOPPS rate for all off-campus outpatient departments, excepted and nonexcepted.
  • CMS did not propose to remove any procedures from the Inpatient Only List (IOL), but did propose to add 9 procedures that were newly created by the AMA CPT® Editorial Panel for CY 2024.These new services are described by the placeholder CPT® codes X114T, 2X002, 2X003, 2X004, 619X1, 7X000, 7X001, 7X002, and 7X003, which will be effective on January 1, 2024.
  • CMS proposed to amend several hospital price transparency (HPT) requirements for hospitals, including revised standard charge information and data elements which must be provided; use of a CMS developed template; improvement of accessibility by requiring a direct link to a publicly available webpage with the required machine-readable file (MRF); and improvement of the enforcement process.

For Ambulatory Surgery Centers:

  • CMS proposed a payment rates increase by 2.8 percent for hospitals that meet the Ambulatory Surgical Center Quality Reporting (ASCQR) Program; and a continuation of a 2.0 percent reduction in payment for ASCs that fail to meet the ASCQR program requirements.
  • CMS proposed Conversion Factor (CF) of $53.397 for ASCs that meet the ASCQR Program requirements; and a CF of $52.358 for hospitals that fail to meet the ASCQR Program requirements.
  • For the complexity adjustment payments, CMS finalized their proposal in CY 2023 to assign each eligible code combination a new C code that describes the primary and add-on code procedures performed. The new C codes would be added to the ASC CPL and when an ASC bills the C code, they will be paid the higher payment rate. For Cy 2024, CMS proposed to continue this special payment policy and methodology.
  • CMS proposed to maintain the criteria used to review and update the ASC covered procedure list (ASC CPL). Based on their review, they have proposed to add 26 dental procedures for CY 2024. In addition, codes 92985 and 93986 are proposed to be on the ASC covered surgical procedures list designated as permanently office-based.

The complete HOPPS/ASC proposed rule summary can be found on the GORE Coding Resource Center website under “Education – CMS Rules Updates”: https://gore.rccsclients.com/education/rules-updates/.