American Society of Hematology

Medicare Hospital Outpatient Prospective Payment System (OPPS) 2013 Final Rule

Published on: November 26, 2012

The Centers for Medicare & Medicaid Services (CMS) issued a final rule on November 15 updating payment policies and rates for both hospital outpatient departments (HOPDs) and ambulatory surgical centers (ASCs) for calendar year (CY) 2013. The rule can be found here. CMS projects that total payments for services furnished to Medicare beneficiaries in HOPDs during CY 2013 under the Hospital Outpatient Prospective Payment System (OPPS) will be approximately $48 billion.


Since August 2000, Medicare has paid hospitals for most services furnished in their outpatient departments under the OPPS. The OPPS payments cover hospital resources including equipment, supplies, hospital staff and overhead excluding the cost of services of physicians and nonphysician practitioners paid under the Medicare Physician Fee Schedule (MPFS).

Services under the OPPS are classified into payment groups called Ambulatory Payment Classifications (APCs). Procedures are assigned to an APC based on their clinical similarity and relative homogeneity in resource use as measured by estimated cost. There is a national APC rate for each service which is adjusted geographically based on relative differences in wages.

Each APC is assigned a cost weight which is multiplied by a monetary conversion factor to yield a payment rate. The cost weight assigned to an APC is based on the estimated costs of all procedures assigned to that APC. Estimated costs are derived from hospital charges adjusted to costs using each hospital's cost to charge ratio. Beneficiaries share in the cost of services by paying a 20 percent coinsurance or, for certain services, a higher copayment which is gradually being phased down to 20 percent coinsurance.

Significant Changes for CY 2013 

Update and Other Adjustments  

CMS is increasing the OPPS conversion factor by 1.8 percent for 2013 which is based on a 2.6 percent inflationary increase in the hospital market basket index less a 0.8 percent reduction provided for in statute. In addition, payments for hospitals failing to meet the hospital outpatient quality reporting (OQR) requirements will be further reduced by 2.0 percent.

Change in payment methodology from median costs to geometric mean costs  

Since the inception of the OPPS program, the cost weight assigned to an APC has been based on the median cost of all services assigned to that APC. Beginning in 2013, CMS will base the APC weight on the geometric mean costs of services in lieu of the median costs. CMS has been using the geometric mean to calculate DRG costs under the inpatient prospective payment system. The change to geometric means from median costs will be budget neutral across all hospitals and CMS' analysis shows that the proposed change would have a limited payment impact on most providers, with a small number experiencing payment gains or losses based on their service-mix. Some individual procedures will, however, see higher or lower payment.

Payment for Drugs and Blood Clotting Factor  

For CY 2013, CMS is increasing the rate paid for separately payable drugs and biologicals without pass-through status to average sales price (ASP) plus 6.0 percent. This is an increase from the current rate of ASP plus 4.0 percent. Drugs with estimated costs of less than $80 per day are packaged into the APC rate for the procedures and are not separately paid.

Blood clotting factor will also be paid at ASP+ 6 percent rate. In addition, CMS will continue the separate payment for the cost of furnishing blood clotting factor. The 2012 rate is $0.0181 per unit and the 2013 rate will be announced later this year. (ASH only and take clotting factor out of header for other clients)

Analysis of Changes of Interest to ASH  

Attached are tables showing the changes in payment from 2012 to 2013 for APCs of interest to ASH. There are 4 sets of tables: Transfusion and Blood Processing Codes, Drug Administration Codes, Procedural Service Codes and Blood Products. There are 35 transfusion and blood processing codes assigned to 4 APCs with the majority seeing substantial increases. The drug administration codes do particularly well with all but one seeing increases. For procedural services, apheresis, blood transfusion, bone marrow biopsy, harvesting and transplant codes all do well. However, flow cytometry and the more complex bone marrow/stem cell processing codes such as T-cell reduction will see some reduction in payment. Finally, payment for blood products is mixed with the payment for some of the low volume products varying substantially from year to year. The high volume blood procedures are much more stable with changes mostly in the +/- 5 percent range. The highest volume blood product code, P9040, Leukocyte reduced RBCs, will see about a 4 percent increase.

Hospital Outpatient Quality Reporting Program 

Under the Outpatient Quality Reporting Program, hospitals need to successfully report on the use of designated quality measures to avoid a 2 percent reduction in payment. The payment a hospital will receive in 2013 will be based on reporting of these measures in 2011; payments in 2014 will be based on quality reporting in 2012, and so forth. CMS is not adding any new measures to those previously finalized for the CY 2014 and CY 2015 payment determinations. The complete list of the quality measures for hospital outpatient reporting follows.

Hospital OQR Program Measures for the CY 2014, CY 2015 and Subsequent Year Payment Determinations 


OP-1: Median Time to Fibrinolysis

OP-2: Fibrinolytic Therapy Received Within 30 Minutes

OP-3: Median Time to Transfer to Another Facility for Acute Coronary Intervention

OP-4: Aspirin at Arrival

OP-5: Median Time to ECG

OP-6: Timing of Antibiotic Prophylaxis

OP-7: Prophylactic Antibiotic Selection for Surgical Patients

OP-8: MRI Lumbar Spine for Low Back Pain

OP-9: Mammography Follow-up Rates

OP-10: Abdomen CT – Use of Contrast Material

OP-11: Thorax CT – Use of Contrast Material

OP-12: The Ability for Providers with HIT to Receive Laboratory Data Electronically Directly into their Qualified/Certified EHR System as Discrete Searchable Data

OP-13: Cardiac Imaging for Preoperative Risk Assessment for Non Cardiac Low Risk Surgery

OP-14: Simultaneous Use of Brain Computed Tomography (CT) and Sinus Computed Tomography (CT)

OP-15: Use of Brain Computed Tomography (CT) in the Emergency Department for Atraumatic Headache*

OP-17: Tracking Clinical Results between Visits

OP-18: Median Time from ED Arrival to ED Departure for Discharged ED Patients

OP-19: Transition Record with Specified Elements Received by Discharged ED Patients**

OP-20: Door to Diagnostic Evaluation by a Qualified Medical Professional

OP-21: ED- Median Time to Pain Management for Long Bone Fracture

OP-22: ED Patient Left Without Being Seen

OP-23: ED- Head CT Scan Results for Acute Ischemic Stroke or Hemorrhagic Stroke who Received Head CT Scan Interpretation Within 45 minutes of Arrival

OP-24: Cardiac Rehabilitation Patient Referral From an Outpatient Setting ***

OP-25: Safe Surgery Checklist Use


*Information for OP-15 will not be reported in Hospital Compare in 2012. Public reporting for this measure would occur in July 2013 at the earliest.
**Data collection for OP-19 was suspended effective with January 1, 2012 encounters until further notice.
***Data collection for OP-24 would begin on January 1, 2014, and its first application toward a payment determination will be for CY 2015 rather than CY 2014.

2013 Final Hospital Outpatient Prospective Payment System (HOPPS) Regulations  

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