Medicare’s Final Payment Rule: Solid Progress for ASCs in 2024

In this episode of the Advancing Surgical Care Podcast, ASCA Chief Executive Officer Bill Prentice talks with ASCA Regulatory Counsel and Director of Government Affairs Kara Newbury about the 2024 outpatient payment and quality reporting rule the Centers for Medicare & Medicaid Services released on November 2, 2023. A highlight of the conversation is their discussion of ASCA’s successful efforts to add several dozen new codes to the ASC Covered Procedures List (ASC-CPL). These include total shoulder arthroplasty, a procedure ASCA has long encouraged Medicare to allow its beneficiaries to access in orthopedic surgery centers. Prentice and Newbury also discuss a payment update that rises above the amount projected in the proposed rule, prospective changes to the ASC Quality Reporting Program and more.

Transcript

Narrator:   0:01
Welcome to the Advancing Surgical Care Podcast brought to you by ASCA, the Ambulatory Surgery Center Association. ASCA represents the interests of outpatient surgery centers of every specialty and provides advocacy and resources to assist them in providing safe, high-quality, cost-effective patient care. As with all of ASCA’s communications, please check to make sure you are listening to or viewing our most up-to-date podcasts and announcements.

Bill Prentice:   0:27
Hi, I’m Bill Prentice and I’m ASCA’s CEO and the host of this episode. On this ASC podcast, I’m pleased to welcome back Kara Newbury, ASCA’s regulatory counsel and director of government affairs. And I’ve invited Kara onto the podcast today to discuss the final 2024 ASC payment system and quality reporting rule that was released by the Centers for Medicare & Medicaid Services, or CMS, on November 2. And this year, I’m very pleased to report that thanks to ASCA’s efforts, the final rule was improved substantially compared to the draft that was proposed this summer. And we were particularly pleased by the addition of total shoulder arthroplasty to the ASC covered procedures list, something we’ve been urging CMS to approve for the last several years. We also won approval of several other procedures and an improved inflation rate adjustment but before I say more about the rule, let me bring Kara into the discussion. Kara, welcome.

Kara Newbury:   1:19
Thanks, Bill.

Bill Prentice:   1:20
So, Kara, again, a big thank you to you and the entire ASCA government affairs team for your work during the Medicare rulemaking process, convincing CMS to add total shoulder to the ASC covered procedures list was the result of, I know, the substantial advocacy effort on the part of ASCA and our members. Can you talk about the work we did this year, over the course of this year, to advocate with CMS on behalf of our members.

Kara Newbury:   1:43
Sure, Bill. And as you know, often, the addition of some of these procedures is a multi-year process. So, once we were successful in getting knee and hip added to the ASC covered procedure list, we really shifted our focus to total shoulder and as well as total ankle replacement and very pleased to see that both of those procedures were added. It requires several meetings a year with CMS, including the meeting that we had most recently, just a month ago, really with the CMS chief transformation officer, Doug Jacobs, and some of the staff at CMS and we were joined by Dr. Weinstein, who’s on the ASCA Board and does total shoulder replacements. And so, I think his story was really the most compelling that we could offer to CMS. Dr. Weinstein said, “How come my colleagues who are doing total knees and total hips are allowed to do so on the Medicare population, and I’m not allowed to do shoulders.” And I think that that really resonated with the staff. We also provided research for the past three years on outpatient total shoulder and total ankle, and we were able to get some data from some of our members, so, thank you all that helped with that some were participating in the Hospital Without Walls program and so, they were able to do total shoulders on the Medicare population as they were serving as a hospital. So that data was definitely compelling and then we did also have some private payer data that we shared with CMS, over the past couple of years, from facilities that have been doing total shoulder for a long time. So, we’ve already been hearing from our members, saying, you know, how excited their doctors are, how they’re going to be able to, you know, fill up an entire day now, at a surgery center doing total shoulder is really going to help with their practice.

Bill Prentice:   3:39
I can’t overstate though, for our listeners. I mean, what a change this was from the proposed rule to the final rule that anyone who heard me speak over the last few months has heard me express a lot of frustration with the agency. Because in the proposed rule, there was nothing about adding any of these procedures and, and indeed, for the last couple of years, we were very concerned that the medical directors were actually moving in the opposite direction with some of their philosophy. So, I really think this meeting that we had last month, you know, inviting Dr. Weinstein on and you to talk to CMS leadership and express our frustration about how they were just not keeping up with current clinical practice and leaving millions, if not billions of dollars, on the table over time, by not allowing us these procedures was a huge mistake. So, I really can’t thank you enough for making this really kind of U-turn for the agency in terms of giving these procedures that I think we know we can safely be performing.

Kara Newbury:   4:37
It is very rare to see procedures added to the final rule that were not proposed, as you mentioned, Bill, and I’ve been getting a lot of very stunned emails from people because we had been trying to level set with our members and you know, not get anybody’s hopes up. And so, a lot of people are I think even more pleasantly surprised because we didn’t expect this. I do want to also just note quickly, because this wasn’t in any of our information that was released, we do have our rate calculator up now. So, facilities can go and check out the payment rates for the new codes that were added, shoulder, ankle, we also got a thyroid code that I know a lot of our members had requested. But importantly for the joint replacement codes, they were put into a different APC group, so Ambulatory Payment Classification group, then knee and hip, they are more complex and costlier than the implants. So, I think that that’s important to note, the reimbursement at the national level is approximately $14,000 in the ASC, for shoulder and a little higher for ankle. So do make sure that you’re checking out the rate calculator on ASCA’s website to see what your local rate will be for those procedures in 2024.

Bill Prentice:   5:54
That’s great information. Well, Kara, we need to take a pause for a quick message from our podcast sponsor so standby and we’ll be right back.

Narrator:   6:01
This episode of the Advancing Surgical Care Podcast is brought to you by AMSURG, a national leader in the strategic and operational management of ambulatory surgery centers. AMSURG partners with more than 2,000 physicians and health systems and more than 250 ASCs operating in 34 states. Learn more by visiting amsurg.com.

Bill Prentice:   6:22
So, Kara, there are still hundreds of codes that CMS has approved for hospital outpatient departments yet not had approved for ASCs. I’m hopeful that the progress we saw on the current role is a harbinger for a more thoughtful and clinical approach on behalf of CMS. Any thoughts about that?

Kara Newbury:   6:39
Yes, as you know, it’s still unfortunately a piecemeal process where we are strategically targeting certain procedures every year and trying to get them added. We have for the past several years advocated for CMS to just align what is allowed in the hospital outpatient department setting with what is on the ASC covered procedure list. Once again, in this final rule, CMS indicated that it is not comfortable making that leap. So, I don’t think anytime soon, we’re just going to see them, you know, automatically allow anything that is payable in the hospital outpatient department setting to also be payable in the ASC. There is the new process that starts in January, where stakeholders may submit codes through a CMS portal and there will be more information to come from ASCA in the next few weeks on this because we certainly want to work with our members to make sure that we are requesting all of the procedures that you all would like to see added to the ASC covered procedure list. And the nice thing about that portal is that it will all be you know sent to CMS, so presumably public information and so everyone will know what has been submitted for consideration. And so, if it’s not added, then you know, we can pressure CMS, we can ask for more information in terms of you know why they believe clinically, this should not be allowed in the ASC setting. But I don’t see any, you know, significant change unfortunately, in the process Bill, I think it’s still going to be us, you know, requesting codes and getting a few here and there. Just because CMS has not indicated that they’re comfortable adding 400 codes at once again.

Bill Prentice:   8:31
Essentially just creating one outpatient procedure list, right?

Kara Newbury:   8:33
Correct.

Bill Prentice:   8:37
To just reiterate, so anyone out listening who thinks there’s a procedure that they’re performing, that should be on the Medicare list, make us aware of that. But in reality, send us some data too don’t just tell us the code obviously give us some evidence that we can share with the agency or that they can then share through this portal. So that we’re well armed with in terms of trying to make you know, the case for any given procedure.

Kara Newbury:   9:03
That has been a challenge with some of the codes that have been requested in the past. They’re more aspirational all say and codes that facilities would like to see added, but they’re not even really performing them yet on the private payer population. Those are going to be a bigger lift than procedures that are already being done in the ASC setting.

Bill Prentice:   9:22
So, Kara, let’s move on to the inflation update for 2024. Again, we saw a modest improvement over the initial inflation update in the proposal. Can you speak to the update and nuance of how that applies reimbursements overall and what our long-term strategy is with that inflation update?

Kara Newbury:   9:38
Sure, Bill and we are slated to get a 3.1 percent update across the board, which is slightly higher, 0.3 percent higher than what was in the proposed rule. You know, we recognize that all of your costs and are rising you know at a higher rate than that but I hate to, I hate to say it’s better than it’s better than the alternative. If you look at what’s happening to some of the other payment systems, the Medicare Physician Fee Schedule, for instance, they’re seeing another cut this year. So, a 3.1 percent increase, on average, is okay. But you know, better than it could be.

Bill Prentice:   10:19
Well, that’s a great point. I’m sorry Kara to interrupt but that’s a great point. Because he, you know, we’ve seen, obviously, other provider groups rules come out. And if you look at them, we did very, very well, relative to a lot of other provider groups in terms of how you know, our Medicare rate and other elements in the rule. So, again, this is pretty, pretty good year for us.

Kara Newbury:   10:41
And I do want to just remind everyone that the 3.1 percent update is across all procedures, it’s the average. So, we do have resources available on our website. So, you can check and see what the specific rates are for the procedures that you’re most interested in as well. I will have a webinar coming up in early December, where I do review for like the top 10 and top 100 codes, what the update will look like for some of those procedures. And it’s important to note that we are going to continue to be updated on the hospital market basket for the next two years. ASCA successfully advocated for alignment of the hospital outpatient department and ASC update factor, which is the hospital market basket for the past five years. And we’re able to get that two-year extension. And we will continue to advocate for permanent application of the hospital market basket as our update factor. I know for a while there, the consumer price index for All Urban Consumers, which is what we were previously updated on was slightly higher because of how inflation was going. But we’ve seen that normalize, and that’s historically not the case. So, we do think that long term, it’s better to be, you know, aligned with the hospital outpatient departments and to get that hospital market basket update.

Bill Prentice:   11:59
Great. Yeah, all very important. And obviously members can help us going forward trying to see we can make that hospital market basket our permanent inflation update factor. So, Kara, my last question concerns the ASC Quality Reporting Program for Medicare and a new reporting measure that’s for ASCs that perform hip and or knee arthroplasty, can you talk about this measure and when it goes into effect?

Kara Newbury:   12:21
Absolutely bill, there is a new patient reported outcome-based performance measure quite the mouthful for total hips and total knees in the ASC setting that will go into effect for 2028 reporting period. Now, that is a one-year delay from what was in the proposal ASCA requested while we requested for the measure to be paused but we also asked for a delay due to the implementation of other measures that are going to require our time and effort in the coming couple of years. I do also want to note that we used the proposal of this measure to once again advocate for additional joint replacements to be added to the ASC covered procedure list because we said if total joints are so prevalent already in ASCs, that you are adding a new quality reporting measure to our program, then I think that total shoulder and total ankle deserve more consideration for addition to the ASC covered procedure list.

Bill Prentice:   13:26
Great. Well listen, Kara, again, a great year for ASCA in terms of this Medicare rule, and hopefully it’s just the start of some momentum that we’re going to build on to get further improvements to the Medicare program on behalf of our members. And, again, kudos to you and the entire government affairs team for your efforts over the year. I know they’re very much appreciated by the membership. So, thank you.

Kara Newbury:   13:48
Yes, thanks to you, Bill. And thanks to all of our members who submit comments and provide data—it really did help this year.

Bill Prentice:   13:56
Well once again, if anyone listening has additional questions, please don’t hesitate to contact us or visit the ASCA website, our new and improved ASCA website I might add, were more details about the final payment rule can be found. And finally, before closing, I would once again like to thank our podcast sponsor AMSURG, a leading ASC management company with more than 250 ASC partners in 34 states. To learn more, visit amsurg.com.