CMS dials back plan to slash payment for off-campus services by half

The CMS finalized its proposal to slash what Medicare pays for healthcare obtained at medical facilities that are owned by hospitals but located off their campuses. The agency released its finalized 2018 physician fee pay rule last week, dropping off-campus facili-

ties’ rates from 50% to 40% of what they would have been paid under outpatient rates. Originally, the CMS had proposed to drop the rate to 25%.

The Obama administration last year finalized a rule that paid hospital off-campus facilities the same as hospital-based outpatient departments if they started billing Medicare after Nov. 2, 2015.

But the smaller reimbursement cut did little to assuage hospitals’ concerns. Tom Nickels, executive vice president of the American Hospital Association, said he was “particularly concerned about the impact on rural and vulnerable communities that do not have sufficient access.” Dr. Bruce Siegel, CEO of America’s Essential Hospitals, said the policy “aggravates already damaging cuts” that are hitting the 340B program next year.

The prior, more generous payment made to off-campus facilities has led to hospitals acquiring physician practices at a rapid clip. But hospitals say the facilities, while increasing their operating costs, allow them to provide greater access to healthcare.