FY2015 Final Hospital Inpatient Rule Summary

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1 FY2015 Final Hospital Inpatient Rule Summary Interventional Cardiology (IC) Peripheral Interventions (PI) Rhythm Management (RM) On August 4, 2014, the Centers for Medicare & Medicaid Services (CMS) released Final Hospital Inpatient Prospective Payment System (IPPS) rates for FY2015. CMS final payment and policy changes will go into effect October 1, Overall payment rates will increase slightly, with a 1.4% increase for hospitals that successfully participate in the Hospital Inpatient Quality Reporting (IQR) Program. See Table 1 on page 5-6 for payment rates for procedures of interest to IC, PI, and RM. IPPS FINAL RULE HIGHLIGHTS CMS continues to refine pay-for-performance programs (e.g., readmissions reduction program, hospital-acquired conditions, value-based purchasing program) to drive improvements in quality and patient outcomes. CMS will increase the penalty/bonus in the Hospital Value-Based Purchasing (VBP) program from 1.25% to 1. 5%. For the first time, CMS will penalize the worst performing hospitals with hospital-acquired conditions (such as surgical site infections after implant of cardiac electronic implantable devices) with a 1% reduction in inpatient payment. Congress delayed the October 1, 2014 ICD-10-CM coding implementation date by one year. Some hospitals have indicated the transition will be burdensome and they are not ready for the documentation requirements and necessary changes to their IT billing system. Coding updates for new technology and clinical diagnoses are on hold until ICD-10-CM implementation; no new ICD-9-CM codes will be added. Boston Scientific provides information regarding the ICD-9 to ICD-10 transition in a complimentary on-demand webinar, available at (select Reimbursement, Webinar). Topics include basics of the ICD-10 CM and PCS (diagnostic and procedural) coding systems and ICD-10 preparation tips. Attendees may earn 1.5 Continuing Education Unit (CEU) from the AAPC. Inpatient Admission and Medical Review Criteria (Two Midnight Rule) The utilization of RAC audits to enforce the Two Midnight Rule is delayed through March 31, 2015; however hospitals are still feeling the impact as RACs may still probe and educate to guide hospital and physician compliance. The American Hospital Association filed a lawsuit claiming the Two Midnight Rule is a burden to hospitals with arbitrary standards and documentation requirements. While there have been a significant number of stakeholder comments and advocacy activities about the Two Midnight Rule, CMS has not withdrawn the rule. CMS says it will continue to actively work to address the complex question of how to improve payment policy for short inpatient hospital stays. No action was taken at this time as CMS looks for a budget neutral solution in potential future rulemaking. Page 1 of 6

2 Readmission Reduction Program The Hospital Readmissions Reduction Program will continue to assess hospitals readmission penalties using five readmissions measures endorsed by the National Qualify Forum (NQF): heart attack, heart failure, pneumonia, chronic obstructive pulmonary disease and hip/knee arthroplasty. For FY 2015 the maximum reduction will increase from 2% to 3%. CMS also finalized a methodology that accounts for planned readmissions of the existing readmissions measures and CMS will add another new readmission measure beginning in FY 2017: readmissions for coronary artery bypass graft (CABG) surgical procedures. Changes to the Hospital Value-based Purchasing Program (VBP) The Value-Based Purchasing Program (VBP) builds upon the current Inpatient Quality Reporting Program, using performance data to adjust payments. In FY 2015, the VBP will redistribute 1.5% of hospital payments, which CMS estimates will allow for $1.4 billion in incentive payments. The incentive payments will be based on a hospital s reported quality and efficiency measures during a defined performance period. Notably, CMS is expanding the program to include Medicare spending per beneficiary for FY Selected cardiovascular measures are listed below: IQR: Inpatient Quality Reporting VBP: Value Based Purchasing AMI Mortality Readmissions Other Metrics Inpatient Mortality AMI 30-Day Mortality Rate AMI 30-Day Readmission Rate Median Time to Primary PCI Timing of Receipt of Primary PCI Acute Myocardial Infarction (AMI) 30-day mortality rate Primary PCI Received Within 90 Minutes of Hospital Arrival Heart Failure Mortality HF 30-Day Mortality Rate Heart Failure (HF) 30-day mortality rate Readmission Other Metrics Total Program Measures HF 30-Day Readmission Rate Evaluation of LVS Function ACEI or ARB for LVSD FY2015: 47 Measures (adding 11, removing 19) Discharge Instructions FY2015: 28 total measures including 12 Clinical Process, 8 Patient Experience of Care Measure, 5 Mortality Outcomes and 1 Efficiency Measure (based on 2013 performance measurement year) Addition of Heart Failure for Inpatient Quality Reporting CMS finalized the proposal to assess the value of hospital care for heart failure patients. Specifically, starting in FY 2015, CMS will begin collecting quality data on heart failure hospitalizations (which will be used to make payment adjustments in FY 2017). Page 2 of 6

3 Hospital Acquired Conditions (HAC) Reduction Program The HACs payment policy currently prohibits hospitals from being paid at a higher MS-DRG rate for patients with major complications if the sole reason for the higher payment is the occurrence of one of the conditions on the HACs list during the beneficiary s hospital stay. While CMS did not add or remove any conditions from the HAC list, CMS will implement a 1% payment reduction for the lowest-performing hospitals. New Technology Add-on Payment (NTAP) Applications For FY2015, CMS considered five device applications for New Technology Add-on Payments. All new technology applicants are subject to CMS criteria for newness, high cost threshold, and substantial clinical improvement. CMS approves NTAPs on the merits of meeting all criteria for newness, high cost threshold, and substantial clinical improvement. Boston Scientific withdrew its NTAP for the WATCHMAN Left Atrial Appendage Closure System as FDA approval was not obtained by July 1 st for this fiscal year s consideration. CMS approved two of the three cardiovascular-related applications. These include the MitraClip system for transcatheter mitral valve replacements ($15,000 maximum add-on payment per case) and the CardioMEMS Heart Failure monitoring system ($8,875 maximum add-on payment per case). SPECIFIC PAYMENT CHANGES Overall weighted average changes across key cardiovascular device-related procedures are provided below. DRGspecific changes are detailed in Table 1 on page 5. Cardiovascular stenting: Increase of 3.29% Percutaneous Transluminal Angioplasty (PTA), peripheral stenting and embolization procedures: Increase of 3.63% Cardiac rhythm management procedures: Increase of 0.57% Catheter ablation procedures: Increase of 3.35% Interventional Cardiology Drug-eluting stent weighted average base payments: Drug-eluting stent weighted average payment increase of 2.30% for the two MS-DRGs related to DES o Payment for MS-DRG 246 patients (i.e. a drug-eluting stent procedure for a patient with major complications or comorbidities) increases by 2.84% ($525) to $18,985 o For the treatment of patients without major complications or comorbidities (MS-DRG 247), the hospital reimbursement payment increases by 2.02% ($239) to $12,075 Bare-metal stent weighted average base payments: BMS weighted average payment increase of 4.29% across the two MS-DRGs o MS-DRG 248 up 4.33% ($741) to $17,838 and MS-DRG 249 up 4.26% ($451) to $11,032 Structural Heart Endovascular or Transthoracic Valves TAVR: CMS finalizes move of TAVR procedures from the current six MS-DRGs to two new TAVR specific MS- DRGs. The two new TAVR specific MS-DRGs allow improved alignment of costs and more appropriate reimbursement. Assuming the TAVR complication case mix stays the same, the net change in payments between the two systems is 14.9%. (14.87% increase with the new DRGs, 0.03% decrease if TAVR had remained grouped with the open valve procedures.) Page 3 of 6

4 Weighted average base payments: Weighted average payment across all the TAVR MS-DRGs is $45, Endovascular Cardiac Replacement with MCC ($51,329) 267 Endovascular Cardiac Replacement without MCC ($39,175) Peripheral Interventions Weighted average base payments: Peripheral PTA, stenting, atherectomy and embolization increases 3.63% to $15,411 for MS-DRGs 252, 253, 254 Cardiac Rhythm Management Weighted average base payments: ICD and CRT-D system implant payment rates decrease by 0.22% for MS-DRGs ICD and CRT-D system replacement payment rates increase by 1.69% for MS-DRGs 245 & 265 Pacemaker and CRT-P system implant payment rates increase by 0.81% for MS-DRGs Pacemaker and CRT-P system replacement payment rates increase by 4.00% for MS-DRGs Electrophysiology Weighted average base payments: Overall, payment rates for cardiac ablation cases increase by 3.35% (Note that WATCHMAN Left Atrial Appendage Closure Device also currently maps to cardiac ablation MS-DRGs. WATCHMAN is approved for investigational use in the United States.) * BSC has no ablation catheter FDA-approved for treatment of Atrial Fibrillation Disclaimer: Health economic and reimbursement information provided by Boston Scientific Corporation is gathered from third-party sources and is subject to change without notice as a result of complex and frequently changing laws, regulations, rules and policies. This information is presented for illustrative purposes only and does not constitute reimbursement or legal advice. Boston Scientific encourages providers to submit accurate and appropriate claims for services. It is always the provider s responsibility to determine medical necessity, the proper site for delivery of any services and to submit appropriate codes, charges, and modifiers for services that are rendered. Boston Scientific recommends that you consult with your payers, reimbursement specialists and/or legal counsel regarding coding, coverage and reimbursement matters. Boston Scientific does not promote the use of its products outside their FDAapproved label. Page 4 of 6

5 TABLE 1: SELECT CARDIOVASCULAR MS-DRG FY2015 FINAL PAYMENT CHANGES The table below shows final FY2015 MS-DRG national average base payment rates for select cardiovascular procedures and the percent change as compared to FY2014 MS-DRG final national average rates. The rates and percent changes shown are base payments. Actual rates may vary for individual hospitals due to geographic wage differences. MS- DRG Interventional Cardiology Procedure FY 2015 Final Rate FY 2014 Final Rate $ Change (FY2015 Final - FY2014 Final) % Change (FY2015 Final - FY 2014 Final) Drug-Eluting Stents 246 Percutaneous cardiovascular proc w drug-eluting stent w MCC $18,985 $18,460 $ % 247 Percutaneous cardiovascular proc w drug-eluting stent w/o MCC $12,075 $11,836 $ % Bare Metal Stents 248 Percutaneous cardiovasc proc w non-drug-eluting stent w MCC $17,838 $17,097 $ % 249 Percutaneous cardiovasc proc w non-drug-eluting stent w/o MCC $11,032 $10,581 $ % Angioplasty or Atherectomy without Stent 250 Perc cardiovasc proc w/o coronary artery stent w MCC $17,529 $17,330 $ % 251 Perc cardiovasc proc w/o coronary artery stent w/o MCC $11,965 $11,447 $ % New - Endovascular Cardiac Valve Replacement (TAVR) 266 Endovascular Cardiac Valve Replacement w MCC $52,742 NA 267 Endovascular Cardiac Valve Replacement w/o MCC $39,602 NA Structural Heart - Open Procedure Valves 216 Cardiac valve and other major cardiothoracic procedures with cardiac catheterization w MCC 217 Cardiac valve and other major cardiothoracic procedures with cardiac catheterization w CC 218 Cardiac valve and other major cardiothoracic procedures with cardiac catheterization w/o CC/MCC 219 Cardiac valve and other major cardiothoracic procedures without cardiac catheterization w MCC 220 Cardiac valve and other major cardiothoracic procedures without cardiac catheterization w CC $55,862 $54,981 $ % $37,123 $36,442 $ % $32,667 $31,470 $1, % $45,203 $45,928 ($725) -1.58% $30,533 $30,690 ($157) -0.51% 221 Cardiac valve and other major cardiothoracic procedures without cardiac catheterization w/o CC/MCC $27,185 $26,924 $ % Rhythm Management ICD Systems 222 Cardiac defib implant w cardiac cath w AMI/HF/shock w MCC $50,777 $51,133 ($356) -0.70% 223 Cardiac defib implant w cardiac cath w AMI/HF/shock w/o MCC $36,908 $37,266 ($358) -0.96% 224 Cardiac defib implant w cardiac cath w/o AMI/HF/shock w MCC $45,008 $44,787 $ % 225 Cardiac defib implant w cardiac cath w/o AMI/HF/shock w/o MCC $34,378 $34,337 $ % 226 Cardiac defibrillator implant w/o cardiac cath w MCC $40,808 $40,655 $ % 227 Cardiac defibrillator implant w/o cardiac cath w/o MCC $31,963 $32,128 ($165) -0.51% ICD Replacements 245 AICD generator procedures $27,266 $27,271 ($5) -0.02% 265 AICD Lead procedures $16,799 $15,595 $1, % Page 5 of 6

6 Pacemaker Systems 242 Permanent cardiac pacemaker implant w MCC $21,844 $21,743 $ % 243 Permanent cardiac pacemaker implant w CC $15,658 $15,494 $ % 244 Permanent cardiac pacemaker implant w/o CC/MCC $12,643 $12,532 $ % Pacemaker Revisions and PG Placements 258 Cardiac pacemaker device replacement w MCC $16,196 $15,792 $ % 259 Cardiac pacemaker device replacement w/o MCC $11,686 $11,287 $ % 260 Cardiac pacemaker revision except device replacement w MCC $21,970 $21,597 $ % 261 Cardiac pacemaker revision except device replacement w CC $10,882 $10,024 $ % 262 Cardiac pacemaker revision except device replacement w/o CC/MCC $8,199 $8,042 $ % Cardiac Catheter Ablation 250 Perc cardiovasc proc w/o coronary artery stent or AMI w MCC $17,529 $17,330 $ % 251 Perc cardiovasc proc w/o coronary artery stent or AMI w/o MCC $11,965 $11,447 $ % Peripheral Interventions Peripheral PTA, Stent, Atherectomy and Embolization 252 Other vascular procedure w MCC $19,148 $18,255 $ % 253 Other vascular procedure w CC $14,976 $14,599 $ % 254 Other vascular procedure w/o MCC\CC $10,150 $9,866 $ % MS-DRG = Medicare Severity Diagnosis Related Group Weighted Average based on 2013 MedPAR (Table 7B) inpatient volume distribution in MS-DRGs MCC = Major Complications and Comorbidities CC = Complications and Comorbidities COMMENTS / QUESTIONS If you have questions or would like additional information, contact: Interventional Cardiology (IC)/ Peripheral Interventions (PI): Tom Meskan IC & PI Deb Lorenz- IC Brent Hale- PI Rhythm Management (RM): Call CARDIAC (request Reimbursement Support) Additional Information Read the full FY2015 Final IPPS Rule (CMS-1607F) at the following link: Page-Items/FY2015-Final-Rule-Regulations.html?DLPage=1&DLSort=0&DLSortDir=ascendingl Page 6 of 6

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