ParaRev Weekly eJournal, January 25, 2023

PROVIDERSMUSTWAITUNTIL FALL FORCMS 340B REMEDY

Facilities seeking to recover underpayments made by Medicare due to unlawfully reduced OPPSreimbursement for drugs purchased under the Health Resource Service Agency?s 340B program between 2018 and September 28, 2022, will have to wait until this fall to learn exactly how and when CMSplans to remedy that financial shortfall

By some estimates, nearly $10 billion dollars of underpayments are at stake Drugs purchased under the 340B program are reported with modifier JG on outpatient facility claims

PARA Dat a Edit or users can identify 340B discounted payments from Medicare by searching the CMStab for outpatient claims reporting modifier JG:

CMSasserts that due to budget neutrality requirements, it is unable to immediately remit payment to correct years of prior claims processing. The agency has promised to publish a proposed remedy prior to the publication of the 2024 OPPSProposed Rule, which is typically released in early summer. The final decision on repayment methodology should be released in the fall of 2023, commensurate with the release of Medicare?s 2024 OPPSFinal Rule

Dissatisfied with the delay in resolution, the American Hospital Association filed a motion with the United States District Court for the District of Columbia to require immediate repayment to the affected providers, claiming that this was the only appropriate solution to resolve the underpayments That motion was denied on January 10, 2023 The court?s decision included the following key excerpts:

?Plaintiffs argue that the Supreme Court?s holding in Becerra ?dictates a single possible remedy?: ?repaying those hospitals that were unlawfully underpaid, from 2018 to the present, the difference between what they were paid and ASP plus 6%.?? And this Court has already identified several potential remedies that the parties previously put on the table ? Thus, the Court is puzzled by Plaintiffs?attempt to now characterize the remedial path as providing just one option, and it fails to see what exactly that option is.

?To the extent Plaintiffs seek an order commanding HHSto repay each underpaid claim to the penny, that cannot possibly be the only rational choice available to the agency.As Plaintiffs readily acknowledge, HHScould seek to implement a remedy such as a prospective one-time rate increase that avoids calculating individual claims ?

?Although the Court declines to retain jurisdiction, it expects that HHSwill act promptly to remediate its underpayments ?

The AHA issued a press release which reported the court decision at the following link: https://www.aha.org/news/headline/2023-01-10-district-court-remands-case-hhs-determineremedy-340b-underpayments

PROVIDERSMUSTWAITUNTIL FALL FORCMS 340B REMEDY

?The U S District Court for the District of Columbia today decided to allow the Department of Health and Human Services to propose an appropriate remedy for its past underpayments to hospitals participating in the 340B drug pricing program. ? In the outpatient prospective payment system final rule for calendar year 2023, the agency said it would defer any proposal of a remedy for CYs 2018-2021 until sometime before its CY2024 payment rule, and in subsequent legal filings, the agency stated that it intends to announce a final remedy before the 2024 OPPSrulemaking cycle is complete next fall.

?In a statement shared with the media today, AHA General Counsel Melinda Hatton said, ?For more than five years, the Department of Health and Human Services has unlawfully withheld vital funding from 340B hospitals that helps them provide a range of important benefits to their patients and communities.

We are disappointed that the district court elected to extend this delay by remanding this case back to the department to determine the appropriate remedy. HHSrecently indicated that it expects to propose a remedy by April, and like the district court said in its opinion, the AHA ?expects that HHSwill act promptly to remediate its underpayments ?We look forward to continuing to work with the Administration to develop a plan to swiftly repay 340B hospitals, with interest, while ensuring the remainder of the hospital field is not penalized as they too continue to serve and care for their patients and communities.?

As a result of legal action taken by the AHA, the District Court previously ordered Medicare to stop applying the unlawful 340B discounts on claims processed on or after September 28, 2022. Medicare announced its compliance with that directive in its ?MLN Connects?edition dated October 13, 2022: https://www.cms.gov/outreach-and-educationoutreachffsprovpartprogprovider-partnershipemail-archive/2022-10-13-mlnc# Toc116466499

PROVIDERSMUSTWAITUNTIL FALL FORCMS 340B REMEDY

Background:

Beginning January 1, 2018, Medicare reduced OPPSreimbursement for separately payable (Status K) drugs purchased under the 340B program at certain hospitals In 2018, CMSadjusted the reimbursement amount for 340B drugs at the average sales price (ASP) minus 28 5 percent, although certain hospitals were excepted from the payment adjustment policy.In 2019, CMS dropped the reduction to ASP minus 22.5%.

Drugs which were not acquired through the 340B program were paid under the OPPSat ASP+6 percent in both 2018 and 2019. Affected hospitals are required to append modifier ?JG?(Drug or biological acquired with 340B drug pricing program discount) to outpatient claims reporting payable drugs to facilitate the discounted rate of payment

In 2019, CMScalculated payments made on drug charges with the JG modifier appended at .775 of the ASP(in other words, ASP minus 22 5% )That rate is lower than standard OPPS methodology of 106%ASP(ASPplus 6% ) Therefore, for every $100 in allowable paid on lines reporting modifier JG in 2019, affected hospitals could recover an additional $36 77

On June 15, 2022, the Supreme Court of the United States (SCOTUS) issued a decision that Medicare improperly reduced OPPSreimbursement to certain hospitals which purchase drugs under HRSA?s 340B program in 2018 and 2019 The full text of the court?s decision is available at https://www supremecourt gov/opinions/21pdf/20-1114 09m1 pdf )

PROVIDERSMUSTWAITUNTIL FALL FORCMS 340B REMEDY

CMScontends that due to budget neutrality requirements, reversing the current payment policy could cause Medicare to fund the additional expense by cutting OPPSreimbursement in other areas, or even recouping other payments made under OPPSin the same years.

According to a study commissioned by the Federation of American Hospitals, even rural OPPS hospitals that were exempted from the 340(b) cuts could eventually be affected by the fallout: https://avalere.com/insights/opps-340b-policy-reversal-lowers-hospital-payment-and-increases-copays#

? nearly half (49 4%) of all OPPS340B hospitals would see a net payment decrease in total OPPSpayments under a policy reversal. This occurs because the corresponding budget neutrality payment reduction for all non-drug items and services would outweigh the drug payment increase. The aggregate beneficiary cost-sharing amount for separately payable drugs across all OPPS340B hospitals is estimated to increase by $472.8 million under a policy reversal Of note, the specific cost-sharing amount a beneficiary pays for a drug or a service under OPPSis capped at the amount of inpatient hospital deductible, which is $1,484 in 2021

The American Hospital Association published a Special Bulletin on June 15, 2022, stating that ?Now that the Supreme Court has ruled, we look forward to working with the Administration and the courts to develop a plan to reimburse 340B hospitals affected by these unlawful cuts while ensuring the remainder of the hospital field is not disadvantaged as they also continue to serve their communities.?

https://www.aha.org/system/files/media/file/2022/06/2022-0615-Special-Bulletin-340BSupreme-Court-Decision pdf

?[u]nder the text and structure of the statute,? the case was ?straightforward?as a matter of law: ?Because HHSdid not conduct a survey of hospitals? acquisition costs, HHS acted unlawfully by reducing the reimbursement rates for 340B hospitals ?

PROVIDERSMUSTWAITUNTIL FALL FORCMS 340B REMEDY

Meanwhile, in October of 2022, Medicare Administrative Contractor Novitas Solutions (Jurisdiction JH) offered to reprocess any discounted 340B payments made in calendar year 2022 at the full APC rate; however, no other MAChas followed this example, including Novitas Solutions in Jurisdiction JL.

The Jurisdiction JH MACoffer to reprocess 2022 claims is found at the link below: https://www novitas-solutions com/webcenter/portal/MedicareJH/pagebyid?contentId=00259704

UNDERSTANDINGESTIMATESIN PRICETRANSPARENCY &NO SURPRISES

Withtheintroductionof theNoSurprisesAct,PriceTransparencyfor theinsuredindividual has becomeconfusedwiththeGoodFaithEstimatefor theuninsuredindividual.

It?s important to understand the difference of an estimate generated for an individual under the Price Transparency law and an uninsured individual under the No Surprises Act Price Transparency Tool (PTT) The PTTis a patient-facing online tool meant to be used by patients who are shopping for services prior to scheduling. These individuals can be insured or uninsured

The desired service must be available as a shoppable service to generate an estimate with the PTT Although generating an estimate for services involves a variety of contractual discounts and health insurance plan information, the PARA Price Transparency Tool (PTT) allows the patient to determine their cost from the provider-based web portal

More information about the PARA PTTcan be found at this link: PARA Price Tranparency Tool - Sept 2021 pdf (para-hcfs com)

UNDERSTANDINGESTIMATESIN PRICETRANSPARENCY &NO SURPRISES

PARA Dat a Edit or (PDE) Charge Quot e

When the patient is having trouble accessing or navigating the PTT, or the desired service is not a shoppable service, the Charge Quote tab of the PARA Data Editor (PDE) can be used by PDEUsers to generate a quote These quotes are not mandated by any laws, but the benefits of providing cost estimates prior to scheduled services include:

- Providing price transparency

- Providing estimates prior to service, avoiding unexpected financial liability

- Reducing Patient dissatisfaction directed at the provider

- Increasing self-pay collections while decreasing bad debt

The Charge Quote tool is available to PDEUsers under the Charge Quote tab

UNDERSTANDINGESTIMATESIN PRICETRANSPARENCY &NO SURPRISES

An instructional video on how to use the Charge Quote tool is available under the Advisor tab and can be found by keying ?Charge Quote?in the Summary field.

No Surprises Act Good Fait h Est im at e (NSA GFE)

The No Surprises Act (NSA) requires that all healthcare providers and facilities who schedule services for uninsured individuals provide a Good Faith Estimate (GFE) which meets certain requirements. PARA and CorroHealth have developed tools which include all of the required data elements and disclaimers as outlined in the NSA These tools (PDENSA Tool and NSA Co-Provider Portal) are available to PARA clients who act as the convening provider or the co-provider to issue a compliant GFEto uninsured individuals.

The PDENSA tool is accessed by PDEUsers to issue the GFEto uninsured individuals who are scheduling a service or requesting the price of a service

UNDERSTANDINGESTIMATESIN PRICETRANSPARENCY &NO SURPRISES

The NSA Co-Provider Portal is accessed by Users who work in conjunction with the convening provider to issue a comprehensive GFEof all reasonably anticipated charges from all anticipated providers during the scheduled service. The Co-Provider Portal can also be used to issue a GFE directly to an uninsured individual when the co-provider is scheduling the service in their office/clinic and is now considered a convening provider who must furnish all the required GFE data elements

A demonstration of how these two platforms work together to create a GFEcan be viewed at this link: CorroHealth NSA Platform Overview Demonstration (vimeo.com)

NO SURPRISESACTIDRDISPUTEFEEINCREASED BY 700% IN 2023

The administrative fee for the Independent Dispute Resolution (IDR) process has increased by 700%in 2023 The administrative fee to participate in a dispute related to the No Surprises Act (NSA) ban on balance billing jumped from $50 to $350. Given the significant increase in the fee, many providers may find that disputes are not worth the burden and forgo the process. With the volume of disputes filed in a five-month window exceeding the anticipated yearly volume, one can speculate that CMSis using the fee to alleviate some of the backlog.

In addition to the administrative fee hike, the threshold for the IDRarbitrators?fixed fee was increased to $700 in 2023, an increase of $200 over the 2022 rates. For batched cases, the maximum allowed fee increased from $670 in 2022 to $938 in 2023

Last year was the first year balance billing was banned under the NSA with respect to the following services:

- Emergency services

- Non-emergency items or services furnished by out-of-network (OON) providers at certain in-network health care facilities, and

- Air ambulance services furnished by OON providers of air ambulance services

The OON facilities and providers found themselves disputing reimbursement with health plans rather than balance billing patients The law created a process for providers and insurers to resolve payment disputes by entering into a baseball-style arbitration. When they couldn? t negotiate between themselves, they turned to certified IDRentities to resolve the dispute

The first report published by HHS, DOL, and the Treasury Department reported that over 90,000 disputes were submitted to the federal IDRportal between April 15 and September 30. The report provides some interesting data indicating how the system was overloaded Over 80%of the disputes originated from emergency department visits Only ten provider groups accounted for 75%of the disputes. United Healthcare was involved in 25%of the disputes followed by Aetna with 14% The complete report can be found at this link:

Initial Report on the Independent Dispute Resolution (IDR) Process (cms gov)

RECOVERINGFEES IN THE340B DRUGPROGRAM

In October, 2022, the United States District Court for the District of Columbia ruled in favor of the American Hospital Association who brought suit against the Department of Health and Human Services The court ruled that HHSmust immediately halt the departments?unlawful cuts to outpatient reimbursement rates for the remainder of 2022 for certain hospitals that participate in the 340B Drug Pricing Program. ?The prospective portion of the 2022 reimbursement rate shall be vacated because it is defective and because vacating this portion of the 2022 OPPSRule will not cause substantial disruption,?wrote Judge Rudolph Contreras. ?HHSshould not be allowed to continue its unlawful 340B reimbursements for the remainder of the year just because it promises to fix the problem later.? The AHA in August urged the court to halt the 2022 cuts, explaining that ?each and every passing day? HHScontinues to "underpay for 340B drugs pursuant to this unlawful" policy Judge Contreras has not yet ruled on AHA?s motion to include 2020-2022 reimbursement cuts in AHA?s case, as well as AHA?s motion to repay hospitals for the unlawful cuts since 2018 without penalizing other hospitals AHA?s August brief noted that nothing in the 340B law authorizes HHSto retrospectively take back these funds, and in similar circumstances HHShas never recouped funds already spent without explicit congressional authorization, which does not exist here. As a result of the court order the Centers For Medicare and Medicaid Services (CMS) must revise its methodology for paying 340B hospitals for outpatient drugs and reprocessing claims paid on or before the September 28, 2022 ruling

CMSceased reimbursing 340B hospitals the default rate after it released the 2018 Outpatient Prospective Payment System (OPPS) final rule. That final rule reduced reimbursement rates by 28 5 percent and saved the government about $1 6 billion But the judge was unimpressed and now HHSmust restore full payment to 340B hospitals.

The prospect ive port ion of t he 2022 reim bursem ent rat e shall be vacat ed because it is defect ive and because vacat ing t his port ion of t he 2022 OPPS Rule w ill not cause subst ant ial disrupt ion.

RECOVERINGFEES IN THE340B DRUGPROGRAM

The Ruling At A Glance... And Your Opportunity

- Medicare is under a court order to stop applying the unlawfully discounted rate for 340B drugs on claims processed on and after September 28, 2022

- One MAC,Novitas, has issued instructions to providers to request corrected reimbursement for the claims processed between January 1,2022and September 28,2022by resubmitting claims which billed separately payable drugs with modifier JG

- Other Medicare Administrative Contractors are beginning to issue instructions on claims for dates of service within 2022. Palmetto GBA, as an example, has limited providers resubmission of corrected claims to 1 (one) year from discharge

FDA REVOKESEUA FORBEBTELOVIMAB INJECTION

On November 30, 2022, the Food and Drug Administration (FDA) announced the Eli Lilly COVID-19 monoclonal antibody infusion treatment bebtelovimab, 175 mg injection is no longer approved under an emergency use authorization.

The FDA release states bebtelovimab is no longer authorized because it is not expected to be effective against the prevalent Omicron subvariants

https://www.fda.gov/drugs/drug-safety-and-availability/fda-announces-bebtelovimabnot-currently-authorized-any-us-region

EUAs for Paxlovid, molnupiravir (Legavrio), and Veklury remain as treatment options for patients with the Omicron subvariants

2023 OPPSUPDATE: INPATIENTONLY CHANGES

In the 2023 OPPSFinal Rule, Medicare added nine codes to OPPSAddendum E, the ?Inpatient only?list. Medicare will not cover these services when billed on an outpatient claim except if the patient expires before admission to inpatient status or when the provider transfers the patient to another facility.

2023 Inpatient Only Procedures Addendum Emay be located by searching ?2023?in the Advisor tab of the PARA Dat a Edit or (PDE).

The nine newly added Inpatient Only HCPCSprocedures are identified with the letters ?NC?in the column labeled ?N?(Change Indicator) as shown below:

Medicare provides guidance on these exceptions in the Medicare Claims Processing Manual, Chapter 4 ?Part B Hospital, Paragraph 180.7 ? Inpatient-only Services: https://www cms gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/clm104c04 pdf

?There are two exceptions to the policy of not paying for outpatient services furnished on the same day with an ?inpatient-only?service that would be paid under the OPPSif the inpatient service had not been furnished:

Except ion 1:If the ?inpatient-only?service is defined in CPT to be a ?separate procedure?and the other services billed with the ?inpatient-only?service contain a procedure that can be paid under the OPPSand that has an OPPSSI=Ton the same date as the ?inpatient-only? procedure or OPPSSI = J1 on the same claim as the ?inpatient-only?procedure, then the ?inpatient-only?service is denied but CMSmakes payment for the separate procedure and any remaining payable OPPSservices. The list of ?separate procedures?is available with the Integrated Outpatient Code Editor (I/OCE) documentation. See http://www cms gov/Medicare/Coding/OutpatientCodeEdit/

Except ion 2:If an ?inpatient-only?service is furnished but the patient expires before inpatient admission or transfer to another hospital and the hospital reports the ?inpatient only?service with modifier ?CA?, then CMSmakes a single payment for all services reported on the claim, including the ?inpatient only?procedure, through one unit of APC5881, (Ancillary outpatient services when the patient dies.) Hospitals should report modifier CA on only one procedure.?

CMSsummarized the CY2023 Medicare Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System Final Rule changes in its Newsroom Fact Sheet available through the following link: https://www cms gov/newsroom/ fact-sheets/cy-2023-medicare-hospitaloutpatientprospective-payment-systemand-ambulatory-surgical-center-2

PARA YEAR-END HCPCSUPDATEPROCESS

As usual, clients will be fully supported with information and assistance on the annual CPT® HCPCScoding updates for calendar year 2023.

The PARA Dat a Edit or (PDE) contains a copy of each client chargemaster; we use the powerful features of the PDEto identify any line item in the chargemaster with a HCPCScode assigned that will be deleted as of December 31, 2022.

ParaRev will not review chargemasters loaded into the PDEolder than 12 months For this reason, it is important that clients check to ensure that a recent copy of the chargemaster has been supplied to ParaRev for use in the year-end update.

ParaRev will produce Excel spreadsheets of each CDM line item, as well as our recommendation for alternate codes, in three waves as information is released from the following sources:

- The American Medical Association?s publication of new, changed, and deleted CPT® codes; this information is released in Sept em ber of each year ParaRev will produce the first spreadsheet of CPT® updates for client review in Oct ober 2022

- Following the release of Medicare?s 2023 OPPSFinal Rule, typically in early Novem ber; ParaRev will perform analysis and produce the second spreadsheet to include both the CPT® information previously supplied, as well as alpha-numeric HCPCSupdates (J-codes, G-codes, C-codes, etc ) from the Final Rule Clients may expect this spreadsheet to be available in Novem ber 2022

- Following the publication of Medicare?s 2023 Clinical Lab Fee Schedule (CLFS) ? typically published in late Novem ber, ParaRev will prepare a final spreadsheet to be available in Decem ber 2022 This final spreadsheet ensures that ParaRev shares any late-breaking news or coding information, although we expect the December spreadsheet to be very similar to the November edition.

Clients will be notified by email as spreadsheets are produced and recorded on the PARA Dat a Edit or ?Admin?tab, under the ?Docs?subtab. When the code maps are ready, the 2023 spreadsheet will appear just as they did in 2022:

In addition, ParaRev consultants will publish concise papers on coding update topics in order to ensure that topical information is available in a manner that is organized and easy to understand ParaRev clients may rest assured that they will have full support for year-end HCPCScoding updates to the chargemaster

FORYOURINFORMATION

Theprecedingmaterialsare for instructional purposesonly. Theinformation ispresented "as-is"and to the best of ParaRev?s knowledgeisaccurate at thetime of distribution. However, dueto theever changing legal/regulatorylandscapethisinformation issubject to modification, asstatutes/laws/regulationsor other updatesbecomeavailable.

Nothingherein constitutes, isintended to constitute, or should berelied on as, legal advice ParaRev expressly disclaimsanyresponsibilityfor anydirect or consequential damagesrelated in anywayto anythingcontained in thematerials, which areprovided on an ?as-is?basisand should beindependentlyverified beforebeing applied.

You expresslyaccept and agree to thisabsoluteand unqualified disclaimer of liability.Theinformation in this document isconfidential and proprietaryto ParaRev and isintended onlyfor thenamed recipient. No part of thisdocument maybereproduced or distributed without expresspermission. Permission to reproduce or transmit in anyform or byanymeanselectronicor mechanical, includingpresenting, photocopying, recording and broadcasting, or byanyinformation storageand retrieval system must be obtained in writingfrom ParaRev. Request for permission should be directed to sales@pararevenue.com.

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As always, we are available to answer any questions you may have regarding this news We thank you for your continued partnership