CMS will repay 2019 outpatient payment cut as a result of AHA lawsuit

The Centers for Medicare & Medicaid Services will automatically reprocess calendar year 2019 claims for hospital outpatient services provided in off-campus provider-based departments grandfathered under the Bipartisan Budget Act of 2015 in order to repay these hospitals for an unlawful payment cut that was successfully challenged in court by the AHA and hospital organizations.

“CMS installed a revised Hospital Outpatient Prospective Payment System Pricer to update the rates being applied to claim lines,” the agency wrote. “The revised Pricer went into production on November 4, 2019, and applies to claims with a line item date of service of January 1, 2019, and after. Starting January 1, 2020, and over the next few months, the Medicare Administrative Contactors will automatically reprocess claims paid at the reduced rate; no provider action needed.”

In a statement, AHA General Counsel Melinda Hatton said the association was pleased that “at our urging, CMS will be repaying affected hospitals the full OPPS rate for 2019 to support the critical work they do for the patients and communities they serve. Now that a federal court has sided with the AHA and found these outpatient clinic visit cuts exceed the Administration’s authority, we continue to call on CMS to abandon further illegal cuts for 2020 and to pay the full OPPS rate going forward.”

The AHA, joined by the Association of American Medical Colleges and several member hospitals, filed a lawsuit against the Department of Health and Human Services over the payment cuts. A federal judge in September ruled in favor of the AHA and hospital organizations saying that the CMS exceeded its statutory authority in implementing the cuts. In October, the judge reaffirmed her previous order to CMS to vacate the payment cut.