The Centers for Medicare & Medicaid Services late today issued a proposed rule that would increase Medicare hospital outpatient prospective payment system rates by a net 2.7% in calendar year 2023 compared to 2022. 
In a statement shared with the media, AHA Executive Vice President Stacey Hughes said, “We are deeply concerned about CMS’ proposed payment update of only 2.7%, given the extraordinary inflationary environment and continued labor and supply cost pressures hospitals and health systems face ... A much higher update is warranted, and we will be closely analyzing CMS' proposed market basket, as well as its proposed productivity offset.”
For hospitals that participate in the 340B Drug Pricing Program and that were affected by CMS’ OPPS cuts in recent years, the agency announced it would restore the Medicare outpatient payment to average sales price (ASP) plus 6% for CY 2023, given the recent Supreme Court decision. CMS also noted that it is evaluating how to apply the Supreme Court’s decision to the prior year cuts and is seeking public comment on potential remedies affecting cost years 2018-2022. 
In the statement, Hughes said, “The AHA appreciates that, following the favorable unanimous ruling in our 340B Supreme Court case, CMS will be ending its unlawful cuts to 340B hospitals in next year's Medicare outpatient payment. This will help 340B hospitals provide comprehensive health services to their patients and communities. Having now recognized what 340B hospitals are owed under the law, we urge the Administration to promptly reimburse those hospitals that were affected by these unlawful cuts in previous years. Additionally, we continue to urge the agency to ensure the remainder of the hospital field is not penalized for their prior unlawful policy, especially as hospitals and health systems continue to deal with rising cost for supplies, equipment, drugs and labor.”

CMS also released proposals on the Rural Emergency Hospital model, a new provider type to help financially struggling rural hospitals. The rule contains proposals related to model payment, including the monthly facility payment and the enrollment process.  Specifically, CMS proposes to consider all covered outpatient department services as REH services, to allow for a change of information application in order to convert to an REH, and to update the physician self-referral law for the REH, among other proposals. 
In addition, CMS proposes to exempt rural sole community hospitals from the site-neutral clinic visit cuts and instead pay for clinic visits furnished in excepted off-campus provider-based departments of these hospitals at the full OPPS rate.
The agency also would, as urged by AHA, continue payment for remote behavioral health services furnished by HOPD staff beyond the end of the public health emergency. Patients would be allowed to receive remote services in their homes, including via audio-only technology, but CMS would require an in-person visit 6 months prior and every 12 months after the remote interaction.
Among other proposals, CMS would require prior authorization for an additional service category, remove 10 services from the inpatient only list, and add one procedure to the ambulatory surgical center covered procedures list. CMS does not propose any new measures for the Outpatient Quality Reporting or Rural Emergency Hospital Quality Reporting Programs, but does propose certain programmatic requirements and solicits feedback on future measures. In addition, the agency solicits input on additional data the agency should release to evaluate competition in the health care system. 

CMS will accept comments on the proposed rule through Sept. 13. AHA members will receive a Special Bulletin with more details on Monday. 

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