Site-Neutral Payment

Americans rely heavily on hospitals to provide 24/7 access to care for all types of patients, to serve as a safety net provider for vulnerable populations, and to have the resources needed to respond to disasters.

However, these roles are not explicitly funded; instead, they are built into the overall hospital cost structure and supported by revenues received from providing direct patient care. Hospitals are also subject to more comprehensive licensing, accreditation and regulatory requirements than other settings.

Yet some policymakers want to make total payment for a service provided in a hospital the same as when a service is provided in a physician office or ambulatory surgery center.

Section 603 of the Bipartisan Budget Act of 2015 enacted site-neutral payments for new, off-campus provider-based hospital outpatient departments, despite different cost structures between HOPDs and physician offices. Subsequently, with AHA’s support, the 21st Century Cures Act established exceptions for certain off-campus HOPDs that were under construction at the time BiBA was passed in November 2015. Some, including the Medicare Payment Advisory Commission, have advocated for even greater use of such “site-neutral” payments.

The AHA continues to urge Congress to reject calls for any additional site-neutral payment policies for HOPDs. We also urge CMS to implement its policies for 2018 and beyond in the most flexible manner possible.

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