Physician Payment Rules
The Centers for Medicare & Medicaid Services (CMS) publishes rules to establish or modify the way the agency administers its programs, including Medicare Physician Fee Schedule rule, Inpatient Prospective Payment (IPPS) rule, Outpatient Prospective Payment System (OPPS) rule, Medicare Advantage and Part D rules, the No Surprises Act, as well as other ancillary regulations.
Medicare Physician Fee Schedule Rule
The Centers for Medicare & Medicaid Services (CMS) reimburses physicians for care furnished to Medicare Part B beneficiaries based on the Medicare Physician Fee Schedule (PFS). The PFS contains the resource costs associated with the physician work, practice expense and malpractice insurance for the current procedural terminology (CPT) and Healthcare Common procedure Coding System (HCPCS) codes that represent office visits, surgical procedures, anesthesia services, diagnostic tests, and a range of other therapies. The rule also addresses Medicare billing requirements, quality standards, program integrity, and other issues impacting physician practices.
The proposed PFS rule is usually released by CMS in July of each year, after which comments are accepted for 60 days. Each year’s “Final Rule” is published in early November for implementation in January of the following year.
Inpatient Prospective Payment (IPPS) Rule
Medicare payment for acute care hospital inpatient stays is based on set rates under Medicare Part A. The system for payment, known as the Inpatient Prospective Payment System (IPPS), categorizes cases into diagnoses-related groups (DRGs) that are then weighted based on resources used to treat Medicare beneficiaries in those groups. CMS updates the IPPS regulations annually.
Outpatient Prospective Payment System (OPPS) Rule
Medicare payment for outpatient services provided in hospitals is based on set rates under Medicare Part B. The system for payment, known as the Outpatient Prospective Payment System (OPPS) is used when paying for services such as X rays, emergency department visits, and partial hospitalization services in hospital outpatient departments. Payment for ambulatory surgical center (ASC) services is also based on rates set under Medicare Part B. This system for payment is called the ASC Payment System and is used when paying for covered surgical procedures, including ASC facility services that are furnished in connection with the covered surgical procedure. CMS updates the OPPS/ASC regulations together in one rule annually, with comment periods open prior to implementation of the final rule.