In recent years, hospitals began to increase the acquisition of physician practices, resulting in Medicare paying a higher amount under the hospital outpatient payment methodology for the same service that would otherwise have been paid under the physician fee schedule rate, creating a strong incentive for hospitals to game the system.
To address the issue, the 2015 Bipartisan Budget Act, implemented by CMS in 2017, added a section to Medicare law prohibiting hospitals from billing at the hospital outpatient rate if an existing off-campus service (beyond 250 yards from the main campus) moved to a new location or a new hospital service opened that was located greater than 250 yards from the main campus. A very limited number of exceptions were permitted, e.g., services furnished in an emergency department, in an on-campus department, or a remote location within 250 yards of the main campus.
This action has created an “unintended consequence” for CR and PR programs that wish to expand access to services or create a new service in an “off-campus” department. Since Medicare data confirm there is no incentive for hospitals to purchase CR and PR programs in order to obtain higher payment rates (see link below), AARC and other pulmonary organizations met with CMS to ask for an exemption, but CMS indicated it had no authority to do so under current law.
H.R. 4838, the Sustaining Outpatient Services (SOS) Act, championed by the American Association for Cardiovascular and Pulmonary Rehabilitation (AACVPR) and the National Association for Medical Direction of Respiratory Care (NAMDRC), amends the law to set financial thresholds that would allow certain hospital outpatient services like cardiac and pulmonary rehab to be exempt from reduced reimbursement.
The AARC has advocated tirelessly for ways to improve payment for pulmonary rehabilitation (PR) services since the inception of the Medicare program and most recently has joined a workgroup dedicated to continuing the fight for better payment. We strongly support this bill.
As we are currently working on updating our advocacy website, we are asking RTs who work in these programs to use the AACVPR’s TAKE ACTION link (see below) where you will see a button for CR/PR Practitioners to ask for co-sponsorship. Additional background information is available in the second link.
We appreciate your support.