Washington Watch

2019 ASC Payment Rate Proposal Brings Major, Long-awaited Victories

Find out what this means for your ASC

Last spring, I was visiting with a senior staffer at the House Ways and Means Committee and lamenting the lack of progress made by the Centers for Medicare and Medicaid Services (CMS) in implementing some regulatory and payment reforms that are vital to the ability of ASCs to survive and thrive in our cost-conscious, regulatory, and competitive healthcare system.

His response? “It is about time that the agency realized that surgery centers are not the problem but the answer to the provision of high-quality, lower-cost, and patient-centered care to Medicare beneficiaries.”

In the proposed 2019 ASC payment rule issued in July, CMS states that “to the extent that it is clinically appropriate for a beneficiary to receive services in a lower cost setting, we believe it would be appropriate to continue to develop payment incentives and remove payment disincentives to facilitate this choice.” From their lips to God’s ears!

Give the agency credit. CMS has delivered on a number of issues on which the Outpatient Ophthalmic Surgery Society (OOSS) has lobbied for years. The proposal effectuates a number of major reforms to the payment and quality reporting programs to which ASCs are subject.

ASC Payment Rates

After years of lobbying by OOSS, CMS has proposed that, for the period 2019-2023, it will update ASC payment rates by the Hospital Market Basket rather than the lower Consumer Price Index-Urban (CPI-U). OOSS has been a leader in the effort to actualize this change for more than a decade, seeking to persuade both CMS and Congress of its merits. Under this new policy, ASCs would receive the same update as hospitals, subject to certain adjustments. While CMS has actually proposed that ASC rates be subject to the higher Hospital Market Basket, the agency is soliciting comments regarding whether, instead, the CPI-U should remain in effect for the next 5 years while CMS collects evidence to justify a different payment update or ultimately adopt the hospital update factor.

Under the new proposed policy, ASC payment rates would be updated by 2.0 percent in 2019. I note that HOPD rates, because of the application of a different set of payment adjustments, would receive a 2019 update of 1.25 percent, or .75 percent lower than ASC payments.

Under the ASC payment system, facilities receive a percentage of the relative weight assigned to a code for procedures furnished in HOPDs. The relative weights are re-calibrated each year based on a complex formula that takes into account a number of factors, including changes in hospitals’ costs in providing such services and the mandate that the ASC payment system remain budget-neutral. ASCs are presently paid only half the amounts reimbursed to hospitals for the same services.

With respect to the latter point, OOSS’s goal has been to ensure that ASCs receive as high a percentage of HOPD rates as possible, and if necessary, that hospital payments be reduced to ASC rate levels for procedures that can be safely and effectively performed in the surgery center. This would be a positive volume proposition for ASCs.

Devices Implanted in the ASC

Like hospitals, ASCs have occasion to use expensive devices and operative supplies during certain surgical procedures. Although surgery centers are adept at achieving greater operational efficiencies than HOPDs, typically, we are not able to extract greater discounts on devices and supplies than hospitals.

“Device-intensive procedures” are those with respect to which the device cost exceeds a certain threshold of the total cost of the procedure, thereby providing additional payment for the device to the ASC. Currently, that threshold is 40% in both the HOPD and ASC.

CMS is proposing to reduce the threshold applicable to the ASC setting to 30%, as recommended by OOSS and the ASC and ophthalmology communities. This would allow procedures that use relatively high-cost devices to be reimbursed at higher rates in the ASC setting, potentially augmenting migration of services from the HOPD to the ASC.

ASC Quality Reporting

In a significant policy development, CMS is proposing to eliminate many of the quality reporting measures to which ASCs have been subject for the past several years, thereby reducing our facilities’ administrative burden and financial costs.

  • For 2020 payment determinations, the agency proposes removing ASC-8, Influenza Vaccination Coverage Among Healthcare Personnel.
  • For 2021 payment determinations, CMS proposes removing seven quality measures, the following of which are relevant to ophthalmic ASCs:
  • ASC-1, Patient Burn
  • ASC-2, Patient Fall
  • ASC-3, Wrong Site, Wrong Side, Wrong Patient, Wrong Implant
  • ASC-4, All-Cause Hospital Transfer/Admission
  • and, ASC-11, Cataracts – Improvement in Patient’s Visual Function within 90 Days Following Cataract Surgery. (We note that 98% of ASCs have been in compliance with these and other ASC quality reporting mandates.)

CMS is also proposing changes to the factors the agency uses to remove measures from the program, and importantly from OOSS’s point of view, to align these factors with the HOPD quality reporting program, which should promote transparency in the information available to consumers choosing their site for surgery.

Delay in Implementation of Patient Outcome/Experience Survey (OAS CAHPS)

In last year’s payment rule, CMS delayed indefinitely the mandatory implementation of the Consumer Assessment of Healthcare Providers and Systems Outpatient and Ambulatory Surgery Survey (OAS CAHPS) under the ASCQR Program for CY 2018 data collection. For years, OOSS has raised serious concerns with respect to the size and content of and administrative and financial burdens associated with the survey.

Furthermore, OOSS joined the ASC community in lobbying for delay in requiring that facilities participate. CMS confirms in the proposed rule that the survey will not be adopted in 2019 — and, hopefully, ever.


OOSS is the only organization dedicated exclusively to the interests of the ophthalmic ASC and its patients. Yet, remarkably, only about a third of these facilities are members. Without OOSS, where would your facilities be now: Could surgeons even own and refer their patients to their ASCs? Would our facility fees have increased by 300 percent or would they have dropped like professional fees? Would we be able to perform virtually every ophthalmic surgical procedure in the ASC? Would Medicare have regulated us out of business?

Our agenda is broad and deep, and without your support as members, we simply cannot address all of your concerns.

  • If you’re not a member of OOSS, please join.
  • Using our new grassroots Advocacy Center, build relationships with your elected officials so that we can continue to make progress on our issues.
  • On those rare occasions that we make such a request, contact your senators and representatives to advocate for our positions.
  • Contribute to OOSPAC.

Office Cataract Surgery

In the physician payment rule published on July 12, CMS is silent with respect to taking any further action regarding payment of a facility fee for office cataract surgery. This is great news – FOR NOW!

As you know, OOSS is the only ophthalmology organization to unequivocally oppose the implementation of payment for office cataract surgery. We are hopeful that CMS’s decision not to press forward with the establishment of payments for office cataract surgery is a final one.

Should CMS further proceed in the near or distant term, OOSS leadership will be aggressive and zealous in safeguarding the interests of our patients and our centers; this is our most important regulatory priority. ■