This Month’s Resources

Oi Healthcare News Roundup

Every month, we provide an overview of the healthcare finance news impacting hospitals, health systems, critical access providers, and community hospitals. 

CMS Releases IPO Final Rule

CMS announced on December 2, 2020, that they have finalized the proposal to eliminate the Inpatient Only (IPO) list. This will happen over a three-year period, starting with the removal of around 300 musculoskeletal services. The list will be completely phased out by CY 2024. 

The change will allow for Medicare reimbursement of these services in the hospital outpatient setting when appropriate. Inpatient reimbursement will also still be possible when deemed appropriate by a physician. 

This fact sheet covers additional details, including information on the ASC covered procedures list and implications of the two-midnight rule. 

Advisory Board Weighs In on IPO Rule

This summary from Advisory Board covers their insights into the recent CMS finalized rule. It addresses: 

  1. Increases to payment rates
  2. The IPO list as an acceleration of site of care shifts
  3. The scaling back of proposed additional 340B cuts to average sales price

It additionally touches on expansions of prior authorization requirements, changes to level of supervision for various services, and alterations to overall hospital quality star rating methodology. 

McKinsey Discusses the Shift to ASC as an Accelerating Trend

This article from McKinsey covers ambulatory care as a high-growth segment and examines the history of many health systems moving early to get ahead of the trend. 

It discusses how COVID-19 has accelerated public interest in ambulatory care and variations in use of ambulatory services, but also how much of the growth in the massive hospital care segment has been fueled by swells in the ambulatory space. It also presents the market forces that are driving this shift including innovation, consumer demand, and financial opportunities for providers. 

The AHA Comments on the IPO Phase Out

As CMS moves forward with the phaseout of the IPO list, the American Hospital Association (AHA) has offered its opinion. 

“We also are concerned that, even among the 266 musculoskeletal services proposed

for removal in CY 2021, there are procedures without adequate data to support the

appropriateness of their performance in the outpatient setting. According to the

American Association of Orthopaedic Surgeons (AAOS), ‘Finalizing this policy as

proposed will mean that complicated procedures from major trauma, such as pelvic,

acetabulum, hip and fragility fractures and amputation that are mostly done with heavy

inpatient monitoring, will be paid in the outpatient setting. AAOS experts believe that

even with advances in medical practice, such procedures cannot be safely done in the

outpatient setting currently.’ The AHA agrees. There are many musculoskeletal

procedures among the 266 which are high risk and would require more than 24 hours of

recovery or monitoring time.”

 Review Last Month’s Hospital Finance Ed topic: What Comes After Price Transparency?