CMS Releases CY 2021 Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System Final Rule

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On December 2, 2020, the Centers for Medicare & Medicaid Services (CMS) released the CY 2021 Changes to Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; Addition of New Categories for Hospital Outpatient Department Prior Authorization Process [CMS-1736-F], which finalizes payment updates and policy changes affecting Medicare hospital outpatient and ambulatory surgical center (ASC) services for CY 2021.

For CY 2021, CMS increased payment rates under the Hospital Outpatient Prospective Payment System (OPPS) and the ASC Payment Systems by a factor of 2.4%. Hospitals and ASCs that fail to meet quality reporting program requirements are subject to a 2.0% reduction to the update factor.

CMS estimates, based on the finalized policy changes, that total payments to hospitals and ASCs will be approximately $83.9 billion and $5.42 billion, respectively, for an increase of approximately $7.5 billion and $120 million, respectively, over CY 2020 program payments.

While CMS finalized these slightly higher payment rates, several other policies will be of concern for hospitals and surgery centers. For example, this rule finalizes policies that seek to eliminate the site of service barriers for surgical procedures, and continues to address site neutrality reforms and payments under the 340B drug discount program.

A new Administration may wish to take a fresh look at some of these policies, and may redirect or even reverse course in a few instances.

  • The final regulations are available here.
  • The press release is available here.
  • The fact sheet is available here.

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For more information, contact Jennifer Archer, Paul Gerrard, Deborah Godes, Sheila Madhani, Kristen O’Brien and Jessica Roth.