Skip to Main Content

Medicare proposed rules for calendar year 2019: OPPS, ASC and quality reporting programs


Outpatient Prospective Payment System (OPPS)
Ambulatory Surgical Center Payment System (ASC)
Quality Reporting Programs

Release Date: July 25, 2018
Federal Register publication date: July 31, 2018
Comments Due: 5:00 p.m. EST, September 24, 2018
Effective Date: January 1, 2019


Proposed update factors:  OPPS ASCs
Market basket increase  2 .80%  2 .80%
Multifactor productivity adjustment (0 .80%) (0 .80%)
ACA required adjustment (0 .75%) (0 .00%)
Proposed increase factor   1 .25%  2 .00%

CMS estimates the OPPS update factors will increase Medicare payments by approximately $4.9 billion in 2019 compared to 2018. It is estimated the update factors for ASC will increase payments by approximately $300 million for CY 2019. Hospitals and ASCs that fail to meet hospital OQR (outpatient quality reporting) and ASCQR (ambulatory surgical center quality reporting) requirements will be subject to a statutory 2% reduction in the update factors.

Comprehensive APCs:

Three new proposed comprehensive APCs (C-APCs) will bring the total number of C-APCs to 65. The newly proposed C-APCs are C-APC 5163 (Level 3 END Procedures), C-APC 5183 (Level 3 Vascular Procedures) and C-APC 5184 (Level 4 Vascular Procedures).

Proposed Changes to the Inpatient Only List:

This rule proposes removing CPT code 31241 (Nasal/sinus endoscopy, surgical; with ligation of sphenopalatine artery) and CPT code 01402 (Anesthesia for open or surgical arthroscopic procedures on knee joint, total knee arthroplasty) from the inpatient only list and adding C9606 (Percutaneous transluminal revascularization of acute total/subtotal occlusion during acute myocardial infarction, coronary artery or coronary artery bypass graft, any combination of drug-eluting intracoronary stent, atherectomy and angioplasty, including aspiration thrombectomy when performed, single vessel) to the inpatient only list.

Proposal and Comment Solicitation on Method to Control Unnecessary Increases in Volume of Outpatient Services:

CMS proposes to control for unnecessary increases in volume of outpatient service by paying for clinic visits furnished at a grandfathered (excepted off-campus Provider-Based Department (PBD) which provided services prior to November 2, 2015) at a Physician Fee Schedule (PFS)-equivalent rate rather than at the standard OPPS rate. The clinic visit is the most common service billed under the OPPS and is often furnished in the physician office setting. CMS estimates Medicare savings of $610 million in 2019 and estimated savings to the Medicare beneficiary of $150 million or $14 on each off-campus department clinic visit based on lower copayments.

CMS is also soliciting public comments on how to expand the Secretary’s statutory authority to additional items and services paid under the OPPS that may represent unnecessary increases in hospital outpatient department utilization.

Expansion of Clinical Family of Services at Off-Campus PBDs Paid under the OPPS (Section 603):

For CY 2019 and subsequent years CMS is proposing that if a grandfathered off-campus PBD furnishes services from a clinical family of services for which it did not provide services from November 1, 2014 through November 1, 2015 that those services from the new clinical family of services will be paid under the PFS rates not the OPPS rates.

CMS is also proposing that a grandfathered off-campus PBD would be paid under OPPS for a new item or service from a clinical family of services it had provided services for from November 1, 2014 through November 1, 2015 as this would not be considered a “service expansion”.

Proposal to Apply 340B Drug Payment Policy to Off-Campus Departments of a Hospital Paid under the Medicare Physician Fee Schedule:

For CY 2018 CMS reduced payments to hospitals for 340B program outpatient drugs from Average Sales Price (ASP) plus 6% to ASP minus 22.5%. Initially this applied only to on-campus hospital departments. For CY 2019 CMS is proposing to extend the payment cuts to grandfathered off-campus provider-based departments. The rule would continue to exempt rural sole community hospitals, children’s hospitals and certain cancer hospitals.

Payment of Drugs, Biologicals, and Radiopharmaceuticals if Average Sales Price (ASP) Data Are Not Available:

This proposed CY 2019 rule recommends payment for the above described drugs at wholesale acquisition cost (WAC)+3 percent rather than the current WAC+6 percent.

Rural Adjustment:

Medicare proposed to continue the 7.1 percent adjustment to OPPS payments for certain rural SCHs. CMS also intends to continue the adjustment for future years in the absence of data to suggest a different percentage rate.

Ambulatory Surgical Center (ASC) Payment Update:

CMS is proposing to use the hospital market basket update for calendar years 2019 through 2023 rather than the CPI-U. Payment factor updates are identified above.

Payment for Non-Opioid Pain Management Therapy:

This rule proposes to change the packaging policy for certain drugs when administered in the ASC setting and provide separate payment for non-opioid pain management drugs that function as a supply when used in as surgical procedure when the procedure is performed in an ASC.

Hospital OQR Program and ASCQR Program:

The following steps are being proposed for CY 2019 to align the Hospital OQR Program with those used in the ASCQR Program.

  • Update measure removal Factor 7
  • Add a new removal Factor 8
  • Codify the measure removal policies and factors
  • Provide clarification of CMS’ “topped-out” criteria


  • Payment Policy for Biosimilar Biological Products without Pass-Through Status That Are Acquired under the 340B Program
  • Device-Intensive Procedure Criteria
  • Device Pass-Through Payment Applications
  • New Technology APC Payment for Extremely Low-Volume Procedures
  • Cancer Hospital Payment Adjustment
  • Proposed Changes to the List of ASC Covered Surgical Procedures
  • Hospital Inpatient Quality Reporting (IQR) Program Update

If you are interested in more information on any of the topics addressed in this outreach please contact Ellen Donahue.

Source: Medicare Program: Proposed Changes to Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Report Programs; Requests for Information on Promoting Interoperability and Electronic Health Care Information, Price Transparency and Leveraging Authority for the Competitive Acquisition Program for Part B Drugs and Biologicals for a Potential CMS Innovation Center Model.
Released: July 25, 2018

Related Professionals

This site uses cookies to provide you with an improved user experience. By using this site you consent to the use of cookies. Please read our Privacy Policy for more information on the cookies we use and how you can manage them.