Becker's Spine Review

45 HEALTHCARE NEWS Hospitals win challenge to site-neutral pay cuts By Ayla Ellison A Washington, D.C., federal judge ruled Sept. 17 that CMS overstepped its authority last year when it expanded a site-neutral pay policy that cut Medicare payments for hospital outpatient visits by hundreds of millions of dollars. Under the 2019 Medicare Outpatient Pro- spective Payment System final rule, CMS made payments for clinic visits site-neutral by reducing the payment rate for evaluation and management services provided at off-campus provider-based departments by 60 percent. In an attempt to overturn the rule, the Amer- ican Hospital Association, the Association of American Medical Colleges and dozens of hospitals across the nation sued HHS. ey argued CMS exceeded its authority when it finalized the payment cut in the OPPS rule. ey claim the site-neutral payment policy violates the Medicare statute's mandate of budget neutrality and Congress's directive that excepted provider-based departments be reimbursed at OPPS rates and not at lower payment rates CMS applies. HHS argued that under the Bipartisan Bud- get Act of 2015 it has authority to develop a method for controlling unnecessary increas- es in outpatient department services. Since "method" is not defined in the statute, the government argued its approach satisfies generic definitions of the term. U.S. District Judge Rosemary M. Collyer rejected that ar- gument in granting the hospitals' motion for summary judgment Sept. 17. Oentimes, the meaning of words or phrases only becomes evident when placed in context and with a view to their place in the statutory scheme, the judge wrote in the 28-page decision. "at context does not make clear what a 'meth- od' is, but it does make clear what a 'method' is not: it is not a price-setting tool, and the govern- ment's effort to wield it in such a manner is man- ifestly inconsistent with the statutory scheme." e judge concluded that CMS failed to follow the statutory process for setting Medicare pay- ment rates when it finalized the OPPS rule. "CMS believes it is paying millions of tax- payer dollars for patient services in hospital outpatient departments that could be provid- ed at less expense in physician offices. CMS may be correct. But CMS was not authorized to ignore the statutory process for setting payment rates in the Outpatient Prospective Payment System and to lower payments only for certain services performed by certain pro- viders," the judge wrote. e decision will stop CMS from reducing re- imbursement rates to hospitals by $380 mil- lion this year and $760 million in 2020. e hospitals had also requested a court order requiring CMS to issue payments improperly withheld due to the final rule. Ms. Collyer did not grant that request. Instead, she asked the parties to submit a joint status report by Oct. 1 to determine if additional briefings are nec- essary to determine an appropriate remedy. e American Hospital Association and the Association of American Medical Colleges said they are pleased with the court's decision. "e ruling, which will allow hospitals to maintain access to important services for patients and communities, affirmed that the cuts directly undercut the clear intent of Con- gress to protect hospital outpatient depart- ments because of the many real and crucial differences between them and other sites of care. Now that the court has ruled, it is up to the agency to put forth remedies for impact- ed hospitals and the patients they serve," the groups said in a joint statement. n Maryland hospitals merge, unveil name for combined system By Ayla Ellison A nne Arundel Medical Center in Annapolis, Md., and Doctors Community Health System, a single-hospi- tal system based in Lanham, Md., have merged to create a new system: Luminis Health. The two hospitals completed the merger July 1, roughly two months after announcing plans to combine their orga- nizations. Officials said the full integration of the two hospi- tals is expected to take up to two years. Luminis Health will launch its new brand and logo in spring 2020. The health system will seek feedback from employ- ees, physicians, community members and other stakehold- ers to determine how the new system name will apply to both hospitals' existing names. "For years, Anne Arundel Medical Center and Doctors Community Health System have shared a dedication to compassionate care, delivered when and where peo- ple need it most," Victoria Bayless, president and CEO of AAMC and CEO of Luminis Health, said in a press release. "We're carrying that same commitment into the future as Luminis Health, a health system that is here to embrace progress and awaken a new era in care for our communi- ties." n

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