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Medicare’s Inpatient Proposed Rule and What it Means for Hematology

Medicare’s Inpatient Proposed Rule and What it Means for Hematology

On April 18, 2016, the Centers for Medicare and Medicaid Services (CMS) released the annual set of proposals governing payments for services provided to patients admitted to the hospital, commonly referred to as the hospital inpatient prospective payment system (IPPS). As in past years, issues of importance to hematologists are included. 

Consideration of New DRG for Pulmonary Embolism with tPA

Medicare pays for inpatient hospital services on the basis of diagnosis-related groups (DRGs) which differentiate patients based primarily on their principle diagnosis, but also in some cases based on the procedures which they receive. Today, patients with a principle diagnosis of pulmonary embolism are paid at the same rate regardless of whether the patient receives a tissue plasminogen activator (tPA) drug or not. A requester has asked for the care for the patients who receive this drug, who often have higher costs and longer hospital stays, be paid at a different rate by establishing a new DRG. The proposed rule does not recommend a new DRG; CMS states its concern that those receiving tPA are not necessarily sicker than those who do not. Approximately 1,200 patients of the more than 20,000 admitted for pulmonary embolism in 2014 were treated with tPA. 

New Technology Payments – One Proposed to End, One Proposed to Continue, and Two to Potentially Begin

Although Medicare pays for services on the basis of DRGs, it also establishes a program to allow for the introduction of new technology by paying for it separately for up to three years to allow the new technology to be included in the charges that drive the overall payment rate. This allows hospitals to use the new technology while limiting losses from their use. For the past three years, CMS has paid a new technology payment for a prothrombin complex concentrate with the trade name Kcentra. As it has reached the maximum of three years of new technology payments, CMS proposes to eliminate the add-on payment for this drug in 2017, meaning that it will no longer be paid separately.

Another drug, blinatumomab, used in certain patients with acute lymphoblastic leukemia, was approved for add-on payments, in part based on ASH comments, for fiscal year 2016. CMS proposes to continue the add-on payment for this service in 2017.

In the proposed rule, CMS is also considering an application for add-on payments for two drugs, idarucizumab and andexanet alfa, intended to reverse the effects of novel anticoagulant drugs. Idarucizumab was approved by the Food and Drug Administration (FDA) in October 2015. Andexanet alfa is not yet approved by the FDA but CMS reports that the manufacturer anticipates approval before the 2017 fiscal year begins on October 1, 2016. 

In order to receive new technology add-on payments, it must be demonstrated that a new technology offers substantial improvement and increased costs. CMS is accepting comments on whether these two products meet the definition. 

Elimination of Venous Thromboembolism Measures and New Measure in Cancer Hospitals
Hospitals are required to report on certain quality measures and have their payments adjusted modestly on the basis of a certain subset of these measures. For nearly as long as the program has existed, it has included measures of performance in patients with venous thromboembolism. This rule proposes to finally eliminate all but one of these measures from required reporting starting with the 2019 fiscal year. Some measures are proposed to be eliminated due to universal high performance. Other measures, which had been retained only for electronic reporting (as opposed to manual abstraction), were eliminated due to continued difficulty in finding necessary data in structured data fields in the electronic health record. The lone VTE measure proposed to be retained would measure incidence of potentially preventable VTE. 

CMS establishes a different set of measures for ten hospitals identified as cancer hospitals. These hospitals are paid under a separate payment system that is based on reported costs. CMS proposes to add a new quality measure in the 2019 fiscal year for these hospitals that would measure admissions and emergency department use for patients who are undergoing chemotherapy. This measure would track emergency department use and admissions for issues that are likely related to chemotherapy in the 30 days following chemotherapy and would be risk-adjusted. Notably, due to the high toxicity of the disease and the treatment for the disease, patients with leukemia are excluded from this measure. 

ASH is in the process of drafting its comments on the CMS IPPS proposal. If you have any questions or comments about the proposed rule and its impact on hematology, please contact Brian Whitman at [email protected].