[Federal Register Volume 77, Number 2 (Wednesday, January 4, 2012)]
[Rules and Regulations]
[Pages 217-227]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-33751]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

42 CFR Parts 410, 411, 416, 419, 489, and 495

[CMS-1525-CN]
RIN 0938-AQ26


Medicare and Medicaid Programs: Hospital Outpatient Prospective 
Payment; Ambulatory Surgical Center Payment; Hospital Value-Based 
Purchasing Program; Physician Self-Referral; and Patient Notification 
Requirements in Provider Agreements; Corrections

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Correction of final rule with comment period.

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SUMMARY: This document corrects technical errors that appeared in the 
final rule with comment period published in the Federal Register on 
November 30, 2011, entitled ``Medicare and Medicaid Programs: Hospital 
Outpatient Prospective Payment; Ambulatory Surgical Center Payment; 
Hospital Value-Based Purchasing Program; Physician Self-Referral; and 
Patient Notification Requirements in Provider Agreements.''

DATES: Effective Date: This correction is effective January 1, 2012.

FOR FURTHER INFORMATION CONTACT: Marjorie Baldo, (410) 786-0378, 
Hospital outpatient prospective payment issues. James Poyer, (410) 786-
2261, and Donald Howard, (410) 786-6764, Hospital Value-Based 
Purchasing (VBP) Program Issues.

SUPPLEMENTARY INFORMATION:

I. Background

    In FR Doc. 2011-28612 of November 30, 2011 (76 FR 74122), 
(hereinafter referred to as the CY 2012 OPPS/ASC final rule with 
comment period), there were a number of technical errors that are 
identified and corrected in the Correction of Errors section below. The 
provisions in this correction document are effective as if they had 
been included in the CY 2012 OPPS/ASC final rule with comment period 
(76 FR 74122) appearing in the November 30, 2011 Federal Register. 
Accordingly, the corrections are effective January 1, 2012.

[[Page 218]]

II. Summary of Errors

A. Outpatient Prospective Payment System and Ambulatory Surgical Center 
Payment System Corrections

    In the CY 2012 OPPS/ASC final rule with comment period, we 
finalized a continuation of our policy to exclude line items that were 
eligible for payment in the claims year but did not meet the Medicare 
requirements for payment (76 FR 74141). Line items that did not meet 
the requirements for Medicare payment were rejected or denied during 
claims processing. It is our longstanding policy to not use line items 
that were rejected or denied for payment for modeling costs under the 
OPPS. In reviewing the claims data used to establish the APC median 
costs for the CY 2012 OPPS/ASC final rule with comment period, we 
discovered that the trim of unpaid lines was not applied correctly. We 
have corrected our programming logic in the OPPS data process to apply 
the line item trim correctly and have recalculated the median costs for 
each separately paid service using the claims that result from the 
correctly applied trim. We note that no other changes were made to the 
programming logic described in the CY 2012 OPPS/ASC final (see 76 FR 
74141).
    The correct application of the line item based trim has an impact 
on the APC median costs used to establish the relative payment, which 
impacts the CY 2012 OPPS/ASC payment rates, copayments, outlier 
threshold, and impacts. Due to the APC median costs changes, we had to 
recalculate the budget neutral weight scaler. Using the updated 
unscaled relative weights, the CY 2012 budget neutrality weight scaler 
changed from 1.3588 to 1.3585 (see 76 FR 74189). The changes associated 
with the revised APC median costs and the corrected budget neutrality 
weight scaler have no further impact on budget neutrality, in 
particular, those applied to the CY 2012 conversion factor. The correct 
application of the line item trim changed the data used to model the CY 
2012 fixed-dollar outlier threshold. Using the corrected set of claims 
data, the CY 2012 OPPS/ASC fixed-dollar outlier threshold changed from 
$1,900 to $2,025 (see 76 FR 74209).
    Also, as a result of the recalculated median costs, the APCs now 
displays violations of the two times rule, which caused the following 
APC codes to be added: APC 0105 Repair/Revision/Removal of Pacemakers, 
AICDs and Vascular Access Devices, APC 0263, Level I Miscellaneous 
Radiology Procedures, and APC 0655, Insertion/Replacement/Conversion of 
a Permanent Dual Chamber Pacing Electrode.
    In addition, the recalculated median costs caused several APCs to 
no longer display violations of the two times rule, which caused the 
following APSC codes to be removed: APC 0262 Plain Film of Teeth, APC 
0341 Skin Tests and APC 0660 Level II Otorhynolaryngologic Function 
Tests. We are revising Table 19--Final APC Exceptions to the 2 Times 
Rule for CY 2012 (76 FR 74227) to reflect these changes.
    Furthermore, we made changes to Table 59--Estimated Impact of the 
Final CY 2012 Changes for the Hospital Outpatient Prospective Payments 
System (76 FR 74562) and the correlating preamble language (76 FR 
74570). Specifically, a hospital that had submitted a claim containing 
a single line for which no payment was made, is no longer represented 
in the data, therefore, the number of facilities whose claims are 
represented in the data declined from 4,161 to 4,160, and the number of 
hospitals declined from 3,895 to 3,894 (see 76 FR 74558). Because of 
the trim of lines for which no payment was made from the single 
procedure bills from the remaining hospitals, the number of hospitals 
by category, and the impact for the categories have minor changes. In 
addition to the minor changes to the number of hospitals and the 
impacts by category of hospital, the estimated increase for all 
facilities and all hospitals when all changes are accounted for 
declines from 1.9 percent to 1.8 percent because the CY 2011 threshold 
models as if it were paying 1.0 percent of total payment for outliers 
rather than 0.93 percent. Therefore, the estimated total increase in 
payment based on the technical corrections noted above results in a 
decline of 0.1 percent.
    To view the revised payment rates that result from the changed 
median costs, we refer readers to the Addenda and supporting files that 
are posted on the CMS Web site at: http://www.cms.gov/HospitalOutpatientPPS/HORD. Select ``CMS-1525-FC'' from the list of 
regulations. All revised Addenda for this correction document are 
contained in the zipped folder entitled ``2012 OPPS FC Addenda'' at the 
bottom of the page for CMS-1525-FC. The corrected CY 2012 table of 
updated offset amounts is posted on the OPPS Web site under ``Annual 
Policy Files,'' which is found on the left side of the page. The 
corrected CY 2012 OPPS file of median costs is found under supporting 
documentation for CMS-1525-FC.
    ASC payment rates are based on the OPPS relative payment weights 
for the majority of services that are provided at ASCs. Therefore, the 
correct application of the line item based trim also has an impact on 
the CY 2012 ASC relative payment weights and ASC payment rates. Due to 
the changes to the OPPS relative payment weights, we had to recalculate 
the budget neutral ASC weight scaler (see 76 FR 74447 and 74448). Using 
the updated scaled OPPS relative weights, the CY 2012 budget neutrality 
ASC weight scaler changed from 0.9466 to 0.9477 (76 FR 74448). The 
changes associated with the revised OPPS relative payment weights and 
the corrected budget neutrality CY 2012 ASC weight scaler have no 
impact on the CY 2012 ASC conversion factor. To view the revised ASC 
payment rates that result from the revised ASC relative payment 
weights, see the ASC Addenda that are posted on the CMS Web site at: 
http://www.cms.gov/ASCPayment/ASCRN. Select ``CMS-1525-FC'' from the 
list of regulations. All revised ASC addenda for this correction 
document are contained in the zipped folder entitled ``Addenda AA, BB, 
DD1, DD2, and EE'' at the bottom of the page for CMS-1525-FC.
    In addition to the incorrect application of the line item based 
trim, we failed to recognize that existing HCPCS code C9716 (Creations 
of thermal anal lesions by radiofrequency energy) was replaced with new 
CPT code 0288T (Anoscopy, with delivery of thermal energy to the muscle 
of the anal canal) (for example, for fecal incontinence). For CY 2012, 
the CPT Editorial Panel created new CPT code 0288T. Before CY 2012, 
this procedure was described by the Healthcare Common Procedure Coding 
System (HCPCS) as code C9716. In Addendum B of the CY 2012 OPPS/ASC 
final rule with comment period, both HCPCS code C9716 and 0288T were 
assigned to specific APCs. Specifically, HCPCS code C9716 has been 
assigned to APC 0150 (Level IV Anal/Rectal Procedures) and CPT code 
0288T was mistakenly assigned to APC 0148 (Level I Anal/Rectal 
Procedures). Because HCPCS code C9716 and CPT code 0288T describe the 
same procedure, CMS is deleting HCPCS code C9716 on December 31, 2011, 
since it will be replaced with CPT code 0288T effective January 1, 
2012. In addition, the APC assignment of CPT code 0288T will be 
corrected from APC 0148 to APC 0150 effective January 1, 2012. Since 
0288T replaces C9716, it should have been assigned to the same APC that 
C9716 was assigned, APC 150. In addition, we neglected to reflect the 
inclusion of new HCPCS code G0451 (Development testing, with 
interpretation and report, per standardized instrument form) in

[[Page 219]]

the mental health composite (APC 0034) and mistakenly assigned it 
status indicator ''S''. We have corrected this error and assigned 
status indicator ``Q3'' to HCPCS code G0451. These corrections are 
included in the revised OPPS and ASC addenda which are posted to the 
CMS Web site at http://www.cms.gov/HospitalOutpatientPPS/HORD.
    In addition, the CY 2012 Statewide Average CCRs displayed in Table 
11 (76 FR 74195 through 74198) and in the Annual Policy Files section 
on the CMS Web site at http://www.cms.gov/HospitalOutpatientPPS/have 
also been revised for CY 2012 and CY 2011 Cost-to-Charge Ratio (CCR) 
values. The tables incorrectly contain CY 2012 proposed rule CCR values 
as the Final CY 2012 Default CCR for Table 11 and as the Previous 
Default CCRs in the Annual Policy file. CMS uses overall hospital-
specific CCRs calculated from the hospital's most recent cost report to 
determine outlier payments, payments for pass-through devices, and 
monthly interim transitional corridor payments under the OPPS during 
the PPS year. Medicare contractors cannot calculate a CCR for some 
hospitals because there is no cost report available. For these 
hospitals, CMS uses the Statewide average default CCRs to determine the 
payments mentioned above until a hospital's Medicare contractor is able 
to calculate the hospital's actual CCR from its most recently submitted 
Medicare cost report. These hospitals include, but are not limited to, 
hospitals that are new, have not accepted assignment of an existing 
hospital's provider agreement, and have not yet submitted a cost 
report.
    We are correcting an amendatory instruction in regulations text 
Sec.  416.171. In the amendatory instructions for Sec.  416.171, we 
inadvertently revised the entire paragraph (b). Paragraph (b) contains 
3 subparagraphs, (b)(1) through (3), respectively. We intended only to 
revise paragraph (b) introductory text, while making no additional 
changes to the subparagraphs. Therefore, we are correcting this error.

B. Hospital Value-Based Purchasing Corrections

    Section 1886(o)(1)(C)(iii) of the Act requires the Secretary to 
conduct an independent analysis of appropriate minimum numbers of cases 
and measures for scoring under the Hospital Inpatient Value-Based 
Purchasing Program. In the CY 2012 OPPS/ASC final rule with comment 
period, we inappropriately referred to analyses performed by Brandeis 
University and Mathematica Policy Research together despite their 
slightly differing subjects and implications for CMS policies. This 
document corrects the erroneous references.

III. Waiver of Proposed Rulemaking and the 30-Day Delay in Effective 
Date

    We ordinarily publish a notice of proposed rulemaking in the 
Federal Register to provide a period for public comment before the 
provisions of a rule take effect in accordance with section 553(b) of 
the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). We also 
ordinarily provide a 30-day delay in the effective date of the 
provisions of a notice in accordance with section 553(d) of the APA (5 
U.S.C. 553(d)). However, we can waive both the notice and comment 
procedure and the 30-day delay in effective date if the Secretary 
finds, for good cause, that it is impracticable, unnecessary, or 
contrary to the public interest to follow the notice and comment 
procedure or to comply with the 30-day delay in the effective date, and 
incorporates a statement of the finding and the reasons therefore in 
the notice.
    The policies and payment methodologies finalized in the CY 2012 
OPPS/ASC final rule with comment period have previously been subjected 
to notice and comment procedures. This correction notice merely 
provides technical corrections to the CY 2012 OPPS/ASC final rule with 
comment period that was promulgated through notice and comment 
rulemaking, and does not make substantive changes to the policies or 
payment methodologies that were finalized in the final rule with 
comment period. For example, to conform the document to the final 
policies of the CY 2012 OPPS/ASC final, this notice makes changes to 
revise inaccurate tabular information. Therefore, we find it 
unnecessary to undertake further notice and comment procedures with 
respect to this correction notice. In addition, we believe it is 
important for the public to have the correct information as soon as 
possible and find no reason to delay the dissemination of it. For the 
reasons stated above, we find that both notice and comment and the 30-
day delay in effective date for this correction notice are unnecessary. 
Therefore, we find there is good cause to waive notice and comment 
procedures and the 30-day delay in effective date for this correction 
notice.

IV. Correction of Errors

0
In FR Doc. 2011-28612 of November 30, 2011 (76 FR 74122), make the 
following corrections:

A. Outpatient Prospective Payment System and Ambulatory Surgical Center 
Payment System Preamble Corrections

0
1. On page 74189, in the first column, in the second full paragraph, in 
line 14, replace 1.3588 with 1.3585.
0
2. On pages 74195 through 74198, Table 11--CY2012 Statewide Average 
CCRs, is corrected to read as follows:
BILLING CODE 4120-01-P

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[GRAPHIC] [TIFF OMITTED] TR04JA12.002


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[GRAPHIC] [TIFF OMITTED] TR04JA12.003


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[GRAPHIC] [TIFF OMITTED] TR04JA12.004

BILLING CODE 4120-01-C
0
3. On page 74208, in the third column, in the first response to 
comment, in line 17, replace $1,900 with $2,025.
0
4. On page 74209, in the first column, under the heading ``3. Final 
Outlier Calculation,''--
0
A. In the first full paragraph, in line 31, replace $1,900 with $2,025.
0
B. In the second paragraph, replace $1,900 with $2,025.
0
5. On page 74210, in the third column, in the third paragraph--
0
A. In line 16, replace $307.74 with $309.46.
0
B. In line 19, replace $301.59 with $303.27.
0
6. On page 74210, in the third column, in the fourth paragraph--
0
A. In line 5, replace $242.66 with $244.02 and $307.74 with $309.46.
0
B. In line 8, replace $237.81 with $239.14 and $301.59 with $303.27.
0
C. In lines 10 and 11, replace $123.10 with $123.78 and replace $307.74 
with $309.46.
0
D. In lines 13 and 14, replace $120.63 with $121.31 and replace $301.59 
with $303.27.
0
E. In line 16, replace $365.76 with $367.80.
0
F. In line 17, replace $242.66 with $244.02 and $123.10 with $123.78.
0
G. In line 19, replace $358.44 with $360.44 and $237.81 with $239.14, 
and replace $120.63 with $121.31.
0
7. On page 74211, in the second column, under ``Step 1. Calculate the 
beneficiary* * *.''--
0
A. In line 5, replace $61.55 with $61.90.
0
B. In line 7, replace $307.74 with $309.46.
0
8. On page 74227, in Table 19--Final APC Exceptions to the 2 Times Rule 
for CY 2012, the APC codes are revised by replacing APC code 0262 with 
APC code 0105, and APC 0341 with APC code 0263, and APC 0660 with APC 
code 0655. The APC codes are listed in numerical order.
0
9. On page 74448, in the third column--
0
A. In the first full paragraph, in line 6, replace 0.9466 with 0.9477.
0
B. In the second paragraph, in line 6, replace 0.9466 with 0.9477.
0
10. On pages 74562 through 74565, Table 59--Estimated Impact of the 
Final CY 2012 Changes for the Hospital

[[Page 223]]

Outpatient Prospective Payment System, is corrected to read as follows:
BILLING CODE 4120-01-P
[GRAPHIC] [TIFF OMITTED] TR04JA12.005


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[GRAPHIC] [TIFF OMITTED] TR04JA12.006


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[GRAPHIC] [TIFF OMITTED] TR04JA12.008

BILLING CODE 4120-01-C
0
11. On page 74570 in the third column, in the first full paragraph, in 
line 9, replace 0.9466 with 0.9477.

B. Hospital Value-Based Purchasing Preamble Corrections

0
1. On page 74532, second column, under heading ``b. Minimum Number of 
Cases for Mortality Measures, AHRQ Composite Measures, and HAC 
Measures,'' first paragraph, lines 1 and 2, replace ``analyses'' with 
``analysis'' and remove the words ``and Mathematica''.
0
2. In line 9, the words ``these analyses'' are corrected to read ``this 
analysis''.
0
3. On page 74534, in the first column, under the first response, in 
line 20, the words ``the analyses'' are corrected to read ``the 
analysis''.
0
4. In line 21, the words ``and Mathematica'' are removed.

[[Page 227]]

C. Regulations Text Corrections


Sec.  416.171  [Corrected]

0
1. On page 74582, in the second column, in Sec.  416.171, 
``Determination of payment rates for ASC services,'' in amendment 7, 
the instruction ``a. Revising paragraph (b)'' is corrected to read ``a. 
Revising paragraph (b) introductory text.''

(Catalog of Federal Domestic Assistance Program No. 93.778, Medical 
Assistance Program)

(Catalog of Federal Domestic Assistance Program No. 93.773, 
Medicare--Hospital Insurance; and Program No. 93.774, Medicare--
Supplementary Medical Insurance Program)

    Dated: December 28, 2011.
Jennifer Cannistra,
Executive Secretary to the Department.
[FR Doc. 2011-33751 Filed 12-30-11; 4:15 pm]
BILLING CODE 4120-01-P