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Outpatient Facility Reimbursement

The following are reimbursement changes that became effective April 1, 2016.

Utilize the same tier system previously established for short-term acute facilities:

  • Tier 1 – Network urban facilities with greater than 300 beds.
  • Tier 2 – All other urban and non-network facilities.
  • Tier 3 – Critical access hospitals (CAH), sole community hospitals (SCH), Indian, military and VA facilities.
  • Tier 4 – All other network rural facilities.
    • For short-term acute facilities, Tier 4 remains frozen until Tier 2 base rate exceeds Tier 4, which is estimated to occur in 2023. At that time, both short-term acute and outpatient Tier 4 facilities will move to Tier 2.

Changes will be phased in over three years:

  • April 1, 2016.
  • April 1, 2017.
  • April 1, 2018.

Code ranges that will be allowed as a tier-specific percentage of Medicare, with phase in as indicated in table below:

  • Surgery and other procedures within 10000-699999 that are not packaged by Medicare.
  • Cardiovascular and other procedures within 92900-93999 that are not packaged by Medicare.
  • HCPCS C codes that are not packaged by Medicare.
Tier April 1, 2016 April 1, 2017 April 1, 2018
1 220% 205% 180%
2 210% 195% 170%
3 230% 215% 200%
4 220% 205% 190%

Revenue codes

Covered revenue codes that are currently allowed at 60% or 70% of billed charges, generally packaged revenue codes, will initially be allowed at a reduced percentage of billed charges and then will be phased out.

Tier April 1, 2016 April 1, 2017 April 1, 2018
All 25% 10% No Payment

Covered implants will be allowed at the CPT/HCPCS allowable fee, or if no CPT/HCPCS code exists, then revenue codes 275, 276, 278 and 279 will be allowed at 30% or 35% of billed charges.

Tier April 1, 2016 April 1, 2017 April 1, 2018
1 30% 30% 30%
2 30% 30% 30%
3 35% 35% 35%
4 35% 35% 35%

Colonoscopy services

Allowable fees will begin at fully phased-in levels. 

Tier April 1, 2016 April 1, 2017 April 1, 2018
1 180% 180% 180%
2 170% 170% 170%
3 200% 200% 200%
4 190% 190% 190%

Revenue codes associated with colonoscopy procedures currently allowed at 60% or 70% will initially be allowed at reduced percentages of billed charges and then will be phased out.

Tier April 1, 2016 April 1, 2017 April 1, 2018
All 25% 10% No Payment

Allowable fees for procedures identified for the Select program will move to fully phased-in levels beginning with the first quarter following their inclusion in the program.

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