Will the Massachusetts Proposed Legislation on Hospital Outpatient Facility Fees Have a Nationwide Impact?

In Some States, Including the Commonwealth of Massachusetts, " Neutrality of the Site "For outpatient hospital reimbursement, one must consider the state's own health reform and cost control initiatives. This goes far beyond the limitation of reimbursement for Medicare in new out-of-campus ambulatory hospital services under section 603 of the Bipartite Budget Act, 2015 . ]. Since the Massachusetts Health Reform Act was the model upon which the Affordable Care Act was based, many other jurisdictions are turning to Massachusetts to see how the state is addressing the "cost" component of the health care system. equation, especially now that the access component treated by the ACA and the state initiatives. Massachusetts has repeatedly taken the course on the cost puzzle, including the latest law introduced in October 2017. This recent legislation includes a provision that would essentially eliminate a large number of hospital ambulatory costs, on-campus and off-campus .

Treatment of "installation costs" under the New Senate Bill

On October 17, 2017, the Massachusetts State Senate released a bill titled "Law Strengthening Self-Sufficiency and Financial Capacity Through Transformative Healthcare". This bill was discussed on October 23, 2017 in a special hearing room. Senate Committee on containment of health care costs and reform, where representatives of teaching and community hospitals, health plans and patient / citizen groups were present.

This bill also includes several far-reaching provisions that we will address in subsequent publications, including the issues of vendor price changes and off-grid payment; because these provisions are also of great interest to the hospital industry. However, a major concern in the bill, from a review of hospital operations, is a ban on hospitals charging a facility fee for many common outpatient services, as a condition of hospitalization. Authorization to exercise.

The contours of this prohibition are not entirely clear, but seem to target outpatient assessment and management services (O & M) in any department of a hospital that submits a request to a hospital. insurer (public and commercial) an outpatient service. The bill allows the Department of Public Health (DPH) to add additional services to the ban beyond the outpatient E & M. In addition to the ban on billing, the bill provides several other measures to restrict or impose billing for outpatient services, including payment limits for state employees under the Group Insurance Commission and several sections requiring advice to patients. hospitals and other providers referring patients to hospital services. At least one of these notices is required prior to providing services in the ER (Emergency Room), "if possible".

What is included in the Senate bill of the state of Massachusetts?

Presumably, more will be known about the intentions of the editors in the days and weeks to come, as well as what the House of Representatives will do with them. In the meantime, here are some observations on the bill:

If passed, Massachusetts hospitals (and, once the insurance provisions come into effect, probably hospitals throughout New England and other states dealing with beneficiaries covered by Massachusetts), do not may not charge a common fee. of these services, including nurses, other staff members, medical supplies, facilities, overhead, food, electronic medical records, patient safety, infection control, )
There is a serious ambiguity as to which services are subject to the ban. Is it just an outpatient service from O & M or other services where a doctor performs an E & M service, such as an emergency department or an observation service affected? Given the wording of the bill, it would appear to be very broad and encompasses many different places, including outpatient services on campus. Indeed, the Senate report that accompanies it suggests that a larger set of services would be subject to the ban on payment.
We do not know which payers are covered. Since the prohibition is incorporated not in the insurance laws but, rather, as part of the hospital licensing terms, it would seem that it should apply to all. payers, including Medicare and employer health plans covered by ERISA. This raises serious preemption and other issues. It may have been intended only for commercial payers and the Governor in Council to include similar language in these pieces of legislation, but it will be necessary to clarify the scope of the application of this bill, particularly because of the placement in a number of jurisdictions. legislative provisions.
Contrary to the Medicare Site Neutrality Act, which allows hospitals to pay a reduced fee for non-exempt on-site ambulatory services, Massachusetts proposes a zero refund rule, not a reduction in payment and no "grandpathering". Existing locations: If the law is passed, only physicians will be able to bill the relevant services at all sites.
In addition, unlike the rule of Medicare, the Senate bill seems to apply both on campus and on off campus services. As the Senate report accompanying the recommendation suggests that only off-campus services be targeted, we wonder if the Senate intended to have such broad geographic coverage.
If only physicians can bill for these services, will physicians have to share their fees with hospitals to cover hospital overhead? You may remember that it was a feature of the original CMS proposal under the neutrality of the Medicare site . If not, is there any implication of the "Stark" law (physician self-reference) on the theory that the physician receives "free" use of the hospital space? If so, will physicians be able to request a full payment of the unrestricted medical fee schedule for the "service differential? And if doctors can not bill all professional fees, does this mean that hospitals and doctors will offer these services for free or at a considerable discount to all payers?
Does the bill require hospitals to provide a notice of costs to emergency patients prior to service delivery and, if possible, do hospitals conflict with the federal government and its implementation? implemented? Labor Law (EMTALA, also known as the Anti-Dumping Law)? CMS has long been concerned that talking to patients about costs and fees before receiving emergency services can cause patients to leave hospital emergencies in a dangerous medical condition and to violate EMTALA. .

The impact of this proposal may extend beyond Massachusetts

Although we asked several questions about this initial proposal on hospital costs, it appears that the Commonwealth is moving in a direction that could have a significant impact on hospital reimbursements, budget and operations. Hospital administrators in Massachusetts will follow this closely. At the national level, hospital leaders and health systems should also be concerned that this type of state strategy could also be considered in other countries

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Interested parties should consider commenting on the state's Senate bill.

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