Medicare OPPS Chapter 7 Flashcards

Questions and Answers

Define packaging as it pertains to OPPS.

Occurs when reimbursement for minor ancillary services associated with a significant procedure is combined into a single payment for the procedure.

Define bundling as it pertains to OPPS.

Occurs when payment for multiple significant procedures or multiple units of the same procedure related to an outpatient encounter or to an episode-of-care is combined into a single unit of payment.

Which reimbursement method uses SI Q3?

Composite APC payment.

Which reimbursement method uses SI K?

APC payment. Signup and view all the answers

Which reimbursement method uses SI J1?

Comprehensive APC payment (C-APC). Signup and view all the answers

Which reimbursement method uses SI Q4?

Conditional APC payment. Signup and view all the answers

In an outpatient ambulatory surgery encounter with codes SI J1, SI T, SI S, which codes are separately payable and which are packaged?

SI J1 - Separately payable, SI T - Packaged, SI S - Packaged Signup and view all the answers

Describe discontinuing as it applies to payment SI T.

A reimbursement policy where the highest-weighted procedure is fully reimbursed, and all other procedures with payment SI T are reimbursed at 50%. Signup and view all the answers

What are CCRs?

Cost-to-Charge Ratios - The total amount of money required to operate a hospital, divided by the sum of the revenues received from patient care and all other operating revenues. Signup and view all the answers

What is PPS?

Prospective Payment System - a method of reimbursement in which Medicare payment is made based on a predetermined, fixed amount. Signup and view all the answers

What is MedPAC?

Medicare Payment Advisory Commission - advises Congress on a range of issues affecting Medicare, including payments, services, access, and regulations. Signup and view all the answers

Define OPPS.

Outpatient Prospective Payment System - the system through which Medicare decides how much money a hospital or community mental health center will get for outpatient care provided to patients with Medicare. Signup and view all the answers

What does ASP stand for?

Average Sales Price - the average price that a manufacturer sells drugs after accounting for any credits, chargebacks, discounts, and rebates applied throughout the sales process. Signup and view all the answers

What is APC?

Ambulatory Payment Classification - a system used by the Centers for Medicare and Medicaid Services (CMS) to determine reimbursement rates for outpatient services provided by hospitals and other healthcare facilities. Signup and view all the answers

What are SIs?

Status Indicators - a code that establishes how a service, procedure or item is paid in OPPS. Signup and view all the answers

A high-cost supply that is reimbursed under a different reimbursement methodology than other supplies is known as a __________.

Pass-through. Signup and view all the answers

What is a PHP?

Partial hospitalization program - an intensive outpatient program of psychiatric services provided as an alternative to inpatient psychiatric care to patients who have an acute mental illness. Signup and view all the answers

What are CMHCS?

Community mental health centers - provide outpatient services, including specialized services for children, the elderly, and people who are chronically mentally ill. Signup and view all the answers

What does MPFS stand for?

Medicare Physician Fee Schedule - Fee schedule set up by CMS to pay physician services and other fees paid under the Physician Fee Schedule. Signup and view all the answers

Define per diem APC payment.

Type of prospective payment method in which the third-party payer reimburses the provider a fixed rate for each day a covered member is hospitalized. Signup and view all the answers

What are comprehensive APC payments?

All-inclusive APC categories where a primary procedure is identified for the encounter, and the ten most other procedures, services, and supplies are packaged into the C-APC payment amount. Signup and view all the answers

What is conditional APC payment?

A payment concept that indicates an item or service is not separately paid when it is considered integral, supportive, dependent, or adjunctive to an associated primary service. Signup and view all the answers

What is composite APC payment?

A single payment rate for a service that combines several HCPCS codes on the same date of service. Signup and view all the answers

A payment method calculated by multiplying the charge for the service times the CCR is known as __________.

Reasonable Cost Payment. Signup and view all the answers

Under OPPS, outpatient services that are similar both clinically and in use of resources are assigned to separate groups called __________.

APCs. Signup and view all the answers

Which of the following statements is true about APCs? a. APCs are based solely on the patient's principal diagnosis. b. ICD-10-CM procedure codes are used to group patients. c. Severity of illness is taken into consideration when grouping APCs. d. APCs are based on the CPT or HCPCS code(s) reported.

d. APCs are based on the CPT or HCPCS code(s) reported. Signup and view all the answers

What does the status indicator T indicate?

That the APC payment is reduced when multiple procedures with this status are reported together. Signup and view all the answers

What does the relative weight APC component measure?

The resource intensity of a particular procedure or service. Signup and view all the answers

The national unadjusted payment amount is the product of the conversion factor multiplied by the relative weight, unadjusted for __________.

Geographic factors. Signup and view all the answers

Which type of service includes an APC per diem methodology that includes payment for all services provided on a single day of service under OPPS? a. Clinic visits b. Partial hospitalization c. Emergency department visits d. Same-day surgery

Partial hospitalization Signup and view all the answers

What is the modifier included in the interrupted services provision under OPPS?

<ol start="73"> <li></li> </ol> Signup and view all the answers

Study Notes

Medicare Outpatient Payment System (OPPS) Key Concepts

Packaging: Combines reimbursement for minor ancillary services linked to a significant procedure into a single payment.
Bundling: Merges payments for multiple significant procedures, or multiple units of the same procedure in an outpatient visit into one payment.
Composite APC Payment: Uses SI Q3 as a reimbursement method.
APC Payment: Identified by SI K, pertains to specific outpatient services.
Comprehensive APC Payment (C-APC): Links higher-level procedures with SI J1 for payment purposes.
Conditional APC Payment: Refers to SI Q4; covers items/services not separately paid when related to a primary service.

Reimbursement Methods and Codes

Claims for outpatient surgery can have multiple codes, where SI J1 is separately payable, while SIs T and S are packaged.
Discontinuing Services: Policy where the highest-weighted procedure receives full reimbursement, and others with SI T are paid at 50%.
Cost-to-Charge Ratios (CCRs): Measure of operating costs versus revenues, essential for calculating reasonable cost payments.
Prospective Payment System (PPS): Medicare's predetermined fixed payment method for inpatient services.

Payment and Classification Systems

Ambulatory Payment Classification (APC): Determines outpatient service reimbursement rates based on specific groupings of clinically comparable procedures.
Status Indicators (SIs): Codes that indicate how services are reimbursed under OPPS, with specific meanings, like G for pass-through drugs and T for surgical procedures with multiple procedure reduction.
Comprehensive APCs, indicated by SIs J1 and J2, aim to streamline payment processes for outpatient services.
Specific methodologies like Per diem APC use daily fixed rates for hospitalizations.

Provisions and Adjustments under OPPS

OPPS Provisions: Include high-cost items, interrupted services, and adjustments for rural hospitals or dedicated cancer facilities.
High-Cost Outlier Adjustment: Compensation for exceptionally expensive services relative to typical costs.
Cancer Hospital Adjustment: Provides extra support for facilities dedicated to cancer treatment due to their higher operational costs.

Unique Payment Concepts

Packages: Refers to payments that combine specific service types, indicated by SI N, to facilitate cost-effective care.
Non-Reimbursed Services: Identified by various SIs that denote procedures not deemed necessary or appropriate for outpatient settings.
OCE (Outpatient Code Editor): Software used to implement packaging logic in OPPS, ensuring systematic billing and coding accuracy.

General Guidelines and Additional Terminology

Conversion Factor (CF): A vital multiplier for determining payment rates across services in the Medicare system.
Core Based Statistical Area (CBSA): Influences the cost index applied to facilities based on location.
Partial Hospitalization Program (PHP): Offers intensive outpatient psychiatric services as an alternative to inpatient care.

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Description

Test your knowledge of the Medicare Hospital Outpatient Payment System through these flashcards focusing on key concepts like packaging and bundling. Perfect for students and professionals looking to deepen their understanding of outpatient payment methods.