HEALTH ECONOMICS AND REIMBURSEMENT

HEA LTH ECONOM I C S A ND R EIM B U RS E M E NT F Y 2016 HOSPITAL INPATIENT PROSPECTIVE PAYMENT SYSTEM (IPPS) UPDATE Abbott Vascular is pleased to pr...
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HEA LTH ECONOM I C S A ND R EIM B U RS E M E NT

F Y 2016 HOSPITAL INPATIENT PROSPECTIVE PAYMENT SYSTEM (IPPS) UPDATE Abbott Vascular is pleased to provide you with this summary of the Medicare Hospital Inpatient Prospective Payment System (IPPS) Update for Fiscal Year (FY) 2016.1 The information in this document is effective October 1, 2015 – September 30, 2016.

IPPS HIGHLIGHTS

FY 2016 Payment Update

The final rule increases IPPS operating payment rates by 0.9 percent after accounting for inflation and other adjustments. As in previous years, this increase reflects a temporary reduction of 0.8 percent for a documentation and coding recoupment adjustment required by the American Taxpayer Relief Act of 2012. Cardiac hospitals (14 total) are expected to experience a payment increase of 0.7 percent in FY 2016 relative to FY 2015. Select cardiovascular device-related procedure reimbursement (base DRG payments) will change as illustrated here: Coronary Stents (Drug Eluting and Non) Coronary Angioplasty/Atherectomy Peripheral Angioplasty/Atherectomy & Stenting Carotid Stenting Transcatheter Mitral Valve Repair Endovascular Cardiac Valve Replacement

+4% -10% +3% +3% +21% -3%

These data reflect a percentage change in year-over-year estimated reimbursement, weighted by procedure volumes. For Transcatheter Mitral Valve Repair procedures, the above percent change figure includes the impact of the MS-DRG change discussed below.  edicare Program; Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals and the M Long-Term Care Hospital Prospective Payment System Policy Changes and Fiscal Year 2016 Rates; Revisions of Quality Reporting Requirements for Specific Providers, including Changes Related to the Electronic Health Record Incentive Program; Extensions of the Medicare-Dependent, Small Rural Hospital Program and the Low-Volume Payment Adjustment for Hospitals; Federal Register, 42 CFR Part 412. Displayed August 17, 2015. https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/FY2016-IPPS-Final-Rule

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HIGHLIGHTS FY 2016 Payment Update . . . . . . . . . . 1 Creation of Percutaneous Intracardiac Procedures MS-DRGs . . . . . . . . . . . . . . . 2 Creation of Other Major Cardiovascular Procedures MS-DRGs . . . 2 CMS Approves Two Applications for New Technology Add-on Payment and Five Continuations . . . . . . . . . . . 2 ICD-10 Coding Status . . . . 3 Hospital Readmissions Reduction Program . . . . . . 3 Hospital Acquired Condition Reduction Program . . . . . . . . . . . . . . . . 3 Medicare 2016 Hospital Inpatient Reimbursement . . . . . . . . . 4

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Creation of Percutaneous Intracardiac Procedures MS-DRGs Consistent with recommendations in the proposed rule, CMS finalized the creation of MS-DRGs 273 and 274, Percutaneous Intracardiac Procedures with and without MCC to replace several procedures historically grouped to MSDRG 250 and 251, Percutaneous Cardiovascular Procedures without Coronary Artery Stent or AMI with and without MCC. These new MS-DRGs include procedures occurring within the heart chambers using intracardiac techniques, such as transcatheter mitral valve repair, catheter-based invasive electrophysiology and endovascular cardiac ablation. With the establishment of the new MS-DRGs 273-274, these procedures will receive an estimated 19 percent increase in base MS-DRG payments. Coronary angioplasty and atherectomy procedures will continue to group to MS-DRGs 250 and 251. • New MS-DRGs 273-274 are subject to the Post-Acute Transfer Policy (PACT), which reduces hospital payments for cases where the patient is discharged to a long-term care setting after a short length of stay. • MS-DRGs 250-251 are not subject to the PACT.

Creation of Other Major Cardiovascular Procedures MS-DRGs The final rule creates new MS-DRGs 268-272 (Aortic and Heart Assist Procedures, Except Pulsation Balloon with and without MCC & Other Major Cardiovascular Procedures with and without MCC). Upon review of MS-DRGs 237238, Major Cardiovascular Procedures with and without MCC, CMS discovered varying resource utilization, clinical complexity and wide range of costs for procedures classified in these MS-DRGs. Therefore, 237-238 are deleted for FY 2016. The newly created MS-DRGs 268-272 distinguish types of procedures based on length of stay and costs better than the previous MS-DRGs 237-238. For detailed code lists for each MS-DRG, refer to pages 200-251 of the FY 2016 IPPS Final Rule.

CMS Approves Two Applications for New Technology Add-on Payment and Five Continuations CMS evaluated six applications for New Technology Add-on Payments (NTAP) for FY 2016. Two applications were approved as new and five continuations of previous approvals were granted, effective October 1, 2015 (FY 2016): Continuations: • Kcentra™ • Argus® II Retinal Prosthesis System • CardioMEMS™ HF (Heart Failure) System • MitraClip® System • Responsive Neurostimulator System (RNS®) New: • Blinatumomab (BLINCYTO™) • LUTONIX® Drug Coated Balloon (DCB) Percutaneous Transluminal Angioplasty (PTA) and IN.PACT™ Pacliaxel Coated Percutaneous Transluminal Angioplasty (PTA) Balloon Catheter

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NTAP allows for incremental payment above the base MS-DRG rate. NTAP is calculated as the lesser of (1) 50 percent of the incremental cost of the new technology above the DRG payment, or (2) 50 percent of the device’s costs per case. Approval of NTAP enables CMS to provide separate add-on payment for up to two to three years following FDA approval until which time that CMS determines there are sufficient data to assess the ultimate MS-DRG assignment for the new medical service.

ICD-10 Coding Status The compliance date for ICD-10 is October 1, 2015. All Medicare inpatient hospital claims must use ICD-10-CM diagnosis codes and ICD-10-PCS procedure codes. Other sites of service must use ICD-10-CM diagnosis codes.

Hospital Readmissions Reduction Program The Hospital Readmissions Reduction program will continue in FY 2016 and the maximum penalty will remain 3 percent. For FY 2016, CMS determined hospitals’ readmission penalties using five readmissions measures endorsed by the National Qualify Forum (NQF): • Heart attack • Heart failure • Pneumonia • Chronic obstructive pulmonary disease • Hip/knee arthroplasty CMS is evaluating potential impact of socioeconomic status on provider results in quality programs, such as the Hospital Readmissions Reduction Program. When results are available, CMS will examine findings and recommendations. CMS will add a new readmission measure beginning in FY 2017: readmissions for coronary artery bypass graft (CABG) surgical procedures.

Hospital Acquired Condition Reduction Program CMS implemented the Affordable Care Act’s Hospital Acquired Condition (HAC) Reduction Program in FY 2015. Hospitals scoring in the top quartile for the rate of HACs (i.e., those with the poorest performance) will have all of their Medicare inpatient payments reduced by 1 percent.

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SELECT CARDIOVASCUL AR MS-DRG FY 2016 PAYMENT AMOUNTS AND CHANGES

Medicare 2016 Hospital Inpatient Reimbursement

MS-DRG

Description

FY 2015 Final Rule (October 1, 2014 September 30, 2015)

FY 2016 Final Rule (October 1, 2015 September 30, 2016)

Base Rate

Base Rate

% Difference Final 2015 to Final 2016

Dollar Change Final 2015 to Final 2016

025

Craniotomy and Endovascular Intracranial Procedures w MCC

$25,473

$25,370

-0.4%

-$103

026

Craniotomy and Endovascular Intracranial Procedures w CC

$17,625

$17,689

0.4%

$64

027

Craniotomy and Endovascular Intracranial Procedures w/o CC/MCC

$13,404

$13,483

0.6%

$79

034

Carotid Artery Stent Procedure w MCC

$21,734

$21,760

0.1%

$25

035

Carotid Artery Stent Procedure w CC

$12,984

$13,609

4.8%

$625

036

Carotid Artery Stent Procedure w/o CC/MCC

$10,168

$10,144

-0.2%

-$23

037

Extracranial Procedures w MCC

$18,475

$18,239

-1.3%

-$237

038

Extracranial Procedures w CC

$9,320

$9,188

-1.4%

-$132

039

Extracranial Procedures w/o CC/MCC

$6,215

$6,264

0.8%

$50

163

Major Chest Procedures w MCC

$29,559

$29,533

-0.1%

-$26

164

Major Chest Procedures w CC

$15,275

$15,247

-0.2%

-$28

165

Major Chest Procedures w/o CC/MCC

$10,700

$10,716

0.1%

$16

216

Cardiac Valve & Other Major Cardiothoracic Procedure with Cardiac Cath w MCC

$55,932

$55,884

-0.1%

-$48

217

Cardiac Valve & Other Major Cardiothoracic Procedure with Cardiac Cath w CC

$37,170

$36,950

-0.6%

-$220

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Health Economics and Reimbursement

MS-DRG

Description

FY 2015 Final Rule (October 1, 2014 September 30, 2015)

FY 2016 Final Rule (October 1, 2015 September 30, 2016)

Base Rate

Base Rate

% Difference Final 2015 to Final 2016

Dollar Change Final 2015 to Final 2016

218

Cardiac Valve & Other Major Cardiothoracic Procedure with Cardiac Cath w/o CC/MCC

$32,707

$32,367

-1.0%

-$341

219

Cardiac Valve & Other Major Cardiothoracic Procedure without Cardiac Cath w/MCC

$45,260

$44,634

-1.4%

-$626

220

Cardiac Valve & Other Major Cardiothoracic Procedure without Cardiac Cath w/CC

$30,572

$30,158

-1.4%

-$414

221

Cardiac Valve & Other Major Cardiothoracic Procedure without Cardiac Cath w/o CC/MCC

$27,219

$26,811

-1.5%

-$408

231

Coronary Bypass with PTCA w MCC

$45,366

$46,090

1.6%

$724

232

Coronary Bypass with PTCA w/o MCC

$32,874

$34,117

3.8%

$1,243

233

Coronary Bypass with Cardiac Catheterization w MCC

$43,161

$43,448

0.7%

$287

234

Coronary Bypass with Cardiac Catheterization w/o MCC

$28,669

$28,978

1.1%

$309

235

Coronary Bypass without Cardiac Catheterization w MCC

$33,527

$34,308

2.3%

$781

236

Coronary Bypass without Cardiac Catheterization w/o MCC

$22,289

$22,446

0.7%

$157

246

Percutaneous Cardiovascular Procedure with Drug-Eluting Stent w MCC or 4+ Vessels/Stents

$19,009

$19,187

0.9%

$178

247

Percutaneous Cardiovascular Procedure with Drug-Eluting Stent w/o MCC

$12,090

$12,581

4.1%

$491

248

Percutaneous Cardiovascular Procedure with Non Drug-Eluting Stent w MCC or 4+ Vessels/Stents

$17,860

$18,125

1.5%

$265

249

Percutaneous Cardiovascular Procedure with Non Drug-Eluting Stent w/o MCC

$11,046

$11,302

2.3%

$256

250

Percutaneous Cardiovascular Procedure without Coronary Artery Stent w MCC

$17,551

$15,928

-9.2%

-$1,623

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MS-DRG

Description

FY 2015 Final Rule (October 1, 2014 September 30, 2015)

FY 2016 Final Rule (October 1, 2015 September 30, 2016)

Base Rate

Base Rate

% Difference Final 2015 to Final 2016

Dollar Change Final 2015 to Final 2016

251

Percutaneous Cardiovascular Procedure without Coronary Artery Stent w/o MCC

$11,980

$9,957

-16.9%

-$2,023

252

Other Vascular Procedures w MCC

$19,172

$19,410

1.2%

$238

253

Other Vascular Procedures w CC

$14,994

$15,369

2.5%

$374

254

Other Vascular Procedures w/o CC/MCC

$10,162

$10,175

0.1%

$13

266

Endovascular Cardiac Valve Replacement w MCC

$52,808

$50,772

-3.9%

-$2,036

267

Endovascular Cardiac Valve Replacement w/o MCC

$39,652

$38,720

-2.3%

-$931

268

Aortic and Heart Assist Procedures Except Pulsation Balloon w MCC (New FY 2016)

N/A

$37,086

N/A

N/A

269

Aortic and Heart Assist Procedures Except Pulsation Balloon w/o MCC (New FY 2016)

N/A

$23,053

N/A

N/A

270

Other Major Cardiovascular Procedures w MCC (New FY 2016)

N/A

$27,958

N/A

N/A

271

Other Major Cardiovascular Procedures w CC (New FY 2016)

N/A

$18,556

N/A

N/A

272

Other Major Cardiovascular Procedures w/o CC/MCC (New FY 2016)

N/A

$13,290

N/A

N/A

273

Percutaneous Intracardiac Procedures w MCC (New FY 2016)*

$17,551

$20,961

19.4%

$3,410

274

Percutaneous Intracardiac Procedures w/o MCC (New FY 2016)*

$11,980

$14,288

19.3%

$2,308

280

Acute Myocardial Infarction, Discharged Alive w MCC

$10,154

$10,021

-1.3%

-$133

281

Acute Myocardial Infarction, Discharged Alive w CC

$6,018

$6,042

0.4%

$24

282

Acute Myocardial Infarction, Discharged Alive w/o CC/MCC

$4,441

$4,462

0.5%

$21

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Health Economics and Reimbursement

MS-DRG

Description

FY 2015 Final Rule (October 1, 2014 September 30, 2015)

FY 2016 Final Rule (October 1, 2015 September 30, 2016)

Base Rate

Base Rate

% Difference Final 2015 to Final 2016

Dollar Change Final 2015 to Final 2016

283

Acute Myocardial Infarction, Expired w MCC

$9,839

$9,810

-0.3%

-$29

284

Acute Myocardial Infarction, Expired w CC

$4,524

$4,622

2.2%

$98

285

Acute Myocardial Infarction, Expired w/o CC/MCC

$2,975

$3,232

8.6%

$257

286

Circulatory Disorders Except Acute Myocardial Infarction, with Cardiac Catheterization w MCC

$12,474

$12,858

3.1%

$384

287

Circulatory Disorders Except Acute Myocardial Infarction, with Cardiac Catheterization w/o MCC

$6,630

$6,827

3.0%

$197

299

Peripheral Vascular Disorders w MCC

$8,277

$8,394

1.4%

$117

300

Peripheral Vascular Disorders w CC

$5,738

$5,901

2.8%

$163

301

Peripheral Vascular Disorders w/o CC/MCC

$3,979

$4,147

4.2%

$167

673

Other Kidney and Urinary Tract Procedures w MCC

$20,568

$19,816

-3.7%

-$753

674

Other Kidney and Urinary Tract Procedures w CC

$13,273

$13,668

3.0%

$396

675

Other Kidney and Urinary Tract Procedures w/o CC/MCC

$8,482

$9,208

8.6%

$726

*FY 2015 Comparison From MS-DRGs 250.251

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Please visit the Abbott Vascular Reimbursement Web site at:



www.abbottvascular.com/us/reimbursement.html

For questions regarding this Reimbursement Update and other questions regarding reimbursement for Abbott Vascular products and related services, please contact:



Abbott Vascular Reimbursement Hotline



800.354.9997 [email protected]

DISCLAIMER The information provided in this document was obtained from third-party sources and is subject to change without notice as a result of changes in reimbursement laws, regulations, rules, policies and payment amounts. All content is informational only, general in nature, and does not cover all situations or all payers’ rules and policies. It is the responsibility of the hospital or physician to determine appropriate coding for a particular patient and/or procedure. Any claim should be coded appropriately and supported with adequate documentation in the medical record. A determination of medical necessity is a prerequisite that Abbott Vascular assumes will have been made prior to assigning codes or requesting payments. Any codes provided are examples of codes that specify some procedures or which are otherwise supported by prevailing coding practices. They are not necessarily correct coding for any specific procedure using Abbott Vascular’s products. Hospitals and physicians should consult with appropriate payers, including Medicare Administrative Contractors, for specific information on proper coding, billing and payment levels for healthcare procedures. Abbott Vascular makes no express or implied warranty or guarantee that (i) the list of codes and narratives in this document is complete or errorfree, (ii) the use of this information will prevent difference of opinions or disputes with payers, (iii) these codes will be covered [or (iv) the provider will receive the reimbursement amounts set forth herein]. Reimbursement policies can vary considerably from one region to another and may change over time. The FDA-approved/cleared labeling for all products may not be consistent with all uses described herein. This document is in no way intended to promote the off-label use of medical devices. The content is not intended to instruct hospitals and/ or physicians on how to use medical devices or bill for healthcare procedures.

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