The Centers for Medicare and Medicaid Services’ decision to not eliminate the inpatient only list (IPO) was due to the numerous comments and feedback it received from the medical community, the COVID-19 public health emergency and the fact that the change “transpired quickly,” according to the final rule (CMS-1753FC) issued in December.1
Heading into 2022, hospitals, treating physicians and utilization review teams will not have to deal with the elimination of the IPO list, according to the final rule from CMS. As of this ruling, almost all of the 298 proposed procedures to be removed from the list will remain; only three services are recommended to be removed from the list:
- CPT codes 22630 (Lumbar spine fusion), 23472 (Reconstruct shoulder joint), and 27702 (Reconstruct ankle joint) and their corresponding anesthesia codes
- CPT code 01638 (Anesthesia for open or surgical arthroscopic procedures on humeral head and neck, sternoclavicular joint, acromioclavicular joint, and shoulder joint; total shoulder replacement)
- CPT 01486 (Anesthesia for open procedures on bones of lower leg, ankle, and foot; total ankle replacement)
The IPO list gained attention in 2021 when CMS announced it would eliminate the list, which “identifies services for which Medicare will only make payment when the services are furnished in the inpatient hospital setting because of the nature of the procedure, the underlying physical condition of the patient, or the need for at least 24 hours of postoperative recovery time or monitoring before the patient can be discharged.”1
CMS had requested and received feedback on whether or not it should continue to pursue the goal of eventually eliminating the IPO list. “The overwhelming majority of the commenters, including professional associations, hospital associations, hospitals, and many providers, supported maintaining the IPO list.” 1, pg. 623.
This along with other feedback, CMS said “Given the significant policy shift and work required to operationalize the elimination of the IPO list, we acknowledged that more time is required to separately evaluate and consider the inpatient only classification of each service and its potential APC assignment.”1, pg. 582
CMS will maintain its long-standing practice of evaluating a procedure for addition to or removal from the IPO list using its five standing criteria1pg. 576 Moving forward it will take the additional step to codify those five criteria making it a more gradual process. The five standing are the following, according to CMS:
- Most outpatient departments are equipped to provide the services to the Medicare population.
- The simplest procedure described by the code may be furnished in most outpatient departments.
- The procedure is related to codes that we have already removed from the IPO list.
- A determination is made that the procedure is being furnished in numerous hospitals on an outpatient basis.
- A determination is made that the procedure can be appropriately and safely furnished in an ASC and is on the list of approved ASC services or has been proposed by us for addition to the ASC list.
CMS stated that it continues to believe the IPO list is a valuable tool because there are some additional forces that can impact inpatient decisions.
“We also received comments from physicians and medical specialty societies who stated that, while they agreed that physicians should be the primary arbiters regarding the clinically appropriate site of service for a procedure for a particular beneficiary, they support maintaining the IPO list because a physician’s medical judgment is not always the primary factor in determining whether a procedure is furnished in the inpatient or outpatient hospital setting. These commenters stated that many of the adverse impacts from removing procedures from the IPO list arise from hospitals that drive provider admission decisions … According to commenters, physicians must, at times, convince a hospital or payer that a particular patient should receive a given procedure in an inpatient setting due to patient safety concerns.”1 pg. 585
CMS also noted that the list, which is meant as guidance for Medicare payment for procedures, at the same time impacts commercial insurance who may reference this information during their prior authorization process for elective inpatient stays for procedures. When the CMS IPO list was being considered for elimination, it was perceived to reinforce the fact that “both CMS (for Medicare beneficiaries) and commercial payers have historically pushed for the use of ASCs as an alternative, lower-cost site of care.”2 In its discussion of the comments received regarding the elimination of the list, CMS said it was wrong for payers to see the list as a means of denying payment for procedures done in an inpatient setting.
When considering the impact of IPO list changes on commercial payers, CMS had strong words for any payers using IPO to deny payment. “It is a misinterpretation of CMS payment policy for providers to create policies or guidelines that establish the hospital outpatient setting as the baseline or default site of service for a procedure based on its removal from the IPO list. As stated in previous rulemaking, services that are no longer included on the IPO list are payable in either the inpatient or hospital outpatient setting subject to the general coverage rules requiring that any procedure be reasonable and necessary, and payment should be made pursuant to the otherwise applicable payment policies (84 FR 61354; 82 FR 59384; 81 FR 79697).”1
CMS said its reversal was, in part, due to the pandemic. “We acknowledged that the COVID-19 PHE may have negatively impacted the time and resources that providers have to adapt to the removal of these procedures from the IPO list— making it more difficult for providers to prepare, update their billing systems, and gain experience with newly removed procedures eligible to be paid under either the IPPS or the OPPS.”
Finally, CMS acknowledged that the comments and feedback they received demonstrated that the longer-term objective to eventually eliminate the list was not what most in the medical community wanted. They will therefore “continue to systematically scale the list back to ensure that inpatient only designations are consistent with current standards of practice.”
Dr. Monika Mlynarski, AppriseMD Director of Provider Services, said having the IPO list is better for hospitals and certainly for patients. “The list acknowledges these inpatient procedures are in need of more monitoring and more resources that are available in hospital settings.” Maintaining the majority of these procedure on the IPO list, she said, will eliminate confusion and clarify whether an inpatient setting in within CMS guidance or whether an outpatient setting is required for reimbursement.
As always it is important for providers and payers to keep a close eye on CMS recommendation for changes in payment guidance, give feedback when requested and keep the current requirements and standards of care in all clinical care situations.
- “Medicare Program: Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Program; Price Transparency of Hospital Standard Charges; Radiation Oncology Model.” Department of Health and Human Services Centers for Medicare & Medicaid Services, 42 CFR Parts 412, 416, 419, and 512; Office of the Secretary 45 CFR Part 180, CMS –1753-FC. https://www.federalregister.gov/documents/2021/11/16/2021-24011/medicare-program-hospital-outpatient-prospective-payment-and-ambulatory-surgical-center-payment
- Kehayes, Naya, et al. “Total Hip Arthroplasty: CMS 2021 OPPS Proposed Rule.” ECG Management Consultants Oct. 26, 2020. https://www.ecgmc.com/thought-leadership/blog/total-hip-arthroplasty-cms-2021-opps-proposed-rule