Whether we like it or not, medicine is moving from fee-for-service (FFS) to value-based payments. Part of this movement involves site neutrality payments from Medicare, which means that imaging services are likely to be affected.
In June 2013, the Medicare Payment Advisory Commission (MedPAC), which advises Congress on Medicare payments, recommended site neutrality for certain services including diagnostic imaging. In its report, MedPAC states:
Site-neutral payments reflect the Commission’s position that the program should not pay more for care in one setting than in another if the care can safely and effectively be provided in a lower cost setting. The Commission has examined inpatient and outpatient services for which the program pays different rates depending on the site of service and has made recommendations to lower or eliminate price differences.
At its core, site neutrality includes the same payment amounts for a service regardless of where the service is provided by Medicare. For example, hospitals traditionally charge more for an MRI than a free-standing facility; but under site neutrality, both facilities would be paid the same.
In addition, CMS is coming close to eliminating differential payment for certain services. We might see these changes implemented as early as 2016.
Site neutrality overview
Attorneys Adrienne Dresevic and Leslie Rojas have written an article that gives an excellent overview of site neutrality. According to the article, “President Obama’s 2016 Fiscal Year Budget includes a provision to reduce payment for services provided in provider-based, off-campus hospital outpatient departments to either the lower MPFS rate or the ASC payment system rate.”
That being said, if CMS goes with the Medicare Physician Fee Schedule (MPFS), payments will be equalized for the same services provided by a physician-owned medical practice or an off-campus, hospital-owned physician office.
How to prepare for site neutrality
Because this change is more of a when than an if, here are a few things you can do now to prepare for the inevitable.
In a blog for The Advisory Board Company, Eric Passon and Michele Molden provide suggestions for preparing for site neutral payments:
- Offset revenue losses with strategic contracts.
- Get your outpatient operations in order.
- Transform to an ambulatory enterprise.
In their article, Dresevic and Rojas also outline several ways to get ready:
- Dedicate time and resources to ensure accurate cost reports and claims data.
- Redesign your health care delivery model, shifting certain ancillary services to more appropriate outpatient, off-site locations.
- Participate in the Medicare Shared Savings Program or Medicare Advantage.
Final Thoughts | Site Neutrality in Medicare
In the end, the important thing for any organization is to be prepared: get your facility set up as best you can to minimize hits to your bottom line.
As always, an accreditation seal of quality from RadSite will demonstrate to payers that your facility meets nationally-accepted quality guidelines! Contact us for more information on our accreditation program.