Coalition of providers, insurers and patient advocacy groups calls on Congress to further advance site-neutral policies to reduce healthcare costs for patients, employers and taxpayers
WASHINGTON – The Alliance for Site Neutral Payment Reform today applauded a new site-neutral payment provision included in the federal budget agreement signed into law yesterday by President Barack Obama. The measure establishes a site-neutral payment policy for all newly acquired provider based off-campus hospital outpatient departments (HOPD). The policy would exclude any newly acquired physician that does not practice on the main campus of the hospital from the Outpatient Prospective Payment System (OPPS) and would align their payments with other physician practices paid under either the Ambulatory Surgical Center (ASC PPS) or the Medicare Physician Fee Schedule (PFS).
According to the Alliance, “The site-neutral payment provision in the budget deal marks an important first step in equalizing payment for the same healthcare service despite site of service, which our coalition advocates is needed to eliminate unfair payment differentials that unnecessarily drive up costs to patients and the healthcare system as a whole. However, while this provision shows great progress, significant disparities in reimbursement between hospital outpatients departments and freestanding, community-based care settings still exist and will continue to drive up prices and encourage consolidation of the healthcare marketplace.”
The Alliance warns that payment policies that support higher reimbursement in the HOPD setting encourage the acquisition of office-based physician practices, which results in higher costs and the closure of community-based care settings, further restricting patient access to care in the lower cost setting. Data show that an increase in the market share of hospital ownership of physician practices has led to higher healthcare prices and spending. A report published in the Journal of the American Medical Association, for example, found that total spending per patient was 10.3 percent higher for hospital-owned settings compared with physician-owned settings.
“President Obama, bipartisan lawmakers and MedPAC all agree that site-neutral payment reforms can save our healthcare system billions of dollars,” added Ted Okon, Executive Director of the Community Oncology Alliance (COA). “We look forward to working with policymakers to further advance payment policies that level the playing field for all healthcare providers, which will ultimately protect patients and reduce healthcare spending.”
The Alliance was formed to address payment parity across site of service in order to decrease Medicare and commercial spending, ensure patients receive the right care in the right setting, lower taxpayer and beneficiary costs and increase patient access. While patients need to access various outpatient services in hospital and non-hospital settings, the Alliance encourages site-neutral payment policies that are fiscally wise and enhance patients’ healthcare options.