Hospital Outpatient PPS

Learn What’s New for CY 2023

CMS issued a CY 2023 Medicare Hospital Outpatient Prospective Payment System (PPS) and Ambulatory Surgical Center (ASC) Payment System final rule with comment period to improve access to health care—including behavioral health services—in rural communities. See the press release, Medicare Hospital Outpatient PPS and ASC Payment System fact sheet, and Rural Emergency Hospital fact sheet for provisions effective January 1, 2023.

Vacating Differential Payment Rate for 340B-Acquired Drugs in 2022 Outpatient Prospective Payment System Final Rule with Comment Period

On September 28, 2022, the United States District Court for the District of Columbia vacated the differential payment rates for 340B-acquired drugs in the Calendar Year 2022 Outpatient Prospective Payment System (OPPS) final rule with respect to their prospective application. The Court ruled:

  • CMS can’t apply the average sales price (ASP) minus 22.5% drug payment rate for these drugs for the rest of the year
  • As a result, CMS will revert to paying the default rate (generally ASP plus 6%) under Medicare statute for 340B-acquired drugs

CMS is uploading revised OPPS drug files that will apply the default rate (generally ASP plus 6%) to 340B-acquired drugs for the rest of the year. CMS also will reprocess claims our contractors paid on or after September 28, 2022, using the default rate (generally ASP plus 6%).

OPPS and ASC Temporary Increase in Medicare Part B Payment for Certain Biosimilar Biological Products

Section 11403 of the Inflation Reduction Act of 2022 (IRA) temporarily increases payment for certain biosimilar biological products that are calculated using the Medicare Average Sales Price Payment Methodology from average sales price (ASP) plus 6 percent to ASP plus 8 percent of the ASP of the reference biological. The increase applies for a 5-year period defined in the statute. For qualifying biosimilar biological products for which payment was made using ASP as of September 30, 2022, the 5-year period begins on October 1, 2022. For qualifying biosimilar biological products for which payment is first made using ASP between October 1, 2022, through December 31, 2027, the 5-year period begins on the first day of the calendar quarter during which such payment is first made. A qualifying biosimilar biological product is defined as a biosimilar with an ASP that is not more than the ASP of the reference biological.

The Outpatient Prospective and Ambulatory Surgical Center payment systems generally use the Medicare Average Sales Price Payment Methodology for biosimilars. Therefore, in accordance with section 11403 of the IRA, the OPPS and ASC addenda files will reflect the temporary increased amount for qualifying biosimilar biological products beginning with the October 2022 file.

COVID-19: New HCPCS Code for Convalescent Plasma in Outpatient Setting

On December 28, the FDA revised the emergency use authorization for COVID-19 convalescent plasma with high titers of anti-SARS-CoV-2 antibodies. It’s authorized for treatment of COVID-19 in patients with immunosuppressive disease or getting immunosuppressive treatment, in the outpatient or inpatient setting.

CMS created HCPCS code C9507 for COVID-19 convalescent plasma for use in the outpatient setting, effective on or after December 28. For billing & payment information, see the April 2022 Addendum B on the OPPS Addendum A and Addendum B Updates webpage.

OPPS Drugs and Biologicals with Quarterly Restated Payment Rates

Some drugs and biologicals based on ASP methodology may have payment rates that are corrected retroactively. These retroactive corrections typically occur on a quarterly basis as a part of the OPPS payment system quarterly update change request. Beginning with the January 2015 OPPS payment system quarterly update change request, the list of drugs and biologicals with corrected payments rates, for a particular quarter, are accessible from the left menu link titled "Restated Drug and Biological Payment Rates".

Hospital Center

For a one-stop resource web page focused on the informational needs and interests of Medicare Fee-for-Service (FFS) hospitals, go to the Hospital Center (see under "Related Links Inside CMS" below). Mailbox: outpatientpps@cms.hhs.gov.

For files to order, see Limited Data Set Files - Hospital Outpatient Prospective Payment System and the Identifiable Data Files.  

Page Last Modified:
11/02/2022 12:11 PM