In the Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) final rule for Calendar Year (CY) 2021, the Centers for Medicare & Medicaid Services (CMS) finalized their proposal to begin to eliminate the inpatient-only (IPO) list. CMS will transition services off the IPO list over a 3-year period, with the list completely eliminated by CY 2024. CMS recognized that stakeholders may need time to adjust to the removal of procedures from the list.
The IPO list was established with the implementation of the OPPS in the CY 2000 OPPS/ASC final rule. The IPO list was created to identify services that require inpatient care because of the invasive nature of the procedure, the need for at least 24 hours of postoperative recovery time, or the underlying physical condition of the patient who would require the surgery. For example, the list includes certain surgically invasive services on the brain, heart, and abdomen, such as craniotomies, coronary-artery bypass grafting, and laparotomies.
For the CY 2021 final rule, CMS concluded that they no longer believed there was a need for the IPO list in order to identify services that require inpatient care. Instead, CMS agreed with past commenters that the physician should use his or her clinical knowledge and judgment, together with consideration of the beneficiary’s specific needs, to determine whether a procedure can be performed appropriately in a hospital outpatient setting or whether inpatient care is required for the beneficiary. CMS believed that this change would ensure maximum availability of services to beneficiaries in the outpatient setting and that emerging new technologies and innovative medical practice were blurring the difference between the need for inpatient care and the sufficiency of outpatient care for many services.
In addition, as medical practice continues to develop, CMS believed that the difference between the need for inpatient care and the appropriateness of outpatient care has become less distinct for many services. Therefore, CMS believed that the IPO list was no longer necessary to identify services that require inpatient care.
To begin the transition for eliminating the IPO, for CY 2021, musculoskeletal services was the first group of services removed from the IPO list. CMS believed it was appropriate to remove this group of services first for the following reasons:
- In recent years, due to new technologies and advances in surgical care protocols, expedited rehabilitation protocols, and significant enhancements to postoperative processes, total knee (TKA) and total hip arthroplasties (THA), which are both musculoskeletal services, had been previously removed.
- During the process of proposing and finalizing removing TKA and THA from the IPO list, stakeholders have continuously requested that CMS remove other musculoskeletal services from the IPO list as well, citing shortened length of stay times, advancements in technologies and surgical techniques, and improved postoperative processes.
- Additionally, CMS noted that, more often than not, stakeholders’ historical requests for removals were for musculoskeletal services.
- CMS also recognized that there is already a set of comprehensive Ambulatory Payment Classifications (APCs) for musculoskeletal services for payment in the outpatient setting, which facilitates the removal of these types of services for CY 2021. Specifically, because CMS had previously removed codes from the IPO list that are similar clinically and in terms of resource cost, and assigned them to these comprehensive APCs, these APCs generally describe appropriate ranges and placements for these musculoskeletal codes being removed in CY 2021, which will allow for appropriate payment.
CMS finalized its proposal to remove 266 musculoskeletal procedures from the IPO list for CY 2021 in addition to 32 anesthesia and service codes for a total of 298 codes. The procedures that currently remain on the IPO list are found in Addendum E which may be accessed on the CMS website at: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS?redirect=/HospitalOutpatientPPS