David Shapiro, M.D. Texas Ambulatory Surgery Center Society 2013 Annual Meeting Houston

1. Regulatory Effects on ASC PaymentorSurgery Centers and Quality MeasuresorEverything You Didn’t Want To Know About ASC Federal Legislation & Regulation David Shapiro, M.D. Texas Ambulatory Surgery Center Society 2013 Annual Meeting Houston

2. 2014 Proposed Medicare Payment Rule CMS Proposed and Final Rule for ASCs and Hospital Outpatient Departments (HOPD) Contains information regarding Payment and Quality Reporting for both sites of service. Timeframe: July 8, 2013 Proposed Rule Release Date September 6, 2013 Comments Due November 1, 2013 Original Final Rule release date Mid to Late November Current Final Rule release date

3. 2014 Proposed Rule

4. 2014 Proposed Rule Under the proposal, ASC rates will receive an across-the-board increase of 0.9 percent based on the Consumer Price Index for All Urban Consumers (CPI-U) while hospital outpatient departments (HOPDs) will receive an across-the-board increase of 1.8 percent based on the hospital market basket. The agency chose to continue to use the CPI-U, an inappropriate measure of inflation in the cost of providing health care, to update the ASC rates ASCA and TASCS will continue to work both with CMS officials and in Congress to halt the growing disparity in the ASC and HOPD rates.

5. 2014 Proposed Rule Outpatient Prospective Payment System: Hospital payments: projected to increase next year by nearly $4.4 billion, or 9.5 percent over 2013, Ambulatory Surgical Center payments: projected to increase by about $133 million, or 3.5 percent over 2013 It would also “make the payment system more of a predetermined one that packages more services together” by “adding seven more categories of services.”

6. 2014 Proposed Rule No new procedures proposed The agency has not proposed to add any procedures to the ASC list of payable procedures for 2014. ASCA is gathering information to determine which procedures should be added to the list of ASC payable procedures for 2014. This information will help ASCA advocate for the expansion of the list of procedures that CMS considers clinically appropriate for ASCs to provide to Medicare beneficiaries. Participants must complete one form for each procedure they would like added. For example, someone who would like to see three procedures added would need to complete three documents.

7. 2014 Proposed Rule Four additional quality measures proposed. CMS is proposing the following measures, which will affect payment in CY 2016, with data collection beginning in CY 2014: 1. Complications within 30 Days following Cataract Surgery Requiring Additional Surgical Procedures 2. Endoscopy/Polyp Surveillance: Appropriate follow-up interval for normal colonoscopy in average risk patients 3. Endoscopy/Polyp Surveillance: Colonoscopy Interval for Patients with a History of Adenomatous Polyps – Avoidance of Inappropriate Use 4. Cataracts: Improvement in Patient’s Visual Function within 90 Days Following Cataract Surgery.

8. 2014 Proposed Rule Proposed small facility quality reporting exemption CMS has proposed a minimum case threshold to exempt smaller facilities where program implementation can be overly burdensome. They have selected 240 Medicare claims per year because 10 percent of ASCs have fewer than 240 Medicare claims per year so this policy would exempt only those ASCs with the fewest number of Medicare claims. Maintain Minimum Reporting Threshold at 50%

9. CMS Interpretive Guidelines Proposed and Enacted Revisions 416.50 Patient Rights 416.44 (c) Emergency Equipment 416.44 (a) Physical Environment (Temperature and Humidity) 416.49 (b) Radiologic Services 416.50 (c) Advance Directives

10. CMS CfC Reversal October, 2011 CMS issued a Final Rule which will allow ASCs to notify patients of their rights on the day of the procedure without qualification The policy change effective date was December 23, 2011 Reverses the policy that required ASCs, except in very limited circumstances, to provide patient notifications prior to the day of surgery.

11. CMS CfC Reversal The change in the timing of the notification applies to all the information an ASC previously had to communicate with a patient prior to the date of the surgery: Patient Rights Physician Ownership Advance Directive Policy

12. Revised CfCEmergency Equipment Requirement Effective July 16, 2012, the Centers for Medicare & Medicaid Services (CMS) announced that it will no longer mandate that ASCs have a specific list of emergency equipment. Instead, an ASC’s governing body, working in conjunction with the ASC’s medical staff, will have flexibility in determining which emergency equipment is necessary to best safeguard the safety of the patients the ASC serves. The decision about which equipment is necessary must be based on accepted standards of practice. In making the change, CMS echoed the concerns ASCA had previously expressed to the agency. CMS also noted that it had “learned from the ASC community that some of these equipment requirements are outdated, while other equipment requirements would not be applicable to the emergency needs of all ASCs.” Allows ASCs to tailor their list of equipment to suit their needs and remove the cost and burden of having to maintain unnecessary equipment

13. §416.44 (a) Physical Environment Q-0101 (Temperature and Humidity) Humidity- An example of an acceptable humidity standard for ORs is the American Society for Heating, Refrigerating, and Air Conditioning Engineers (ASHRAE) Standard 170, Ventilation of Health Care Facilities. Addendum D of the ASHRAE standard requires RH in ORs to be maintained between 20 - 60 percent. In addition, this ASHRAE standard has been incorporated into the Facility Guidelines Institute (FGI) 2010 Guidelines for Design and Construction of Health Care Facilities, and has been approved by the American Society for Healthcare Engineering of the American Hospital Association and the American National Standards Institute.

14. §416.49 (b) Radiologic Services Current Requirement b) Standard: Radiologic services. (1) The ASC must have procedures for obtaining radiological services from a Medicare approved facility to meet the needs of patients. (2) Radiologic services must meet the hospital conditions of participation for radiologic services specified in § 482.26 of this chapter.

15. Proposed Change (Wrong Answer) Remove (b)(1) and replace it with the requirement that radiologic services may only be provided when integral to procedures offered by the ASC and must meet the requirements specified in § 482.26(b), (c)(2), and (d)(2). Remove (b)(2) and replace with the requirement that an MD/DO who is qualified by education and experience in accordance with State law and ASC policy must supervise the provision of radiologic services

16. ASCA Comment Letter (Right Answer) Option A: 416.49(b)(2) The ASC’s governing body must oversee the provision of radiologic services in keeping with state law and in accordance with approved policies and procedures of the ASC. Option B: Supervision of the provision of radiologic services shall be performed by a physician or other credentialed practitioner, in accordance with State law and the individual ASC’s radiology policies.

17. Advance Directives The CMS state surveyor guidelines have been recently updated to provide additional instruction on how to survey ASCs regarding their policy on honoring advance directives.  ASCs should review their advance directive policy to make sure that it takes into consideration the new surveyor guidelines. 

18. Advance Directives The new guidelines (416.50(c)) indicate that an ASC should “to the maximum extent practicable” honor a patient’s advance directives.   This means that a blanket statement that an ASC does not honor any advance directives is no longer permissible The new guidelines permit an ambulatory surgery center to refuse to honor certain advance directives due to moral or ethical beliefs (reason of conscience) so long as it is in compliance with state law.

19. Advance Directives If the ambulatory surgery center was not willing to comply with this directive, the guidelines require that it will communicate this to the patient through a statement of limitation rather than by providing a blanket statement that advance directives are not honored. If, after the physician explains the ASC’s statement of limitation and the patient refuses to accept the limitation; the law requires that the patient be transferred to a facility that will honor the patient’s advance directive.  The statement of limitation should be communicated before the start of surgery and meet three criteria specifically set out in the surveyor guidelines.  The surveyor guidelines also provides an example of a sample statement of limitation.

20. Advance Directives Statement of Limitation (Recommendations) -Delete blanket statement refusing to honor. -Check state regulations for limitations. -Include legal language from Florida law stating your center will: always attempt to resuscitate a patient and transfer that patient to a hospital in the event of deterioration. -Have governing board approve new statement of limitations, if allowed by state. -Document the new policy in meeting minutes. -Change center policies after governing board approval, and educate employees on changes.

21. Advance Directives ASCA submitted a letter to CMS Administrator Marilyn Tavenner raising concerns with recent changes to the advance directive requirements in the recently revised interpretive guidelines. The new advance directive language, adding more procedural requirements for ASCs who refuse to honor all aspects of an advance directive, is not appropriate for patients who receive care at ASCs. The letter questions the survey and certification office’s authority to require ASCs to comply with regulatory language that is almost identical to requirements for hospitals and other providers outlined in 42 CFR 489.102(a), despite the fact that ASCs are excluded from that language.

22. Current CMS Quality Reporting Program

24. Submission of Web-based Measure data for ASC Measures 6 and 7 Web based submission (Quality Net) of data regarding: • Safe Surgery Checklist Use in 2012 • Volume of Selected Procedures 2012 (Original) Reporting Period July 1-Aug 15 2013 Affects Payment Determination for 2015

26. Quality Net To submit web-based measure data and access reports, the ASC must have an active Security Administrator registered with QualityNet Download>Complete>Approval (another individual)> Notarize>Mail In Upon completion, the form must be submitted to the ASCQR Program Support Contractor for processing.

27. QualityNet User Guide New User Enrollment Process - Prerequisite for Secure Portal Usage Before you log in to the Secure QualityNet Portal for the first time, you must complete the New User Enrollment Process. The prerequisites for this process are: • A completed QualityNet Registration that in turn has allowed your organization’s Security Administrator to provide you with a QualityNet user ID and password. • A Symantec VIP multifactor credential application downloaded to your PC, tablet, or smartphone. To download the multifactor authentication application to your PC or tablet, access the Verisign ID Protection Center web site: https://idprotect.verisign.com/desktop/download.v To download the multifactor authentication application directly to your smartphone, type the following into your default mobile browser: m.verisign.com

28. QualityNet User Guide Important: You will only complete this new user enrollment process once; you will not do this every time you log into the Secure QualityNet Portal. This one-time process is a six-step procedure that should take you no longer than five minutes to complete if you have all of your prerequisites in hand. Some users will find they cannot complete the proofing part of the new user enrollment process as they will experience errors. Here are some explanations of why this might happen: The identity proofing steps of this process include identity verification by Experian, an external service that CMS has engaged to verify user identities. Experian uses your credit history within their extensive financial databases to confirm that you are who you say you are. If you do not have much credit history or if you have had problems with credit in the past, the online steps of the process may not work for you. If this happens, there are alternative options. If you find you cannot complete the proofing process online, you may be given the option to complete the proofing process with Experian via a phone call. This option will be offered if you have some credit history. If you have little or no credit history, you will be offered the option to prove your identity directly, in-person, with your Security Administrator. While you are on the Identity Proofing screen during the enrollment process (see Figure 5-4), please review the Remote Proofing FAQ link for more details and Q&A about the proofing process. You may also visit Experian’s PreciseID web site, http://www.experian.com/whitepapers/precise_id_whitepaper.pdf, for more details about the proofing process.

29. Additional QualityNet Requirements As of May 31, 2013, the Centers for Medicare & Medicaid Services (CMS) is now requiring QualityNet users for the ASC Quality Reporting Program to complete an additional user enrollment process to ensure access to the Secure QualityNet Portal. After receiving a user ID and password, the security administrator will now be required to download the Symantec VIP Access application (Symantec VIP multifactor credential application). To download the multifactor authentication application to your PC or tablet, access the Verisign ID Protection Center web site: https://idprotect.verisign.com/desktop/download.v When logging in to the portal for the first time, security administrators will be guided through a six-step New User Enrollment Process that includes personal identity verification conducted by Experian, an external service enlisted by CMS. Name, Home Address, Financial Data (Mortgage, Credit Cards) Social Security Number

30. Additional QualityNet Issues Administrators uncomfortable with the requirement to enter personal data such as home address and social security number to comply with the regulations The new ASC Portal was not communicated and appeared very late in the process.  Many administrators had already registered and this was not built yet so they were not aware they needed to complete this phase of the process. The instruction manual is very difficult to follow and not user friendly – the portal portion was added to this but late and many had already registered ASCA and FSASC have significant concerns with personal data being required from our members in order to comply with quality reporting regulations, and is reaching out to CMS to determine the rationale behind this requirement. Possible modification involving Masking SS# No query regarding specific mortgage amount

31. QualityNet Reporting As announced to QualityNet users in an email blast on June 28, the reporting period for the Web-based measures for the ASC Quality Reporting Program (ASCQR), scheduled to begin on July 1, 2013, was delayed due to the need for continued software testing. In this communication, the Florida Medical Quality Assurance, Inc. (FMQAI), the national support contractor for the reporting program, stated that it anticipated that access to measures ASC-6 (Safe Surgery Checklist Use) and ASC-7 (ASC Facility Volume Data on Selected ASC Surgical Procedures) would be enabled by July 9th FMQAI also indicated that ASCs would be alerted to the new start date for reporting through the ASCQR ListServe as soon as the Web-based tool becomes available (Eventually resolved July 10th)

32. QualityNet Reporting Access to measures ASC-6 (Safe Surgery Checklist Use) and ASC-7 (ASC Facility Volume Data on Selected ASC Surgical Procedures) have been enabled through the web-based tool. If you encounter one of the following issues listed below, please contact the QualityNet Help Desk at 866-288-8912 for assistance. You see a "Run Report" link but not a "Measures" link on the task page. You receive an error message once logged into the portal at any part during the process. You can enter data, but the system will not save the data. Posted July 16: Document addressing known issues associated with Ambulatory Surgical Center Quality Reporting (ASCQR) Now updated with newly identified issues and resolutions

33. QualityNet Updates Privacy Issues CMS worked with Experian to establish a set of questions that would be less invasive and yet still maintain the integrity of the identity proofing process Outdated Versions of Java Resolved so that centers may use a version of Java that is compatible with Internet Explorer 8 Application Backlog All applications received have been processed Reporting Delays CMS extended the reporting deadline to August 23

34. QualityNet Contact Information Florida Medical Quality Assurance, Inc. Ambulatory Surgical Center Support Contractor Team Florida Medical Quality Assurance, Inc. (FMQAI): Information for Healthcare Improvement 5201 W. Kennedy Blvd. Suite 900 Tampa, FL 33609 Phone: 866-800-8756

35. Agency for Healthcare Research and Quality (AHRQ) AHRQ Surgical Unit-based Safety Program for ambulatory (SUSP-AS) named “AHRQ’s Safety Program for Ambulatory Surgery”, is focused on developing the optimal use of a safe surgical checklist to improve outcomes in ambulatory settings and developing a culture of safety. Data reporting for the first cohort began July 1, 2013

36. Consumer Assessment of Healthcare Providers and Systems (CAHPS) The CMS contract for the development of an outpatient surgical CAHPS survey was awarded to Research Triangle Institute (RTI). RTI still plans to recruit patients from 36 sites for the field test. RTI would like a mix of demographics as well as different surgery/procedures. Volunteer facility participants are being sought.

37. Additional Item to Worry AboutHIPAA Omnibus Rule Ten years have passed since the HIPAA Security Rule came out, and much changed when the HIPAA Omnibus Rule became effective on September 23th, 2013 ASCs must be compliant with far-reaching changes to the Health Insurance Portability and Accountability Act’s (HIPAA) privacy, security and breach notification requirements

38. HIPAA Omnibus Rule Compliance involves consideration of issues related to: Notice of Privacy Practices Changes to privacy policies Risk analysis for Breaches New contract requirements for Business Associate Agreements (BAA) Enforcement Fines range from $100 - $50,000/violation. Maximum fines of $1.5 million for all violations. Currently, a Covered Entity is not liable for the acts of its Business Associates who meet the federal common law definition of an “agent” –If HIPAA-compliant Business Associate agreement is in place –Covered Entity did not know of a pattern or practice of violations and fail to act. The Final Rule eliminates this exception, essentially making a Covered Entity or Business Associate strictly/vicariously liable for violations by its agent. –The most important criterion is the right to exercise control over the Business Associate. –In drafting a BAA, consider the tradeoff between the need to control the Business Associate and the liability associated with such control

39. Electronic Health Records (EHR) Congress passed the HITECH Act of 2009 to incentivize Medicare providers to adopt and use EHR systems. Unfortunately, ASCs were not eligible for HITECH funds to develop EHR systems, and no certified EHR is currently available for ASC encounters. Under the current program, physicians for whom at least half of their patient encounters do not occur in settings with qualified EHR systems will not meet “meaningful use” requirements and will be penalized with reduced payments. Current regulation may dissuade physicians from using ASCs—often a lower-cost option—because patient encounters in the ASC setting currently count toward the physicians’ total encounters but cannot meet “meaningful use” requirements

40. Electronic Health Records (EHR) The Electronic Health Records Improvement Act of 2013 introduced by US Representative Diane Black (R-TN) provides a short-term exemption to the HITECH Act that would allow physicians to provide care in ASCs for three years following its enactment without having the cases they perform there being factored into the “meaningful use” requirements. This exemption will allow ASCs the time they need to develop standards for EHR that meet the unique needs of the ASC setting. The legislation also reinstates the “batching” process that allows all physicians who input patient records from an ASC setting into an EHR system at a later time to include those patient encounters in their “meaningful use” requirements.

41. Electronic Health Records (EHR) Allowing physicians to perform procedures in ASCs without fear of being penalized encourages them to continue to choose the lowest-cost setting of care. Providing this short-term reprieve will give the ASC community time to explore ways to develop criteria for EHR systems that can be certified for this unique setting, which would benefit both physicians and patients. Encourage all members of the US House of Representatives to offer their support to H.R. 1331.

42. Electronic Health Records (EHR) ASCA submitted a letter to Farzad Mostashari, MD, the national coordinator for Health Information Technology, who is responsible for directing the federal government's development of health information technology (HIT) standards and strategy. The letter was drafted in response to Dr. Mostashari’s request for more information regarding the importance of creating a voluntary certification process for EHRs in the ASC setting. ASCA staff is also in the process of organizing a group of ASC leaders, vendors and other stakeholders. This group will convene in the Fall to discuss the development of standards for EHRs that would be appropriate for the workflow of ASCs.

43. ASC Legislation The ASC Quality and Access Act of 2013 was introduced in early June by Senators Ron Wyden (D-OR) and Mike Crapo (R-ID). The Senate bill (S. 1137) has 5 additional cosponsors. The ASC Quality and Access Act of 2013 (H.R. 2500) was introduced in the House of Representatives on June 25th, by Representatives Devin Nunes (R-CA) and John Larson (D-CT). The bill is the companion legislation to (S. 1137) They have been joined by 37 additional cosponsors

44. ASC Legislation Ambulatory Surgery Centers Quality and Access Act of 2013 • CMS conversion to Hospital Market Basket • Value Based Purchasing Program • Representative to HOP Advisory Panel • Transparency in Approved Procedure List

45. Texas Cosponsors • Michael Burgess • Kay Granger • Ralph Hall • Kenny Marchant • Pete Sessions • Marc Veasey

46. ASC Quality and Access Act 2013 Requires the Centers for Medicare & Medicaid Services (CMS) to use the hospital market basket as the update factor when determining the update for payments for services performed in ambulatory surgery centers (ASCs). Currently, ASCs do not have a market basket update and the default update mechanism is the Consumer Price Index for All Urban Consumers (CPI-U), which does not appropriately measure the costs of an ASC. The provision does not affect the productivity adjusters mandated for all providers by the Patient Protection and Affordable Care Act (PPACA) or the secondary rescaling required for budget neutrality in the ASC pool.

47. ASC Quality and Access Act 2013 Requires the development of a value-based purchasing (VBP) program for ASCs by January 1, 2015. The system would be established as follows: Each reporting facility would be assigned a score based on its performance on the quality measurements; Facilities would not be required to report on those measures that were inappropriate for their facility, i.e. shaving of the surgical site in ASCs that perform ophthalmic procedures; CMS would develop an estimate of the total amount that Medicare is expected to spend on hospital outpatient department (HOPD) and ASC procedures for the coming year for procedures that are eligible to be performed in an ASC. The estimate would be based on spending in the three prior years and would be adjusted for beneficiary demographics, eligible procedures and other factors, such as changes in the proportion of beneficiaries enrolled in Medicare Advantage plans;

48. ASC Quality and Access Act 2013 Each year, CMS would compare the actual spending to its estimated spending for procedures eligible to be performed in an ASC that were performed in either an HOPD or an ASC. If the actual spending for these procedures is less than the estimated spending, the difference would create the shared savings or bonus pool. This system is similar to the VBP system designed for the home health demonstration mentioned in the The shared savings pool would be divided, with 50 percent of the pool being retained by CMS and returned as savings to the Medicare program. The other 50 percent of the pool would be used to provide bonuses to high quality ASCs; The creation of the mechanism to provide bonuses to individual ASCs is left to the discretion of the Secretary with instruction to reward providers for both improvement and attainment; however, the Secretary is required to spend 50 percent of the savings pool on ASC bonuses.

49. ASC Quality and Access Act 2013 Directs CMS to add a representative from the ASC community to the membership of the Advisory Panel on Hospital Outpatient Payment since decisions made by the panel affect both HOPD and ASC facility fees and eligible procedures.

50. ASC Quality and Access Act 2013 The Ambulatory Surgery Center Quality and Access Act requires CMS to disclose which criteria triggers the exclusion and prohibits CMS from excluding procedures reported with unlisted codes from the ASC setting. The agency is not required to disclose which of the criteria triggers the exclusion.