This toolkit is designed to educate and assist hospitals in setting the charge for G0424, the code assigned Medicare’s pulmonary rehabilitation program benefit. In its final rule announcing 2012 payment rates, CMS highlights G0424 as a primary example of hospitals’ failure to develop appropriate charges for new “bundled” codes that reflect a broad base of services that had been separately billable (see p. 8 of this toolkit). The information provided here is designed to ensure that hospitals carefully consider all the services, supplies and equipment that are integral to the provision of pulmonary rehabilitation services encompassed in G0424 and establish appropriate charges reflective of that scope of services.
CMS Proposed and Final Rules—CY 2012 Payment Update for Hospital Outpatient Services
CMS-1525-P: Before CMS had enough data from claims submitted for G0424, it used a simulated model to establish the payment rate. The proposed rule walks you through the process CMS used to set the rates for CY 2010 and 2011 and how the process for CY 2012 is different. The discussion highlights the fact that the simulated model CMS used when first setting the rates assumed that hospitals would include the charges for multiple services that comprise the pulmonary rehab comprehensive program when they billed for G0424. You should familiarize yourself with these regulations because they can provide valuable insight as to the problem that exists today with hospitals’ claims and the data CMS relies on to set the rates.
Discussion of Pulmonary Rehabilitation begins on page 70 of the PDF file or page 42239 of the Federal Register.
CMS-1525-FC: The final rule establishing the current payment rate of $37 discusses why CMS believes the data it had was sufficient to make a final decision using claims for G0424, rather than waiting another year and using the simulated payment model it used in previous years. (Note: AARC, together with other pulmonary organizations, recommended using the simulated model to give hospitals a chance to get over the learning curve of dealing with a new bundled code.) CMS uses the pulmonary rehab code G0424 to drive home the point that hospitals need to account for ancillary services that were billed separately prior to use of a single code so as not to under-represent the cost of providing the service which can result in too low a payment. This is what happened with the dramatic reduction to the PR payment rate.
Discussion of under-representing charges associated with a bundled code using G0424 as an example can be found in the right-hand column on page 103 of the PDF file or page 74224 of the Federal Register.
Discussion on setting the payment rate of $37 for pulmonary rehabilitation begins on page 142 of the PDF file or page 74263 of the Federal Register.
Previous AARC Articles on the PR Payment Reduction
- AARC Will Fight Pulmonary Rehab Payment Reduction—November 9, 2011
- AARC Meets with CMS over Reduced Payment for Pulmonary Rehabilitation—August 30, 2011
Additional Information—Members Only Content
Webcast on Pulmonary Reimbursement Reductions
This Members Only webcast titled “Strategies for Addressing the New Pulmonary Rehabilitation Reimbursement Reductions” was presented on March 28, 2012. It provides additional details on the information in the Toolkit and is key to helping respiratory therapists understand how they can help efforts to improve PR payment rates.