The House Committee on Ways and Means recently debuted an important healthcare proposal that would provide ambulatory surgery centers with a seat on the Advisory Panel on Hospital Outpatient Payment. The 19-member body advises the Centers for Medicare and Medicaid Services on coding, accounting and other important outpatient business office functions. The legislation, “Hospital Improvements for Payment Act of 2014,” was introduced as a discussion draft on November 17 by Rep. Kevin Brady (R-Texas), a subcommittee chairman on the powerful House tax-writing panel. The draft includes an extensive list of healthcare industry regulatory and statutory priorities, such as changing Medicare’s controversial “two-midnights” policy. The legislation also would establish a new hospital prospective payment system and overhaul the backlogged Recovery Audit Contractors program. In a statement releasing the draft, GOP Ways and Means members singled out changes to Medicare as a priority heading into the next Congress, which begins in January 2015. “It has been over four years since the last major legislation was passed that made payment changes that impact the way hospitals deliver care in the Medicare program,” Brady and other Republican members wrote. “It is imperative that we address and consider these priorities as soon as possible.” While these proposed fixes may come to impact all healthcare providers, the most immediate priority for the ASC community is securing a seat on the 19-member advisory panel. This influential, volunteer body meets three times a year and provides important recommendations that affect policy, limit red tape and, ultimately, advance clinical outcomes. For example, a recent panel meeting covered major outpatient issues such as drug and device payment policies and stereotactic radiosurgery that lacked critical ASC community input during the discussion. The new discussion draft marks the second time in as many years that lawmakers have proposed adding an ASC voice to the CMS advisory panel. In 2013, a bipartisan group of more than 70 Senate and House members introduced the “Ambulatory Surgical Center Quality and Access Act of 2013,” which included the provision. That narrower, ASC-focused bill also included a number of important ASC priorities, including adjusting the rate to address the disparity in Medicare reimbursement rates for ASCs and hospital outpatient departments, which has grown dramatically in the past decade. In 2003, ASCs received 87 percent of the amount Medicare paid HOPDs for the same procedures. Since then, that percentage has gradually dropped to 55 percent, where it stands today. The reason for the difference in reimbursement rates involves how federal regulators compute inflation for both types of facilities. For HOPDs, the Centers for Medicare and Medicaid Services uses an aggregate of hospital-specific items to determine the inflationary change year-to-year. For ASCs, CMS uses the Consumer Price Index for urban consumers, a rate that held lower than the hospital-related “market basket” during the past decade. An example developed by the Ambulatory Surgery Center Association highlights the real cost differences for patients: “For example, when cataract procedures are performed at an ASC, Medicare pays $964. However, if the ASC were acquired by a hospital and converted to an outpatient unit, the payment rate would be $1,671, or $707 more per surgery. If a center performed 2,000 cataract surgeries for Medicare patients (as many do), the government would pay $1.4 million more per year for the ASC’s services if it were converted to an HOPD. In addition, a patient’s 20% co-pay for the surgery would rise from approximately $193 to $490.” The 2013 bipartisan, bicameral ASC bill also proposed the establishment of a value-based purchasing program and forcing CMS to disclose how it determines whether procedures can be performed at ASCs. With the lame duck session nearly complete, the prospects for both proposals going into the new Congress are uncertain. Please visit www.ascassociation.org for more information on all ASC legislation, or contact your congressman or senators to make your voice heard.