New Year Brings 5 New Skin Procedures APC Groups

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Happy New Year! Typically, at the end of each year, I’d always wonder if there would be enough reimbursement news to fill nine annual Business Briefs columns. As 2015 drew to a close, we learned from our publishers that we’d be producing 12 annual issues of Today’s Wound Clinic moving forward. Of course, that means more work for all involved, but this year I am not worried about having enough reimbursement news to fill those 12 issues! The changes in coding, payment, and coverage are happening faster than I can write about them. In fact, I had to choose between numerous pertinent topics for this first column of 2016. Therefore, I look forward to another year of sharing reimbursement information with you.

As we all know, the Medicare payment system for wound care hospital-based outpatient departments (HOPDs) is based on grouping the HOPDs’ services, procedures, and products into ambulatory payment classification (APC) groups. In other words, the Medicare national average allowable rate affiliated with the APC group equals the national average allowable payment rate for the services, procedures, and products assigned to that specific APC group. Periodically, the Centers for Medicare & Medicaid Services restructures one or more APC groups. The 2016 Outpatient Prospective Payment System (OPPS) Final Rule announced a major restructuring of the skin procedures APC groups, which means several significant Medicare payment changes for HOPDs. See Table 1 for a list of the five new skin procedures APC groups. In addition to these new groups, several other wound care-related services/procedures have been assigned to new/different APC groups. 

Please note that each APC group is assigned a status indicator. These status indicators let HOPDs know if a wound care service, procedure, or product will be paid in full, partially paid, packaged, etc. For example, the five new skin procedures APC groups are assigned status indicator “T,” which means the procedures that are assigned to each of these new APC groups are considered “significant procedures” and that the “multiple reduction applies” if more than one procedure with a status indicator of “T” is performed during the same encounter.

The description of status indicator “T” goes on to say that the procedures in the APC groups are “paid under OPPS” and are assigned a “separate APC payment.” You can read the definitions of all status indicators in Addendum D of the 2016 OPPS Final Rule. See Table 2 for a description of the status indicators discussed in this article. Now, let’s take a look at the major APC payment changes that HOPDs will experience in 2016. 

Clinic Visits

G0463 was assigned to a new APC group - Level II Examinations and Related Services. The Medicare allowable rate increased slightly. HOPDs should pay particular attention to the status indicator, which changed from “Q3” to “J2.”  HOPDs that automatically bill for a clinic visit on days when other procedures are performed should reconsider this practice, especially when considering the descriptor of status indicator “J2.” 

Surgical & Medical Debridement

The APC restructuring has some important payment implications for surgical and medical debridement:

• The surgical debridement of subcutaneous tissue (11042) and the medical selective debridement (97597) are now assigned to the same APC group, which provides a payment increase for selective debridement and a payment decrease for subcutaneous tissue debridement. The status indicator “T” remains the same as in 2015.

• The surgical debridements of muscle (11043) and bone (11044) are now assigned to APC groups with higher allowable rates. The status indicator “T” remains the same as in 2015. 

• The add-on codes for the surgical and medical debridements are still packaged; status indicator “N” verifies the packaging.

• Nonselective debridement (97602) was assigned to a lower-paying APC group. In addition, the status indicator was changed from “T” to “Q1,” which limits separate payment for this procedure when performed at the same encounter with many other procedures. Carefully read the descriptor of “Q1” in Table 2. 

Autografts

The APC restructuring of autografts has some important payment implications:

• The split-thickness autografts (15100 and 15120) continue to be assigned to the same APC group, but the new APC group - Level V Skin Procedures - has a lower payment rate in 2016. The status indicator “T” remains the same as in 2015. 

• Unlike 2015, the epidermal autografts (15110 and 15115) to all anatomic locations are now assigned to the same APC group - Level IV Skin Procedures - which results in a much higher allowable payment rate for 15110 and a slightly higher rate for 15115. The status indicator “T” remains the same as in 2015.

• The add-on codes for the split-thickness autografts and the epidermal autografts larger than 100 sq cm are still packaged; status indicator “N” verifies the packaging.

Cellular and/or Tissue-Based Products for Wounds (CTPs)

Ever since the CTPs (outdated term “skin substitute grafts”) were packaged into the application procedures, HOPDs found it difficult to afford the use of CTPs for wounds ≥ 100 sq cm because the allowable payment rates were significantly less than the cost of many of the CTPs. This problem has been partially alleviated in 2016.

• For “low cost” CTP allowable rates, note the application codes (C5273 and C5277) for all anatomic locations ≥ 100 sq cm have been moved to higher-paying APC groups, which should make the use of most “low cost” CTPs affordable for these larger wounds.

• For “high cost” CTP allowable rates, note the application code (15273) for wounds ≥ 100 sq cm on the trunk, arms, and legs was moved to a lower-paying APC group.  The application code (15277) for wounds ≥ 100 sq cm on smaller anatomic locations (eg, feet) was moved to a higher-paying APC group. These changes may or may not make the use of “high cost” CTPs affordable for these larger wounds. The cost of the “high cost” products > 100 sq cm will determine affordability.

• The restructured APC group allowable rates for the “low cost” and “high cost” CTPs up to 100 sq cm remain nearly the same as 2015.

• The status indicator “T” remains the same for the application of both “low cost” and “high cost” CTPs.      

• The add-on codes for both “low cost” and “high cost” CTPs remain packaged as specified by the status indicator “N.”

Compression

The APC group restructuring brought some good news and some bad news for various compression codes:

• The good news is for the application of multilayer compression system to the thigh and leg, including ankle and foot (29582), which moved to a higher-paying APC group.

• The bad news is for the application of total contact cast, Unna’s boot, and the other multilayer compression systems (29581, 29583, and 29584), which moved to lower-paying APC groups.

• The status indicator “S” for all compression codes remains the same as last year. 

Negative Pressure Wound Therapy (NPWT): Durable Medical Equipment & Disposable Equipment

The APC group restructuring impacts NPWT differently for traditional durable medical equipment (DME) and disposable equipment:

• The APC group restructuring placed the use of traditional DME on all sizes of wounds into the same APC group. That realignment provides a payment rate increase for the use of traditional NPWT (97605) on wounds ≤ 50 sq cm and a payment rate decrease for the use of traditional NPWT (97606) on wounds > 50 sq cm.

• Last year, the status indicator for 97605 was “Q1” and it remains “Q1” for 2016.  However, the status indicator for 97606 was “T” last year. That has been changed to “Q1” for 2016.

• The APC group restructuring also placed the use of disposable NPWT equipment (97607 and 97608) on all sizes of wounds into the same APC group. Most importantly, the significant payment rate increase for 97607 and 97608 should make the use of disposable NPWT affordable in HOPDs.

• Last year the status indicator for disposable NPWT was “T” and it remains “T” for 2016. 

Low-Frequency, Noncontact, Nonthermal Ultrasound

Both the APC group and the status indicator changes impact 97610 in 2016:

• The movement to a lower-paying APC group reduced the 2016 allowable payment rate.

• The status indicator change to “Q1” from “T” packages the procedure if performed on the same encounter as a procedure/service with status indicator “S,” “T,” or “V.” 

Hyperbaric Oxygen Therapy

The APC group restructuring of hyperbaric oxygen (G0277) has very little impact on HOPDs:

• The allowable rate remains nearly the same.

• The status indictor “S” remains the same. 

Nonophthalmic Fluorescent Vascular Angiography

The APC group restructuring caused a payment rate increase for C9733 and maintained the “Q2” status indicator. 

SUMMARY

If you perform any services and/or procedures that were not reviewed above, you should review the APC group restructuring, the payment rate changes, and the status indicators for each of those services and/or procedures. The information can be found in Addendum B of the 2016 OPPS Final Rule. 

Kathleen D. Schaum & Associates Inc., Lake Worth, FL; and director, medical products, reimbursement, biotherapeutics at Smith & Nephew.