MSSP Proposed Rule to Address Anomalous Catheter Billing in 2023
On June 28, 2024, CMS released a proposed rule to mitigate the impact of suspected catheter-related Durable Medical Equipment (DME) fraud; referred to by CMS as “Significant, Anomalous, and Highly Suspect Billing Activity” or “SAHS” on Medicare Shared Savings Program (MSSP) ACO financial calculations for calendar year 2023 (CY2023). The proposed policies come in response to reports by ACOs who noticed concerning increases in catheter-related DME spending, and Medicare patients themselves who noticed billing for services they did not receive.
In this blog, we provide answers to key questions ACOs may want to know about this proposed rule. While the policies are only proposed at this stage, we anticipate that most, if not all, of these policies will be finalized as currently written given the time sensitivity and shared desire from CMS and program participants to limit potential delays on financial calculations. While the proposed rule specifically governs MSSP, CMMI has indicated that ACO REACH will align its policies with MSSP and that additional guidance for REACH is forthcoming.
At a high level, what is CMS proposing?
CMS is proposing to exclude 2023 catheter-related DME claims from ACO performance year and benchmark calculations to avoid situations where ACOs see significant impact to their savings or losses as a result of the unanticipated and significant increases in billing for catheters in 2023. The exclusions would apply to the ACO’s expenditures as well as regional and national calculations used to develop and trend the benchmark.
Which specific claims would be excluded from ACO calculations?
CMS is proposing to exclude costs for the following codes from ACO financial calculations for dates of service in CY2023:
A4352 Intermittent urinary catheter; Coude (curved) tip, with or without coating (Teflon, silicone, silicone elastomeric, or hydrophilic, etc.)
A4353 (Intermittent urinary catheter, with insertion supplies)
CMS reports a 163% increase in A4352 and a 5000% increase in billing for A4353 from 2022 to 2023.
What calculations would be affected by the exclusions?
CMS is proposing to exclude costs from these codes from all CY2023 calculations, including:
ACO performance year expenditures
ACO benchmark year expenditures
Regional and national benchmark amounts and trends
Accountable Care Prospective Trend (ACPT)
Truncation thresholds
Repayment mechanism amounts
High/Low Revenue determinations and its implications for Advance Investment Payment and ACO PC Flex eligibility
As currently proposed, only dates of service in CY2023 would be excluded. This would affect PY2023 financial settlement and would affect benchmark calculations for ACOs in which 2023 is a benchmark year (i.e., ACOs entering a new agreement period in 2024, 2025, and 2026).
The codes referenced above would not be excluded from other benchmark years (e.g., 2021 and 2022 for ACOs that entered a new agreement period in 2024).
Is the proposed exclusion limited to claims billed by certain DME suppliers or otherwise determined to be “highly suspect”?
No. CMS is proposing to exclude all instances of A4352 and A4353 from CY2023 calculations.
Will every ACO’s performance improve as a result of these policies or could these changes make an ACO’s performance worse?
CMS states that for most ACOs, the inclusion of the specified catheter codes does not substantially change their estimated financial outcome in PY2023. If proposals to remove the codes are finalized as proposed, some ACOs would perform better, some would perform worse, and many would likely see no substantial difference. How the exclusion of catheter claims affects a given ACO will depend on how billing and payment for the relevant codes in their attributed population compares to the utilization of those services in the regional and national reference populations and how each has trended over time.
What is the timeline for finalizing and applying these proposed policies?
Given the time sensitivity of this issue, CMS has shortened the typical 60-day comment period to 30 days and comments are due by July 29, 2024. Federal law typically requires at least 30 days notice from when a rule is finalized to when it goes into effect. Exceptions are allowed in certain cases and CMS has indicated that they may shorten or waive those requirements and is seeking comments on that approach. We anticipate that CMS will finalize the rule as proposed shortly after July 29 with a waiver of the standard waiting period so that they can move as quickly as possible to calculate PY2023 financial settlement reports and other relevant calculations for PY2024 and PY2025.
Will PY2023 financial settlement calculations be delayed?
If finalized as proposed, CMS anticipates a 6-week delay in issuing financial settlement reports. Annual financial settlement reports are typically issued in early August with payments of shared savings being made in September. This delay would likely push those reports to mid-September with shared savings being paid sometime in October.
Will these policies also apply to ACO REACH? What about other CMMI APMs?
This proposed rule is specific to MSSP. However, CMMI notified ACOs participating in the ACO REACH Model that they intend to align their policies with the MSSP policies, which is consistent with what CMMI Director, Liz Fowler, has indicated in recent months. Additional guidance from ACO REACH is expected in the near future. CMS has not yet indicated if or how any similar policies would be applied to other APMs.
Does this proposed rule address how CMS will identify and address “SAHS” in the future?
This proposed rule is specific to dates of service in CY2023. In the CMS Fact Sheet released along with the rule, they indicated that additional details are expected in the Physician Fee Schedule, which should be released in early July. We anticipate that in that rule, CMS may make broader policy proposals about how to handle similar situations in the future.
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