On August 4, 2020, the Centers for Medicare & Medicaid Services (CMS) released the Changes to Hospital Outpatient Prospective Payment and Ambulatory Surgical Center Payment Systems and Quality Reporting Programs; Addition of New Categories for Hospital Outpatient Department Prior Authorization Process [CMS-1736-P], which includes proposed payment updates and policy changes affecting Medicare hospital outpatient and ambulatory surgical center (ASC) services for CY 2021. The proposed regulations will be published in the Federal Register on August 12, 2020. Comments are due October 5, 2020. 

For CY 2021, CMS proposes to increase payment rates under the Hospital Outpatient Prospective Payment System (OPPS) and the ASC Payment Systems by a factor of 2.6%. In continuation of an existing policy, hospitals and ASCs that fail to meet their respective quality reporting program requirements are subject to a 2.0% reduction in the CY 2021 fee schedule increase factor.

CMS estimates, based on the proposed policy changes, that total payments to hospitals and ASCs will be approximately $83.9 billion and $5.45 billion, respectively, for an increase of approximately $7.5 billion and $160 million, respectively, over CY 2020 program payments.

CMS indicates that they are waiving the 60-day publication requirement for the Final Rule and replacing it with a 30-day notification, meaning the Final Rule will be effective January 1, 2021, even though it may not be published until December 1, instead of the typical November 1 target publication date.