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HOPPS: evolution of a CMS process.

James V Rawson1, Pam Kassing

  • 1Department of Diagnostic, Therapeutic and Interventional Radiology, Medical College of Georgia, Augusta, GA 30912-0006, USA. jrawson@mcg.edu

Journal of the American College of Radiology : JACR
|April 7, 2007
PubMed
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Medicare

Area of Science:

  • Health Economics
  • Healthcare Policy
  • Medical Billing

Background:

  • Medicare's hospital outpatient prospective payment system (HOPPS) was established to control escalating outpatient expenses.
  • The Balanced Budget Act of 1997 mandated HOPPS, effective August 1, 2000.
  • Centers for Medicare and Medicaid Services (CMS) utilized hospital charge data for ambulatory patient classification (APC) payment weights.

Purpose of the Study:

  • To analyze the development and evolution of Medicare's HOPPS.
  • To understand the methodologies used in developing APC payment weights.
  • To examine proposed changes to HOPPS, including its application in nonhospital settings.

Main Methods:

  • Review of legislative mandates and policy documents related to HOPPS.

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  • Analysis of the data sources used by CMS for payment weight development.
  • Examination of proposed legislative changes impacting HOPPS.

    • Main Results:

    • HOPPS was developed due to a significant increase in Medicare outpatient costs.
    • CMS employed hospital charge data, distinct from the Medicare Physician Fee Schedule, for APC weights.
    • Legislative actions led to an advisory panel and the exclusion of diagnostic mammography from APCs.
    • The Deficit Reduction Act suggested extending HOPPS to nonhospital technical fees.

    Conclusions:

    • HOPPS has undergone significant evolution driven by legislative action and policy adjustments.
    • The system's development highlights the use of charge data and the impact of specific exclusions.
    • Future policy may expand HOPPS beyond traditional hospital settings.