Actions to Take Now in Response to CMS’s FY17 OPPS Final Rule

Area of Science:

• Health Economics
• Healthcare Policy
• Clinical Laboratory Science

Background:

• The Outpatient Prospective Payment System (OPPS) governs Medicare payments for hospital outpatient services.
• The L1 modifier was previously used to identify unrelated laboratory tests.
• Bundling laboratory tests with other services impacts reimbursement and resource allocation.

Purpose of the Study:

• To analyze the implications of the OPPS rule change eliminating the L1 modifier for laboratory tests.
• To understand how the packaging of unrelated laboratory tests affects healthcare providers and the payment system.

Main Methods:

• Review of the updated OPPS rule and its specific provisions regarding laboratory test modifiers.
• Analysis of the financial and operational impact of bundling laboratory tests into global payments.

Main Results:

• The L1 modifier for unrelated laboratory tests is eliminated under the new OPPS rule.
• Laboratory tests will now be packaged and reimbursed as part of other procedures or services.

Conclusions:

• This OPPS rule change signifies a shift towards integrated payment for outpatient services.
• Providers must adapt to new reimbursement structures where laboratory test costs are absorbed within broader service payments.