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ASC and OPPS payment rates
The U.S. Centers for Medicare & Medicaid Services (CMS) has finalized payment rates and policy changes for 2017 under the Ambulatory Surgical Center (ASC) Payment System and the Hospital Outpatient Prospective Payment System (OPPS). The agency estimates that the updates will increase ASC rates by 1.9 percent and OPPS payments by 1.7 percent during 2017. The rule also finalizes the removal of the pain management dimension of the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey to eliminate any financial pressure clinicians may feel to overprescribe medications. CMS will continue to develop and field test alternative questions related to provider communications and pain, and plans to solicit comments on those alternatives in future rulemaking. Further, CMS in the rule finalized 90-day meaningful use reporting to increase flexibility for eligible professionals who participate in the Medicare and Medicaid Electronic Health Record (EHR) Incentive Programs. CMS is also finalizing policies to implement section 603 of the Bipartisan Budget Act of 2015, which requires that certain items and services furnished by certain off-campus hospital outpatient departments will no longer be paid under the OPPS beginning Jan.1, 2017.

Societal savings of THA
Data from a study published in Clinical Orthopaedics and Related Research (CORR, December) suggest that use of total hip arthroplasty (THA) may be associated with societal benefits that offset the costs of surgery. The researchers used a Markov model to assess overall cost-effectiveness of THA compared with nonsurgical treatment for osteoarthritis. They found that THA was associated with increased average annual patient productivity of $9,503. Overall, the researchers project that THA increases average lifetime direct costs by $30,365, which are offset by $63,314 in lifetime savings due to increased productivity.

U.S. trauma networks
Two recently released studies examine the network of trauma services in the United States. The first, published in the Annals of Surgery (online), reviews data on 839,809 severely injured patients across 287 centers, and finds that each 1 percent increase in volume was associated with a 73 percent increased likelihood of improved standardized mortality ratio (SMR) over time, while each 1 percent decrease in volume was linked to a two-fold increase in odds of worsening SMR over time. In addition, the authors note that Level I and Level II centers saw significant improvement in SMR after 3 or more preceding years of increasing volume.

The second study, published in the Journal of the American College of Surgeons (online), suggests that trauma services in the United States may be unevenly distributed. The researchers reviewed data on trauma admissions, providers, demographics, and mortality for 1,345,024 trauma admissions during 2013. They found considerable variation between the top five            and bottom five states in terms of Level I/Level II trauma centers and surgical critical care (SCC) surgeon availability, despite less variation in trauma admission density. Overall, they note that distribution of trauma admissions was positively associated with SCC provider density and age-adjusted trauma mortality, and inversely associated with per capita income. They also note that each additional SCC provider per 1 million population was linked to a decrease of 618 deaths per year.

MACRA implementation
An article in Modern Healthcare examines the future of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) in the wake of the election. The writer notes that some physicians have announced that they would retire or stop accepting Medicare due to dissatisfaction with provisions in the final payment rule, putting pressure on lawmakers to slow value-based payment efforts. However, observers note that MACRA was passed with bipartisan support through two Republican-controlled houses of Congress, and legislators may not wish to revisit a law that received wide support so soon after its passage.

Medicare may penalize providers more for excess readmissions than excess mortality
Findings from a study published in JAMA Cardiology (online) suggest that current Medicare financial penalties may not meet the goals of aligning incentives and fairly reimbursing hospitals for patient-centered outcomes. The research team reviewed hospital-level data on readmission penalties, excess readmission ratio, and 30-day mortality rates for heart failure, pneumonia, and acute myocardial infarction during FY 2014. They found that readmission penalties closely tracked excess readmissions, were minimally and inversely related with excess mortality, and correlated modestly with excess readmission and mortality combined. The research team writes that during FY 2014, financial penalties would have been substantially altered for one-third of hospitals in the United States if 30-day readmission and mortality had been considered equally important. According to the researchers, under most circumstances, patients would rather avoid death than rehospitalization. The authors concluded that "current Medicare financial penalties do not meet the goals of aligning incentives and fairly reimbursing hospitals for patient-centered outcomes."

Many THA readmissions may not be preventable
A study published in CORR (online) suggests that many readmissions following THA may not be preventable. The authors conducted a retrospective evaluation of 1,096 elective THAs for osteoarthritis (OA) conducted at a single center. Of those, 69 patients who met inclusion criteria were readmitted within 90 days of discharge. Overall, 31 patients (45 percent) were readmitted for orthopaedic reasons and 38 patients (55 percent) were readmitted for medical reasons. Overall, three readmissions (4 percent) were identified as potentially preventable. Of the potentially preventable readmissions, one was orthopaedic (hip dislocation) and two were medical. The authors note that 30-day readmissions were more likely to be for orthopaedic reasons than 90-day readmissions.

Disability and social factors may influence readmission rates for Medicare patients
According to a study published in the Journal of General Internal Medicine (online), disability and social factors may influence readmission risk for Medicare patients. The researchers conducted a retrospective cohort study of Medicare patients using state inpatient databases, zip code-level demographic information, and Medicare claims data for three conditions: pneumonia, heart failure, and acute myocardial infarction. They found that, for pneumonia, ≥ three activities of daily living (ADL) difficulties and prior home healthcare needs increased readmission in Health and Retirement Study-Medicare claims data (HRS-CMS) models; and ADL difficulties and "other" race increased readmission in Census American Community Survey-Healthcare Cost and Utilization Project (ACS-HCUP) models. For heart failure, children and wealth were associated with lowered readmission in HRS-CMS models, while black or "other" race increased readmission in ACS-HCUP models. Finally, for acute myocardial infarction, nursing home status increased readmission in HRS-CMS models, and "other" patient-level race and hospital-level race were linked to increased readmission in ACS-HCUP models.

CMS releases list of proposed quality and efficiency measures
Healthcare Finance News reports that CMS and the U.S. Department of Health & Human Services (HHS) have released the 2016 list of quality and efficiency measures under consideration for adoption. The 97 proposed reporting measures include:

• Median time to pain management for long bone fracture
• Average change in back pain following lumbar discectomy and/or laminotomy
• Average change in back pain following lumbar fusion
• Average change in leg pain following lumbar diskectomy and/or laminotomy
• Hospital visits following orthopaedic ambulatory surgical center procedures
• Intraoperative timeout safety checklist
• Patient-centered surgical risk assessment and communication

HHS will accept comment on the measures through Feb. 1, 2017.

CMS rule maintains TKA as IPO procedure
A recent CMS final rule (p. 558) continues to require that total knee arthroplasty (TKA) be performed as an inpatient only (IPO) procedure. According to the agency, a majority of commenters stated it would be unsafe to perform outpatient TKA for Medicare beneficiaries. CMS also clarified the following principles:

• A procedure not on the IPO list may still be performed on an inpatient basis.
• The IPO list status of a procedure has no effect on the Medicare Physician Fee Schedule professional payment for the procedure.

Further, CMS continues to seek comments on modifying the Comprehensive Care for Joint Replacement (CJR) and the Bundled Payment for Care Improvement Initiative (BPCI) models if the TKA procedure were to be moved off the IPO list.

CMS launches tool to help clinicians share data under Medicare Quality Payment Program
CMS has released an online tool to help clinicians automatically share electronic data under the Medicare Quality Payment Program. The tool is a programming interface designed to make it easier for organizations to integrate with the existing Quality Payment Program website. Developers may use the tool to write software to retrieve and maintain the Quality Payment Program's measures and then build applications for clinicians and their practices.

FDA holds hearing to discuss communications regarding off-label use of drugs and devices
Medpage Today reports on a U.S. Food and Drug Administration (FDA) hearing held to discuss issues related to communications regarding off-label use of FDA-regulated drugs and medical devices for humans by manufacturers, packers, and distributors. The writer notes that previously, the FDA had strict regulations prohibiting nearly all promotion of unapproved indications for approved drugs and devices, but federal courts later ruled that "truthful and non-misleading speech" by manufacturers about their products is protected under the First Amendment. Physicians and consumer advocates argued that the agency should not loosen its restrictions on companies marketing off-label medical products. However, others argued that the limiting of communications regarding off-label use may confuse healthcare professionals, and called for uniformity and clarity in the regulatory process to enable appropriate sharing of information.