The procedures must be similar in terms of use of resources (costs). The composition of the APC groups rests on two premises: The procedures within each group must be similar. As mentioned earlier, each service or procedure within the APC group is identified by a HCPCS code. For example, if a simple laceration repair occurs during an encounter that also includes extensive medical and diagnostic services, the medical visit would be bundled into the laceration repair. Medical visits (for example, a HCPCS ER code) may also be bundled in some situations. Medical visit bundling Supply and pharmaceutical cost bundling involves supplies and drugs, except some expensive chemotherapy drugs. Supply and pharmaceutical cost bundling, and The APC system has two methods of bundling: By using packaging and bundling concepts CMS is providing incentives for healthcare facilities to improve their efficiency by avoiding unnecessary ancillary services, supplies, and pharmaceuticals and by substituting less expensive, but equally effective, options. The logic of APC groupers includes the aforementioned packaging and bundling. Bundling occurs when payment for multiple significant procedures or multiple units of the same procedure related to an outpatient encounter or to an episode of care is combined into a single unit of payment. Services and procedures for which HOPPS payment won't be made include those excluded from the Medicare program by statute, those that can be provided only to inpatients, and those that are paid by fee schedule or other payment methods. Procedures and services for which no Medicare HOPPS payment is made Incidental services that are not paid separately (packaged), and Medical visits in hospital clinics and emergency departments An outpatient may be assigned more than one (1) APC code per hospital encounter, whereas, as you know, an inpatient is assigned only Each APC group consists of a cluster of services that can be provided during an outpatient procedure, including: Significant surgical and nonsurgical procedures Remember, the major difference between the hospital outpatient PPS and the inpatient PPS is in the assignment of the APCs and the DRG. one (1) MS-DRG code per hospital admission. The number of APC assignments is based on the number of reimbursable procedures or services provided for that patient. There may be an unlimited number of APCs per encounter for a single patient encounter. The APC assignment for a procedure or service does not change based on the patient's medical condition or the severity of illness. Each HCPCS code is assigned to one and only one APC group. The hospital and the physician would each bill separately for reimbursement with CPT code 10060, as follows: APC 0006 (facility) $159.66įee schedule (physician) $87.13 To understand how the APC payment system works, you will have to understand several key elements of the system, including: PackagingĬonversion Factor The CMS defines each outpatient service under the PPS by a HCPCS code and classifies it into either an APC group for which an outpatient PPS payment rate is established or a nonpayment category of services that are excluded from the outpatient PPS system. Laboratory services are paid via For example, consider a patient presenting to the hospital for outpatient incision and drainage of a skin abscess. Ambulance transportation, physical and occupational therapy, and speech-language pathology are reimbursed via Resource-Based Relative Value Scale (RBRVS), Physician and nonphysician practitioner are paid under the Medicare Physician Fee Schedule based on a the Medicare Clinical Diagnostic Laboratory Fee Schedule. Most outpatient procedures and services are reimbursed under APCs. Certain items and services, such as an acquisition of corneal tissue and influenza and pneumococcal pneumonia vaccines continue to be paid on a various fee schedules.
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