In early November, the Centers for Medicare & Medicaid Services moved forward with its site-neutral payments policy for doctor’s visits despite the fact that in September of this year, a federal judge ruled against the policy.

This rule is being introduced by the Trump administration under the Outpatient Prospective Payment System, which will result in physicians being paid the same amount for a basic visit regardless of whether it takes place in an on-campus or off-campus hospital outpatient setting. Ultimately, the goal of this rule is to reduce payments to on-campus departments to match payments made to off-campus physician offices.

CMS says “[w]ith the completion of the two-year phase-in, the cost-sharing will be reduced to $9, saving beneficiaries an average of $14 each time they visit an off-campus department for a clinic visit in 2020.” In addition, CMS argues that the second year of the two-year phase-in of the site-neutral cuts will save Medicare roughly $800 million in 2020. CMS also stated that while they may appeal the September ruling that vacated the policy, 2019 claims will be paid in accordance with the court order.

However, because these site-neutral cuts are being pushed forward even though the policy was vacated by a federal court in September of this year, there is significant pushback from hospitals and hospital associations. One of the major critics of this rule is the American Hospital Association, who stated that the site-neutral payment rule was misguided and in going forward with it, CMS is ignoring the decision of the courts.

Tom Nickels, Executive Vice President of the AHA made his sentiments clear by stating, “[t]here are many real and crucial differences between hospital outpatient departments and the patient populations they serve and other sites of care [and these cuts go] against clear congressional intent to protect the majority of clinic services.”

With the pushback that CMS and the Trump administration are once again facing from various hospitals and hospital associations regarding this policy, it is likely that some form of legal action will be taken again in the federal courts. This means that we have likely still not seen the end of this troublesome divide regarding site-neutral payments.