CMS has issued guidance documents addressing how hospitals can (1) qualify an off-campus provider-based department (PBD) for the “mid-build” exception set forth in the 21st Century Cures Act and (2) request from their CMS Regional Office a relocation exception for an excepted PBD due to an extraordinary circumstance.  PBDs that remain “excepted” from the payment changes set forth in Section 603 of the Bipartisan Budget Act of 2015 will receive full OPPS payment in the future.  These guidance documents for receiving or maintaining excepted status are described below. 

Mid-Build Exception 

As previously reported here, on December 13, 2016, President Obama signed the 21st Century Cures Act into law.  The Act provided additional criteria by which off-campus PBDs that were “mid-build” before November 2, 2015 can qualify as excepted from payment changes under Section 603 and continue to receive full OPPS payment beginning in 2018 if they submit certain documents to CMS by February 13, 2017.  The guidance document from CMS addresses the process by which hospitals should provide the required documentation to their Medicare Administrative Contractor to qualify for this exception.  Per the guidance document, hospitals must submit the following materials to their MAC no later than February 13, 2017:

• An attestation (pursuant to 42 C.F.R. § 413.65(b)(3)) that such department meets the requirements of the provider-based regulation at 42 C.F.R. § 413.65;
• Documentation that the provider included such department as a hospital practice location on its CMS-855A enrollment form; and
• A written certification signed by the chief executive officer or chief operating officer of the main provider (as defined by 42 CFR 413.65(b)(2)) (or equivalent if such titles are not used by the main provider) that the department met the definition of a “mid-build” department.  The Cures Act defines a “mid-build” PBD as one for which the hospital had a binding written agreement with an unrelated third party for actual construction of the PBD before November 2, 2015.

CMS’s notice states that additional guidance will be forthcoming at a later date.  

Relocation Exception

As previously reported here, the CY 2017 OPPS Final Rule implemented Section 603, which states that CMS may not pay for certain non-excepted items and services provided in off-campus hospital outpatient departments under the OPPS beginning January 1, 2017.  CMS adopted a policy to allow an excepted off-campus PBD to relocate to a new location (either temporarily or permanently) without losing its excepted status, only upon a demonstration of extraordinary circumstances outside of the hospital’s control (such as a natural disaster).  The guidance document provides information on the timelines for relocation exception requests, describes the minimum information applicants should provide to the CMS Regional Office, and provides staff contact information for the various CMS Regional Offices.

Applications for relocations that occurred between November 2, 2015 and December 31, 2016 must be received by the hospital’s CMS Regional Office no later than January 31, 2017.  These requests will receive priority review by CMS.  While such application is pending, CMS states that it expects hospitals to bill using the claims modifier “PN” for non-excepted items and services furnished at these departments.  However, an approved application will be given a January 1, 2017 effective date – presumably indicating that providers can resubmit any 2017 claims for services furnished before approval and receive the full OPPS payment amount.

Applications for relocations that took place on or after January 1, 2017 must be submitted to the provider’s CMS Regional Office no later than 30 days after the extraordinary circumstance occurs – not after the relocation itself.  This may present a time crunch as a hospital that experiences one of these events must settle on a new location and report it to CMS within 30 days of the triggering event.