The CMS will expand quality-reporting requirements for hospitals under its final regulations for the 2007 hospital outpatient prospective payment system, but the expansion wont take place as quickly as the CMS initially planned. In proposed regulations issued in August, the CMS had said hospitals would have to report inpatient quality measurements in order to receive a full payment update under the outpatient PPS in 2007. The final regulations instead announce the CMS plans to develop outpatient-specific measures and to require hospitals to report those measures by 2009 in order to receive the full outpatient update. The final regulations also include an expansion of inpatient quality-reporting requirements -- notably use of a new patient satisfaction survey and reporting of 30-day mortality rates for heart failure -- that will take effect Oct. 1, 2007, the start of federal fiscal 2008. Those new requirements would be tied to the inpatient update, in line with current policy, and not the outpatient update. The American Hospital Association said it was pleased that the agency dropped its plan to link inpatient quality reporting to the outpatient update.
As in the proposed regulations, the final regulations will boost Medicare rates to hospital outpatient departments by an average of 3% in 2007. The CMS also released its final regulations for physician fees in 2007 including an overall payment cut of 5%. Congress, however, still is considering legislation to change how Medicare sets physician rates, and the cut may be averted. -- by Matthew DoBias