ALS MEMBER UPDATE: January 2, 2003:

Health and Human Services’ Semi-Annual Regulatory Agenda

On December 9, 2002, the Department of Health and Human Services (“HHS”) issued its Semi-Annual Regulatory Agenda in the Federal Register. The purpose of that publication is to provide an inventory of all rulemakings that are under review or in development within HHS or its sister agencies, including the Centers for Medicare and Medicaid Services (“CMS”).

CMS lists three regulations on its regulatory agenda that may significantly affect an ambulatory surgical center (“ASC”). First, CMS states that it will propose to “revise the [ASC] conditions for coverage to reflect current innovations in healthcare delivery, quality assessment, and performance improvement.” 67 Fed. Reg. 74,492, 74529 (Dec. 9, 2002). CMS anticipates publishing that proposed rule in June 2003.

Second, CMS also anticipated publishing a final rule in December 2002 that makes additions to, and deletions from, the list of approved Medicare ASC procedures. Coupled with CMS’s previous statement that its “business” will be published in the Federal Register on the “fourth Friday of each month,” we expect that the updated list of approved Medicare ASC procedures may be published on December 27, 2002. It is unclear whether lithotripsy will be included in that rule in light of the pending resolution to the ALS lawsuit against CMS. In the proposed ASC Prospective Payment System for 1998, CMS, then the Health Care Financing Administration, proposed a rate of $2,107 for the provision of lithotripsy in an ASC. Recently, CMS promulgated a new $1,339 rate for “Group 9” under the existing ASC Fee Schedule. Group 9 was originally slated to include lithotripsy, but at present no “active” procedures are assigned to Group 9. Based upon informal conversations with staffers at CMS, we believe that (i) when and if lithotripsy is included on the approved Medicare list of ASC procedures, it will be reimbursed somewhere between $1,339 and $2,107; and (ii) lithotripsy will not likely be included on the updated approved Medicare list of ASC procedures that will be effective January 1, 2003.

CMS also listed the final Stark II Phase II as under development. The anticipated publication date of that rule is May 2003. That rule will generally set forth the provisions concerning ownership and investment exceptions and compensation exceptions, in addition to further modifications of Stark II Phase I.

Although the Semi-Annual Regulatory Agenda provides insight into HHS and CMS’s agenda and timetable for regulations under development, the anticipated publication dates are tentative and subject to change (if past action serves as a guide, the regulations will likely be released later than projected). As always, ALS will provide you with any further updates on the status of these regulations should any change occur.

Questions also may be directed to the Society's Executive Director, Wesley E. Harrington, CAE, at the ALS Headquarters in Waltham, Massachusetts, at 781-895-9098.

305 Second Avenue, Suite 200
Waltham, Massachusetts 02451
Telephone: 781-895-9098
Fax: 781-895-9088

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American Lithotripsy Society
305 Second Avenue, Suite 200
Waltham, Massachusetts 02451
Telephone: (781) 895-9098
Fax: (781) 895-9088

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