Outlier adjustment
(A) In general
(A)In general#
Subject to subparagraph (D), the Secretary shall provide for an additional payment for each covered OPD service (or group of services) for which a hospital’s charges, adjusted to cost, exceed—
(i) a fixed multiple of the sum of— (I) the applicable medicare OPD fee schedule amount determined under paragraph (3)(D), as adjusted under paragraph (4)(A) (other than for adjustments under this paragraph or paragraph (6)); and (II) any transitional pass-through payment under paragraph (6); and
(ii) at the option of the Secretary, such fixed dollar amount as the Secretary may establish.
(A)(i)#
a fixed multiple of the sum of—
(I) the applicable medicare OPD fee schedule amount determined under paragraph (3)(D), as adjusted under paragraph (4)(A) (other than for adjustments under this paragraph or paragraph (6)); and
(II) any transitional pass-through payment under paragraph (6); and
(A)(i)(I)#
the applicable medicare OPD fee schedule amount determined under paragraph (3)(D), as adjusted under paragraph (4)(A) (other than for adjustments under this paragraph or paragraph (6)); and
(A)(i)(II)#
(B)Amount of adjustment#
The amount of the additional payment under subparagraph (A) shall be determined by the Secretary and shall approximate the marginal cost of care beyond the applicable cutoff point under such subparagraph.
(C)Limit on aggregate outlier adjustments#
(i) In general The total of the additional payments made under this paragraph for covered OPD services furnished in a year (as estimated by the Secretary before the beginning of the year) may not exceed the applicable percentage (specified in clause (ii)) of the total program payments estimated to be made under this subsection for all covered OPD services furnished in that year. If this paragraph is first applied to less than a full year, the previous sentence shall apply only to the portion of such year.
(ii) Applicable percentage For purposes of clause (i), the term “applicable percentage” means a percentage specified by the Secretary up to (but not to exceed)— (I) for a year (or portion of a year) before 2004, 2.5 percent; and (II) for 2004 and thereafter, 3.0 percent.
(C)(i)In general#
The total of the additional payments made under this paragraph for covered OPD services furnished in a year (as estimated by the Secretary before the beginning of the year) may not exceed the applicable percentage (specified in clause (ii)) of the total program payments estimated to be made under this subsection for all covered OPD services furnished in that year. If this paragraph is first applied to less than a full year, the previous sentence shall apply only to the portion of such year.
(C)(ii)Applicable percentage#
For purposes of clause (i), the term “applicable percentage” means a percentage specified by the Secretary up to (but not to exceed)—
(I) for a year (or portion of a year) before 2004, 2.5 percent; and
(II) for 2004 and thereafter, 3.0 percent.
(D)Transitional authority#
In applying subparagraph (A) for covered OPD services furnished before January 1, 2002 , the Secretary may—
(i) apply such subparagraph to a bill for such services related to an outpatient encounter (rather than for a specific service or group of services) using OPD fee schedule amounts and transitional pass-through payments covered under the bill; and
(ii) use an appropriate cost-to-charge ratio for the hospital involved (as determined by the Secretary), rather than for specific departments within the hospital.
(D)(i)#
apply such subparagraph to a bill for such services related to an outpatient encounter (rather than for a specific service or group of services) using OPD fee schedule amounts and transitional pass-through payments covered under the bill; and
(D)(ii)#
use an appropriate cost-to-charge ratio for the hospital involved (as determined by the Secretary), rather than for specific departments within the hospital.
(E)Exclusion of separate drug and biological APCS from outlier payments#
No additional payment shall be made under subparagraph (A) in the case of ambulatory payment classification groups established separately for drugs or biologicals.