On June 2, 2000, the U.S. Health Care Financing Administration (HCFA) announced that implementation of the Medicare Outpatient Prospective Payment System (OPPS) would be delayed one month, from July 1, 2000, to August 1, 2000. Development of the OPPS was mandated in the 1997 Balanced Budget Act and modified in the Balanced Budget Refinement Act. The OPPS will pay hospitals for ambulatory services based on ambulatory payment classification (APC) groups that define a visit or service on the basis of detailed coding performed by the hospital. It will also change beneficiary copayment amounts and the way they are calculated. Major computer and other complicated systems changes are required to implement OPPS, and HCFA has experienced severe delays in this area. The hospital community across the country had expressed growing concerns about the impossibility of implementing the system on July 1, and HCFA had even developed a contingency plan in which it anticipated the wholesale inability of the Medicare program to pay, and hospitals to bill, under OPPS. In its announcement of the delay, HCFA acknowledged that certain key implementation steps were several weeks behind schedule and that this lag limited hospitals' ability to prepare. The hospital community will continue to monitor the readiness of the system as of August 1. Among other issues of concern are proper notification of the changing system to beneficiaries and how and why copayment amounts will change.

GNYHA Activities: GNYHA has developed a reimbursement model for member hospitals' use that presents five claims computations to illustrate how services will be paid under OPPS. The Excel spreadsheet can be downloaded from the Data and Information section of the Members' Area of the GNYHA Web site, at www.gnyha.org, and used to determine hospital payment amounts for specific procedures and under different scenarios. GNYHA has also prepared hospital-specific patient origin zip code analyses that are useful in determining whether hospital ambulatory care sites will meet other complicated new requirements under OPPS to maintain their status as hospital-based entities. GNYHA has also submitted comments on the final OPPS rule to HCFA on specific items of concern, including the requirements for provider-based status, and has created an OPPS technical workgroup to help members prepare for the operational requirements of the complex new system.