CMS Proposes More Observation Money, but It’s a Package Deal

Observation services are the latest piece to fall into CMS’s plan to package as many outpatient services as possible, according to the proposed 2016 outpatient prospective payment system (OPPS) regulation, which was published in the July 8 Federal Register. In a surprise move, CMS created a new observation “comprehensive ambulatory payment classification” (C-APC) and deposited into the payment pretty much all associated services, including the emergency room visit, labs and radiology. How it affects hospitals’ finances depends on their ability to manage utilization and control costs.