New Study Shows Site Neutral Policies May Adversely Affect Access to Care

Hospital outpatient departments treat sicker patients than independent physician offices

April 15, 2021

Proposals to reimburse hospitals the same as physician offices could negatively affect Medicare patients who receive care in a hospital outpatient department (HOPD), according to a new study conducted for the American Hospital Association (AHA) by KNG Health Consulting LLC. That’s because Medicare patients who receive care in an HOPD are more likely to have severe chronic conditions than Medicare patients treated in an independent physician office. To the extent those differences result in variations in the cost of care, so-called “site-neutral” payments could impact access to care.
In a statement about the study, AHA noted that regulatory standards are higher for hospitals and health systems precisely because of the care involved in treating patients who have more complex needs. The study found that patients seen in an HOPD are more likely to be disabled or have end-stage renal disease. They are also more likely to be on both Medicare and Medicaid, indicating they tend to have lower income. You can access a copy of the study on AHA’s webpage.

The AHA, joined by member hospitals and health systems and other national organizations representing hospitals, in February filed a petition asking the U.S. Supreme Court to reverse an appeals court decision challenging the U.S. Department of Health and Human Services’ (HHS’s) payment reductions in the 2019 outpatient payment rule for certain hospital outpatient off-campus provider-based departments. A lower court twice found that HHS exceeded its statutory authority when it reduced these payments; however, in July, a three-judge appeals panel reversed this decision.

This story originally appeared in the April 15, 2021 edition of WHA Newsletter