Analyzing CMS’ 2022 Final Medicare Payment Rule

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Analyzing CMS’ 2022 Final Medicare Payment Rule

It includes minor improvements but much work lies ahead

In its 2022 final payment rule for ASCs and hospital outpatient departments (HOPD), the Centers for Medicare & Medicaid Services (CMS) finalized its proposal to reverse policy changes from the previous administration that added a significant number of codes to the ASC Covered Procedures List (ASC-CPL) and began the process of eliminating the inpatient-only (IPO) list, with a few modifications. CMS also continued to use the hospital market basket to update ASC payments for calendar year (CY) 2022. This policy is currently slated to run through CY 2023 as the agency assesses its impact on volume migration.

CMS released the rule on November 2, 2021. Major provisions in the 1,394-page rule are highlighted below.

2.0 Percent Average Rate Update

CMS finalized an effective update of 2.0 percent—a combination of a 2.7 percent inflation update based on the hospital market basket and a productivity reduction mandated by the Affordable Care Act of 0.7 percentage points. This is a decrease of 0.3 percent from the proposed rule. This is an average and updates might vary significantly by code and specialty.

The information below provides a comparison between the 2022 ASC and HOPD reimbursement updates.

Inflation update factor 2.7% 2.7%
Productivity reduction mandated by the ACA 0.7 percentage points 0.7 percentage points
Effective update 2.0% 2.0%
Conversion factor $49.916 $84.177

CMS Finalizes Positive Device-Intensive Procedure Policy for ASCs

CMS has finalized a policy change to calculate the device offset percentage to use ASC rates and not HOPD rates as was previous practice. This means that any procedure for which the device cost is 30 percent of the overall ASC procedure rate will receive device-intensive status. ASCA has long requested this change.

Additionally, if a device receives HOPD device-intensive status, that device also will be device-intensive in the ASC setting. For CY 2022 and subsequent years, if a procedure is assigned device-intensive status for HOPDs but has a device offset percentage below the device-intensive threshold under the standard ASC rate-setting methodology, the procedure will be assigned device-intensive status under the ASC payment system with a default device offset percentage of 31 percent.

Removal of Codes from the ASC-CPL

For 2022, CMS is removing 255 of the 258 codes that it had added to the ASC-CPL in 2021 using the revised exclusionary criteria it established. The three codes that will remain on the ASC-CPL are:

  • 0499T (Cysto f/urtl strix/stenosis)
  • 54650 (Orchiopexy (fowler-stephens))
  • 60512 (Autotransplant parathyroid)

CMS is reversing recent changes to 42 CFR §416.166 by bringing back the general exclusion criteria in place during 2020 and previous years.

CMS also finalized its proposal to establish a new procedure nomination process for CY 2022. Using this process, external stakeholders, such as professional specialty societies, would nominate procedures for addition to the ASC-CPL. CMS will review and finalize procedures through annual rulemaking, beginning with the CY 2023 rule. ASCA needs your help identifying codes to pursue for addition to the ASC-CPL through the nomination process. Please reach out to Kara Newbury with suggestions.

Reinstatement of the IPO List

CMS is finalizing its proposal to halt the elimination of the IPO list over a three-year period, as finalized in 2021 rulemaking, and to add almost 300 codes back to the IPO list for 2022. ASCA provided research and data on the safety of several of these codes to be performed on an outpatient basis and was notably successful with keeping CPT codes 22630 (Lumbar spine fusion), 23472 (Reconstruct shoulder joint), 27702 (Reconstruct ankle joint) and the anesthesia codes associated with these procedures from going back on the IPO list.

Changes to the ASC Quality Reporting Program

Regarding the ASC Quality Reporting (ASCQR) Program, CMS is finalizing the following:

  • Adopt ASC-20: COVID-19 Vaccination Coverage Among HCP measure beginning with 2022 data collection.
  • Require and resume data collection for ASC-1, ASC-2, ASC-3 and ASC-4 beginning in CY 2023 for reporting in CY 2024, which will impact CY 2025 payment determinations. These measures will now be reported through web-based submissions and will apply to all ASC patients, not just Medicare beneficiaries.
  • Require that ASC-11: Cataracts: Improvement in Patient’s Visual Function within 90 Days Following Cataract Surgery be mandatory beginning in CY 2025 reporting period/CY 2027 payment determination and for subsequent years. The dates in the proposed rule were CY 2023/CY 2025, respectively. ASCA will continue to oppose the inclusion of this measure.
  • Require the Outpatient and Ambulatory Surgery Consumer Assessment of Healthcare Providers and Systems (OAS CAHPS) Survey-based measures (ASC-15a-e), with voluntary reporting in the CY 2024 reporting period and mandatory reporting beginning with the CY 2025 reporting period/CY 2027 payment determination and for subsequent years. The dates in the proposed rule were CY 2023/CY 2025, respectively.


ASCA’s Medicare payment resources have been updated to reflect the changes finalized in the 2022 final payment rule. These resources are available only to ASCA members, and include:

  • 2022 Final Rule Analysis—a table that includes select proposals from the rule, ASCA’s comments in response to the proposals and the determinations made in the final rule
  • 2022 Final Rule Rate Calculator—shows CY 2022 national and local ASC payment rates as published in the final rule
  • 2022 Final Rule Payment Resources—provides separate worksheets for several code groups, such as separately payable, packaged, office-based and more

The rate calculator is set to automatically show rates with the 2 percent Medicare sequester payment reduction applied. The sequester was paused for much of 2020 and 2021 due to the COVID-19 pandemic, but the reduction is set to resume in 2022 unless Congress acts.

As there has been one the past several years, ASCA does expect a correction notice to be forthcoming from the agency and will update documents and let members know once that information becomes available.

Year-End Webinars

In the coming weeks, ASCA will also host two webinars addressing the final payment rule’s impact on ASCs, “CMS Quality Reporting for ASCs”—free for ASCA members—and “Understanding Medicare’s 2022 Final Payment Rule.”

Recent changes in the CMS quality reporting program for ASCs pose new challenges for perioperative leaders in the ASC setting. During her presentation, “CMS Quality Reporting for ASCs,” Gina Throneberry, director of education and clinical affairs at ASCA, will discuss the quality reporting measures required now and the key definitions and answers to frequently asked questions about the measures that ASCs need to report. This webinar will take place on Tuesday, November 30, at 1:00 pm ET.

In “Understanding Medicare’s 2022 Final Payment Rule,” Kara Newbury, director of government affairs and regulatory counsel at ASCA, will talk about the changes to Medicare’s ASC payment system that will take effect January 1, 2022. Attendees will find out about changes to ASC payment rates in 2022, updates to the ASC-CPL and new measures added to the ASC Quality Reporting Program. This webinar will not discuss coding changes. ASCA will offer this webinar on Tuesday, December 7, at 1:00 pm ET.

Register today for the last two webinars of the year.