Under a proposed rule for 2009 Medicare payments for hospital outpatient services, the Centers for Medicare and Medicaid Services (CMS), has proposed modest payment increases for most frequently transfused blood products. However, reimbursement for many blood products and services would continue to lag behind actual costs. In addition, Medicare payments for bone marrow and stem cell procedures would remain woefully inadequate, despite small proposed payment increases for such services.

Payments for Blood Products

For calendar year 2009, CMS has proposed payments for blood and blood products based on simulated medians calculated using CY 2007 hospital claims data. For example, CMS proposes to pay $192.43 for a unit of leukocyte-reduced red blood cells, compared with its $185.15 payment in 2008. Overall, payments would be increased for most blood products, particularly the most frequently transfused products. Payments for 25 of the 34 blood products would increase under the CMS proposal. Unfortunately, however, the actual average hospital acquisition costs for most blood products remain significantly higher than the proposed 2008 CMS payments.

The following table compares the proposed 2008 payment rates for blood products with current Medicare payment rates:

Payments for Bone Marrow and Stem Cell Processing Services

CMS has proposed very modest increases in payments for bone marrow/stem cell processing codes 38207-38215, which were first recognized by the agency in 2008. The proposed payment rate for Codes 38207-38209 (cryopreservation and thawing codes) is $222.94 (compared with $216.35 now), and the proposed payment for Codes 38210-38215 (cell depletion codes) is $397.83 (compared with $362.55). It should be noted that since these payments are based on 2007 claims data, any more recent adjustments that hospitals have made in their charging practices are not yet reflected in CMS’ payments. Hospitals are encouraged to take steps now to ensure that their charges accurately reflect the actual costs of providing these services since CMS will base future payments on such charge data.

The following table compares 2008 payment rates for bone transfusion and cellular therapy procedures with CMS’ proposed 2009 payments for these services:

Intravenous Immunoglobulin (IVIG)

For several years, CMS has been paying an additional amount for the pre-administration costs of acquiring IVIG. This payment is in addition to the payment for the drug itself and its administration. A temporary code, G0332, was established to report this service which was intended to compensate for the time and effort to locate and obtain the product in a difficult market. In 2009, CMS proposes to no longer pay separately for pre-administration, but instead consider this a packaged service. CMS states that additional payment was intended to be a temporary measure during a period of market fluctuations for IVIG and the agency has concluded that market conditions have improved and this payment is no longer necessary.

AABB will submit comments to CMS regarding the proposed rule. The proposed rule will be posted in the July 18, 2008 edition of the Federal Register.