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Hospital and pharmacy leaders called on Congress this week to reject any proposed site-neutral legislation that would reduce reimbursements for drug administration in hospital outpatient departments.
American Hospital Association (AHA) and American Society of Health–System Pharmacists (ASHP) officials urged Senate and House leaders against passing proposals that they argued would “equate care provided in these hospital clinics with less complex care provided at freestanding physician offices.”
“The care is not equivalent, and current payment rates take into account these important differences,” AHA and ASHP leaders wrote in a Tuesday letter, noting that hospitals must take additional measures to ensure medications are prepared and administered safely, as well as comply with federal safety standards.
The associations raised concerns that the proposals before Congress could “force hospitals and pharmacists to scale back some of the critical services they are able to provide to their patients.” That, they argued, could reduce care access for individuals like Medicare beneficiaries, who are typically sicker and have more medically complex health issues.
AHA has taken issue with three specific proposals:
- The Patient Act of 2023 and the Healthcare Transparency Act, both of which would cut drug administration services at off-campus hospital outpatient departments. Such services would be paid at a site-neutral rate—likely 40% of the outpatient prospective payment system—following a four-year phase-in period. An AHA analysis projected that it would result in a $4+ billion cut to hospitals over 10 years.
- The Site-based Invoicing and Transparency Enhancement (SITE) Act, which AHA said calls for site-neutral payment cuts for items and services—including those previously exempted under Medicare—in certain grandfathered, off-campus hospital outpatient departments. The association cautioned that the proposal would lead to a $34+ billion cut to hospitals over 10 years.
- The Medicare Patient Access to Cancer Treatment (MPACT) Act, which AHA said would impose site-neutral payment cuts to cancer care-related services at off-campus hospital outpatient departments. AHA offered that the policy would lead to a nearly $12 billion cut to hospitals over 10 years.
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