CMS Pub. 100-04, ch. 4, § 10.6.2.3

CMS claims processing software will automatically reduce payment to “Subsection (d)

hospitals” when those hospitals that fail to meet the quality reporting requirements bill

for services to which the reduced update applies. However, contractors must update the

Outpatient Provider Specific File (OPSF) quality reporting field when CMS furnishes the

list of hospitals to which the payment reduction applies. The FISS auto-populates the

Hospital Quality Indicator field of the OPSF field with a “1” for all hospitals. Once CMS

has issued the list of hospitals failing to meet the requirements, Medicare contractors

must remove the ‘1’ in the Hospital Quality Indicator field for each Subsection (d)

hospital that fails to meet the quality reporting requirements. Contractors make no

changes to the ‘1” indicator for hospitals that are not Subsection (d) hospitals providing

OPPS services or for hospitals that are Subsection (d) hospitals providing OPPS services

that are not listed as failing the requirements.

CMS sends Medicare contractors the file of hospitals to which the reduction applies for a

given calendar year by a Joint Signature Memorandum/Technical Direction Letter as

soon as the list is available. This will be sent as soon as possible, expected to be on or

about December 1 of each year preceding the calendar year to which the payment

reduction applies. Should a Subsection (d) hospital later be determined to have met the

criteria after dissemination of this list, CMS will change the hospital’s status. CMS will

notify Medicare contractors of the change in status and contractors must update the OPSF

as needed and must mass adjust paid claims.

For new hospitals, Medicare contractors must provide information to the Quality

Contractor to be specified by CMS as soon as possible so that the Quality Contractor can

enter the provider information into the Program Resource System and follow through

with ensuring provider participation with the requirements for quality data reporting, if

applicable. CMS will notify Medicare contractors of how to contact the Quality

Contractor each year in the annual OPPS update change request. This allows the Quality

Contractor the opportunity to contact new facilities as early as possible in the calendar

year to inform them of the hospital outpatient quality reporting requirements. As soon as

possible, Medicare contractors must provide the following information on newly

participating hospitals to the Quality Contractor to be specified by CMS:

• State code;

• Provider name;

• Provider ID numbe;

• Medicare accept dat;e

• Contact name (if available); and

• Telephone number.