38 hospitals sue HHS over site-neutral payment policy

by Paige Minemyer | Jan 23, 2019

Dozens of hospitals have followed in the footsteps of the American Hospital Association and are suing the Trump administration over its decision to institute site-neutral payments. 

Thirty-eight hospitals have signed on to a lawsuit (PDF) against the Department of Health and Human Services that says the agency overstepped its authority in finalizing the payment change as part of the annual outpatient prospective payment system (OPPS) rule. 

Care provided in hospital-run outpatient clinics is more “resource intensive” than care provided by an independent physician practice, the hospitals said, so instituting site-neutral payments could significantly impact patients who seek care at these facilities. 

“The Secretary’s unlawful rate cut directly contravenes clear congressional directives and will impose significant harm on affected off-campus hospital outpatient departments and the patients they serve,” the hospitals said. 

Providers involved in the lawsuit include Montefiore Health System, Rush University Medical Center, Vanderbilt University Medical Center, Atrium Health, Ochsner Medical Center and OSF HealthCare. 

Under the previous system, Medicare paid a higher rate for services provided at a hospital’s outpatient facilities. The Centers for Medicare & Medicaid Services projects that the policy change could save beneficiaries $150 million in copayments annually, by dropping the average copay from $23 to $9. 


Chris J. Stewart

Chris currently serves as President and CEO of Surgio Health. Chris has close to 20 years of healthcare management experience, with an infinity to improve healthcare delivery through the development and implementation of innovative solutions that result in improved efficiencies, reduction of unnecessary financial & clinical variation, and help achieve better patient outcomes. Previously, Chris was assistant vice president and business unit leader for HPG/HCA. He has presented at numerous healthcare forums on topics that include disruptive innovation, physician engagement, shifting reimbursement models, cost per clinical episode and the future of supply chain delivery.

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