Provider-based rules, which were most recently amended in November 2016, may significantly impact operational decision making.  In its 2017 final OPPS rule, CMS included provisions intended to implement “site neutral” reimbursement for non-excepted (i.e., non-grandfathered) off-campus provider-based locations.

Non-excepted off-campus provider-based locations are generally those acquired or established after November 2, 2015, subject to certain exceptions (such as dedicated emergency departments, projects meeting the “mid-build” standard, and others).

Although hospitals will continue to bill the “technical” or “facility” component on a CMS-1450 (UB-04) for these non-excepted locations, CMS created a new site of service identified by the “PN” modifier, which must be added to institutional claims from these locations.

Claims with this modifier will be paid under the Medicare Physician Fee Schedule (MPFS).  The claim will undergo the same OPPS process from an IT perspective, yet will receive a new payment rate.  This new rate is intended to reflect the “estimated relative resource costs” in furnishing services, and will incorporate packaging and billing rules unique to the hospital outpatient setting.

For CY2017, CMS states these new “technical” or “facility” component rates will generally be set at 50% of the OPPS payment rate for the same service. Given this 50% general test, it seems likely that some services will continue to receive a positive reimbursement impact in the provider-based setting, whereas others may benefit from a freestanding venue.  Murer applied this general test to the evaluation & management of established patients CPT code set below, utilizing current CMS base rates.  The results show newly established or acquired HOPDs still benefit from provider-based status for this E&M code set, though results will likely vary by service.  These results, as well as general billing guidelines for varying outpatient care sites, are included below:



E&M Established Patient CPT Code Physician Office On-campus HOPD Grandfathered Off-campus HOPD New Off-campus HOPD
99211 $ 20.05 $ 111.43 $ 111.43 $ 60.37
99212 $ 43.68 $ 127.54 $ 127.54 $ 76.48
99213 $ 73.40 $ 153.68 $ 153.68 $ 102.62
99214 $ 108.13 $ 181.25 $ 181.25 $ 130.19
99215 $ 145.72 $ 214.19 $ 214.19 $ 163.13



Physician Office On-campus HOPD Grandfathered Off-campus HOPD New Off-campus HOPD
1500 with POS 11 1500 with POS 22 1500 with POS 19 1500 with POS 19
No UB UB without modifier UB with modifier “PO” UB with modifier “PN”
  • “HOPD” means hospital outpatient department.


  • “Physician Office” values assume “non-facility” (i.e., POS 11) rate per the Medicare Physician Fee Schedule (“MPFS”).


  • “On-campus HOPD” and “Grandfathered Off-campus HOPD” values combine “facility” rate per the MPFS (i.e., POS 19 or 22) plus the Outpatient Prospective Payment System (“OPPS”) rate for CPT G0463. 


  • “New Off-campus HOPD” values combine “facility” rate per the MPFS (i.e., POS 19) plus 50% of OPPS rate for CPT G0463.