In a comment letter to Center for Medicare & Medicaid Services (CMS) Administrator Marilyn Tavenner, the ACR made clear its position that the proposed separate cost centers for CT and MR in the 2014 Hospital Outpatient Prospective Payment (HOPPS) rule is a bad idea. The problem, as the ACR explains to CMS, is that hospitals vary widely in how they report their charges and costs, and because of the difficulty in accurately calculating all of the capital costs associated with advanced imaging equipment, most underreport this cost to CMS. As evidence that the data upon which the cost-to-charge ratio was calculated for CT and MR is unreliable, the ACR submitted examples of how it would skew payments. In one scenario, an x-ray of the skull on a machine that costs approximately $125,000 would be reimbursed at $82 while a CT scan of the head/brain on a machine that costs over $1 million would be reimbursed at $84 — just $2 more than the x-ray. The ACR also noted in the letter that while hospitals may be able to absorb the effects of payment reductions from separate CT and MR cost centers because other payments, like those for x-rays, would go up, this is not the case for office practice settings. By law, the Physician Fee Schedule (PFS) must pay for the technical component of imaging at the HOPPS rate if the HOPPS rat is lower than that in the PFS. Therefore, the reduction to CT and MR reimbursement in the 2014 HOPPS rule will also apply to scans done by radiologists at outpatient imaging centers where a narrower range of services is provided and the cumulative effects of the cuts would be greater. CMS will now review all the comments it received on its 2014 proposed HOPPS rule before publishing the final rule by November 1. In addition to asking CMS not to implement the separate cost centers for CT and MR (at least until the reasons why their implementation distorts payments are understood), the ACR also made the following recommendations: • Delay implementation of comprehensive device-dependent packaged ambulatory payment categories. • Reduce errors and provide more details on the creation of packaging policies so that the ACR and others can replicate CMS’s methodology when analyzing proposed policies. • Delay implementation of proposed new packaging policies for drugs, biologicals and radiopharmaceuticals that function as diagnostic test or procedure supplies. • Allow hospitals to bill for transvenous intrahepatic portosystemic shunts (TIPS) in the outpatient setting.