195 Pages Distilled for FY22 New Technology Add-On Payment Tool 9/27/21

The FY2022 Inpatient Prospective Payment System (IPPS) Final Rule was published in the Federal Register and is effective October 1, 2021. Of which, the New Technology Add-on Payments (NTAP) are a big aspect and impact the Pharmacy Revenue Cycle. 

NTAP is considered for new services or technologies when: 1) they are new and not substantially similar to other existing services or technology; 2) the services or technology is more costly or the MS-DRG payment is inadequate for coverage of the new technology; 3)  and the service or technology demonstrates substantial clinical improvements over existing services or technology with the exception of certain antimicrobials. Antimicrobials approved under the Limited Population Pathway for Antibacterial and Antifungal Drugs (LPAD) and are authorized by the FDA as a Qualified Infectious Disease Product (QIDP) are not required to meet the requirement that it represents an advance that substantially improves. The maximum add-on payment for the technology or service is equal to the lesser of 65% of the cost of the new technology or 65% of the amount by which the cost exceeds the standard DRG payment. For technology approved through the LPAD, the payment threshold is 75%.

The NTAP tool provided by Pharmacy Revenue Cycle has been updated to reflect the FY22 changes that impact the drugs and biologicals. The crosswalk contains the newness start date, NTAP status, maximum NTAP payment and the associated ICD-10-PCS codes. It is noted that 2019 claims data was utilized over the 2020 for the purposes of restating payments thresholds. In summary:

• 9 drugs were granted an additional year of NTAP that would have otherwise been discontinued for FY22 based on the newness criterion 

• 8 drugs continue NTAP eligibility

• 7 drugs became eligible 

• 3 applications were denied NTAP eligible

• Fetroja and Recarbrio both submitted new applications based on the FDA approval of the indication hospital acquired bacterial pneumonia and ventilator-associated bacterial pneumonia despite having a baseline continued NTAP status. The max payment rates were adjusted to reflect updated data based on the new indication. 

• Remdesivir (Veklury) was approved for NTAP with the newness date starting with the time it was authorized by the FDA for the Emergency Use Authorization (EUA). Remdesivir is the only drug that is approved for both NTAP and NCTAP (New Covid-19 Treatment Add0on Payment), but will continue to receive payment equal to that as if only it was eligible for NCTAP.

Shout Outs!

1. Pharmacy team and HIM/Coding teams should collaborate to ensure that the system is updated for proper capture and application of the ICD-10-PCS codes to the claim. Without the ICD-10-PCS code, the claim will not process the NTAP payment. 

2. Pharmacy teams should take into consideration NTAP payment in formulary decision making, but note these payments only last for 2 to 3 years.