CY 2025 New Technology APCs

CMS strives to provide its beneficiaries with access to treatment with new technologies. In the outpatient setting, Medicare supports the provision of new technology procedures through reimbursement of these services under New Technology ACPs.

What are New Technology APCs?

The Outpatient Prospective Payment System (OPPS) uses new technology APCs to pay for certain new services until CMS gathers sufficient claims data to enable it to assign the service to an appropriate clinical APC.

To be assigned to a New Technology APC, the service must meet certain criteria, including, but not limited to the following:

• The service must be truly new, meaning it cannot be appropriately reported by an existing HCPCS code assigned to a clinical APC and does not appropriately fit within an existing clinical APC.
• The service must not be eligible for transitional pass-through payment (however, a truly new, comprehensive service could qualify for assignment to a new technology APC even if it involves a device or drug that could, on its own, qualify for pass-through payment).
• The service falls within the scope of Medicare benefits .

Once assigned, a service is paid under a New Technology APC until sufficient claims data have been collected (generally two to three years) to allow CMS to assign the procedure to a clinical APC group that is appropriate in clinical and resource terms.

How are New Technology APCs Paid?

CMS assigns new services to a New Technology APC. New Technology APCs are paid solely on the basis of cost and not the clinical characteristics of the service. The payment rate for each New Technology APC is based on a payment range called a cost band rather than on a relative payment weight. The cost band that the estimated costs for a procedure or service fall into determines the APC it is assigned to. Payment is made at the midpoint of the range for each cost band.

Example:

A new technology with an estimated cost of $510 falls into APC 1507, New Technology – Level 7. The cost band range for APC 1507 is $501 to $600. Procedures whose APCs fall into this cost band would be paid at an amount of $550.50.

Proposed Additions to New Technology APCs for CY 2025

For CY 2025 there are a total of 20 procedures or technologies being proposed for assignment to new technology APCs.

Pass-through Payments – Another Reimbursement Method for Supporting the use of New Technology

In addition to New Technology APCs, CMS also supports beneficiaries’ access to new technology through the use of pass-through payments. While New Technology APCs reimburse providers for individual services, pass-through payments pay for specific drugs, biologics, and devices that providers use in the delivery of services. Pass-through payments are a method for reimbursing providers of new technologies for which an OPPS payment rate cannot be determined because the technology is so new that rate setting data is not available. Pass-through devices and drugs are required by statute to be paid separately under the OPPS.

Prepare Now

Organizations that intend to use these technologies in 2025 are encouraged to visit the OPPS proposed or final rule to review the applicable information for each procedure or technology. Detailed information, including relevant CPT/HCPCS codes, can be found in section III.C.3.A-T Procedures Assigned to New Technology APCs for CY 2025 in the OPPS Proposed Rule and payment rates for the applicable APCs can be found in Addendum B.

To make sure you and your team are ready on January 1, 2025, to apply CPT and other significant payment changes, watch for the December 15 release of our upcoming course CY 2025 CPT and HOPPS Updates.

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The information contained in this coding advice is valid at the time of posting. Viewers are encouraged to research subsequent official guidance in the areas associated with the topic as they can change rapidly.