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April 19, 2019

How CMS wants to change payment rates for inpatient rehab, psych facilities in FY 2020

Daily Briefing

    CMS this week released proposed rules that would increase payments for inpatient rehab facilities (IRFs) and inpatient psychiatric facilities (IPFs) by 2.3%, or $195 million, and 1.7%, or $75 million, respectively, for fiscal year (FY) 2020.

    Cheat sheets: Medicare payment programs

    Inpatient rehab facility proposed rule details

    The annual proposed rule outlines how CMS would update Medicare's prospective payment system rates for IRFs for discharges beginning in FY 2020.

    Under the proposed rule, rural-based facilities would see IRF payments per discharge increase by 4.3% in FY 2020, while facilities located in urban areas would see a 2.2% increase. According to CMS, the total increase will equate to an additional $195 million in payments annually when compared with FY 2019.

    CMS in the rule also proposed revising the IRF market basket, which is the cost for a collection of goods and services related to rehabilitation. CMS currently bases the market basket on costs from 2012, but CMS proposed using prices and costs for services in 2016 to create a baseline.

    CMS in the proposed rule also is seeking public comments on several proposed changes to IRFs' wage index calculation. For example, CMS proposed aligning the IRF wage index with the index used under the Inpatient Prospective Payment system to better align methodologies across acute care settings. CMS also proposed adjusting the wage index based on the labor market where an IRF is located.

    CMS said the proposed methodology changes would be made in a budget neutral manner.

    In addition, CMS in the proposed rule clarified that IRFs can determine whether a physician qualifies as a "rehabilitation physician." Federal rules define rehabilitation physicians as physicians with "specialized training and experience in inpatient rehabilitation," but it is up to IRFs to determine what level of training or experience is sufficient.

    CMS also proposed adopting two new measures for the IRF Quality Reporting Program. The new measures are related to health data transfers and are intended to improve the interoperability of electronic health records and ensure a patient's medication list is up-to-date at the time of transfer or discharge. In addition, CMS proposed requiring IRFs to report patient assessment data for all patients, regardless of payer.

    CMS will accept public comments on the proposed rule through June 17.

    Inpatient psychiatric facilities proposed rule details

    CMS on Thursday released a proposed rule for IPFs that would increase Medicare payments to the facilities by 1.7%, or $75 million, in FY 2020, when compared with FY 2019.

    CMS in the rule also proposed revising the IPF market basket to use 2016 as a baseline year instead of 2012. 

    CMS under the proposed rule also would add one measure to the IPF Quality Reporting Program that would gauge medication continuation for patients with bipolar disorder, major depressive disorder, or schizophrenia. The measure would assess whether such patients filled a prescription for at least one evidence-based medication either two days before their discharge or 30 days after being discharged.

    CMS will accept public comments on the proposed rule through June 17 (King, "Transformation Hub," Modern Healthcare, 4/17; Lotven, Inside Health Policy, 4/17 [subscription required]; AHA News, 4/17; Romoser, Inside Health Policy, 4/19 [subscription required]; AHA News, 4/18).

    Overwhelmed by 2,000+ pages of new Medicare rules? Here's what you need to know.

    If you missed our webconference series diving deep into CMS' proposed and final rules for some of Medicare's most important, and often confusing, programs, don't worry—we've got you covered.

    Download our one-page cheat sheets for a quick overview of each rule's scope, then review the slide decks from our webconferences for full details:

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