CHA News

CHA Issues Summary of IPPS Final Rule

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CHA has issued a detailed summary of the inpatient prospective payment system (IPPS) final rule for federal fiscal year (FFY) 2020. The policy and payment provisions are effective for FFY 2020 discharges, beginning Oct. 1.

The final rule reflects annual updates to Medicare fee-for-service (FFS) inpatient payment rates and policies, as well as:

  • Significant changes to the methodology for computing the area wage index intended to reduce the growing disparity between high- and-low-wage index hospitals. Though modified from the original proposal, this policy will adversely impact California hospitals, which stand to lose more than $22 million in hospital inpatient payments in FFY 2020 alone.
  • Updates to Medicare disproportionate share hospital payment policies
  • Updates to program rules for the Value-Based Purchasing Program, Readmissions Reduction Program and Hospital-Acquired Condition Reduction Program
  • Updates to payment penalties for non-compliance with the Hospital Inpatient Quality Reporting and Electronic Health Record Incentive programs

CHA provided member hospitals and health systems with hospital-specific CHA DataSuite analyses estimating the impact of Medicare inpatient FFS payment changes from federal fiscal year FFY 2019 to 2020 based on policies in the FFY 2020 IPPS final rule.