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CHA Issues Summary of IPPS Proposed Rule

For CEOs, CFOs, Chief Legal Counsel, COOs

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CHA has issued a summary of the federal fiscal year (FFY) 2020 inpatient prospective payment system proposed rule (IPPS) and will host a member forum June 11 at 10 a.m. (PT). During the call, CHA will provide a brief overview of key provisions in the proposed rule and solicit member feedback to inform our comments — specifically on the proposed changes to the area wage index and Medicare disproportionate share hospital (DSH) payments.

Please register online for the forum by June 10 at noon (PT).

For FFY 2020, CMS proposes to increase payment rates by 3.2% compared to FFY 2019. The update includes an initial market basket update of 3.2%, minus 0.5% for productivity and plus 0.5% to partially restore cuts made as a result of the American Taxpayer Relief Act (ATRA) of 2012. CMS estimates that, after accounting for all policies in the proposed rule, total IPPS payments will increase by 3.7%, or approximately $4.67 billion.

In addition to annual payment updates, including changes to Medicare DSH payments, CMS proposes significant changes to the hospital area wage index. CHA believes this proposal inappropriately and unnecessarily punishes states with a high cost of living, like California, and is analyzing the proposal’s impact to determine an appropriate political and policy response.

Comments on the proposed rule are due June 24.

Last week, CHA provided member hospitals and health systems with hospital-specific CHA DataSuite analyses showing how Medicare inpatient fee-for-service (FFS) payments will change from federal fiscal year FFY 2019 to FFY 2020 based on the policies put forth in the CMS FFY 2020 IPPS proposed rule. The analysis compares the year-over-year changes in operating, capital, and uncompensated care IPPS payments and includes breakout sections with detailed insight into specific policies that influence IPPS payment changes.