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CMS Issues Proposed Payment and Policy Updates for Inpatient Psychiatric Facilities

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The Centers for Medicare & Medicaid Services (CMS) has issued the federal fiscal year (FFY) 2024 inpatient psychiatric facility (IPF) prospective payment system proposed rule. Comments are due to CMS by 2 p.m. (PT) on June 5. 

Key proposals include: 

  • Increasing payments by an estimated 1.9%, or $55 million compared to payments in FFY 2023. 
  • Adopting a 2021-based IPF market basket and include proposed changes to the market basket cost weights, price proxies, market basket update, and labor-related share. 
  • Updating the labor-related share for FFY 2024 to 78.5%, a 1.1 percentage point increase from the FFY 2023 labor-related share. 
  • Allowing hospitals to open a new IPF unit at any time during the cost reporting period. This proposal would allow a hospital unit to start being paid under the IPF PPS, as long as 30-day advance notice is provided to the CMS Regional Office and Medicare Administrative Contractor.  
  • Adopting four new quality measures, modifying one existing measure, removing two existing measures, and adopting and implementing a data validation pilot for the IPF Quality Reporting Program.  

Additional details are available in a CMS fact sheet.