Prospective Payment System

The Centers for Medicare & Medicaid Services (CMS) has issued the final rule for the inpatient rehabilitation facility prospective payment system (IRF PPS) for federal fiscal year (FFY) 2020. The provisions will be effective Oct. 1, 2020. According to CMS, this final rule represents continued movement toward the eventual transition to a unified post-acute care (PAC) PPS. 

Below are highlights of the final rule.  

Payment Impact
As provided in the FFY 2019 final rule, CMS will reform the current IRF patient assessment and case-mix  process by discontinuing the use of the functional independence measure (FIM), and instead incorporating similar data elements contained in Section GG of the IRF patient assessment instrument (IRF-PAI) for the purpose of assigning patients to a payment category, or case-mix group (CMG).  Notably, in response to comments, CMS opts not to adopt a weighted motor score for CMG calculation.  

The final rule updates the CMG relative weights and average length of stay values, and uses concurrent inpatient prospective payment system (IPPS) wage index data to align wage index data across settings of care.  Overall, CMS projects that payments to IRFs will increase by 2.5%, or $210 million, as compared to FFY 2019, the result of a 2.9% market basket update, offset by statutorily mandated 0.4% cut for productivity. 

Quality Reporting/SPADEs
CMS finalizes several proposals relating to the IRF Quality Reporting Program (QRP), including the addition of several standardized patient assessment data elements (SPADEs), several of which address social determinants of health. CMS also finalizes two new measures on transfer of health information, as well as a change to the existing “Discharge to Community” measure to exclude baseline nursing home residents. In response to comments, CMS does not finalize its proposal to collect IRF QRP data on all patients regardless of payer source. 

The Centers for Medicare & Medicaid Services (CMS) has issued its calendar year (CY) 2020 outpatient prospective payment system (OPPS) proposed rule, including significant proposals related to price transparency and changes to the hospital area wage index (AWI). Specifically, CMS would carry over hospital AWI policies proposed under the federal fiscal year 2020 inpatient PPS (IPPS) proposed rule, applying the finalized inpatient policies to outpatient payments.

CHA is currently reviewing the Centers for Medicare & Medicaid Services’ calendar year (CY) 2020 proposed rule for the home health (HH) prospective payment system (PPS).

The Centers for Medicare & Medicaid Services (CMS) has postponed the activation of billing edits requiring exact matching for the address on claims data for outpatient prospective payment system providers with multiple service locations. The edits will now be implemented in October 2019.  

CHA has submitted a comment letter on the Centers for Medicare & Medicaid Services’ (CMS) federal fiscal year (FFY) proposed rule for the long-term care hospital (LTCH) prospective payment systems (PPS). 

CHA has submitted a comment letter on the federal fiscal year (FFY) 2020 inpatient prospective payment system (IPPS) proposed rule issued by the Centers for Medicare & Medicaid Services (CMS).

CHA has submitted comments on the Centers for Medicare & Medicaid Services’ (CMS) federal fiscal year (FFY) 2020 proposed rules for the prospective payment systems (PPS) for inpatient rehabilitation facilities (IRFs) and skilled-nursing facilities (SNFs). 

CHA reminds outpatient prospective payment system providers with multiple locations that the Centers for Medicare & Medicaid Services (CMS) will activate billing claims edits in July to check whether the address on a provider’s claim exactly matches the address entered into the Provider Enrollment, Chain and Ownership System (PECOS), as previously reported in CHA News.

CHA has prepared a letter template that members can use to share with the Centers for Medicare & Medicaid Services (CMS) their opposition to its proposed changes to the Medicare area wage index, outlined in the federal fiscal year (FFY) 2020 inpatient prospective payment system (IPPS) proposed rule. Member input is critical, as this proposal inappropriately and unnecessarily harms California’s hospitals.