The Centers for Medicare & Medicaid Services (CMS) recently released a proposed rule to update the Medicare fee-for-service (FFS) long-term care hospital (LTCH) prospective payment system (IPPS) for fiscal year (FY) 2027. Highlights of the proposed rule include:
- Increasing the standard LTCH PPS rate by a net 2.7%, after the 0.8 productivity cut and budget neutrality adjustments, from $50,824 to $52,177 for LTCHs that successfully comply with the CMS quality reporting program and electronic health record requirements. LTCHs that do not meet the requirements for these programs are subject to a 2-percentage-point reduction in the annual update.
- Continue paying cases at the site-neutral rate if they fail to meet LTCH criteria.
- Maintaining the fixed-loss amount for high-cost outlier cases at the current $78,936 for standard LTCH payment rate cases. Site-neutral payment cases are subject to the inpatient PPS fixed loss amount, proposed at $51,679.
- Increasing the labor-related share of the standardized operating rate slightly from 72.9% to 73%
- Removing two measures from the LTCH Quality Reporting Program (QRP) and from public display beginning with the FY 2028 payment determination. If finalized, LTCHs would not be required to report calendar year 2026 data for the COVID-19 Vaccination Coverage Among Healthcare Personnel measure. The CMS also proposes to remove the COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to Date measure beginning with the FY 2028 payment determination.
- Revising the LTCH QRP data submission deadlines beginning with the FY 2029 LTCH QRP to reduce the timeframe for data submission from four and a half months after the end of the performance period to 45 days.
The MHA will provide a hospital-specific impact analysis and additional details in the coming weeks. Members are encouraged to submit comments to CMS by June 9 and notify Vickie Kunz at the MHA of any identified issues by June 1. CMS is expected to release a final rule around Aug. 1.