The Centers for Medicare & Medicaid Services (CMS) recently released a final rule to update the Medicare fee-for-service (FFS) long-term care hospital (LTCH) prospective payment system (PPS) for fiscal year (FY) 2027.
Highlights of the final rule include:
- Increasing the standard LTCH PPS rate by a net 2.6%, after the 0.9 productivity cut and budget neutrality adjustments, from $50,824 to $52,133 for LTCHs that successfully comply with the CMS quality reporting program (QRP) and electronic health record requirements. LTCHs that do not meet the requirements for these programs are subject to a two-percentage-point reduction in the annual update.
- Continuing to pay 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 $49,346.
- Increasing the labor-related share of the standardized operating rate slightly from 72.9% to 73%
- Finalizing the removal of two measures from the LTCHQRP and from public display beginning with the FY 2028 payment determination. LTCHs will not be required to report calendar year 2026 data for the COVID-19 Vaccination Coverage Among Healthcare Personnel measure. The CMS also removed the COVID-19 Vaccine: Percent of Patients/Residents Who Are Up to Date measure beginning with the FY 2028 payment determination. LTCHs will not be required to collect and submit data for this measure beginning with residents discharged on or after Oct. 1, 2026. The CMS will remove the data element from the LTCH Continuity Assessment Record and Evaluation Data Set effective Oct. 1, 2028, as it is not technically feasible to remove it sooner. LTCHs will not be required to collect or submit measure data for patients discharged on or after Oct. 1, 2026.
- Reducing the LTCH QRP data submission deadlines beginning with the FY 2029 LTCH QRP to reduce the timeframe for data submission from the current 4.5 months after the end of the performance period to 45 days. If this day falls on a Friday, a weekend, or a federal holiday, the deadline will be 11:59 p.m. Eastern Standard Time on the next business day. This timeframe applies to both assessment-based data and National Healthcare Safety Network data.
The MHA will provide an updated hospital-specific impact analysis and additional details on the final rule in the near future. Members with questions should contact the MHA Health Finance team.
The Centers for Medicare & Medicaid Services (CMS) recently released a final rule to update the Medicare fee-for-service (FFS) long-term care hospital (LTCH) prospective payment system (PPS) for fiscal year (FY) 2027.
