CMS Announces 2023 Medicare Premiums and Deductibles

The Centers for Medicare & Medicaid Services (CMS) recently announced the calendar year 2023 Medicare fee-for-service Part A deductible for inpatient hospital services will increase by $44 to a new total of $1,600. The Part A daily coinsurance amounts will be:

  • $400 for days 61-90 of hospitalization in a benefit period.
  • $800 for lifetime reserve days.
  • $200 for days 21-100 of extended care services in a skilled nursing facility in a benefit period.

The monthly Part A premium, paid by beneficiaries who have fewer than 40 quarters of Medicare-covered employment and certain people with disabilities, will increase by $7 in 2023 to a total of $506. Certain voluntary enrollees eligible for a 45% reduction in the monthly premium will pay $278.

The annual deductible for Medicare Part B will decrease by $7 to a total of $226, while the standard monthly premium for Medicare Part B will decrease by $5.20 to a total of $164.90.

Members with questions should contact Vickie Kunz at the MHA.

Comments Due Aug. 16 on Medicare Home Health PPS Proposed Rule

The Centers for Medicare & Medicaid Services (CMS) recently released the proposed rule to update the Medicare fee-for-service (FFS) home health (HH) prospective payment system (PPS) effective Jan. 1, 2023. Highlights of the proposal include:

  • A net 6.25% decrease in the national, 30-day standardized payment amount after the estimated 6.9 percentage point cut to achieve budget-neutrality for the Patient-Driven Groupings Model on a prospective basis. The proposed payment rate is $1,904.76, down from the current $2,031.64 for HHs that comply with HH quality reporting program (QRP) requirements.
  • An increase in the fixed-dollar loss ratio from the current 0.40 to 0.44.
  • A permanent 5% cap on wage index decreases to mitigate significant payment reductions from wage index changes.
  • Comment solicitation regarding the data collection on the use of remote services at the individual beneficiary level, which would allow the CMS to analyze the characteristics of the beneficiaries using remote services and potential for identifying social determinants of health that impact use of remote services.
  • Ending the suspension of data submission for non-Medicare/non-Medicaid patients. HH agencies would be required to submit all-payer OASIS data for purposes of the HH QRP beginning with the 2025 program year.
  • Changes to the Expanded HH value-based purchasing (VBP) model, including definitions for the baseline and model year, changing the baseline year from 2019 to 2022 for existing HH agencies and modifying the model year from 2019 to 2022 beginning in 2023.
  • Seeking feedback on development of health equity measures for the HH QRP and potential future application of health equity in the Expanded HH VBP model’s scoring and payment methodologies.

The MHA will provide members with an estimated impact analysis within the next few weeks and share draft comments prior to the Aug. 16 deadline. The MHA encourages members with HH operations to review the impact of the proposed rule on their operations and submit comments to the CMS. Members that have not received impact analyses in the past for affiliated, free-standing HH agencies are encouraged to provide the agency’s CMS certification number (also known as Medicare provider number), agency name, and federal information processing standards code to receive an estimated impact analysis in the future. Members are encouraged to forward this information and questions to Vickie Kunz at the MHA.

MDHHS Addresses Medicaid Attending Physician Claim Edit

The Michigan Department of Health and Human Services (MDHHS) recently issued an L-letter regarding attending physician claim edits that were implemented Jan. 1, 2022. The letter addresses concerns raised by the MHA and hospitals regarding the claim edit that has resulted in denied claims. Existing Medicaid policy stipulates:

  • The attending physician (MD or DO) is responsible for determining medical necessity and appropriateness of service within the scope of current medical practice and Medicaid guidelines.
  • Services must be furnished under the direction of a physician (MD or DO) or dentist.
  • The attending physician must be Medicaid-enrolled for all institutional claims. If the attending physician is not reported on the claim or if the provider is not enrolled in Michigan Medicaid, the claim cannot be paid.

The MDHHS final policy (MSA 21-45), issued Dec. 1, 2021, reflected the above policy and notified providers that the MDHHS would implement edits that would preclude payment for services where the attending provider was a physician assistant, nurse practitioner or podiatrist, resulting in claims denials for dates of service beginning Jan. 1, 2022.  The L-letter modifies policy to mitigate the denial of hospital claims associated with this edit as follows:

  • Outpatient services – The provider types allowed in the attending field prior to Jan. 1, 2022, will be permitted. Also, additional provider types can be reported in the attending physician field for outpatient hospitals.
  • Inpatient services – The provider types allowed in the attending field include physicians (MD/DO), dentists, certified nurse midwives and podiatrists.

The complete listings of permitted attending provider types for inpatient hospitals and outpatient hospital providers are available on the MDHHS website and will be updated as needed.

Affected Medicaid fee-for-service claims for dates of service on and after Jan. 1, 2022, will be reprocessed beginning May 19. Medicaid health plans (MHPs) may begin to reprocess claims and/or resubmit encounters effective immediately. Hospitals are encouraged to contact the MHP for specific instructions. The MDHHS anticipates releasing additional clarification soon. Members with questions should contact Vickie Kunz at the MHA.

CMS Releases FY 2023 Proposed Rule to Update Hospital IPPS

The Centers for Medicare & Medicaid Services (CMS) recently released a proposed rule to update the Medicare fee-for-service (FFS) hospital inpatient prospective payment system (IPPS) for fiscal year (FY) 2023. When all proposed changes are considered, the rule is expected to result in a net decrease due to proposed cuts to disproportionate share hospital (DSH) and other payments. The MHA considers these cuts to be unacceptable given the extraordinary inflationary environment and extreme labor and supply cost pressures that hospitals continue to experience.  The proposed rule would:

  • Reduce national DSH and uncompensated care (UCC) pool payments by $800 million. The CMS projects a UCC pool of roughly $6.5 billion to be allocated to hospitals based on audited Worksheet S-10 data from FY 2018 and FY 2019 cost reports. The CMS proposes to use a three-year average to calculate payments starting in FY 2024.
  • Eliminate payment enhancements for Medicare-dependent hospitals and low-volume hospitals absent congressional action to extend those payments beyond the Sept. 30, 2022, expiration date.
  • Provide a net 3.2% increase in the federal operating rate for hospitals that successfully participate in the inpatient quality reporting program (QRP) and are meaningful electronic health record users.
  • Increase the standard federal capital rate by 1.6% from $472.60 to $480.29.
  • Establish a cost outlier threshold of $43,214, up 39% from the current $30,988 threshold, resulting in fewer cases qualifying for an outlier payment. The CMS adjusts the threshold annually to ensure that outlier payments do not exceed the established target of 5.1% of aggregate IPPS payments.
  • Cap wage index decreases at 5%, ensuring each hospital’s wage index is at least 95% of its final wage index for the prior fiscal year. This policy would be funded by a national adjustment to the standard federal operating rate. The CMS proposes to continue the current policy that provides a wage index increase for hospitals in the bottom quartile.
  • Modify graduate medical education policy related to full-time-equivalent caps and increase flexibility for rural hospitals that participate in a rural track program.
  • Suppress several measures in the hospital value-based purchasing program and continue the special scoring methodology used for FY 2022 to ensure hospitals are neither penalized nor rewarded due to the COVID-19 public health emergency.
  • Suppress all six measures in the hospital acquired conditions (HAC) reduction program. If finalized as proposed, hospitals will not be given a measure score, a total HAC score, or a payment penalty for FY 2023.
  • Establish a publicly reported hospital designation on the quality and safety of maternity care in efforts to reduce maternal mortality and morbidity, a priority of the Biden-Harris administration. The CMS would award this designation to hospitals that report “Yes” to both questions in the Maternal Morbidity Structural Measure, previously finalized in the Hospital Inpatient QRP.
  • Seek input on ways to advance health equity. The CMS is seeking comment on key considerations to improve data collection to better measure and analyze disparities across CMS programs and policies and approaches for updating the Hospital Readmission Reduction Program to encourage providers to improve performance for socially at-risk populations.
  • Seek input on the appropriateness of a payment adjustment for FY 2023 and beyond to recognize the additional resource costs associated with acquiring surgical N95 respirators that are approved by the National Institute for Occupational Safety and Health and are wholly domestically made.

The MHA is continuing to review the proposed rule and will provide hospitals with an estimated impact analysis soon. The association will also share its draft comments with members when available. The CMS will accept comments on the proposal through June 17. Members with questions should contact Vickie Kunz at the MHA.