CMS Releases FY 2024 Inpatient Psychiatric Facility Final Rule

The Centers for Medicare & Medicaid Services (CMS) recently released a final rule to update the Medicare fee-for-service (FFS) prospective payment system (PPS) for inpatient psychiatric facilities (IPF) for fiscal year (FY) 2024, which begins Oct. 1, 2023.

Key provisions of the final rule include:

  • A 3.5% net increase to the IPF federal per diem base rate for providers that comply with the CMS IPF quality reporting (QR) program requirements, resulting in a final rate of $895.63, an increase from the current rate of $865.63.
  • A 3.5% increase to the electroconvulsive therapy per diem payment rate from the current $372.67 to $385.58 for providers that comply with the CMS IPF QR program requirements.
  • A rebased IPF PPS market basket to use FY 2021 data instead of FY 2016.
  • An increase in the labor-related share from the current 77.4% to 78.7%.
  • A 36% increase in the outlier threshold amount from the current $24,630 to $33,470 to maintain estimated outlier payments at 2% of total estimated aggregate IPF PPS payments. This will result in fewer cases qualifying for an outlier payment.
  • Modifying the excluded unit regulation to allow a hospital to open a new IPF unit and begin being paid under the IPF PPS at any time during the cost reporting period if the hospital meets certain requirements. Currently facilities cannot attain excluded unit status in the middle of a cost reporting period.
  • Changes to the IPF QRP including:
    • Adopting new quality measures, including one on patient experience.
    • Modifying the COVID-19 Vaccination Coverage Among Health Care Personnel measure
    • Removing two measures:
      • Patients Discharged on Multiple Antipsychotic Medications with Appropriate Justification (HBIPS-5).
      • Tobacco Use Brief Intervention Provided or Offered and Tobacco Use Brief Intervention Provided (TOB-2/2a).
    • Adopting a data validation pilot program starting with data submitted in 2025.

The MHA will provide IPFs with a facility-specific impact analysis and additional details on the final rule in the near future.

Members with questions should contact Vickie Kunz at the MHA.

MHA Comments on Medicare Fee-for-Service Proposed Rules

The MHA recently submitted comments to the Centers for Medicare and Medicaid Services (CMS) regarding the proposed rule to update the Medicare fee-for-service (FFS) inpatient rehabilitation facility (IRF) prospective payment system (PPS) for fiscal year (FY) 2024. These comments were due to the CMS June 2.

The MHA has also drafted comments regarding the FY 2024 Medicare FFS proposed rule to update the inpatient psychiatric facility (IPF) and the proposed rule to update the skilled nursing facility (SNF) PPS.  Comments on these rules are due June 5.

The CMS is expected to release final rules to update the IRF, IPF and SNF PPS around Aug. 1, for the Oct. 1, 2023, effective date. The MHA will provide members with an updated Medicare FFS impact analysis following release of the final rules.

Members with questions should contact Vickie Kunz at the MHA.

MHA Monday Report May 1, 2023

MHA Monday Report

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The upcoming debt ceiling debate comes at a pivotal time for healthcare because it does not enjoy the good will it has in decades past. The pandemic, dysfunctional political system and the struggling economy have taken a toll on public confidence. Long-term planning for the system’s future is subordinated to the near term imperative to control costs in the context of the debt ceiling debate. …“

Paul Keckley, April 24. 2023


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MHA Monday Report April 24, 2023

MHA Monday Report

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CMS Releases FY 2024 Inpatient Psychiatric Facility Proposed Rule

The Centers for Medicare & Medicaid Services (CMS) recently released a proposed rule to update the Medicare fee-for-service prospective payment system (PPS) for inpatient psychiatric facilities (IPF) for fiscal year (FY) 2024, beginning Oct. 1, 2023. Key provisions of the proposal include:

  • A 3.1% net increase to the IPF federal per diem base rate for providers that comply with the CMS IPF quality reporting (QR) program requirements, resulting in a proposed rate of $892.58, up from the current $865.63.
  • A 3.1% increase to the electroconvulsive therapy (ECT) per diem payment rate from the current $372.67 to $384.27 for providers that comply with the CMS IPF QR program requirements.
  • A rebased IPF PPS market basket to use FY 2021 data instead of FY 2016.
  • An increase in the labor-related share from the current 77.4% to 78.5%.
  • A 41% increase in the outlier threshold amount from the current $24,630 to $34,750 to maintain estimated outlier payments at 2% of total estimated aggregate IPF PPS payments. This will result in fewer cases qualifying for an outlier payment.
  • Modifying the excluded unit regulation to allow a hospital to open a new IPF unit and begin being paid under the IPF PPS at any time during the cost reporting period if the hospital meets certain requirements. Currently, facilities cannot attain excluded unit status in the middle of a cost reporting period.
  • Changes to the IPF QRP including:
    • Adopting four new quality measures, including one on patient experience.
    • Modifying the COVID-19 Vaccination Coverage Among Health Care Personnel measure.
    • Removing two measures:
      • Patients Discharged on Multiple Antipsychotic Medications with Appropriate Justification (HBIPS-5).
      • Tobacco Use Brief Intervention Provided or Offered and Tobacco Use Brief Intervention Provided (TOB-2/2a).
    • Adopting a data validation pilot program starting with data submitted in 2025.

The MHA will provide IPFs with a facility-specific impact analysis and additional details on the proposed rule in the near future. The MHA also encourages members with IPF operations to review the proposed rule, provide comments to Vickie Kunz at the MHA by May 25 and submit comments to the CMS by June 5. The CMS is expected to release a final rule around Aug. 1, for an Oct. 1, 2023, effective date.

Members with questions should contact Vickie Kunz at the MHA.

CMS Releases FY 2023 Inpatient Psychiatric Facility Final Rule

The Centers for Medicare & Medicaid Services (CMS) recently released a final rule to update the Medicare fee-for-service (FFS) prospective payment system (PPS) for inpatient psychiatric facilities (IPFs) for fiscal year (FY) 2023, which begins Oct. 1, 2022. In response to comments received urging the CMS to recognize the inflationary pressures currently faced by IPFs and other providers, the final rule provides a 3.9% net rate increase, up from the proposed 2.9% net increase.

Key provisions of the final rule include a:

  • 3.9% increase in the IPF federal per diem base rate for providers that comply with the CMS IPF quality reporting (QR) program requirements, resulting in a rate of $865.63, up from the current $832.94.
  • 3.9% increase to the electroconvulsive therapy treatment rate from the current $358.60 to $372.67 for providers that comply with the CMS IPF QR program requirements.
  • Permanent limit of 5% for annual decreases to the wage index.
  • Slight increase in the labor-related share from the current 77.2% to 77.4%, which will increase payments for IPFs with a wage index greater than 1.0.
  • 54% increase in the outlier threshold amount from the current $16,040 to $24,630 to maintain estimated outlier payments at 2% of total estimated aggregate IPF PPS payments. This will result in fewer cases qualifying for an outlier payment.

The MHA continues to review details of the final rule and will provide IPFs with an updated impact analysis for Medicare FFS patients in the near future. Members with questions should contact Vickie Kunz at the MHA.

MHA Monday Report April 11, 2022

MHA Monday Report

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CMS Releases FY 2023 Proposed Rule for Inpatient Psychiatric Facilities

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CMS Releases FY 2023 Proposed Rule for Inpatient Psychiatric Facilities

The Centers for Medicare & Medicaid Services (CMS) recently released a proposed rule to update the Medicare fee-for-service (FFS) prospective payment system (PPS) for inpatient psychiatric facilities (IPFs) for fiscal year (FY) 2023, which begins Oct. 1, 2022. Key highlights of the proposal include:

  • A 2.9% increase to the IPF federal per diem base rate for providers that comply with the CMS IPF quality reporting program (QRP) requirements, resulting in a proposed rate of $856.80, up from the current $832.94.
  • A 2.9% increase to the electroconvulsive therapy per diem payment rate from the current $358.60 to $368.87 for providers that comply with the CMS IPFQRP requirements.
  • A permanent policy to smooth the impact of year-to-year IPF payment reductions related to decreases in the wage index. The CMS is proposing that an IPF’s wage index for FY 2023 and subsequent years would not be less than 95% of its prior year wage index.
  • A slight increase in the labor-related share from the current 77.2% to 77.4%, which will increase payments for IPFs with a wage index greater than 1.0.
  • A 51% increase in the outlier threshold amount from the current $16,040 to $24,270 to maintain estimated outlier payments at 2% of total estimated aggregate IPF PPS payments. This will result in fewer cases qualifying for an outlier payment.
  • No changes to the IPFQRP, but the CMS included a request for information on several quality reporting-related topics:
  • General framework that could be used across the CMS QRPs, including principles for selecting quality measures for stratified reporting and a discussion of the benefits and drawbacks of various reporting methods.
  • Approaches that could be used in the IPFQRP to address health equity, including statistical methods to identify specific drivers of inequities and quality measures assessing facility performance in addressing health equity.
  • The concepts described in the previous sections and thoughts about disparity measurement or stratification guidelines for the CMS QRPs.

The MHA will review details of the proposed rule and provide IPFs with an estimated impact analysis for Medicare FFS patients soon. The CMS is accepting comments until May 31. Members with questions should contact Vickie Kunz at the MHA.