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 rehabilitation facilities (IRFs) for fiscal year (FY) 2023, which begins Oct. 1, 2022. Key provisions of the rule include:
- Requirement that the IRF-patient assessment instrument be completed on ALL patients, regardless of payor, beginning Oct. 1, 2024. This is delayed from the proposed Oct. 1, 2023 reporting date.
- A 3.7% net increase to the IRF standard federal rate for providers in compliance with the CMS IRF quality reporting program, resulting in a rate of $17,878, up from the current $17,240. This increase is higher than the 2.7% proposed net increase due to comments received urging the CMS to more accurately reflect inflationary pressures experienced by IRFs and other providers.
- Unchanged labor-related share with the CMS maintaining the current 72.9%.
- Updated case mix group relative weights using updated FY 2021 claims and FY 2020 cost report data.
- Permanent policy to limit annual wage index decreases to 5%.
- A 32% increase in the outlier threshold amount from the current $9,491 to $12,526 to maintain estimated outlier payments at 3% of total estimated aggregate IRF PPS payments. This will result in fewer cases being eligible for an outlier payment.
- Codification of the existing teaching status adjustment policy for IRF closures and displaced medical residents.
- Indication that the CMS will respond in a potential future rule to comments received regarding expansion of the IRF transfer payment policy to include patients discharged to home health.
The MHA continues to review details of the final rule and will provide IRFs with an updated impact analysis for Medicare FFS patients in the near future. Members with questions should contact Vickie Kunz at the MHA.