The Centers for Medicare & Medicaid Services (CMS) released a proposed rule March 29 to update the Medicare fee-for-service prospective payment system (PPS) for inpatient rehabilitation facilities (IRFs) for federal fiscal year (FY) 2025.
Key provisions of the proposed rule include:
- Increasing the IRF PPS payment rate by a net 1.8% after all adjustments, from $18,541 to $18,872. IRFs that fail to comply with the CMS IRF Quality Reporting Program (QRP) requirements are subject to a two-percentage point reduction.
- Updating the wage index using the most recent Office of Management and Budget statistical area delineations based on the 2020 Decennial Census.
- Increasing the labor-related share from the current 74.1% to 74.2%.
- Increasing the cost outlier threshold by 17% from the current $10,423, to $12,158 to achieve the 3% target for outlier payments as compared to aggregate IRF payments, decreasing the number of cases that qualify for outlier payments.
- Updating the case mix group relative weights and average length of stay values using FY 2023 IRF claims and FY 2022 IRF cost report data.
- Requiring IRFs to report four new items using the IRF-Patient Assessment Instrument (PAI) as standardized patient assessment data elements under the social determinants of health category beginning with the FY 2028 IRF quality reporting program (QRP) including:
- One item for Living Situation.
- Two items for Food.
- One item for Utilities
- Modifying the Transportation item collected in the IRF-PAI.
- Requesting information on quality measure concepts for the IRF QRP in future years and an IRF star rating system.
The MHA will provide IRFs with a facility-specific impact analysis and additional details on the proposed rule in the near future. The MHA also encourages members to submit comments to the CMS by May 28 and to contact the MHA with issues identified by May 21. Members with questions should contact Vickie Kunz at the MHA.