On Sept. 30, the Centers for Medicare & Medicaid Services (CMS) released the FFY 2025 IPPS Interim Final Rule with comment period (IFC) , marking a significant shift in how hospitals manage their wage index challenges. Designed to address disparities between low and high wage index hospitals, the rule modifies the federal fiscal year (FFY) 2025 hospital inpatient prospective payment system (PPS) low wage index policy.   This blog post will explore the IFC and its implications for the healthcare industry. In addition, we'll provide insights on the IPPS analysis based on the final rule — so you can best navigate these changes with the most up-to-date adoptions.  Key changes in the FFY 2025 IPPS Interim Final Rule  The FFY 2025 IPPS IFC brings several critical changes to the existing structure of hospital reimbursements under Medicare. Initially implemented in FFY 2020, the low wage index policy aimed to adjust hospital reimbursements to bridge the gap between high ...

On July 31, the Centers for Medicare and Medicaid Services (CMS) released the federal fiscal year (FFY) 2025 final payment rule for the Inpatient Psychiatric Facility (IPF) Prospective Payment System (PPS). The significant updates made in this rule have been a long time coming, considering this payment setting has not seen substantial revisions in many years.   Let's break down what these changes mean for healthcare providers and policy analysts: Think of this as your IPF PPS fact sheet!   Understanding the adopted changes  Aligning ECT payments  One of the pivotal changes in the FFY 2025 IPF PPS final payment rule is the alignment of IPF PPS payments that include electroconvulsive therapy (ECT) payments with the increased cost of furnishing ECT. CMS analyzed the most recent outpatient PPS (OPPS) cost data to consider changes to the IPF ECT payment for FFY 2025. Based on this analysis, CMS will use the calendar year (CY) 2024 OPPS pre-scaled, pre-adjusted geometric m...

Key IPPS updates you need to know about  On April 10, Centers for Medicare & Medicaid Services (CMS) released the federal fiscal year (FFY)   2025 Medicare Inpatient Prospective Payment System proposed rule . This rule proposes significant changes and updates to Medicare fee-for-service (FFS) payments and policies.  Understanding these changes is crucial for healthcare professionals, state hospital associations and multi-state health systems. This blog aims to break down the key points and implications of this proposed rule to help you stay informed and prepared.  Overview of the proposed rule  The proposed rule includes regular updates to wage indexes and the market basket. Below are some policies being proposed.  1. Data utilization for standard calculations  CMS plans to use FFY 2023 Medicare Provider Analysis and Review (MedPAR) claims data and FFY 2022 Hospital Cost Reporting Information System (HCRIS) data for standard calculations. Using Med...

In August, CMS published the final Medicare Inpatient Prospective Payment rule for the federal fiscal year 2024. Most changes announced in the proposed rule were adopted and several are significant, including: Disproportionate Share Hospitals payment cuts; and a Rural Wage Index recalculation with diverse impacts. In this blog, we’ll cover these updates, the IPPS rule's total payment increase and how CMS continues to prioritize health equity in its rulemaking. The most significant IPPS final rule impacts 1. DSH UCC pool payment cuts For FFY 2024, DSH uncompensated care pool payments will decrease by $595 million due to decreased funding projections and a big adjustment to Factor 2 (see below), even though the DSH methodology is the same. This means DSH hospitals will need to find a way to recoup these losses, a challenge given the disadvantaged areas where they operate. If Affordable Care Act Marketplace plan enrollment continues to increase, Factor 2 cuts will continue. DSH UCC...