Wave of CMS Proposed and Final Rules is Here

DATE: 09/11/2018

In recent weeks, CMS has unveiled a number of final and proposed rules impacting inpatient, outpatient, and post-acute care delivery. These rules include annual updates of the Medicare fee-for-service payment rates based on regulatory changes.  In addition to the regular updates to wage indexes, marketbasket, and quality programs, the rules include the following:

  • The Inpatient Prospective Payment System (PPS) final rule includes a 0.5% rate increase for the coding offset adjustment; updates to the Medicare Disproportionate Share Hospital payment policies; continuance of the Medicare Dependent Hospital and expanded Low-Volume Hospital programs; and an addition to the hospice transfers to the Post-Acute Transfer policy.
  • The Outpatient PPS proposed rule includes a proposal that will change the rate for biosimilars purchased by hospitals through the 340B Drug Discount Program; change the inpatient-only list; make payment changes for excepted and non-excepted services furnished in off-campus provider-based departments; and extend the 340B drug payment adjustment (ASP -22.5%) to non-excepted provider-based departments.  Comments on the proposed rule are due to CMS by September 24.
  • The Skilled Nursing Facility (SNF) PPS final rule includes how CMS is replacing the Resource Utilization Group (RUG)-IV system with the Patient-Driven Payment Model (PDPM) on October 1, 2019.  PDPM is expected to account for resident characteristics and care needs while reducing both systematic and administrative complexity.  The model removes service-based metrics from the SNF PPS and derives payments from verifiable resident characteristics.  CMS also provided additional details on the SNF Value-Based Purchasing Program, which begins October 1, 2018.
  • In the Inpatient Rehabilitation Facility (IRF) PPS final rule, CMS adopted its proposal to remove the FIMTM instrument and associated Function Modifiers from the IRF Patient Assessment Instrument (PAI) beginning in federal fiscal year 2020 to reduce administrative burden.  Also to reduce burden, CMS finalized that the post-admission MD evaluation can count as one of the three required face-to-face meetings, rehabilitation MDs may lead the team meetings remotely without additional documentation, and the requirement to have admission order documentation was removed.
  • The Home Health (HH) PPS proposed rule includes proposals that change the rural add-on payments and implement payment for home infusion.  CMS is again proposing to implement case-mix methodology refinements and a change in the unit of payment from a 60-day episode of care to a 30-day period of care, implemented in a budget-neutral manner, effective January 1, 2020. Since the proposed case-mix methodology refinements represent a more patient-driven approach to payment, CMS is renaming it the Patient-Driven Groupings Model (PDGM).
  • In the Inpatient Psychiatric Facility PPS final rule, CMS is reviewing measures regarding administration of a standardized depression instrument; this instrument will be used to assess change in patient-reported function between admission and discharge.
  • In the Long Term Acute Care Hospital (LTCH) final rule, CMS agreed to eliminate the 25% threshold policy, a per discharge payment reduction in the LTCH PPS payments for LTCHs that admit more than 25%  of Medicare cases from an onsite or neighboring inpatient acute care hospital, in a budget-neutral manner.

DataGen has provided briefs on these rules and analyzed provider-specific estimated reimbursement impacts in the various payment settings.  Online versions of these rules are available on the Federal Register.

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