CMS Releases 2011 IPPS/LTCH Final Rule
The Centers for Medicare & Medicaid Services (CMS) issued a final rule July 30 establishing fiscal year (FY) 2011 policies and payment rates for inpatient services furnished to people with Medicare by acute care hospitals, long-term care hospitals (LTCHs), and certain excluded hospitals.
“America’s hospitals strongly disagree with the Centers for Medicare & Medicaid Services’ final inpatient rule,” said American Hospital Association (AHA) President and CEO Rich Umbdenstock. “The rule cuts billions of dollars from the health care system at a time when patients are sicker, more people are losing coverage due to the economic downturn and hospitals are dealing with significant changes contained in the health reform bill … America’s hospitals will continue to work with Congress to ensure the program remains strong so seniors can access the care they need and deserve.”
CMS estimates that payments to general acute care hospitals for operating expenses in FY 2011 will decline by 0.4 percent, or $440 million, compared with FY 2010 under the final rule.
The final rule updates acute care hospital rates by 2.35 percent, but then reduces the 2.6 percent market basked increase for inflation update by 0.25 percent and applies a “documentation and coding” adjustment of -2.9 percent.
CMS is similarly updating LTCH rates by 2.5 percent for inflation, but reducing the inflation update by 0.5 a percentage point. CMS will apply an adjustment of -2.5 percent to the LTCH standard federal rate for the estimated increase in spending in FYs 2008 and 2009 due to documentation and coding that did not reflect increases in patients’ severity of illness. CMS estimates that aggregate payments to LTCHs would increase by approximately 0.5 percent or $22 million.
Hospitals that do not participate in the Reporting Hospital Quality Data for Annual Payment Update (RHQDAPU) program will get hit even harder with a payment adjustment less two percentage points.
The final rule adds 12 measures to the RHQDAPU set, and retires one current measure – Mortality for selected surgical procedures (composite). However, only 10 of the new measures — including rates of occurrence for 8 of 10 categories of conditions that are subject to the hospital-acquired conditions (HACs) policy — will be considered in determining a hospital’s FY 2012 update. The remaining two measures to be reported in 2011 will be considered in determining the hospital’s FY 2013 update.
More information regarding the Acute IPPS is available on the CMS website.