Medicare Compliance & Reimbursement

Aggregate pay increase could approach 3 percent.

The Centers for Medicare and Medicaid Services recently published its massive 2006 proposed inpatient rehab facility payment rule in the Federal Register, letting inpatient rehab facilities know to expect aggregate payments to increase by $180 million over this year's totals.
 
That works out to an approximately 2.9-percent increase overall. And CMS proposes reducing the outlier threshold for unusually costly cases, allowing more cases to qualify for extra reimbursement.
 
Further, CMS wants to revise Core Based Statistical Area market area definitions, whereby 4.4 percent of IRFs would change geographic designations and 66 percent would experience no changes or an increase in their individual wage indexes.
 
The proposed rule also stipulates that teaching facilities receive higher payments to make up for their higher care costs.
 
"This adjustment is well called-for, and I think you'll see a lot of facilities pleased about it," cheers attorney Patrick LePine with the Detroit legal office of Foley & Lardner.
 
CMS also is looking to make changes to the "labor-related share," which accounts for varying labor-related costs throughout the country. The labor-related share is the sum of "the relative importance of wages and salaries, fringe benefits, professional fees, labor-intensive services and a portion of the capital share from an appropriate market basket," the rule states.