CMS proposes FY 2019 Medicare payment rules

CMS proposes FY 2019 Medicare payment rules

The Centers for Medicare & Medicaid Services (CMS) released several proposed Medicare payment rules and policy updates earlier this month that impact hospitals and post-acute care providers. In general, these proposed rules lean toward a greater emphasis on price transparency, healthcare data interoperability and reducing both providers’ and healthcare administrators’ regulatory burden.

Below are key takeaways from the proposed rules:

FY 2019 Inpatient and LTCH Prospective Payment System Proposed Rule

  • General acute care hospitals that submit data and adhere to the Hospital Inpatient Quality Reporting Program would receive a payment rate increase of 1.75 percent in FY 2019
  • Payment rates for long-term care hospitals (LTCHs) would decrease by 0.1 percent compared to FY 2018 under the continued LTCH site neutral payment rules
  • Disproportionate share hospital payments would increase by $1.5 billion in FY 2019
  • Overhaul to the Electronic Health Record Incentive Programs (meaningful use) for eligible hospitals, critical access hospitals and eligible professionals. This should help to better achieve program goals, including renaming of the program to “Promoting Interoperability”, proposing a new scoring methodology, implementing new measures related to e-prescribing of opioids and removing certain measures that do not emphasize interoperability or the electronic exchange of health information. 
  • Reduction in the number of measures acute care hospitals are required to report across the 5 quality and value-based purchasing programs. Eighteen measures are being removed from the quality programs, and they will “de-duplicate” another 21 measures while adopting one claims-based readmissions measure.

FY 2019 IRF Prospective Payment System Proposed Rule

  • Inpatient Rehabilitation Facilities (IRFs) would see the same payment increase received in FY 2018 (0.9 percent, or $75 million)
  • The agency would remove the Functional Independence Measure (FIM) instrument and associated Function Modifiers from the IRF patient assessment instrument (IRF-PAI), impacting discharges on or after October 1, 2019
  • CMS is requesting comments regarding eliminating the face-to-face requirement for rehabilitation physician visits and enabling the use of non-physician practitioners (such as nurse practitioners and physician assistants) to meet the IRF coverage requirements

FY 2019 IPF Prospective Payment System Proposed Rule

  • Inpatient Psychiatric Facilities (IPFs) would see a 0.98 percent payment increase in FY 2019, which translates to $50 million
  • The agency proposes eliminating eight Inpatient Psychiatric Facility Quality Reporting Program measures, effecting FY 2020 payments

FY 2019 SNF Prospective Payment System Proposed Rule

  • Skilled nursing facilities (SNFs) would receive a 2.4 percent increase in FY 2019 or $850 million
  • CMS proposes replacing the current case mix classification system (RUG-IV) with a Patient-Driven Payment Model (PDPM), a model based almost entirely on verifiable resident characteristics. The agency estimates SNFs would see $2 billion in savings in the next 10 years with this new model

FY 2019 Hospice Proposed Rule

  • FY 2019 would bring hospices a 1.8 percent increase in payments, or $340 million, up from the 1 percent increase they received in FY 2018
  • The rule proposes recognizing physician assistants as attending physicians for hospice beneficiaries; however, they would still be unable to certify or recertify a beneficiary’s terminal prognosis
  • CMS also would consider whether the costs associated with a Hospice Quality Reporting Program measure outweigh its benefits, thereby indicating it be removed from the measure set

For more information on this topic, or to learn how Baker Tilly healthcare specialists can help, contact our team.


The monthly healthcare wrap-up: May 2018
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The monthly healthcare wrap-up: May 2018