CMS' proposed inpatient payment rule for 2022: 8 things to know

CMS released its annual Inpatient Prospective Payment System proposed rule April 27, which recommends removing some price transparency requirements. 

Here are eight things to know about the proposal:

1. Payment rate update. Under the proposed rule, acute care hospitals that report quality data and are meaningful users of EHRs will see a net 2.8 percent increase in Medicare rates in fiscal year 2022, compared to 2021. CMS said the payment rate adjustment will mean hospitals see an increase of about $3.4 billion in payments in fiscal year 2022. 

2. Price transparency requirements. CMS proposed repealing the requirement to report median payer-specific negotiated rates by Medicare severity-diagnosis related group, with Medicare Advantage insurers. CMS said this will reduce administrative burden on hospitals by about 64,000 hours. 

3. Disproportionate share payments. CMS is proposing to distribute about $7.6 billion in disproportionate share payments in fiscal 2022, a decrease of about $660 million from fiscal year 2021.

4. Add-on payment for COVID-19 treatment. The proposed rule would extend the add-on payment for COVID-19 treatment through the end of the fiscal year in which the public health emergency ends.

5. Value-based payment programs. CMS proposes to suppress most hospital value-based purchasing program measures during the public health emergency for COVID-19. As a result, hospitals would receive neutral payment adjustments under the value-based program in fiscal 2022. 

6. Inpatient Quality Reporting Program. CMS proposed several changes to the Inpatient Quality Reporting Program, which reduces payment to hospitals that fail to meet program requirements. CMS is seeking to add five new measures,  including  COVID-19 vaccination rates among healthcare personnel, a metric targeting maternal morbidity and two medication-related adverse event electronic clinical quality measures. CMS also wants to remove the exclusive breast milk feeding measure, among other changes.

7. Graduate medical education slots. CMS proposed adding 1,000 new Medicare-funded medical residency positions to train physicians. About 200 slots per year would be phased in beginning in fiscal year 2023. CMS said it expects to spend $1.8 billion to add these residency slots. 

8. Comment period. CMS will accept comments on the proposed rule through June 28. 

Access the full rule here

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