CMS releases 2019 IPPS proposed rule: 10 things to know

CMS filed its annual Medicare inpatient payment update April 24, which would increase payments to hospitals next year and follow through on some of the administration's top healthcare promises, including more price transparency for patients, reduced administrative burden on providers and a greater emphasis on interoperability.   

The 2019 Medicare Inpatient Prospective Payment System proposed rule also includes updated Medicare rates for long-term care hospitals. The rule applies to about 3,300 acute care hospitals and 420 long-term care hospitals, and would take effect Oct. 1. The rule will be published in the Federal Register May 7 and is open for comment until June 25.

Here are 10 key takeaways from CMS' IPPS proposed rule.

Hospital rate changes

1. Acute care hospitals participating in CMS' quality programs will receive a 1.75 percent operating payment rate increase under the rule. CMS arrived at this increase based on a 2.8 percent market basket update and a 0.5 percentage point increase required by law, adjusted down 0.8 percentage points for productivity and 0.75 percentage points as required by the ACA.

2. All changes included, CMS expects inpatient Medicare spending to increase by $4 billion in fiscal 2019. When incorporating other changes in the rule and updates to uncompensated care, capital and low-volume hospital payments, the total IPPS increase is 3.4 percent.

3. CMS wants to increase uncompensated care payments by $1.5 billion compared to fiscal 2018, bringing the total available uncompensated care funding to $8.25 billion. This increase stems from estimated growth in payments that would otherwise be disproportionate share payments and a change in the percentage of Americans who have health insurance.

Price transparency

4. The rule requires hospitals to publish a list of their standard charges online. Hospitals are currently required to make this information publicly available or available upon request.

5. As part of the rule, CMS put out a request for information to better understand what stops providers from giving patients sufficient price information and how price transparency can be improved. The rule calls out specific concerns such as surprise out-of-network billing, particularly by radiologists and anesthesiologists, and unexpected facility fees and physician fees after emergency room visits.

Meaningful measures

6. The proposed rule slashes measures deemed duplicative, excessively burdensome or "topped out," meaning most providers consistently perform well in a measure. Across CMS' five quality and value-based purchasing programs, the rule eliminates 19 measures and "de-duplicates" an additional 21 measures. It would add one measure for claims-based 30-day unplanned readmission under its cancer hospital quality reporting program. This would go into effect in 2021.

7. The rule will also ease documentation requirements, giving hospitals back an estimated 2 million hours previously spent filing paperwork. One of the proposed changes would reduce claim denials by eliminating the requirement that providers record a written inpatient admission order in the medical record to receive Part A payment.

8. The rule also attempts to better account for social risk factors in some of its quality programs. The rule would update the Hospital Inpatient Quality Reporting Program to stratify measure rates by dual-eligible Medicare-Medicaid patients. Under the Hospital-Acquired Conditions Reduction Program, CMS would start to measure hospital performance against peers with similar proportions of dual-eligible patients.

Meaningful use update

9. CMS' rule aims to overhaul meaningful use to put a new focus on interoperability and flexibility. As such, it changed the name of the EHR incentive program to "Promoting Interoperability," and proposed to update scoring methodology and add new measures, including one to address e-prescribing of opioids.

10. The rule includes a request for information from providers on ways to enhance interoperability with specific proposals. These proposals will not be addressed in the final rule, but CMS plans to consider them for future rule-making.

Read the full rule here.

Access CMS' fact sheet here.


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