On August 1, 2014, the Centers for Medicare and Medicaid Services (CMS) issued its annual final rule for policy and payment changes applicable to inpatient stays in acute care and long term care hospitals (Final Rule). This year’s Final Rule is more than 2,400 pages long and is expected to be published in the Federal Register on August 22, 2014. Revisions set forth in the Final Rule are effective for discharges occurring on or after October 1, 2014 (the start of the federal fiscal year (FY) 2015). CMS also issued a press release and Fact Sheet, explaining the highlights of the Final Rule.
Both acute care hospitals (Inpatient Prospective Payment System (IPPS) Hospitals) and long term care hospitals (LTCHs) are now paid primarily under prospective payment systems. CMS has estimated an increase in operating payment rates to IPPS Hospitals of 1.4%, however, when other revisions to payments are included, operating payments will decline by approximately 0.6%. In FY 2015, hospitals which do not submit required quality data or have a meaningful use of electronic health records will face a decline in payments, with an aggregate reduction in total inpatient prospective payments of a projected $756 million. Payments to LTCHs will increase by approximately 1.1%.
Originally, this article was an alert sent to the American Health Lawyers Association’s (AHLA) Regulation, Accreditation and Payment Practice Group. For more information, visit AHLA’s website.