Medicare Inpatient Rehabilitation Facility Prospective ?· Medicare Inpatient Rehabilitation Facility…

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    MedicareInpatientRehabilitationFacilityProspectivePaymentSystem

    PaymentRuleBriefUpdateNoticeProgramYear:FFY2013

    Overview,Resources,andCommentSubmissionOnJuly30,2012,theCentersforMedicareandMedicaidServices(CMS)officiallyreleasedtworegulationsthatwillupdatetheMedicarefeeforservice(FFS)paymentratesandpoliciesundertheInpatientRehabilitationFacility(IRF)ProspectivePaymentSystem(PPS)forfederalfiscalyear(FFY)2013.ThefirstregulationisanupdatenoticethatupdatestheIRFpaymentfactors.Thesecondregulationisaproposedrule(thecalendaryear2013OutpatientPPSproposedrule)thatputsforwardchangestotheIRFqualityreportingprogramestablishedlastyear.AcopyoftheupdatenoticeandotherresourcesrelatedtotheIRFPPSareavailableontheCMSWebsiteathttps://www.cms.gov/Medicare/MedicareFeeforServicePayment/InpatientRehabFacPPS/index.html.Anonlineversionoftheupdatenoticeisavailableathttps://federalregister.gov/a/201218433.AnonlineversionoftheproposedrulethatincludestheIRFqualityreportingproposalsisavailableathttps://federalregister.gov/a/201216813.Thesubmissionofcommentsisnotpermittedontheupdatenotice.However,commentsontheproposedupdatestotheIRFqualityreportingprogramareduetoCMSbySeptember4,2012.Commentscanbesubmittedelectronicallyathttp://www.regulations.govbyusingtheWebsitessearchfeaturetosearchforfilecodeCMS1589P.AbriefoftheupdatenoticethatupdatestheIRFpaymentfactorsandproposedrulethatIRFupdatestothequalityreportingprogramalongwithFederalRegister(FR)pagereferencesforadditionaldetailsareprovidedbelow.ProgramchangesadoptedbyCMSwouldbeeffectivefordischargesonorafterOctober1,2012unlessotherwisenoted.

    IRFPaymentRateThefollowingtableshowstheproposedIRFstandardpaymentconversionfactorforFFY2013comparedtotheratecurrentlyineffect(FRpages44,62844,629).

    Final

    FFY2012ProposedFFY2013

    PercentChange

    IRFStandardPaymentConversionFactor

    $14,076 $14,343 +1.9%

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    ThetablebelowprovidesdetailsoftheproposedupdatestotheIRFpaymentrateforFFY2013(FRpages44,62644,627).

    FFY2013IRFRateUpdates

    Marketbasket(MB)Update +2.7%

    AffordableCareAct(ACA)MandatedProductivityMBReduction

    0.7percentagepoints

    ACAMandatedPreDeterminedMBReduction

    0.1percentagepoints

    OverallRateUpdate(includingbudgetneutrality) +1.9%

    SequestrationReductionsAbsentfromtheupdatenoticeisguidanceastohowCMSwillimplementthe2.0%sequestrationreductiontoalllinesofMedicarepaymentsettotakeeffectonJanuary1,2013.SequestrationreductionswereauthorizedbyCongressaspartoftheBudgetControlAct(BCA)of2011.Itisbelievedthatthe2.0%downwardreductionwillbeappliedatremittance(thetimeMedicarecontractorspayeachMedicareFFSclaim)andwillbeincorporatedintothecostreportsettlement(noFRreference).

    WageIndexandLaborRelatedShareWageIndexThelaborrelatedportionoftheIRFstandardpaymentconversionfactorisadjustedfordifferencesinareawagelevelsusingawageindex.Ashasbeenthecaseinpastyears,CMSwouldusetheprioryearsinpatienthospitalwageindex,theFFY2012preruralfloorandprereclassifiedhospitalwageindex,toadjustpaymentratesundertheIRFPPSforFFY2013.AcompletelistoftheproposedIRFwageindexesforpaymentinFFY2013isavailableontheCMSWebsiteathttps://www.cms.gov/Medicare/MedicareFeeforServicePayment/InpatientRehabFacPPS/Downloads/cms1433nwageindex.pdf(FRpages44,62744,628).LaborRelatedShareCMSisupdatingthelaborrelatedsharevalueto69.981%forFFY2013,aslightdecreasewhencomparedtothecurrentlaborshareof70.199%.AdecreasetothelaborrelatedsharewillincreasepaymentstoIRFswithawageindexlessthan1.0anddecreasepaymentsforthosewithwageindexesgreaterthan1.0(FRpage44,627).

    LIP,Teaching,andRuralAdjustmentsCMSadjuststheIRFstandardpaymentconversionfactorfordifferencesatthefacilitylevel,includingadjustmentstoaccountforanIRFspercentageoflowincomepatients(LIP),teachingstatus,andrurallocation.CMSisnotmakinganychangestotheseadjustmentsforFFY2013.Thefollowingdescribestheadjustments(FRpages44,62544,626):

    LIPAdjustment:CMSwillmaintaintheLIPadjustmentfactorat0.4613forFFY2013.CMSwillmaintainthefollowingformulatocalculatetheLIPadjustment:(1+DisproportionateShareHospital(DSH)patientpercentage)^0.4613.TheDSHpatientpercentageforeachIRFiscalculatedusingthefollowingformula:(MedicareSSIdays/totalMedicaredays)+(Medicaid,nonMedicaredays/totaldays).

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    TeachingAdjustment:CMSwillmaintaintheteachingadjustmentfactorat0.6876forFFY2013.Thispaymentadjustmentisbasedonthenumberoffulltimeequivalent(FTE)internsandresidentstrainingintheIRFandtheIRFsaveragedailycensus(ADC).CMSwillmaintainthefollowingformulatocalculatetheteachingpaymentadjustment:(1+IRFsFTEresidenttoADCratio)^0.6876.

    RuralAdjustment:CMSwillmaintaintheruraladjustmentat18.4%forFFY2013.

    CMGsCMSassignsIRFdischargesintocasemixgroups(CMGs)thatarereflectiveofthedifferentresourcesrequiredtoprovidecaretoIRFpatients.Patientsarefirstcategorizedintorehabilitationimpairmentcategories(RICs)basedontheprimaryreasonforrehabilitativecare.PatientsarefurthercategorizedintoCMGsbasedupontheirabilitytoperformactivitiesofdailylivingorbasedonageandcognitiveability.WithineachoftheCMGstherearefourtiers,eachwithadifferentrelativeweightthatisdeterminedbasedoncomorbidities.Currently,thereare87CMGswithfourtiersandanotherfiveCMGsthataccountforveryshortstaysandpatientswhodieintheIRF.Eachyear,CMSupdatestheCMGrelativeweightsandaveragelengthsofstays(ALOS)withthemostrecentavailabledata.CMSisupdatingthesefactorsforFFY2013usingthemostcurrentfullfederalfiscalyearofclaimsdata(FFY2011)andthemostrecentlyavailableIRFcostreports.CMSisnotmakinganychangestotheCMGcategories/definitions.UsingFFY2011claimsdata,CMSanalysisshowsthat95%ofIRFcasesareinCMGsandtiersthatwillexperiencelessthana+/5%changeintheCMGrelativeweightasaresultoftheupdates.AtablethatliststheFFY2013CMGpaymentsweightsandALOSvaluesisprovidedintheFR(FRpages44,62244,625).

    OutlierPaymentsOutlierpaymentswereestablishedundertheIRFPPStoprovideadditionalpaymentsforextremelycostlycases.Outlierpaymentsaremadeiftheestimatedcostofthecaseexceedsthepaymentforthecaseplusanoutlierthreshold.Costsaredeterminedbymultiplyingthefacilitysoverallcosttochargeratio(CCR)bytheallowablechargesforthecase.Whenacasequalifiesforanoutlierpayment,CMSpays80%ofthedifferencebetweentheestimatedcostofthecaseandtheoutlierthreshold.CMShasestablishedatargetof3.0%oftotalIRFPPSpaymentstobesetasideforhighcostoutliers.TomeetthistargetforFFY2013,CMSisupdatingtheoutlierthresholdvalueto$10,466forFFY2013,a1.8%decreasecomparedtothecurrentthresholdof$10,660.Thethresholddecreasewillincreasethenumberofrehabilitationcaseseligibleforoutlierpayments(FRpages44,63044,631).

    IRFQRPTheACArequiredCMStoimplementaqualitydatapayforreportingprogramforproviderspaidundertheIRFPPS.Lastyear,CMSadopted2measurestoimplementtheInpatientRehabilitationFacilityQualityReportingProgram(IRFQRP).Providersmustbeginreportingonthesemeasuresthisyear.IRFsthatfailtosuccessfullyparticipateintheIRFQRPreceivereducedpaymentsthroughareductionof2.0percentagepointstotheIRFmarketbasketupdate.CMSwillmakethesepaymentdeterminationseachyear.CMSwillmakethefirstpaymentdeterminationrelatedtothe2measuresadoptedlastyearinFFY2014.DetailsonthemeasuresandrulesadoptedforFFY2014paymentdeterminationsareavailableinFRpages47,87447,883ofFFY2012IRFPPSfinalruleathttp://www.gpo.gov/fdsys/pkg/FR20110805/pdf/201119516.pdf.

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    UsingtheOPPSproposedrule,CMSisproposingtoincorporateNationalQualityForum(NQF)technicalupdates/changestothe2measuresadoptedforFFY2014paymentdeterminations:CatheterAssociatedUrinaryTractInfections(CAUTI)OutcomeMeasure(NQF#0138);andPercentofResidentswithPressureUlcersthatareNeworHaveWorsened(NQF#0678).Sincetheiradoptionlastyear,technicalupdates/changeshavebeenmadetotheCAUTImeasureandthepressureulcermeasureiscurrentlyintheNQFreviewprocess.Afulldescriptionofthesetechnicalupdates/changesisavailableontheOPPSproposedruleFRpageslistedbelow.TohandlepotentialfutureNQFtechnicalupdates/changestomeasuresadoptedforuseundertheIRFQRP,CMSisproposingtouseasubregulatoryprocessratherthanthetraditionalproposedandfinalrulemakingprocess.Underthisproposal,CMSwouldnotifytheindustryoftechnicalmeasureupdates/changesviatheCMSIRFQRPWebsiteathttp://www.cms.gov/IRFQualityReporting/.CMSisproposingtousethissubregulatoryprocesswhentheagencybelievestheNQFmodificationswouldnotsubstantiallychangethenatureofthemeasure.CMSwouldcontinuetousethetraditionalproposedandfinalrulemakingprocesswhenCMSbelievestheNQFmodificationswouldsubstantiallychangethenatureofthemeasure.SimilarpolicieshavebeenproposedfortheotherqualityreportingprogramsundertheMedicarePPSs.CMSisalsoproposingtomodifyhowtheagencyadoptsandretainsmeasuresundertheIRFQRP.CMSisproposingthatwhenameasureisadoptedforuse,thatmeasureisautomaticallyadoptedforallsubsequentyeardeterminationsunlessCMSproposestoremove,suspend,orreplacethemeasure.Currently,CMSproposestoretainmeasuresonayearbyyearbasis.CMSisproposingtoapplythismethodtotheCAUTImeasureandpressureulcermeasureadoptedforFFY2014paymentdeterminations.CMShasnotproposedanyadditionalmeasuresforuseundertheIRFQRPforFFY2015paymentdeterminationsandbeyond.InstructionsonhowtosubmitcommentsontheproposedIRFQRPchangesisprovidedintheOverview,Resources,andCommentSubmissionsectionabove(OPPSproposedruleFRpages45,19345,196).

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