CMS hikes Medicare pay for rehab, psychiatric and hospice providers
By Maya Goldman / July 27, 2022
Inpatient rehabilitation facilities, inpatient psychiatric facilities and hospice providers will see a boost in Medicare payment next fiscal year.
In regulations issued Wednesday, the Centers for Medicare and Medicaid Services finalized a 3.8% payment update for hospices, which amounts to an estimated $825 million increase from 2022. Inpatient rehabilitation providers will see an overall 3.2% update, about $275 million more, while inpatient psychiatric providers will get an overall 2.5% pay hike, according to an agency fact sheet.
Provider groups characterized the rate updates from the proposed rule as insufficient to cover rising costs. In a comment letter, the American Medical Rehabilitation Providers Association described the proposed 3.2% market basket update, one element of the rate calculation, "decidedly inadequate." The association called on CMS to stray from its standard payment calculations to further increase payments.
The National Coalition for Hospice and Palliative Care, which represents hospice providers, said the proposed 2.7% hospice pay increase wouldn't keep up with expenses. The majority of hospice providers surveyed said their costs have risen 3%-10% in the past year, the organization wrote in a comment letter to CMS.
CMS used more recent data to slightly enlarge the rate increases in its final rules compared to the draft version but did not deviate from its traditional payment calculation methods.
Additionally, CMS will expand inpatient rehab facility quality data reporting requirements to all patients. Previously, the rule only applied to patients covered by Medicare Part A and Medicare Advantage. In response to comments, CMS pushed back the start date from its earlier proposal, so providers will not have to start collecting patient assessments until October 2024.
CMS solicited feedback about changing Medicare reimbursement for early transfers to home health agencies when it issued the proposed rule. Rehabilitation providers urged CMS not to alter the reimbursement system for early home health transfers, arguing that could lead to underpayments and diminish access to care. The final regulation doesn't directly address those comments, but says the agency will take them into account for future rulemaking.
CMS also finalized a cap on annual wage index adjustments for each provider type so payments won't decrease more than 5% from year to year.