2015 inpatient psychiatric facility PPS final rule
By - On Wednesday, August 6, 2014, the Centers for Medicare & Medicaid Services announced its final rule for updating the prospective payment rates for Medicare inpatient hospital services provided by inpatient psychiatric facilities (IPFs).
The rule will address ICD-10-CM and ICD-10-PCS code implementation, as well as finalize a new methodology for updating the cost of living adjustment (COLA). New quality measures will also be finalized and reporting requirements under the IPF quality reporting program will be finalized.
The final rule’s overall economic impact is an estimated $120 million in increased payments to IPFs during FY 2015. The total costs for IPFs as a result of the final new quality reporting requirements in 2015 are estimated to be $33,372,508.
Here is a quick recap on the final rule details:
Payment rates updates
With the final rule, the FY 2008-based Rehabilitation, Psychiatric, and Long Term Care (RPL) market basket update (currently estimated to be 2.9 percent) will be reduced by 0.3 percentage points. There will also be a reduction for economy-wide productivity (currently estimated to be 0.5 percentage point).
Additionally, the per diem rate for 2015 increased from $713.19 to $728. 31, while the electroconvulsive therapy payment increased from $307.04 to $313.55.
The final rule will also affect the fixed dollar loss threshold amount, which is being updated from $10,245 to $8,755. This will maintain outlier payments that are 2 percent of total IPF PPS payments.
Moreover, the 2015 national urban and rural cost-to-charge ratio (CCR) ceilings are 1.6582 and 1.8590, respectively. The final rule adjusted the national median CCR to 0.6220 for rural IPFs and 0.4710 for urban IPFs. These amounts are used in the outlier calculation to determine if an IPF’s CCR is statistically accurate and for new providers without an established CCR.
The last major provisions with the rule are the cost of living adjustment factors for IPFs located in Alaska and Hawaii. These are updated using the approach finalized in the FY 2014 inpatient hospital prospective payment system (IPPS) final rule.
Additional updates
CMS also identified the ICD-10-CM/PCS codes that will be eligible for the MS-DRG and comorbidity payment adjustments under the IPF PPS. These changes will go into effect on October 1, 2015. The ICD-9-CM/PCS codes that will be eligible for the MS-DRG and comorbidity payment adjustments under the IPF PPS are also identified in the final rule.
CMS announced that it will retain the 17 percent payment adjustment for IPFs located in rural areas, the 1.31 payment adjustment factor for IPFs with a qualifying emergency department, the coefficient value of 0.5150 for the teaching adjustment and the MS-DRG adjustment factors and comorbidity adjustment factors currently being paid to IPFs in FY 2014.
It will also use the best available hospital wage index and establish the wage index budget-neutrality adjustment of 1.0002.
