On April 17, CMS issued a proposed rule for the Inpatient Rehabilitation Facility (IRF) prospective payment system (PPS) for fiscal year 2020. The proposed rule includes notable changes.

A key element of the proposal would increase net payments for IRFs by 2.3% ($195 million) compared to fiscal year 2019 payments. This payment proposal includes a 3.0% increase offset by a statutorily mandated productivity cut of 0.5% and a 0.2% decrease in outlier payments. The rule also proposes to rebase and revise the IRF market basket to reflect a 2016 base year (it had been based upon 2012 costs).

Providers have until June 17, 2019 to submit their comments and recommendations to the CMS proposed rule.

Three additional key provisions of the proposal include:

  1. Consistent with the 2019 final rule, the proposed rule provides more detail about the removal of the Functional Independence Measures (FIM™) in favor of section GG coding. GG coding allows CMS to more consistently track outcomes measurement across post-acute platforms, but isn’t as robust as FIM. Kindred Hospital Rehabilitation Services (KHRS) will continue to track FIM at its sites of service to better measure patient recovery. Going forward, accuracy and attention to detail in completing the quality indicator ratings (GG coding) will be crucial to ensure patient’s correct level of function and corresponding resource needs are accounted for in the revised CMGs and payment determinations.

  2. Within the proposal, CMS provides updated impact data per IRF on the refined case mix groups (CMGs), including updated CMG relative weights and average length of stay values based on FY 2017 and 2018 data. CMGs are an integral component to the CMS formula used to determine IRF reimbursement, and providers will need significant modeling to determine the impact of the CMG updates included in the proposal.

  3. Consistent with other post-acute care sectors, the proposed rule implements two new interoperability measures of the IMPACT Act in order to promote effective communication and care coordination among post-acute care providers. These measures are designed to push all post-acute care providers to have more consistent data and better ability to share that data between settings, most likely through the implementation of better electronic health record/electronic medical record systems.

Kindred is actively engaged in modeling the proposed new system to better understand the impact it may have on patient care and operations.

Kindred will be developing formal comments to CMS prior to the June 17 deadline with recommendations to help shape the final rule and ensure that updates to the payment system preserve patient access to the high intensity and quality-driven care that our nation’s IRFs deliver.

If you are interested in learning more about the details of the proposal and how it might impact your rehab program, please contact Kindred.

By Kindred Hospital Rehabilitation Services