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Medicare final rule for FY 2020 IPF payment and Quality Reporting updates

08.14.19

Inpatient Psychiatric Facilities (IPF) payment updates
IPF Quality Reporting updates


Release Date: July 30, 2019
Federal Register Publication Date: August 6, 2019
Effective Date: October 1, 2019

Major provisions

Update factors Proposed Final
Market basket update 3.10% 2.9%
Economy wide productivity adjustment (0.50%) (0.40%)
ACA required adjustment     (0.75%) (0.75%)
  Net market basket update 1.85% 1.75%
Impact of outlier threshold adjustment (0.15%) (0.23%)
    Increase factor 1.70% 1.52%

CMS estimates that FY 2020 total IPF payments will increase by $65 million in comparison to FY 2019. The PPS (Prospective Payment System) per diem base rate will increase from $782.78 to $798.55 ($803.48 Proposed) from FY 2019 to FY 2020, respectively. The FY 2020 per diem base rate will be reduced by 2% to $782.85 ($787.80 Proposed) for IPFs that failed to report quality data. 

Market basket rebasing
The FY 2020 proposed rule also proposes revising the IPF market basket to reflect a 2016 base year (from 2012) in order to be more reflective of current data on IPF cost structures. The base year was last adjusted in FY 2016 when a 2012-based IPF-specific market-basket was adopted.

Elimination of wage index lag
The final rule (a) eliminates the 1-year lag in wage index data and (b) aligns IPF wage index data with the concurrent IPPS wage data by removing the 1-year lag of the pre-floor, pre-reclassified IPPS hospital wage index upon which the IPF wage is based.

IPF Quality Reporting Program
As proposed CMS is adopting for FY 2020 one new claims-based measure which would impact payment determinations beginning with FY 2021 and subsequent years. The added measure is Medication Continuation Following Inpatient Psychiatric Discharge (National Quality Forum #3205). This measure evaluates whether patients admitted to IPFs with certain diagnosis (Major Depressive Disorder, schizophrenia, bipolar disorder) filled at least one evidence-based medication either two days prior to discharge or during the 30-day post-discharge window. 

If you are interested in more information regarding the final FY 2020 changes to the IPF, please contact Andy Majka.

Source: Medicare Program; FY 2020 Inpatient Psychiatric Facilities Prospective Payment System and Quality Reporting Updates for Fiscal Year Beginning October 1, 2019 (FY 2020) (Federal Register, Doc. 2019-16370 / Tuesday, August 6, 2019).

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