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CMS Update: FY 2020 IPPS Proposed Rule

This article provides an overview of the proposed changes to the Inpatient Prospective Payment System (IPPS) Rule by CMS for FY 2020. Learn about key changes, the CC/MCC overhaul, and how to submit comments to CMS.

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CMS Update: FY 2020 IPPS Proposed Rule

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  1. CMS Update: FY 2020 IPPS Proposed Rule Angelica Naylor, MBA, BSN, RN, CCDS June 2019

  2. Objectives • To understand the history and importance of the IPPS Rule by CMS • To learn and understand the key changes proposed for CMS FY 2020 • To prepare for the changes with CC/MCC overhaul • To understand how to retrieve and submit comment to CMS for the proposed rule change

  3. What is IPPS? • IPPS (Inpatient Prospective Payment System) – CMS applies base payment rates prospectively for inpatient stays based on several factors including diagnosis and SOI (severity of illness). • Federal laws requires CMS to update payment systems annually and account for changes in the prices of goods and services used in treating Medicare patients, as well as other factors. This is known as the hospital “market basket.”  • Access the proposed rule via the Federal Register: https://www.federalregister.gov/documents/2019/05/03/2019-08330/medicare-program-hospital-inpatient-prospective-payment-systems-for-acute-care-hospitals-and-the.

  4. CMS FY 2020 Objective • On April 23, 2019, CMS proposed a rule that focuses on one main objective: “transforming the healthcare delivery system through competition and innovation to provide patients with better value and results” (CMS, 2019). • Acute care hospitals participating in the IQR (Inpatient Quality Reporting) program and meaningful use of EHRs can expect an increase in rates. • “CMS projects the rate increase, together with other proposed changes to IPPS payment policies, will increase IPPS operating payments by approximately 3.5 percent” (CMS, 2019).

  5. Key Changes • About $8.5 billion in DSH payments will be distributed in FY 2020, an increase of $216 million from FY 2019. • CMS proposed an increase to the maximum add-on payment for new technology, including CAR-T cancer therapy, from 50 percent of estimated costs to 65 percent. • Several proposed changes to the inpatient hospital wage index. • “Hospitals with wage index values below the 25th percentile would see an increase, while hospitals with wage index values above the 75th percentile would see a decrease. The rule would cap decreases at 5 percent for fiscal 2020” (Becker’s, 2019).

  6. CC/MCC Changes • About 1,500 CC/MCC proposed changes. Major changes per ACDIS are: • Code E42, Marasmic kwashiorkor, downgrade from an MCC to a CC • Code E43, Unspecified severe protein-calorie malnutrition, downgrade from an MCC to a CC • Code R62.7, Adult failure to thrive, upgrade to a CC • Code L89.95, Pressure ulcer of unspecified site, unstageable, upgrade to a CC • Codes in the L89 category relating to stage 3 and 4 pressure ulcers, downgrade from MCCs to CCs • Codes in the I21 category related to ST-elevated myocardial infarctions (STEMI) and subsequent non-STEMI (NSTEMI), downgrade from MCCs to CCs (note that acute NSTEMI and type 2, 4, and 5 MIs would still be MCCs under these proposals) • Codes for systolic, diastolic, and combined CHF, downgrade from CCs to non-CCs • Codes for stage 4 and 5 CKD, downgrade from CCs to non-CCs; the code for ESRD, downgrade from an MCC to a CC • Code R65.11, SIRS of non-infectious origin with acute organ dysfunction, downgrade from an MCC to a CC • Codes for BMI, downgrade from CCs to non-CCs • Several Z series organ transplant status codes (kidney, heart, lung, liver, bone marrow, stem cells, etc.), downgrade from a CC to a non-CC.

  7. Comment Submission • CMS permits public comment on the proposed final rule prior to rendering the final rule. • Comments on the rule are due no later than 5 p.m. eastern on June 24, 2019. • Electronic submission recommended • Page 3 of the proposed rule includes details on how to submit a comment to CMS. You can send electronic comments to http://www.regulations.gov. Follow the instructions under the “submit a comment” tab. • Link to comment templates here: • https://acdis.org/articles/acdis-update-regulatory-committee-shares-templates-commenting-fy-2020-ipps-proposed-rule

  8. Important Links • Link to the proposed CC/MCC table here: • https://acdis.org/files/cms-1716-p-table-6p1a-1efy-2020xlsx • Link to the Webinar by Dr. Kennedy on the proposed rule and comment details: • https://acdis.org/resources/webinar-2020-ipps-proposed-rule%E2%80%94update-and-action-place • Link to potential financial impact: • https://acdis.org/files/fy-2020-cms-proposed-rule-impact-file-financial-impactpdf

  9. References • https://acdis.org/articles/acdis-update-regulatory-committee-shares-templates-commenting-fy-2020-ipps-proposed-rule • https://acdis.org/articles/news-fy-2020-ipps-proposed-rule-released-ccmcc-downgrades-sight • https://acdis.org/articles/note-acdis-sweeping-changes-2020-ipps-proposed-rule%E2%80%94send-cms-your-comments • https://www.beckershospitalreview.com/finance/cms-proposed-inpatient-payment-rule-for-2020-9-things-to-know.html • https://www.cms.gov/newsroom/fact-sheets/fiscal-year-fy-2020-medicare-hospital-inpatient-prospective-payment-system-ipps-and-long-term-acute

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