On August 2, the Centers for Medicare & Medicaid Services (CMS) released the prospective inpatient payment system (IPPS) final rule for fiscal year (FY) 2022.

The AAMC submitted comments on several policies of the proposed rule last June [refer to Washington Highlights, July 1]. The provisions of the final regulations come into force on October 1, 2021, unless otherwise specified in the regulations.

Notably, in the final rule, CMS chose not to address the postgraduate medical education (CMT) and organ procurement policies included in the proposed rule, due to the number and nature of comments received on the implementation of these proposals. Instead, the CMS noted that it would address these policies, including the distribution of the 1,000 new GME slots, in developing future rules.

Below are summaries of the finalized arrangements important to AAMC member institutions.

Payment terms

IPPS operating payments: Increase operating payment rates by approximately 2.5% for general acute care hospitals paid under the IPPS (an increase of approximately $ 3.7 billion in hospital payments) that are successfully participating in the Hospital Inpatient Quality Reporting (IQR) program and are important users of electronic health records.

Data source for IPPS pricing for fiscal year 2022: Use data from fiscal year 2019 prior to the COVID-19 public health emergency (PHE) to approximate the expected use of inpatients for fiscal year 2022.

Disproportionate share of hospital payments and uncompensated care (UCP): Distribute approximately $ 7.2 billion in PCUs for FY 2022, a decrease of approximately $ 1.1 billion from FY 2021. Use a single year of data on uncompensated care costs from the S-10 Fiscal Year 2018 Hospital Cost Reports spreadsheet to distribute these funds.

Medicaid fraction: Delay in processing the proposal that would have revised the processing of Section 1115 waiver days for the purpose of adjusting the Disproportionate Hospital Share (DSH) due to the number and nature of comments received. The agency will address public comments in a separate document.

New additional payment for COVID-19 (NCTAP) treatments: Extend the NCTAP for MS-DRG payments for eligible COVID-19 treatments until the end of the fiscal year in which the PHE ends. Hospitals will be eligible to receive both the NCTAP and the Traditional Complementary Payment for New Technologies (NTAP) for stays of eligible patients until the end of the fiscal year in which the PHE ends, with the NTAP reducing the amount. of NCTAP.

NTAP: Approve 19 technologies for NTAP in FY 2022, including nine technologies approved under the U.S. Food and Drug Administration (FDA) Breakthrough Devices program and two technologies approved under the designation FDA Qualified Infectious Disease Product . Provide a one-year NTAP extension for 13 technologies for which NTAP would otherwise have been discontinued as of FY2022.

Chimeric antigen receptor (CAR) T cell therapy: Rename the pre-major diagnostic (MDC) MS-DRG 018 category to “Chimeric Antigen Receptor (CAR) T cells and other immunotherapies” to reflect the reporting of non-CAR T cell therapies and other immunotherapies that would be assigned to this MS-DRG. List new procedure codes to be reclassified as non-operating room procedures affecting MS-DRG 018.

Declaration of negotiated fees specific to the median payer: Repeal the requirement that a hospital report its Medicare costs with the median payer-specific negotiated fee that the hospital has negotiated with all of its M’sedicare Aadvantage organizations, by MS-DRG, for cost reporting periods ending on or after January 1, 2021.

Methodology of the relative weight MS-DRG: Repeal the market-based MS-DRG relative weighting methodology that was adopted as of FY 2024. VSContinue to use the existing cost-based MS-DRG relative weighting methodology to define Medicare payment rates for inpatient stays for fiscal year 2024 and beyond.

Imputed Floor Wage Index policy for all urban states: Enforce Section 9831 of the American Rescue Plan Act of 2021, which establishes a minimum wage index by area for hospitals in all urban states. Reinstate the imputed floor wage index policy for all urban states, effective October 1, 2022, with no expiration date.

Provisional final rural reclassification rule with comment period: Modify the current regulations in section 412.230 to allow hospitals with a new rural designation to reclassify through the Medicare Geographic Classification Review Board using the reclassified rural area as the geographic area in which the Medicare is located. hospital.

Quality provisions

Address the impact of COVID-19 PHE on pay-for-performance programs:

  • Adopt a policy of eliminating inter-program measures during the duration of the COVID-19 PHE, in addition to the specific proposals for the program.
  • Hospital Value-Based Purchasing (VBP) Program: Remove the consumer assessment of hospitals, providers and health systems, health insurance expenditure by beneficiary and measures of nosocomial infections for fiscal year 2022. Remove the measure of the pneumonia death rate for the FY2023 Revise the scoring and payment methodology for FY2022 to not include calculations based on deleted metrics. Do not assign a Total Performance Score to any hospital in FY 2022, which would result in a neutral payment adjustment for hospitals. Update the reference periods for certain measures affected by the previous exception for extraordinary circumstances granted in response to the PHE.
  • Nosocomial disease reduction program: Delete Q3 2020 and Q4 2020 for all measures for FY2022 and FY2023 (note that the CMS previously excluded Q1 and Q2 2020 for all measurements earlier during the PHE). Adopt the following applicable periods for fiscal year 2022 instead of the measure removals (PSI-90: July 1, 2018 – December 31, 2019 and CDC National Healthcare Safety Network (NHSN) measures: January 1, 2019 – December 31, 2019) and for fiscal year 2023 (PSI-90: July 1, 2019 – December 31, 2019 and January 1, 2021 – June 30, 2021, and CDC NHSN measures: January 1, 2021 – December 31, 2021).
  • Hospital Readmission Reduction Program (HRRP): Remove the pneumonia readmission measure from program year FY 2023. Exclude COVID-19 patients from condition-specific readmission measures remaining from fiscal year 2023. Under these proposals, hospitals will not would see no reduction in payment based on the pneumonia suppression measure.

Other changes to performance pay programs:

  • VBP: Eliminate the PSI-90 measure from fiscal year 2023.
  • PRH: Plan to begin confidential reporting of the six condition-specific readmission metrics to hospitals using both dual eligibility and the indirect estimate of race and ethnicity in spring 2022. Any potential public posting of results from the disparity would be proposed and finalized as part of a future rule-making process.

Hospital IQR program:

  • Measure adoptions: Finalize the adoption of five new measures: (1) Structural measure of maternal morbidity with a report starting in Q4 2021; (2) COVID-19 vaccination coverage among health personnel (HCP) with declaration from the fourth quarter of 2021; (3) Hospital-wide standardized hybrid risk mortality with a self-reporting period starting in the third quarter of 2022 and mandatory reporting starting in the third quarter of 2023; (4) Hospital damage – Electronic measurement of clinical quality of severe hypoglycemia (eCQM); and (5) Hospital damage – Severe hyperglycemia eCQM (the two hospital damage measures join the list of eCQMs that a hospital can report from the calendar year (AC) 2023 reporting. ).
  • Measure removals: Finalize the removal of three of the five proposed measures. The measures withdrawn are as follows: (1) Exclusive breastfeeding with breast milk; (2) Admit the decision time to the time of departure from the emergency department for admitted patients; and (3) Release of eCQM on statins. The proposed deletions vary in terms of timeframe and impact for the year. The CMS refused to finalize the removal of two measures: (1) Deaths in inpatients in surgery with treatable serious complications (PSI-04) and (2) Anticoagulant therapy for atrial fibrillation / flutter eCQM in response to comments from parties stakeholders.

Medicare Promotion Interoperability Program (“meaningful use”):

  • Addition of measure: Exchange of health information Two-way exchange in the form of a yes / no attestation, as of CY 2022.
  • Increase the required minimum score from 50 points to 60 points (out of 100) to be considered a meaningful user.
  • Require hospitals to use technology certified as compliant with the 2015 edition of Cures Update from CY 2023 reports, which will impact FY2025 payment determinations.


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