- A new CMS proposal for inpatient payment rates for fiscal year 2023 would result in a net decrease in hospital payments compared to this year.
- This proposed rule would increase inpatient PPS payment rates by 3.2% in FY 2023.
- AHA stated that CMS’s financial projections do not reflect the current situation of hospitals and health systems.
The American Hospital Association (AHA) opposes a CMS hospital inpatient prospective payment system. This proposed rule for the fiscal year 2023 would result in a net decrease in hospital payments compared to this year.
This tentative rule proposes a 3.2% rate increase for inpatient PPS (Prospective Payment System) payments in FY (Fiscal Year) 2023.
These proposed changes would put even more pressure on the healthcare system. Hospitals and health systems have been nimble in responding to surges in COVID-19 cases throughout the pandemic. According to the AHA, massive expenses and rising inflation have led to even more challenges for America´s hospitals and health systems.
Therefore, Rick Pollack, AHA President & CEO, stated that the entity has been making a case to CMS urging it to adjust the market-basket update to account for the industry’s inflationary environment and eliminate the productivity cut.
“CMS made financial projections based on historical data that do not align with what has transpired during the past few years. The economic “steady-state” assumptions of past trends have been upended by the reality of the pandemic, historic inflation levels, and many other factors,” Pollack explained.
In addition, other hospital groups, such as the Federation of American Hospitals (FAH), have criticized the rate update, stating that this proposed rule won’t provide enough support for hospitals and health systems considering hyperinflation, staffing shortages, and the pandemic.
Some of the key highlights of this CMS’ proposed policies are:
- Increase inpatient PPS payment rates by 3.2% in FY 2023.
- Cut DSH (Disproportionate Share Hospital) payments by about $800 million, due partially to a decrease in the uninsured population.
- Decrease outlier payments by 1.8% points.
- End the Medicare-dependent hospital and low-volume adjustment programs under the law, which expire on September 30, 2022.
- Add 10 new measures to the inpatient quality reporting (IQR) program.
Read more about this CMS proposed rule on FY 2023 IPPS Proposed Rule Home Page.
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Resources
FY 2023 IPPS Proposed Rule Home Page | CMS
AHA Summary of Hospital Inpatient PPS Proposed Rule for Fiscal Year 2023 | AHA
AHA Asks Congress to Urge CMS to Fix Inadequate Inpatient Payment Proposal | AHA
