MHA Monday Report May 1, 2017

Posted on May 01, 2017

CMS Releases FY 2018 LTCH PPS Medicare Fee-for-Service Proposed Rule

The Centers for Medicare & Medicaid Services (CMS) recently released its proposed rule to update the Medicare fee-for-service long-term acute-care hospital (LTCH) prospective payment system (PPS) for fiscal year (FY) 2018.

FY 2018 will be the first year of full implementation of the statutorily-mandated two-tiered payment system for LTCHs, which includes a standard LTCH rate for higher-acuity cases and a site-neutral payment for lower-acuity cases. Excluding budget neutrality, based on the proposed rule, traditional LTCH PPS rates would increase by a net of 0.4 percent, while payment rates for site-neutral cases are expected to decrease by a net of 22 percent. In addition, during FY 2018, the CMS proposes a regulatory moratorium on the 25 percent rule (which allows LTCHs to admit up to 25 percent of its patients from a single general acute-care hospital; for patients admitted past the 25 percent threshold, an LTCH faces a Medicare reimbursement reduction) so the agency can evaluate whether the policy is still needed. In addition, the CMS proposes to pay all short-stay outlier cases a graduated per diem that blends the inpatient PPS and LTCH amounts to remove the financial incentive to delay discharge.

The rule also proposes a number of changes to the FY 2020 LTCH Quality Reporting Program. Specifically, the CMS would add measures assessing pressure ulcer changes, compliance with a spontaneous breathing trial and ventilator liberation rates. In addition, the CMS proposes to remove an existing pressure ulcer measure and a measure assessing all-cause readmissions within 30 days of LTCH discharge. The CMS would also require LTCHs to collect certain standardized patient assessment data beginning with LTCH admissions on or after April 1, 2018 to meet the requirements of the Improving Medicare Post-Acute Care Transformation Act of 2014.

The MHA continues to analyze the proposed rule and will provide additional information, including facility-specific impact reports, in the near future. In addition, the MHA will draft comments and share them prior to the June 13 due date. The MHA encourages member with LTCH operations to review the proposed rule and the impact on their operations and to submit comments to the CMS prior to June 13. A final rule is expected by Aug. 1 for the Oct. 1, 2017, effective date. Members with questions should contact Vickie Kunz at the MHA.


  • MHA Monday Report May 1, 2017

Tags: AHCA, ACA repeal and replace, Brian Peters, CMS, LTCH, Economic Impact Report, 2018 State Healthcare Budget, DSH, open enrollment, Excellence in Governance Fellowship, BCBSM, prenotification system, BFCC-QIO, KEPRO

Posted in: Monday Report

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