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An Analysis and Commentary on Federal Health Care Issues by Larry Goldberg

CMS Announces Inpatient Psychiatric Facilities PPS Update Proposal for FY 2018

The Centers for Medicare and Medicaid Services (CMS) have issued a proposal to update the Medicare Inpatient Psychiatric Facilities (IPFs) Prospective Payment System (PPS) for Fiscal Year (FY) 2019.

The rule is to be published in the May 8th Federal Register. A “display” copy of the 130-page document can currently be downloaded at: https://s3.amazonaws.com/public-inspection.federalregister.gov/2018- 09069.pdf. This link will change upon publication. A comment period ending June 26th is provided.

CMS says it estimates that the total impact of its proposed changes for FY 2019 compared to FY 2018 will be a net increase of approximately $50 million. This reflects a $60 million increase from the update to the payment rates (+$130 million from the first quarter 2018 IGI forecast of 2.8 percent, -$40 million for the multifactor productivity adjustment of 0.8 percentage point, and -$30 million for another adjustment of 0.75 percentage point), as mandated by the Affordable Care Act (ACA), as well as a $10 million decrease as a result of the update to the outlier threshold amount. This results in a net increase of 1.25 percent.

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