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Senate and House members urge CMS to increase inpatient hospital payment

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Ahead of the Centers for Medicare and Medicaid Services release the final rule on inpatient payment, House and Senate members are urging CMS to increase the rate hospitals will be paid.

A bipartisan group of 112 representatives and 30 senators have asked CMS to consider using its special exceptions and adjustments authority to revise the hospital inpatient prospective payment system rule for fiscal year 2023 to more accurately reflect the cost of providing hospital care to patients. Several other senators have separately urged CMS to address similar concerns.

The House and Senate letters have expressed concern that CMS’ proposed rule does not fully account for the current cost of care, and would result in an overall payment reduction for hospitals.

“We are concerned that the proposed payment updates do not fully account for the current cost of care and when coupled with other policy changes incorporated in the proposed rule, will result in an overall payment reduction for hospitals in 2023,” the Senate letter said.

Senators Bob Menendez, D-N.J., and Kevin Cramer, R-N.D., and Representatives Brad Schneider, D-Ill., and Carol Miller, R-W.Va., spearheaded the letters.

WHY THIS MATTERS

In April, CMS proposed a 3.2% IPPS payment for hospitals in 2023.

Last year, acute care hospitals got a 2.5% pay increase in the final rule that was released in August. The final rule for 2023 is expected to be released around the same time.

Comments on the IPPS proposed rule were due by June 17. Any changes would need to be done under special exceptions and adjustments.

THE LARGER TREND

In June, the American Hospital Association submitted a letter to Congress urging a retrospective adjustment to the proposed rule, citing the financial impact of inflation, supply chain and workforce challenges and the continuing COVID-19 pandemic on hospitals.

CMS’ proposed market basket update of 3.2% for FY 2023 does not capture current rising inflation and massive growth in expenses facing hospitals and health systems, AHA said. More recent data shows the market basket for FY 2022 is trending toward 4%, which is well above the 2.7% CMS actually implemented last year. Additionally, the latest data also indicate decreases, not gains, in productivity. 

“Congress should urge CMS to implement a retrospective adjustment for FY 2023 to account for the difference between the market basket update that was implemented for FY 2022 and what the market basket is currently projected to be for FY 2022,” the AHA said. “In addition, Congress should urge CMS to eliminate the productivity cut for FY 2023.” 

Twitter: @SusanJMorse
Email the writer: [email protected]

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