The Centers for Medicare & Medicaid Services (CMS) issued its proposed rule for the fiscal year (FY) 2025 Medicare hospital inpatient prospective payment system (IPPS), suggesting a payment increase of 2.6%. According to CMS, its projected FY 2025 hospital market basket increase is 3%, and the agency reduced that by 0.4% for a “productivity adjustment.”
If approved, this proposal would translate to an increase in hospital payments of approximately $2.9 billion, or closer to $3.2 billion when considering other policies such as new technology add-on payments.
The American Hospital Association (AHA) issued an initial response to the proposed rule, saying it falls short of providing the help hospitals need to continue providing high-quality care.
“CMS’ proposed inpatient hospital payment update of 2.6% is woefully inadequate, especially following years of high inflation and rising costs for labor, drugs and equipment,” Ashley Thompson, AHA’s senior vice president of public policy analysis and development, said in a statement. “Many hospitals across the country, especially those in rural and underserved communities, continue to operate under unsustainable negative or break-even margins. We urge CMS to reconsider their policy in the final rule so that all hospitals can provide high-quality, around the clock, essential care to their communities.”
American College of Cardiology (ACC) President Cathie Biga, MSN, told Cardiovascular Business the proposal highlights how differently CMS appears to view IPPS policies vs. Medicare Physician Fee Schedule (MPFS) policies.
"It is notable that while the proposed IPPS rule released today includes a 2.6% payment increase to in-patient and long-term care hospitals, each year physicians must pressure Congress to simply reduce payment cuts," she said. "This stark difference in what regulatory agencies have chosen to value highlights the need for meaningful payment reform to the MPFS."
Proposed changes in acute myocardial infarction/heart failure care
CMS is also proposing that four inpatient quality reporting measures be removed, including two that are central to cardiac care:
- Hospital-level, Risk-Standardized Payment Associated with a 30-Day Episode of Care for Acute Myocardial Infarction (AMI Payment).
- Hospital-level, Risk-Standardized Payment Associated with a 30-Day Episode of Care for Heart Failure (HF Payment).
- Hospital-level, Risk-Standardized Payment Associated with a 30-Day Episode of Care for Pneumonia (PN Payment).
- Hospital-level, Risk-Standardized Payment Associated with a 30-day Episode of Care for Elective Primary Total Hip Arthroplasty and/or Total Knee Arthroplasty (THA/TKA Payment).
“We are proposing to remove these measures due to the availability of a more broadly applicable measure, specifically the Medicare Spending Per Beneficiary-Hospital measure (MSPB Hospital) in the Hospital Value-Based Purchasing Program,” according to CMS. “The MSPB Hospital measure evaluates hospitals’ efficiency and resource use relative to the efficiency of the national median hospital. We also note that performance on these measures has either stayed stable (THA/TKA Payment) or decreased (PN Payment, HF Payment, AMI Payment) since FY 2019. By removing these measures, we create more room in the program’s measure set for new clinical topics.
The CMS proposal is available as a PDF here. Click here for additional details from CMS.
Michael has more than 16 years of experience as a professional writer and editor. He has written at length about cardiology, radiology, artificial intelligence and other key healthcare topics.